Wednesday, October 22
At an event yesterday in College Station, Texas, FCC Commissioner Ajit Pai called for the Commission to be more transparent when it comes to the thorny issue of net neutrality. Via The Hill‘s Julian Hattem:
“I was disappointed when the FCC decided to hold each one of its recent net neutrality roundtable discussions at our Washington headquarters,” he said at the start of the forum hosted by the George Bush School of Government and Public Service. “And that’s why I wish that my colleagues were here with me today.”
“On this issue and other critical issues, the FCC shouldn’t be hiding in our nation’s capital,” he added.
Kudos to Commissioner Pai for bringing this discussion out of the Beltway himself. Regardless of which side of the net neutrality debate you fall on, we can all agree that more transparency and openness from the FCC would benefit everyone.
Thursday, October 02
There are several commonly disseminated myths aimed at perpetuating confusion and misinformation during the pendency of the Federal Communications Commission’s (FCC) Open Internet proceeding. Facts, however, cut through the clutter and allow for a discussion rooted in reality rather than rhetoric.
Title II reclassification of broadband is not necessary to preserve an Open Internet.
Here’s why the FCC can and should move forward with Open Internet rules designed under its Section 706 authority rather than reclassifying broadband services under Title II of the Communications Act:
TITLE II AND SECTION 706: Myths vs. Facts
Myth: Title II regulations helped bring about the Internet boom of the early 2000s.
Fact: Although an initial investment spike occurred immediately after the passage of the 1996 Act, that investment was short-lived. That initial spate of investment was primarily directed at technologies and business models that were quickly outstripped by more modern technologies. In fact, the majority of the investment in our country’s broadband infrastructure occurred after the FCC’s 2003-05 decisions to decrease regulations on the broadband industry. This surge in investment laid the groundwork for high-speed Internet to become a leading driver of our nation’s economic growth and to spur the incredible innovation consumers enjoy today.
Myth: Title II-like regulations helped Europe leapfrog the U.S. on broadband deployment.
Fact: Europe gave up its leadership position when it began its path toward heavy-handed regulation that deterred broadband investment and deployment.
According to an independent study, today nearly 82% of U.S. consumers enjoy access to next-generation, high-speed broadband networks (over 25Mbps) while only 54% of Europeans have comparable access. In rural areas, the U.S. again leads in access, 48% to 12%. Next-generation wireless broadband (LTE) is available to 86% of Americans but only 27% of Europeans.
European broadband policies are built on extensive, public utility-style regulation that has depressed broadband investment. In contrast, the U.S. light-touch regulation model has enabled U.S. broadband network operators to invest more than double per household than Europe does: $562 versus $244 in Europe.
Myth: Applying Title II regulations to broadband networks and providers will prevent companies from creating Internet “fast lanes”.
Fact: The FCC has stated that no ISP has ever engaged in paid prioritization schemes. No evidence exists that ISPs have ever or are likely to create fast lanes and slow lanes.
Reclassifying broadband under Title II would not prevent such. In fact, under Title II, public utilities have always been allowed to offer prioritized services. Telephone companies routinely offer installation and repair priority along with service level guarantees to those willing to pay extra money.
According to FCC Chairman Wheeler, the 2010 net neutrality rules were never intended to cover these privately-negotiated business deals, only the last mile of the Internet.
Myth: Wireless networks and wireline networks are virtually interchangeable these days and should have the same net neutrality rules.
Fact: In the 2010 rules, to which all carriers committed, the FCC stated that special characteristics of mobile broadband infrastructure make it essential to give mobile providers additional flexibility in how they manage the traffic on their networks. Due to resource constraints, such as the limited amount of spectrum available for consumer use, mobile networks operate differently than wireline networks. A stringent regulatory environment established under Title II, and intended primarily for a monopoly-era copper wireline world, would be onerous.
The FCC still imposed two conditions on wireless networks in 2010. First, wireless networks cannot block access to legal websites, with exclusions for reasonable network management. Second, wireless network providers were required to disclose their network management practices, performance and terms and conditions of their broadband services.
The current approach acknowledges how wireless networks are different from fixed networks but still protects consumers and enables investment and innovation in the intensely competitive wireless marketplace.
Myth: ISPs harm the open Internet through discriminatory practices. The only way to keep the Internet open is to reclassify Internet services as telecommunications services.
