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A technology known as Deep Packet Inspection (DPI) has spotlighted the issue of Net Neutrality since service providers, such as cable operators, may be able to shunt content such as YouTube videos, into a different “tier” of service. A new paper released today by Free Press explores the technology and its implications. Deep Packet Inspection: The End of the Internet as We Know It? (pdf) argues that both users and lawmakers should raise serious concerns.

“Potential abuses of Deep Packet Inspection put the Internet as we know it at risk,” said Ben Scott, policy director of Free Press and co-author of the paper. “Allowing the industry to continue down this dangerous path will open a Pandora’s box of unintended consequences that could spell disaster for the free market online. At this critical crossroads, policies are urgently needed to protect Internet users and innovators from discrimination.”

The paper asserts that the emerging DPI business model, marketed for its ability to monitor, control and ultimately charge subscribers for every use of an Internet connection, poses a major threat to the open Internet.

Recipients of NTIA broadband grants must adhere to “nondiscrimination” requirements of net neutrality.

The likes of Comcast and DirecTV face accelerating competition from Zillion.TV, Hulu, Roku, and other upstarts that are eager to provide programming on demand, explains Business Week.

Automatically shunting those services to a “pay tier” on your ISP — even if you’ve already paid for the bandwidth — has brought net neutrality into the spotlight.

Hulu is the fourth largest video site in the U.S., according to the latest data from comScore. Hulu drew an audience of 34.7 million people who watched 332.5 million video streams. Hulu overtook Viacom and Microsoft in total viewers and video streams and is catching up to No. 3 video site Yahoo. Fox Interactive (MySpace) was No. 2 with 462.6 million streams with YouTube clearly dominating with 5.3 billion streams.

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