MPAA: EFF Just Jealous It Doesn't Control Copyright Office Like Hollywood Does

from the regulatory-capture dept

Earlier this week we wrote about the revelation, via a FOIA request by the EFF, that the Copyright Office consulted heavily with Hollywood (the MPAA directly, and a variety of movie studios) before weighing in on the FCC's set top box competition proposal. As we noted, the Copyright Office's discussion on the issue involved completely misrepresenting copyright law to pretend that an agreement between to industries (content studios & TV companies) could contractually wipe out fair use for end users. That's... just wrong. The FCC's proposal had absolutely nothing to do with copyright. It was just about letting authorized (paying) customers access content that was already authorized through other devices. What the FOIA request revealed was that the Copyright Office not only had many, many, many meetings with Hollywood, but that it actually prioritized those meetings over ones with the FCC -- and lied to the FCC to say that key Copyright Office personnel were not available the very same week they were meeting with the MPAA, in order to push back the meeting with the FCC.

It was a pretty big deal, given the Copyright Office's reputation for acting as a taxpayer-funded lobbying arm for Hollywood. Of course, the MPAA is now mocking the EFF over this story, with a blog post by Neil Fried, one of the top lobbyist's for the MPAA, and someone who features prominently in the conversations with the Copyright Office revealed by the FOIA request. The crux of Fried's post is that there's no news in the revelations, and that the Copyright Office met with the MPAA because the MPAA asked to meet with it.

The bottom line is that the Copyright Office did not approach stakeholders, selectively or otherwise. It spoke with any and all comers who asked for the opportunity. It then examined the issues and met its statutory obligation to advise federal agencies and Congress on the law. Any EFF suggestion to the contrary is entirely false.

Of 310 pages EFF has “uncovered” in a Copyright Office FOIA request, 232 are transmittals of FCC filings, congressional letters, and other documents from all sides that were already public. The remaining 78 are almost all snowballing email chains to schedule meetings and calls—also from parties on all sides, including the FCC itself and device maker TiVo.

That's... fairly misleading. It's true that there are those pages of email chains trying to schedule meetings, but the vast majority of those are from the MPAA or other Hollywood representatives. And those meetings are clearly eagerly being scheduled by the Copyright Office prior to meeting with the FCC to help shape the Copyright Office's response. The MPAA conveniently leaves out the Copyright Office's meeting with the FCC being pushed off so that the Office can meet with the MPAA first (and even telling the FCC that a key member of the Copyright Office is not available the same week she's meeting with the MPAA). Also, the "TiVo" meeting wasn't even on "the other side" of the debate, really, as the letter there notes that TiVo "will be advocating a simpler solution" compared to what the FCC proposed. It's also noteworthy that this meeting occurred on August 2nd of this year. That was the first time TiVo met with the Copyright Office, but by then the Copyright Office's position was set, as its response was delivered the very next day. The MPAA, on the other hand, first met with the Copyright Office back in early April and met a few times after that as well. So to say that the meetings were on the same level is clearly not true.

The documents reflect what we know to be true. The Copyright Office did not “jump into this fight,” as EFF asserts. Rather, it studiously avoided being brought into the debate until: 1) Chairman Wheeler asked for its analysis, and 2) Members of Congress requested it share that analysis so everyone, not just the FCC, could benefit from its expertise.

Right. About that. That's not true either. As the FOIA documents reveal, then head of the Copyright Office Maria Pallante apparently went directly to Congress and requested that it make a formal request to the Copyright Office to send an opinion on the FCC's proposal. It appears that Fried either missed or ignored this bit of the FOIA request in which a staffer for Rep. Ted Deutch contacts the Copyright Office asking for input on what Deutch should put into the letter requesting the Copyright Office weigh in, and explicitly noting that the reason it was doing so was because they had been told that Pallante wanted them to make that request. That, uh, certainly doesn't look like "avoiding being brought into the debate" until after Congress requested it. It looks like the head of the Copyright Office going directly to Congress and concocting an excuse to publicly weigh in on the debate against the FCC. As a side note, there is plenty of talk that a big part of the reason why Librarian of Congress Carla Hayden was annoyed with Maria Pallante was her penchant for going directly to members of Congress with her own views concerning the Copyright Office, and this seems like just another example of that). Update: As pointed out in the comments, this potentially leaves out some context, in that the emails also show officials in the Copyright Office being surprised about the claim that Pallante wants Congress to weigh in an email (not from Pallante) saying that they're already coordinating with the FCC, which could be interepreted as asking not to have Congess make the request. Of course, that doesn't answer how Deutsch got the information that Pallante wanted him to make a formal request.