Fact: The Internet, without Title II regulations, is and has been open since its first public use. It continues to thrive in the current regulatory environment. In contrast, Title II regulation would stifle investment and hinder innovation. Innovative new services and business models would have to be vetted and approved by the FCC, slowing the Internet’s vitality and growth.
Ensuring a fair and open Internet through authority granted by Section 706 is a better path. Section 706 permits the FCC to prevent paid prioritization while encouraging innovation and investment from ISPs and other Internet companies.
Myth: Title II can be easily adapted to today’s modern communications systems.
Fact: The past 20 years have seen stunning technological advancements in the communication industry. Americans can now access a wealth of information in myriad new ways. The transformation of the communications industry has caused companies to no longer fit neatly into legal categories envisioned by the 1996 Telecommunications Act or, even more obviously, the Title II rules written in 1934. That’s why companies not normally thought of as “broadband providers” could find themselves categorized and regulated as telecommunications carriers because their service overlaps with the services provided by ISPs if Title II regulations are placed on broadband services. For example, when Google connects you to a business you searched, should it be considered subject to Title II? Or if a provider of email enables a video messaging session, would it open itself up to Title II regulation on the grounds that it is a facilities-based provider or reseller? Could be. And that’s the fear.
Myth: The FCC could apply Title II to broadband, but exercise its forbearance authority when dealing with innovative companies and services.
Fact: Reclassifying broadband services as telecommunication services under Title II would burden 1/6 of the nation’s economy with stringent, investment-inhibiting government regulation. The government would have expansive power over all broadband services, likely including all edge providers and consumer broadband applications and services. The process necessary to analyze and identify which areas of the nation’s broadband economy the FCC would spare from heavy government intrusion would be both lengthy and costly. Additional time and resources would probably be squandered in the litigation that will inevitably follow.
Myth: Unlike Title II, the FCC does not have the power to promote an open Internet under the limited provisions of Section 706.
Fact: Relying on Section 706 to protect consumers and ensure an Open Internet is a superior choice to the overbroad, utility-style Title II regulatory framework of the 1934 Communications Act.
The FCC’s Section 706-like approach in 2010, created rules that found the right balance between regulations necessary to advance consumer protection goals and the need to attract new investment to broadband to ensure future deployments of modern high-speed networks. Under those rules, access to capital grew and we saw massive growth in the digital app economy, video over broadband, VoIP, the advent of tablet computing, and the rise of mobile e-commerce.
Moreover, a Federal Appeals court has given Section 706 its seal of approval and the FCC can assert this authority with confidence. In fact, the courts have said that the FCC is empowered to create rules “governing broadband providers’ treatment of Internet traffic…that they will preserve and facilitate the “virtuous circle” of innovation that has driven the explosive growth of the Internet.”
The facts are clear: Reclassification of broadband under Title II is unnecessary to ensure continued Internet openness and would backfire with harmful consequences for innovation and investment. The FCC should instead make use of its powers under Section 706 to protect consumers, promote innovation and encourage nationwide deployment of next-generation broadband.
Wednesday, September 17
Speaking of net neutrality, over at USA Today, Jeff Pulver makes the case that the government can look out for consumers with onerous new rules:
The heavy hand of the early 20th Century rules is not necessary to protect an open Internet, and the benefit of the more modern “information services” classification approach is that it doesn’t kill off the investment needed to continue modernizing our Internet infrastructure. As FCC Chairman Tom Wheeler and the courts have suggested, other provisions in the act provide ample authority for the FCC to protect consumers from potential anti-competitive conduct.
We should do everything to protect the open Internet – no one argues that. But we are doing the American public a disservice if we insist that the only path to that end is a Title II regulatory approach. If we go down that dead-end road and turn the Internet into a regulated public utility, we will ignore the lessons learned a decade ago in the process that led to the “Pulver Order” and choke off a new wave of innovation and investment that will support the next generation of entrepreneurs.
Among the tidal wave of comments the FCC has received over the open Internet/Title II issue, Fred Campbell of the Center for Boundless Innovation in Technology finds something interesting. As he writes:
A stunning revelation is buried in a lengthy Netflix filing at the Federal Communications Commission (FCC): Netflix used its subscribers as pawns in a Machiavellian game of regulatory chess designed to win favorable Internet regulations.
