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Gates Backs Net Neutrality

Washington -- Microsoft Corp. cofounder and chairman Bill Gates, in a brief interview Wednesday night with Multichannel News, tossed considerable support behind so-called network-neutrality mandates on cable's high-speed Internet-access platform.

"We think there's a sound principle that could be beneficial," Gates said after picking up an award at a Consumer Electronics Association dinner that included a video message from President Bush.

Gates -- before addressing an audience that included Federal Communications Commission chairman Kevin Martin -- was seen having a lengthy exchange with House Energy and Commerce Committee chairman Joe Barton (R-Texas), who is developing a bill that would include net-neutrality requirements.

"We were having a dialogue about net-neutrality provisions and the benefits those might bring," said Gates, who started Microsoft in 1975 with Charter Communications Inc. owner Paul Allen.

"He and I agreed on the [net-neutrality] principle," Barton said later. "Like every other American, [Gates] wants to know what the details are in the bill. Again, when the time comes, he'll know."

Under net-neutrality rules, cable- and phone-company providers of high-speed Internet access could not use their network ownership to discriminate against unaffiliated voice, video and content providers on the Web. Discrimination includes blocking services or prioritizing bit flows to degrade competing services.

"We're not a broadband provider ourselves," Gates said, underlining the threat felt by his and other multibillion-dollar Web brands dependent upon unimpeded consumer access. "We're one of many companies that are part of that dialogue."

Barton and Rep. Fred Upton (R-Mich.), chairman of the House Subcommittee on Telecommunications and the Internet, are scheduled to meet with subcommittee Republicans later Thursday to discuss the net-neutrality bill, according to an industry source close to the committee.

Last week, Barton, Upton and the panel's top Democrats agreed in principle to legislation that would not only include net neutrality, but also a national cable franchise for local phone companies, eliminating the need to go to thousands of communities to obtain rights-of-way access.

Barton wants to produce a bipartisan bill. Including net neutrality -- a key issue for Reps. Edward Markey (D-Mass.) and Rick Boucher (D-Va.) -- might be necessary to obtain Democratic support for a national cable franchise for phone companies.

"I don't see [net neutrality] as a necessary element. I think that if we can reach an agreement, it would be a positive addition to the bill," Barton said.

Under the bill, incumbent cable operators couldn't get franchise deregulation until a phone company had secured 15% local market penetration. The bill would also force cable systems to offer uniform rates in a market, which would prevent them from cutting rates to just those homes where phone companies had rolled out service.

National Cable & Telecommunications Association president Kyle McSlarrow last week called the bill a "sweetheart deal" for AT&T Inc. and Verizon Communications Inc.

Asked if he knew that cable was troubled by the bill, Barton said, "I am aware of that. Is that a news flash?"

Barton added that he hoped cable came around to his view that the bill would prove to be in cable's long-term interest.

"Cable, like any other red-blooded American industry that has been successful, has a situation that they are very comfortable with. They would rather maintain the status quo," Barton said, adding, "although I really believe over time, if what we are talking about becomes law, they'll be very comfortable with that and do very well."