Finally, Fried basically mocks the EFF, suggesting that it's just upset that it didn't think to lobby the Copyright Office as aggressively as Hollywood did:

Like anyone else, the EFF could have just as easily made its own inquiries, rather than issue a hyperbolic blog complaining about the entirely legitimate practice of a government agency communicating with a range of parties.

Yes, well, the EFF is a small non-profit. The MPAA is a giant machine of Hollywood with offices blocks away from the White House. Guess who has better access and resources to bug the hell out of the Copyright Office and get it to side (once again) with misleading claims about copyright law?

Besides, when your argument boils down to "sure, the Copyright Office is a captured agency, and if you don't like it, go capture your own agency..." it's not exactly a ringing endorsement for functional policymaking.

Filed Under: copyright office, fcc, lobbying, maria pallante, neil fried, power, regulatory capture
Companies: eff, mpaa

As Expected, FCC Passes Modest Privacy Rules For Broadband Providers, ISPs Act Like World Has Ended

from the just-be-a-little-transparent-dammit dept

Over the past week, we've been talking a lot about the need for more transparency and user control for privacy on the internet, so it's only fitting that the FCC has officially adopted its new privacy rules for ISPs that will require broadband providers to be much more explicit concerning what information it collects and shares with others, and provide (mostly) clear "opt-in" requirements on some of that data collection. This isn't a surprise. It was pretty clear that the FCC was going to approve these rules that it announced earlier this year. And, of course, the big broadband providers threw a giant hissy fit over these rules that just ask them to be more transparent and give users at least a little bit of control over what data is collected.

Comcast has caused these proposals "irrational" and various think tankers paid for by the broadband providers tried to tell the world that poor people benefit from a lack of privacy. And magically new studies came out claiming that broadband providers are cuddly and lovable, rather than snarfing up everyone's data.

And, of course, the various broadband providers want to blame Google for the rules, because everyone wants to blame Google for everything. The issue here is that the broadband access providers have these rules, while online service providers, like Google and Facebook do not. There are, of course, a few responses to this. The first, is that the FCC doesn't have authority over those sites, like it does have over the access providers under the Telecom Act. The second is that users are much more locked in to their broadband access provider, and there is much less competition. Switching is much more difficult. The third argument is, basically, that Google and Facebook don't have nearly the same history as the broadband access providers of really nasty privacy violations. Hell, just as these new rules were coming, Verizon was being fined for stealth zombie cookies. Finally, the simple fact is that broadband access providers have the power to spy on a lot more internet activity than Google or Facebook. Yes, those other services are in more and more places, but it's not difficult to block them. With your ISP everything goes through their pipes, and unless you carefully encrypt your traffic via a VPN, they get to see everything.

Frankly, the new rules are not that crazy and shouldn't be controversial at all. Here's how the FCC explains them: This isn't that complicated, and should move broadband providers towards being more transparent and open. And if what they're offering is truly beneficial then why should they complain about that? It's only when what they're doing is sneaky and underhanded and they know they can't convince people it's worthwhile that they might have a problem. So, yeah, guess why they were so opposed to these rules?

Filed Under: broadband, fcc, information sharing, privacy

The Reason The Copyright Office Misrepresented Copyright Law To The FCC: Hollywood Told It To

from the so-now-we-know dept

There was some oddity over the summer, when the Copyright Office flat out misrepresented copyright law to Congress and the FCC with regard to the impact on copyright of the FCC's (now dead) proposal to create competition among set top box providers. As we've explained over and over again, there were no copyright implications with the FCC's proposal. All it said was that if an authorized user wanted to access authorized content via a third party device, that authorized user should be able to do so. And yet, the Copyright Office, incorrectly, seemed to make up an entirely new exclusivity in copyright law (one that would outlaw DVRs) that basically said not only could a content provider license content to a cable TV provider, but it could also limit the devices on which end users could view that content.