The filing reveals that Netflix knowingly slowed down its video streaming service with the intention of blaming Internet service providers (ISPs). Specifically, Netflix used its relationships with Internet ‘backbone’ providers (e.g., Level 3, Cogent) to deliberately congest their peering links with ISPs, and at the same time, started publishing ‘ISP speed rankings’ to make it appear that ISPs were causing the congestion. It appears that Netflix cynically held its subscribers hostage to reduced service quality in order to pressure the FCC into adopting favorable Internet regulations that would permanently lower Netflix’s costs of doing business.
Netflix’s plan to frame ISPs for sabotaging its service has been surprisingly successful so far. Some subscribers have blamed their ISPs for the service disruptions Netflix itself caused, which prompted the FCC to open an investigation of the Internet backbone market. Now all Netflix needs is for the FCC to adopt new regulations.
At the very least, Campbell’s post should serve as a reminder that in the current version of the seemingly never-ending “net neutrality debate,” it’s not really little guys vs. big guys, but one big tangled mess of special interests and corporations. All the more reason for the FCC to move forward without extreme caution.
Tuesday, September 09
That’s the amount of investment broadband providers have made in networks since 1996, according to a new report from the US Telecom association. Obviously, that’s a lot of investment, and as the paper shows, all those dollars have made a huge difference when it comes broadband access and speeds. Some highlights:
• Over 95% of Americans can access fixed broadband, with 88% having at least two providers to choose from.
• 99% of Americans have broadband at speeds 10 mbps or more available to them.
• 99% also have mobile broadband available, with 97% able to choose from at least three providers.
• Broadband investment jumped to 10% — from $69 billion in 2012 to $75 billion in 2013.
While those are some impressive numbers across the board, It’s not all rosy news from US Telecom. As the association notes in its press release:
Ongoing investment in all broadband networks, wireline and wireless, will be essential to accommodate the expected data traffic growth and enable the continued adoption of more powerful information and communications technologies and applications. Economically efficient investment in U.S. broadband infrastructure will pay off in the form of consumer welfare, business productivity, and global competitiveness. As noted in USTelecom’s blog on investment, a move to stricter Title II regulation could inject unnecessary uncertainty and negative pressures into the broadband investment equation. This poses risks to broadband investment, and also to the so-called “virtuous cycle” of innovation among broadband and related information technology industries.
Investment in broadband matters, which makes any move away from the “light regulatory touch” in place since 1996 all the more problematic. Can the FCC keep the Internet open without putting all this investment at risk? The Progressive Policy Institute thinks so. According to their recent paper, “The Best Path Forward on Net Neutrality,” they’re confident the FCC can achieve its goals by leaning on its Section 706 authority.
Friday, September 05
A new paper from Progressive Policy Institute Senior Fellow Hal Singer and Brookings Non-Resident Senior Fellow Robert Litan examines the effect Title II regulations could have on investment and the Internet ecosystem as a whole. An excerpt:
Imposing public-utility style regulation on Internet access would dampen innovation and investment in more, faster broadband. We propose the FCC implement the same case-by-case process to adjudicate discrimination complaints it has established for cable companies to broadband providers.
It’s not just investment from traditional ISPs that could be negatively effected, Singer and Litan also warn. Many companies that provide services on the Internet could also find themselves among those regulated under Title II:
Reclassifying Internet access as a “telecommunications service” under Title II, as supplemented by the provisions of the Telecommunications Act of 1996, opens up the possibility that other tech services meet the same test. The clearest example would be Google’s ultra-fast broadband service, Google Fiber, which the company is gradually rolling out. But it does not stop there. There is a very slippery slope from subjecting ISPs as common carriers to including other forms of Internet transmissions, because they arguably use “telecommunications services,” the legal hook in Title II for its application.
For example, why not then include within the ambit of a telecommunications service the linkage to an advertiser’s website that Google and Microsoft provide for users of their search engines? By clicking on links, the search engine uses the Internet backbone; if Internet access is a “telecommunications service,” because it provides “transmissions,” then so, too, are the search engines. The same logic potentially applies to Amazon’s Kindle book reader device and service, because its owners are able to download books from Amazon, but only because they are connected to a wireless provider of Internet access in the process. Indeed, what would stop the FCC from classifying as Title II common carriers all device makers that have a connection to an ISP?
