According to KPN, 85 percent of the company’s customers who use a Google Android phone downloaded WhatsApp onto their handsets from last August through April. As a result, KPN’s revenue from text messaging, which had risen 8 percent in the first quarter of 2010 from a year earlier, declined 13 percent in the first quarter of this year.

At a presentation to investors in London on May 10, analysts questioned where KPN had obtained the rapid adoption figures for WhatsApp. A midlevel KPN executive explained that the operator had deployed analytical software which uses a technology called deep packet inspection to scrutinize the communication habits of individual users.

The disclosure, widely reported in the Dutch news media, set off an uproar that fueled the legislative drive, which in less than two months culminated in lawmakers adopting the Continent’s first net neutrality measures with real teeth.

We’d heard of DPI being used to detect grey market traffic in countries that try to maintain international gateways, but this is a new one.

Full story.

The fact that the rules received support — even the lukewarm kind — from big businesses should worry consumers, some public interest groups said Tuesday.

“There is a reason that so many giant phone and cable companies are happy, and we are not. These rules are riddled with loopholes,” Andrew Jay Schwartzman, the policy director for the nonprofit Media Access Project, said in one representative statement. “They foreshadow years of uncertainty and regulatory confusion, which those carriers will use to their advantage.”

Wireless rules are different; we have always claimed they should be.

Other groups warned that the rules would smooth the way for fast and slow lanes on the Internet. They objected especially loudly to the looser rules for wireless devices, which are becoming important on-ramps to the Internet.

But wireless was treated differently, Mr. Genachowski said, because it has “unique technical issues” and is at a more nascent stage of growth. He added, “Any reduction in Internet openness would be a cause for concern, as would any reduction in innovation and investment in mobile broadband applications, devices or networks that depend on Internet openness.”

While wireless carriers will be able to block various apps and services, they won’t be able to block basic Web sites or any apps that compete with their own voice and video products. That represents a win for Skype, the Internet phone service, which praised the F.C.C. rules on Tuesday.

In a speech he plans to give Wednesday in Washington, Julius Genachowski, the F.C.C. chairman, will outline a framework for broadband Internet service that forbids both wired and wireless Internet service providers from blocking lawful content. But the proposal would allow broadband providers to charge consumers different rates for different levels of service, according to a text of the speech provided to The New York Times.

Mr. Genachowski has decided not to use the commission’s telephone regulatory powers to govern broadband Internet service, a move that he proposed in May that would potentially open Internet service to heavier government regulation.

His proposal would also allow broadband providers to manage their networks to limit congestion or harmful traffic.

The framework will form the basis for a proposed order scheduled to be voted on during the F.C.C.’s Dec. 21 meeting.

Full story.

“We have to avoid regulation which might deter investment and an efficient use of the available resources,” Ms. Kroes said during a meeting on net neutrality held by the commission and the European Parliament.

The desire for operators to control traffic on their networks or to pass on the costs to the biggest users — or to the traffic generators themselves — has grown as the popularity of video and file-sharing has exploded.

Google and Verizon, two leading players in Internet service and content, are nearing an agreement that could allow Verizon to speed some online content to Internet users more quickly if the content’s creators are willing to pay for the privilege.

The charges could be paid by companies, like YouTube, owned by Google, for example, to Verizon, one of the nation’s leading Internet service providers, to ensure that its content received priority as it made its way to consumers. The agreement could eventually lead to higher charges for Internet users.

Such an agreement could overthrow a once-sacred tenet of Internet policy known as net neutrality, in which no form of content is favored over another. In its place, consumers could soon see a new, tiered system, which, like cable television, imposes higher costs for premium levels of service.

Any agreement between Verizon and Google could also upend the efforts of the Federal Communications Commission to assert its authority over broadband service, which was severely restricted by a federal appeals court decision in April.

Net neutrality has become a big issue in the US as internet congestion has increased. In Europe, regulators and industry players have claimed that the situation is different because users have more choice of network providers, and the debate has been more muted.

However, there have been growing concern among big telecoms companies that changes introduced in the European Parliament into the so-called telecoms package – the sweeping legislation which is designed to overhaul European Union telecoms laws – could open doors to net neutrality regulation in the future.

Read the full story in ‘Financial Times’ here.

Vint Cerf, who can fairly be described as one of the godfathers of Internet has endorsed Barack Obama in the US presidential race, saying that his decision is swayed by Obama’s stance on net neutrality – the question of whether content providers should be charged more for different content by the “pipe” providers.

Extracts:

We believe that the Internet should remain an open environment. It’s vital to innovation. Companies like Google, and Yahoo, and eBay, and Amazon, and Skype and so on, got their start without having to get permission from any ISP or any broadband provider to offer services. They simply acquired access to the internet, put their services up and then made them available to the general public.

We think that’s the best way for the Internet to evolve and I’m pleased to say that in the upcoming presidential elections, the two candidates have rather different views of this particular matter. Senator Obama in particular sees things the way I do which is that the Net should remain open, fully accessible and providing access on a non-discriminatory basis to the people who want to offer new services on the network.

This might not be good news for the proponents of Net Neutrality. Barack Obama has recently edited his website with significant revisions to the technology plans. Guess what goes out. A large paragraph on Net Neutrality! (which is reproduced below):

[quote] Users must be free to access content, to use applications, and to attach personal devices. They have a right to receive accurate and honest information about service plans. But these guarantees are not enough to prevent network providers from discriminating in ways that limit the freedom of expression on the Internet. Because most Americans only have a choice of only one or two broadband carriers, carriers are tempted to impose a toll charge on content and services, discriminating against websites that are unwilling to pay for equal treatment. This could create a two-tier Internet in which websites with the best relationships with network providers can get the fastest access to consumers, while all competing websites remain in a slower lane. Such a result would threaten innovation, the open tradition and architecture of the Internet, and competition among content and backbone providers. It would also threaten the equality of speech through which the Internet has begun to transform American political and cultural discourse. Barack Obama supports the basic principle that network providers should not be allowed to charge fees to privilege the content or applications of some web sites and Internet applications over others. This principle will ensure that the new competitors, especially small or non-profit speakers, have the same opportunity as incumbents to innovate on the Internet and to reach large audiences. Obama will protect the Internet’s traditional openness to innovation and creativity and ensure that it remains a platform for free speech and innovation that will benefit consumers and our democracy. [unquote]

Hmmmm…We note Obama still keeps the term ‘Net Neutrality’ there – perhaps for old times’ sake – but now it is certain he is no more a fan of the idea.

For more revisions look here.

The following letter by a reader to USA Today highlights similar concerns – may be in another context.

WHY SHOULD BROADBAND BE FREE?

James Lakely – Chicago

Federal Communications Commission Chairman Kevin Martin’s reference to the phone industry exposes the weakness of his argument to provide free broadband access in the USA.

Yes, copper phone lines were, for decades, “the main means of communication for millions of Americans.” But the government didn’t invent that technology, nor give it away for free. The market provided, and Americans paid for it via private transactions. Even if one views broadband as a public utility, why should it be free while Americans pay for basics such as water, garbage and, yes, phone service?

The FCC’s proper role is to regulate as lightly as possible so the market can develop innovative technologies while competition keeps prices affordable. Just as there is no free lunch, there is no “free” broadband.

(Open to comment)