Simply put: that's wrong. That's not how copyright law works, and we've known that since the Supreme Court's ruling in the Betamax case decades ago.

But why would the Copyright Office so misrepresent copyright law? That was the perplexing part. Even with a bunch of copyright professors explaining how wrong the Copyright Office was, the Office still went ahead with its letter. Of course, as with so many policy issues, it really seemed like the Copyright Office was just acting like a lobbying arm of Hollywood.

And that's because it was.

The EFF filed a FOIA request on the Copyright Office's emails and meetings concerning the set top box issue, and -- surprise surprise -- they basically coordinated directly with the MPAA and related lobbyists. The most stunning part? When both the MPAA and the FCC asked to meet with the Copyright Office about this, the Copyright Office quickly scheduled a meeting with... the MPAA. And pushed off the FCC meeting. And they lied to the FCC in the process. Then Copyright Office General Counsel Jacqueline Charlesworth's assistant told the FCC that she was not available to meet... on the very same week that she met with the MPAA over this issue. As EFF notes:

After the FCC announced its intention to break up the set-top box monopoly in February of this year, MPAA quickly called on the Copyright Office to meet on the matter. The documents indicate that the first meeting the Copyright Office held on the set-top box issue was not with the FCC but rather the MPAA. Although both the FCC and MPAA reached out to the Copyright Office in late March, Copyright Office officials met with MPAA on April 11 while postponing and meeting with the FCC a week later. Throughout the spring and summer of this year, the Copyright Office alternated between meetings with the FCC, MPAA, and other major content companies such as Comcast and Viacom. On May 31, just hours after holding a conference call with MPAA, the general counsel of Copyright Office emailed her counterpart at the FCC saying “the proposed rule may in fact implicate some rather serious copyright concerns.”

There was also a bizarre situation, in which a copyright maximalist Congressional Rep reached out to the Copyright Office, claiming that he'd heard from (recently fired) Copyright Office boss, Maria Pallante, basically asking him to officially request the Copyright Office's opinion on the FCC's plans. Others at the Copyright Office -- including Charlesworth -- note that they had been working under the impressiong that the Copyright Office was not seeking an official request from Congress to weigh in. The whole thing is quite bizarre.

But the really telling thing is that the Copyright Office basically spent all its time hearing from one side -- the MPAA and assorted studios, who disliked this idea not for any copyright reasons, but because they just wanted more control -- and totally ignored any other viewpoint (and certainly did not seek it out).

It seems that despite holding itself out as a neutral expert agency on copyright matters, the Copyright Office regularly engaged in discussions with only one set of parties as it formed its opinion. Not once did the agency reach out to the copyright scholars who explained to the FCC that no copyright interests were harmed by the set-top box proposal. Nor did the agency rethink its position when these same parties made clear that what they want is for the FCC to create new legal rights for them that have nothing to do with copyright law. The Copyright Office did eventually meet with a group of companies who are seeking to build competitive set-top boxes that consumers can buy, but that meeting happened on August 2, just one day before the Office issued its public statement. And that statement gives short shrift to the technology companies’ concerns.

When the U.S. Copyright Office waded into the debate, it could have brought an end to the misleading hand-wringing over copyright. Instead, it did the opposite by echoing the MPAA and cable companies, claiming that if cable operators were required to allow customers to use the devices of their choice to view the programs they pay for, the studios’ copyrights would somehow be violated. They even went so far as to say the current copyright law landscape is insufficient and therefore the FCC must do more to protect rightsholders.

An agency that listens only to the views of some industry groups without seeking out additional opinions cannot be a reliably neutral expert for Congress or the FCC. We hope that the FCC will weigh the Copyright Office’s comments appropriately, and resist efforts to derail the agency's work to end the set-top box monopoly.