It’s not all concern and dire warnings in Singer and Litan’s paper, however, as the duo argue the FCC should focus its efforts on something already within its power:
[W]e think the FCC should eschew the heavy-handed approach of Title II regulation, and lean instead on its Section 706 authority to regulate potential abuses by ISPs on a case-by-case basis. Investment across both edge and content providers will be greater compared to Title II, and the FCC can avoid any unintended consequences such as creeping regulation that encompasses content providers or other ISP services.
Check out the full paper, “The Best Path Forward on Net Neutrality,” over at the Progressive Policy Institute.
Thursday, August 28
In the Washington Post, Larry Downes completely dismantles the argument made by those pushing for regulating broadband under Title II. An excerpt:
So why the hysteria? Many of the groups involved in what became a very personal campaign against Wheeler have long sought to turn the Internet into a regulated utility or even to nationalize it outright. Any real or perceived threat to “the Internet as we know it,” even a manufactured crisis, is simply another opportunity to push an agenda Congress wisely rejected in 1996.
The extremists don’t want the FCC to adopt any rules. They want the agency, instead, to take over. That’s the hammer; net neutrality is just a convenient nail.
Yet much of the mainstream media, including The New York Times and US News, continue to validate the non-conspiracy. They continue to accept, for example, that Wheeler is proposing to “authorize” practices dangerous to the Internet (again, the rules only prohibit practices), to “end” existing net neutrality rules (there are none), and even to allow ISPs to “block” content at their discretion (the no-blocking rule explicitly prohibits this, as does antitrust law).
If you care about the future of the Internet, Downes column is required reading.
Thursday, July 17
In a must-read piece for GigaOm, Richard Bennett, the co-inventor of Wi-Fi, argues that Title II would do much more harm than good to the Internet. An excerpt:
Technology regulators must be humble, only intervening in commercial squabbles as a last resort. For all its warts, the permissive broadband approach to internet regulation is the better way forward. The FCC should free broadband networks from the specter of telephone-era regulations and nudge them in the direction of even higher performance, including expedited delivery services for applications that need them, such as immersive video conferencing, HD voice, and other real-time applications.
Read the entire piece over at GigaOm.
Monday, July 14
Title II Regulation and its Potential Impact on Deployment of
21st Century Broadband Networks and Services
Thursday, July 24th
Mandarin Oriental Hotel – The Gallery
Featuring Keynote Speaker
Commissioner, Federal Communications Commission
Commissioner Pai will be followed by a diverse panel of legal, policy and financial analysts that will discuss the potential legal, policy and financial impact of regulating broadband under Title II of the Communications Act.
Director, Center for Boundless Innovation in Technology
Senior Vice President and TeleMedia/Internet Analyst, Washington Analysis
Visiting Senior Policy Scholar, Georgetown Center for Business and Public Policy
Ph.D. fellow in Internet Economics, the Center for Communication, Media and Information, Technologies at Aalborg University in Denmark
Bruce Mehlman (Moderator)
Co-Chairman, Internet Innovation Alliance
Breakfast will be served
*This event complies with House and Senate ethics standards*
Tuesday, June 24
Eighty years ago this month, the Telecommunications Act of 1934 was created to regulate America’s nascent telephone service. At the time, only about 12 percent of U.S. families had phone service and rotary phones were the norm. Touch-tone phones wouldn’t appear for another three decades. This was the era of “party lines” and operators memorialized in movies sitting in front of large switchboards connecting callers to “KLondike 5-1234.”
As we mark the law’s 80th anniversary, now is not the time to slap the modern, high-speed, innovative and entrepreneur embracing Internet with rules that Congress designed for rotary telephones.
Keeping the Internet available to everyone is the right goal. However, applying Title II of the 1934 law, which treated traditional phone service as a public utility, to broadband could bring the pace of entrepreneurism and investment on the Internet to a crawl. Since 1996, when Congress last updated telecommunications laws, ISPs have invested more than $1.2 trillion. The average Internet connection speed in the U.S. has just hit a remarkable 10 Mbps, which is more than enough to stream an HD movie.
