The chairman of the Federal Communications Commission announced Monday that the FCC will conduct formal rulemaking on the issue of "net neutrality."  The FCC is scheduled to issue a Notice of Proposed Rulemaking at its October meeting.

The principle of net neutrality holds that the government should regulate Internet service providers so that they provide everyone equal access to the Internet, regardless of the type of content that they seek to transmit.  Net neutrality proponents desire government intervention because they fear that network providers can stifle the marketplace of ideas by providing more bandwidth to preferred parties.  An (over)generalized example would be network providers giving preferential treatment to big media at the expense of small, independent content creators.

On the other side of the debate, network providers claim that they are under pressure to control already crowded bandwidth.  Government regulation, they say, will prevent them from stopping parties from consuming bandwidth with content that no one wants to see.  Network providers also claim that the marketplace is competitive without government regulation and that regulation will only dampen the incentive to provide Internet services to consumers.

Until now, the FCC maintained a lukewarm position in favor of net neutrality with its four informal "open Internet principles."  But in his speech at the Brookings Institution on Monday, the FCC chairman, Julius Genachowski, stated that the agency will now seek to implement rules and regulate net neutrality.  Genachowski's press release is here.

The net neutrality issue has been simmering for years, so the rulemaking process promises to be a lively debate.  A broad issue to keep an eye on is whether the government's concept of "neutrality" really turns out to be neutral.  This could become a fight between whether big government or big business controls the Internet.