If you read through the document the differences here are quite stark. There are many, many meetings with Hollywood, and many of the emails are jokey and informal (my favorite is when long term NBC Universal lobbyist Alec French tries to joke around with Jacqueline Charlesworth by calling her Jacqui, and then realizes he may have insulted her). The emails for the small group of set top box companies are much more detailed and formal. This is yet another example of how the Copyright Office is captured by Hollywood.

Filed Under: competition, copyright, copyright office, fcc, hollywood, jacqueline charlesworth, lobbying, maria pallante, set top boxes
Companies: mpaa

AT&T's $85 Billion Time Warner Buy Could Be An Anti-Consumer Shit Show Of Monumental Proportions

from the synergies-ahoy dept

As fixed and wireless broadband growth crawls to a halt and cord cutting begins to hammer TV numbers, incumbent telecom giants have been trying to pivot into the media and advertising game with mixed results. Verizon so far has shelled out billions to acquire aging 90s internet brands Yahoo and AOL, believing this can somehow transform the stodgy duopolist into a sexy, sleeker Facebook and Google competitor. So far these efforts to woo Millennials have been arguably underwhelming and occassionally comical, highlighting how innovation and disruption is somewhat foreign to these companies' DNA.

AT&T has decided to follow a similar tack, over the weekend announcing a mammoth $85 billion deal to acquire Time Warner (not to be confused with Time Warner Cable) and its media properties (CNN, HBO). AT&T was quick to proclaim that the deal would be a "perfect match of two companies with complementary strengths," who can bring a "fresh approach to how the media and communications industry works for customers, content creators, distributors and advertisers." The deal comes not too long after AT&T decided to spend $79 billion to acquire DirecTV, adding notable debt for the already giant company.

AT&T's decision to announce the deal now signals that it believes, or has been directly told, that regulators (both the tail end of Wheeler's term and his replacement in the new year) would look kindly upon such a deal. But given AT&T's long, rich history of aggressive anti-consumer behavior (and just blatant lying to prop up past mergers), there's more than a few justified questions raised about AT&T growing larger.

This is, after all, a company that in the last four years alone has been fined for ripping off programs designed for low-income households, ripping off programs designed to aid the hearing impaired, actively aiding drug dealing directory assistance scammers, and making bills harder to understand to help crammers. It's the same company that fought viciously against net neutrality, and is busy using "zero rating" to begin giving its own content an unfair advantage in the market. Yes, what could possibly go wrong with letting AT&T grow immeasurably larger?

Letting one company control an ocean-sized portion of all progamming and the conduit to the home has always been controversial. And while regulators did set some conditions to Comcast's 2011 acquisition of NBC Universal, it was found that Comcast ignored many of those conditions, ultimately leading to regulators blocking its subsequent acquisition attempt of Time Warner Cable.

In this case, AT&T is making it clear that the acquisition is all about the company's upcoming launch of its DirecTV Now streaming video service:

"Both Mr. Stephenson of AT&T and Jeffrey L. Bewkes of Time Warner stressed that during nearly three months of deal negotiations, the idea driving the talks was that Time Warner could help AT&T build out its own video streaming service. That service, called DirecTV Now, is Mr. Stephenson’s response to the migration of consumers toward mobile and online video watching and away from traditional cable packages."

Owning that much content certainly makes licensing easier for AT&T. The problem, again, is that the current FCC has refused to seriously address zero rating (giving your own content a broadband cap exemption while still penalizing Netflix) as a potential anti-competitive weapon. AT&T, in response, has made it abundantly clear that zero rating will play a huge role in this upcoming service. Regulators could ban AT&T from using zero rating to favor Time Warner content, though history has shown enforcement of these promises is inconsistent.

And that's before you get to the spectre of AT&T almost certainly (based on past behavior) using its role as a broadcaster to hamstring the streaming services that hope to compete with it. Or AT&T's abysmal history on privacy issues, be that the use of stealth cookies to track user behavior without consent, or the company's attempts to charge users more money just to opt out of private data collection and sales. AT&T's also fighting tooth and nail against new FCC broadband privacy protections the agency is expected to vote on later this week.