Suddenly putting the Internet under Title II could result in too much innovation needing pre-approval by the FCC. Instead of today’s “bottom up” dynamism in which consumer demands drive change, the web could become hostage to the federal government’s timetable. The spirit and freedom to innovate could depend on Congressional and FCC action.
Today’s Internet is the most free and accessible it’s ever been. That’s getting lost in the push for Title II regulation. America’s broadband deployment continues to rise and 70% of us now have broadband connections at home, according to Pew. People are spending more time online, enjoying real-time benefits with education, healthcare and entertainment.
The less drastic solution is reflected in the FCC’s two existing efforts to balance legitimate consumer interests with the need to maintain the Internet’s dynamism. The FCC’s 2005 Open Internet Policy Statement and its 2010 Open Internet Order both struck that balance.
Yes, the DC Court of Appeals overturned parts of the 2010 Order. But crucially, major ISPs continue to abide by the openness policies, which shows that they recognize the value of providing the freedom that Net users demand.
Belligerents making hyperbolic arguments from opposing corners dominate too many debates in Washington. Ensuring an open Internet doesn’t have to be one of those fights. Nobody wants to turn what we used to call the “information superhighway” into a four-lane toll road with federal monitors stationed at every onramp. Nor should there be an HOV lane only accessible for the wealthiest that leaves the rest of us stuck in a slow moving traffic jam.
Now is the time for common sense rules that are fair to consumers and companies and ensure high speed Internet access to individuals and entrepreneurs without the unintended consequences of 1930’s rotary phone era regulation.
Monday, June 23
At The Hill, Kate Tummarello reports that House Republicans want to take the net neutrality issue out of the FCC’s hands:
Republicans on a House panel want the country’s antitrust regulators, not its telecom regulators, to take the lead on net neutrality.
During a Friday hearing held by the House Judiciary Subcommittee on Antitrust Law, Republicans questioned the need for net neutrality regulation from the Federal Communications Commission (FCC).
“The Internet has flourished precisely because it is a deregulated market” and should be kept open through “vigorous application of the antitrust laws,” House Judiciary Chairman Bob Goodlatte (R-Va.) said.
The idea, according to Tummarello, is for the Federal Trade Commission to take the reigns:
“As regulatory proceedings continue to stretch on, a question I have is whether there might be a more efficient and more effective way to safeguard against potential discriminatory behavior than federal rulemaking,” Subcommittee Chairman Spencer Bachus (R-Ala.) said in his opening statement.
“That is where antitrust law comes in.”
Friday, June 06
With the net neutrality debate once again on the front burner, AT&T Senior Executive Vice President Jim Cicconi has penned a lengthy post at the company’s Public Policy Blog to break down how reclassifying broadband service under Title II is a bad idea for just about everyone with a stake in the open Internet. An excerpt:
Title II would not prohibit the creation of fast lanes and slow lanes on the Internet — that is clear in the plain language of the law, not to mention 80 years of FCC precedent and court decisions. Arguments to the contrary are pure fantasy. At a minimum, Title II supporters have to concede that their argument depends on the bank shot that an appellate court will agree (a) that the FCC can change its mind about how the Internet works after the Supreme Court has validated its prior decision; and (b) the FCC can then ignore the plain language of the statute and 80 years of precedent to determine that the prohibition of “unjust and unreasonable” discrimination actually means it can prohibit any discrimination. And think of all the additional proceedings that will be needed to unpack where we draw the lines between information services “haves” and telecommunications services “have nots.” If that is the road we choose to travel, the investment uncertainty alone will have a massive negative impact on American broadband deployment for years to come.
There’s another important argument against Title II — invoking it would risk massive collateral damage to many, if not most, U.S. Internet companies. Title II could turn every edge or content company into a common carrier for at least part, if not all, of their services.
Cicconi goes on to argue that FCC Chairman Tom Wheeler already has a way to ensure an open Internet without the regulatory hammer of Title II:
Section 706, as interpreted by the court and explained by Chairman Wheeler, does provide a path. It’s a path AT&T supports. For one, it has already been blessed as a valid source of jurisdiction to address the kinds of concerns articulated by Chairman Wheeler and others throughout the current debate. In upholding Section 706 authority, the Verizon court gave the FCC wide latitude to prohibit conduct that would deter broadband investment. And the approach that Chairman Wheeler has proposed would clearly prevent practices like paid prioritization that we feel would change the fundamental nature of the Internet.
