WSJ: “GOOG - Nuts To Net Neutrality”

Looking to create a profit-based “fast-lane” for its Internet traffic, search engine giant Google, Inc. (GOOG) reportedly contacted top phone and cable companies with a proposal, according to today’s Wall Street Journal. This changes Google’s previous stance on the issue — Google had “traditionally been one of the loudest advocates of equal network access for all content providers,” according to the news article — but it also follows already announced plans by AT&T Inc. (T) and Verizon Communications Inc. (VZ) to charge for “fast-lanes” on the Internet.

Of course, this would quite literally generate an entirely new revenue “stream” for these companies, but it flies directly in the face of net-neutrality laws already on the books, which date back to before the surge in Internet usage a dozen or so years ago. Champions of net neutrality cite leaps in innovation and development on the World Wide Web that simply would not have existed without equal, free Internet access for all.

Though there is some downward pressure for earnings estimates in the coming quarters among these companies, they are far from being in dire shape, especially when compared with firms in other industries. So AT&T, Yahoo! Inc. (YHOO), Google, Microsoft Corp. (MSFT), Comcast Corp. (CMCSA), et. al. cannot exactly claim they must rely on these “fast-lanes” for their survival.

Could something like this get messy from a public-relations standpoint for these companies? Perhaps, if net neutrality advocates successfully play up the “haves” and “have-nots” angle, especially when today’s typical American consumer has less and less. Or just ask Governor Blagojevich how his “pay for play” strategy is working out these days.

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