In short, AT&T apparently believes that the best way to navigate a dramatically changing TV landscape that requires flexibility and innovation is to grow bigger and clumsier than ever.

The company has been losing broadband, TV, and postpaid phone subscribers the last few quarters. Executives apparently believe the best solution is to strike a series of massive traditional media deals (with valuations based on peak TV earnings and cash flow) just as the traditional TV sector prepares for a free fall. AT&T bought a satellite TV giant on the eve of the cord cutting revolution, and now aims to buy a traditional media giant just as the TV market begins truly entering an identity crisis. But there's absolutely no indication that any of these deals will make AT&T magically more relevant to Millennials, or that vertical integration between distributors and content producers is still a guaranteed route to success.

That doesn't mean AT&T won't engage in anti-competitive behavior to try and make it work. Once AT&T launches its new streaming service, the company could make it much harder than ever for competing streaming providers to license the programming necessary to compete with it. AT&T could also zero rate its own content, further penalizing streaming video providers trying to compete in the space. And again, that's before you get to AT&T's history on privacy or any other creative new efforts AT&T will cook up to use its significantly larger scale and broadband monopoly to unfair advantage.

This being election season, the Presidential hopefuls were quick to chime in (sort of). Hillary Clinton gave somewhat of a non-answer by saying that she "certainly thinks regulators should look at" the deal (as if regulators tasked to review a deal would do anything else). It was actually Donald Trump's camp that issued the clearest opposition to the deal:

"This oligopolistic realignment of the American media along ideological and corporate lines is destroying an American democracy that depends on a free flow of information and freedom of thought,” Peter Navarro, a senior economic adviser to Mr. Trump, said in a statement on Sunday.

Broken clocks, twice a day, etc. All told there's little to any indication that the deal would be good for consumers, AT&T competitors or small businesses. But there are also doubts that regulators under the (likely) Clinton administration would stop the deal, if her non-answer and the notable amount of telecom money headed in the Clinton camp's direction is any indication. Regardless of the regulatory response, history suggests it should at least be fun watching AT&T's lawyers, lobbyists, and armies of think tankers once again try to spit shine the company's latest attempt to become larger and more powerful than ever.

Filed Under: acquisition, antitrust, consumers, doj, fcc, merger
Companies: at&t, time warner

FTC Warns AT&T Court Victory On Throttling Could Screw Consumers For Decades

from the not-so-free-markets dept

AT&T stopped selling unlimited wireless data plans back in 2011, and instead started pushing more expensive capped and metered plans. Existing unlimited users at the time were "grandfathered," but AT&T went out of its way to make life as unpleasant as possible for these users, ranging from blocking them from using Facetime unless they subscribed to metered plans, to throttling these "unlimited" users after only consuming a few gigabytes of data. Ultimately AT&T faced a $100 million fine by the FCC (currently being contested by AT&T), and a 2014 lawsuit by the FTC for misleading consumers and dramatically changing the terms of service while users were under contract.

But AT&T being AT&T, its lawyers got right to work contesting the FTC lawsuit, arguing that the very Title II common carrier FCC classification it had been fighting tooth and nail against exempted it from the FTC's jurisdiction. As it turned out, AT&T didn't need to engage in this Schrodinger-esque legal tap dance at all, with a court ruling back in August that the FTC never truly had authority over AT&T in the first place:

"The common carrier exemption in section 5 of the FTC Act carves out a group of entities based on their status as common carriers. Those entities are not covered by section 5 even as to non-common carrier activities. Because AT&T was a common carrier, it cannot be liable for the violations alleged by the FTC. The district court’s denial of AT&T’s motion to dismiss is reversed, and the case is remanded for entry of an order of dismissal."

