Apple Balks at Higher Web-Access Fees After $1 Billion Video Bet


(Bloomberg) — Apple Inc. told U.S. regulators it opposes charging higher fees for faster internet access, just weeks after pledging to spend $1 billion making movies and TV shows to stream online.

“Paid fast lanes could replace today’s content-neutral transmission of internet traffic with differential treatment of content based on an online provider’s ability or willingness to pay,’ Cynthia Hogan, Apple vice president of public policy, wrote in a Wednesday letter to the Federal Communications Commission. “It could create artificial barriers to entry for new online services, making it harder for tomorrow’s innovations to attract investment and succeed.”

See also: Advocacy Groups Urge FCC to Release Net Neutrality Complaints

Ajit Pai, appointed by President Donald Trump to head the FCC, is rolling back Obama-era net neutrality rules by lifting bans on blocking web traffic and building “fast lanes” that favor those willing to pay more for faster service.

Until now, Apple mostly avoided the net neutrality debate, though Chief Executive Officer Tim Cook said earlier this year that might change if it became a topic of political discussion. Apple’s fastest growing business is Services, which includes offerings like the App Store, music streaming and cloud storage. The Cupertino, California-based company is spending $1 billion on video content that may serve as the foundation of a new streaming product, people familiar with the plan told Bloomberg earlier this month.

Hogan also addressed the extent of the FCC’s authority over broadband internet service providers, a sticking point in debates over the net neutrality rules. The agency claimed strong authority normally applied to utilities when it wrote the rules under Democratic leadership in 2015. Broadband providers and Republicans say that gives the FCC too much power to interfere in business decisions.

“Apple remains open to alternative sources of legal authority, but only if they provide for strong, enforceable, and legally sustainable protections, like those in place today,” Hogan wrote. “Simply put, the internet is too important to consumers and too essential to innovation to be left unprotected and uncertain.”

U.S. lawmakers have been debating whether to remove the strong utility-style authority in potential legislation. Democrats have objected to earlier proposals, saying they would weaken the FCC’s authority.

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