Thursday, May 29
The latest flare up in the never-ending net neutrality debate involves the possibility that the FCC could regulate Internet service under Title II. At The Hill, Kate Tummarello reports the very idea of Title II has already inspired work on a bill from House Republicans:
A new House Republican bill would prevent the Federal Communications Commission (FCC) from going forward with a proposal for stronger regulations on Internet service providers.
Late Wednesday, Rep. Bob Latta (R-Ohio) — vice chairman of the House Commerce subcommittee on communications — introduced a bill that would keep the FCC from reclassifying Internet providers to treat them more like traditional phone companies, which are heavily regulated.
“The Internet has remained open and continues to be a powerful engine fueling private enterprise, economic growth and innovation absent government interference and obstruction,” Latta said in a statement announcing his bill.
Tuesday, May 27
Speaking of the FCC, Julian Hattem at The Hill reports that Senate Republicans aren’t yet going to step into the Commission’s latest foray into the net neutrality debate:
The top GOP senators on the Appropriations Committee and the subcommittee overseeing the FCC both told The Hill this week that they don’t expect a rider preventing the commission from moving forward with the effort.
“I don’t see any possibility of that. I really don’t,” said Sen. Mike Johanns (R-Neb.), the ranking member of the Financial Services and General Government subcommittee.
“It’s not there yet,” added the top Republican on the full committee, Sen. Richard Shelby (Ala.). “But you know, this is early.”
Monday, April 28
Last week, FCC Chairman Tom Wheeler made waves when he announced new net neutrality (yes, it’s back) rules. At Tech Policy Daily, Roslyn Layton argues that the Internet sky is not falling:
There is no doubt that feelings about net neutrality are strong. Many consider the Internet a human right and that it should not be subject to market norms, indeed that it should be offered without charge and under government control. But whether we like it or not, there are real world costs to delivering the internet. Furthermore the services that we overwhelmingly use online (Google, Facebook, Twitter, Netflix etc) do not do it out of the goodness of their hearts. They expect to make a profit, and if it means that they improve their service so we chose them over others, so be it. The reality of what the FCC proposes actually puts the power in the hands of content and application providers – subject of course to what their customers demand.
The FCC will reportedly take up the proposal at its May meeting. Stay tuned…
Monday, January 06
2014 is here, and the year ahead promises to be a big one in tech, beginning with a major court ruling that could shake things up in the next few days. As Kate Tummarello of The Hill reports, the D.C. Circuit Court of Appeals may soon rule on the FCC’s “net neutrality” rules:
Verizon argues the FCC cannot regulate Internet providers like traditional telephone companies and is hoping to triumph over the administration in the second most powerful court in the land.
A decision against the rules would be a blow to President Obama, who made net neutrality a campaign pledge in 2008. It would also erase one of the central achievements of former FCC Chairman Julius Genachowski.
Flashbacks to three years ago, anyone?
Monday, April 01
Over at The Hill, Brendan Sasso warns President Obama is headed into a “political minefield” as he mulls a successor to FCC Chairman Julius Genachowski:
It’s an important choice for Obama, as the next chairman will face difficult decisions over how to provide enough airwaves for mobile devices, preserve the openness of the Internet and promote competition.
Tom Wheeler, a venture capitalist and fundraiser for Obama, was considered the clear favorite for the job just last week. But then a coalition of public interest groups sent a letter to the president bashing him, and 37 senators signed a letter supporting an alternative pick: FCC Commissioner Jessica Rosenworcel.
“Wheeler is still the front runner, but it isn’t as secure as it was a week or two ago,” another industry watcher said.
Monday, March 25
Last Friday, FCC Chairman Julius Genachowski announced he would be stepping down from the Commission. Today, The Hill‘s Brendan Sasso highlights what could be a major challenge for Genachowski’s successor:
The next chairman of the Federal Communications Commission (FCC) could face a high-stakes and politically explosive decision.
If a federal court strikes down the commission’s net neutrality rules, the next chairman will have to decide whether and how to try to reinstate them.
The next chairman’s response to a negative court ruling could spark a vicious fight with congressional Republicans on one hand, or leave the agency almost powerless to regulate modern technologies on the other.