The FTC isn't particularly pleased with this ruling, and this week it filed a petition for a rehearing in which it stated that the ruling could potentially let any company dodge FTC authority -- just as long as some component of its business has common carrier status. This could, the FTC warns, result in companies buying select companies they may not even want just to avoid regulatory scrutiny:

"The panel’s ruling creates an enforcement gap that would leave no federal agency able to protect millions of consumers across the country from unfair or deceptive practices or obtain redress on their behalf. Many companies provide both common-carrier and non-common-carrier services—not just telephone companies like AT&T, but also cable companies like Comcast, technology companies like Google, and energy companies like ExxonMobil (which operate common carrier oil pipelines). Companies that are not common carriers today may gain that status by offering new services or through corporate acquisitions. For example, AOL and Yahoo, which are not common carriers, are (or soon will be) owned by Verizon. The panel’s ruling calls into question the FTC’s ability to protect consumers from unlawful practices by such companies in any of their lines of business."

And again, while light touch regulation may work in healthy markets, that's simply not the case in telecom, where AT&T all but owns state legislatures and the lion's share of Congress, and the lack of last-mile competition leaves regulators as the last defense for frustrated consumers stuck in monopoly or duopoly markets. The FTC continues to warn that this new enforcement gap, if allowed to become precedent, could have a notable impact on user privacy:

"The FTC is the nation’s primary protector of consumer data privacy, but under the panel’s ruling it could be powerless against any company that provides a common-carrier service. Consumers would have no protection from breach or misuse of their personal information or practices like false advertising or improper billing."

And that's kind of a big deal for an industry in which misleading billing and sneaky fees are already a huge problem. And while the FCC is considering some basic new privacy rules for broadband subscribers, the collective lobbying power of the telecom, advertising, and content industries (Google is also quitely opposing the FCC's new rules), there's not a great chance that they ever see the light of day while retaining any teeth. No regulatory oversight is a problem in a sector where ISPs are flirting with charging users more just to protect their own privacy.

The FTC argues that the appeals court panel ruling conflicts with prior decisions of the 9th Circuit and other appeal courts. But should these efforts fail, one of the least ethical companies in telecom in one of the least naturally competitive industries in America could suddenly face less regulatory oversight than ever before. And while those that falsely believe telecom is a free market and all regulation is inherently bad may applaud that outcome, the resulting regulatory capture AT&T would enjoy would be almost total, resulting in higher prices, worse service, and potentially more anti-consumer behavior than ever before.

Filed Under: broadband, competition, fcc, ftc, oversight, regulation, throttling, title ii

FCC Fines T-Mobile For Abusing The Definition Of 'Unlimited' Data

from the abusing-the-dictionary dept

For the better part of the last decade, wireless carriers have had an often vicious, adversarial relationship with the dictionary. More specifically, they've struggled repeatedly with the definition of the word "unlimited," often pitching data services that proclaim to be unlimited, only to saddle users with onerous, often confusing restrictions. For the last decade, regulators have tried to cure them of this behavior, from Verizon paying $1 million to New York's Attorney General in 2007, to the FCC fining AT&T $100 million last year.

Yet despite repeated warnings, the problem persists. Case in point: this week the FCC announced it had struck a $48 million settlement with T-Mobile (pdf) for advertising unlimited data plans without making it clear the limitations of these connections. More specifically, the FCC says T-Mobile didn't clearly inform consumers that these "unlimited" lines would be throttled during periods of network congestion, or after users consumed 17 GB of data in any given month:

"The FCC’s investigation found that company policy allows it to slow down data speeds when T-Mobile or MetroPCS customers on so-called “unlimited” plans exceed a monthly data threshold. Company advertisements and other disclosures may have led unlimited data plan customers to expect that they were buying better and faster service than what they received. The Commission’s 2010 Open Internet transparency rules require broadband Internet providers to give accurate and sufficient information to consumers about their Internet services so consumers can make informed choices."