Sasso goes on to report that the outgoing Chairman believes the FCC’s net neutrality rules will stand:
In an interview on Friday, Genachowski said he is confident that the commission will defeat Verizon’s challenge, noting that the same court recently sided with the FCC over data-roaming regulations.
“I think that we won the debate on whether to have an open Internet and whether the government has an appropriate role,” Genachowski said, adding that he believes the regulations have spurred innovation and investment. He declined to comment about the potential for reclassification.
Of course, Genachowski wasn’t the only member of the FCC to announce he was leaving. Commissioner Robert McDowell also announced his departure last week, and in an interview with Jon Brodkin of Ars Technica, he took a parting shot at the Commission’s net neutrality work:
First of all, I’ve been a strong advocate for a free and open Internet. What I opposed really focused on, first of all, there is no market failure that needed to be addressed. Second, the FCC did not have the statutory authority to do what it did. Third, if there had been a problem there were laws already on the books that would have addressed the problem.
There wasn’t a problem before the rules and there’s not a problem with any danger of a closed Internet in this country after the rules. For those who think the rules have preserved an open Internet, that’s sort of like a rooster taking credit for the sunrise.
Thursday, January 17
In a post for Multichannel News, titled “In Netflix’s Version of Net Neutrality, It’s Entitled to Non-Neutral Treatment,” Todd Spangler breaks down Netflix’s new push for Internet providers to carry their high volume of traffic:
To Netflix, its Open Connect content delivery network program is an all-around win: By caching frequently accessed (and high bit rate) video in ISPs’ data centers, Netflix saves money on CDN costs; ISPs can cut upstream bandwidth utilization; and end users get a better streaming experience.
Netflix argues that this just makes the Internet better for everyone, and doesn’t cost ISPs a dime since Netflix is footing the bill to install the CDN caches anywhere the providers want.
But some ISPs are chafing at Netflix’s offer. Time Warner Cable has gone on record to complain that it’s unfair for Netflix to hold back “super HD” and 3D content unless a broadband provider plays ball and opens its doors for Netflix’s servers.
Spangler argues Netflix’s actions are anti-competitive, since the company is essentially demanding ISPs cut them a special deal. It also restricts content from certain consumers. As Fred Campbell of the Communications Liberty and Innovation Project (or CLIP), writes:
With its “Open Connect” model, Netflix is withholding content from the customers of ISPs that decline to accede to its demands. Though the details of its demands are unknown, it appears Netflix is requiring that ISPs “peer” with them or pay for the installation of Netflix equipment inside their networks as well as the ongoing costs of operating that equipment.
Like Spangler, Campbell also sees this as a move to reduce competition in the market, especially given Netflix’s increased clout through a recent deal it cut with major content providers:
Netflix recently announced a new multi-year licensing agreement that makes it the “exclusive American subscription TV service for first run live-action and animated features from the Walt Disney Studios.” In addition to Disney-branded content (e.g., The Lion King), the deal includes content produced by Pixar (e.g., Brave), Lucasfilm (e.g., Star Wars), and Marvel (e.g., The Avengers). Netflix also announced a multi-year deal with Turner Broadcasting and Warner Bros. that includes the Cartoon Network and exclusive distribution rights to TNT’s television series Dallas. As an analyst recently told Ars Technica, “These movies, if you’ve got young kids—you’ve got to have Netflix.”
Barring some sort of advanced technological breakthrough — say, content beamed directly into our heads — streaming video is the future of entertainment. That makes this latest maneuver by Netflix worth paying attention to. As Campbell points out:
Unfortunately, most consumers won’t realize that Netflix is trying to impose its costs on all Internet consumers to gain an anticompetitive price advantage against its over-the-top competitors.
Friday, December 07
With Verizon’s challenge to the FCC’s net neutrality order still making its way through the courts, John Eggerton of Broadcasting & Cable reports at least one Commissioner is worried the outcome could lead to more regulation of the Internet:
If a D.C. federal appeals court upholds the FCC’s network neutrality rules, Republican commissioner Ajit Pai expects the Democrat-led commission to expand regulation of the Internet, including into the mobile wireless space and usage-based pricing.
That came in a speech to the Phoenix Center in Washington on Thursday, according to a copy of the text.
Commissioner Pai also stated that any attempt to reclassify broadband under Title II would “dramatically slow broadband deployment.”