All told, T-Mobile will pay a $7.5 million fine and dole out $35.5 million in "consumer benefits" (mostly just minor discounts on select hardware and plans) from T-Mobile and its prepaid subsidiary MetroPCS. This will, the FCC insists, surely teach T-Mobile a lesson about marketing unlimited data tiers that aren't:

"Consumers should not have to guess whether so-called ‘unlimited’ data plans contain key restrictions, like speed constraints, data caps, and other material limitations,” said FCC Enforcement Bureau Chief Travis LeBlanc. “When broadband providers are accurate, honest and upfront in their ads and disclosures, consumers aren’t surprised and they get what they’ve paid for. With today’s settlement, T-Mobile has stepped up to the plate to ensure that its customers have the full information they need to decide whether ‘unlimited’ data plans are right for them."

While this sounds superficially nice, there are a few problems with the FCC's move here. For one thing, the FCC has been making it abundantly clear that it's ok to sell "unlimited" plans with all manner of misleading limits -- you just have to make sure your marketing fine print makes those limitations clear. And while that's good, these kinds of wrist slaps clearly aren't working. And just ensuring transparency is not the end of this particular conversation.

For example, T-Mobile's and Sprint's newest plans, which the FCC hasn't raised a peep about, offer users "unlimited" connections, but throttle all games, video and music unless users shell out a monthly premium if they actually want these services to work as intended. That's a fairly obvious violation of net neutrality principles and an abuse of the word "unlimited," yet the FCC has made it abundantly clear it thinks this sort of behavior is perfectly ok. In other words, you can be a misleading cheat. You just have to make it clear you're a misleading cheat via fine print in your three-hundred page terms of service.

We've noted repeatedly how the FCC simply refuses to acknowledge how usage caps and zero rating are causing significant problems, and it doesn't look like it's an issue that's going to get fixed anytime soon. While current FCC boss Tom Wheeler's pro-consumer bent was a surprise to many (especially given his cable and wireless lobbying past), there are growing signs that his tenure will be up at the end of the year. And given the particular leanings of both Trump and Clinton, there's certainly no guarantee his replacement will have the political courage to stand up for consumers and finish what Wheeler started.

Filed Under: fcc, lies, throttling, unlimited data
Companies: t-mobile

FCC: Comcast Routinely Charges Customers For Hardware, Services Never Ordered

from the earning-your-awful-reputation dept

When you're among the worst ranked companies for customer service in America, you consistently need to find new ways to ramp up your game if you want to take malicious incompetence to the next level. Enter Comcast, which despite constant promises that it's getting better, routinely keeps finding itself in the headlines for immeasurably shady business practices. Earlier this year, for example, the company was sued by Washington's Attorney General for charging users a $5 per month "Service Protection Plan," then routinely and intentionally charging users for repairs that should have been covered under it.

This week, America's least-liked companies is finding itself in the headlines for another misleading practice: errantly and routinely billing customers for hardware or services they never ordered. According to a new FCC announcement, Comcast will be paying the agency $2.3 million to settle an investigation into the behavior. According to the FCC, Comcast apparently likes to charge customers for premium cable channels, hardware, or other services the customer never ordered and may have expressly refused:

"The Commission received numerous complaints from consumers alleging that Comcast added charges to their bills for unordered services or products, such as premium channels, set-top boxes, or digital video recorders (DVRs). In some complaints, subscribers claimed that they were billed despite specifically declining service or equipment upgrades offered by Comcast. In others, customers claimed that they had no knowledge of the unauthorized charges until they received unordered equipment in the mail, obtained notifications of unrequested account changes by email, or conducted a review of their monthly bills."

This being Comcast, the FCC notes that impacted customers had to spend "significant time and energy" removing the charges from their bills. After all, this is the company that routinely refuses to correct its own mistakes unless the practice in question gets significant media attention.

While not specifically mentioned in the FCC's announcement, Comcast also has a long, proud history of charging customers who own their own modem a $10 rental fee anyway. This has been a problem customers have faced for years, yet seems to never stop occurring no matter how many complaints or regulatory wrist slaps the cable giant receives. In this case, the FCC states the obvious:

"It is basic that a cable bill should include charges only for services and equipment ordered by the customer—nothing more and nothing less," said Travis LeBlanc, Chief of the Enforcement Bureau. "We expect all cable and phone companies to take responsibility for the accuracy of their bills and to ensure their customers have authorized any charges."

The problem of course is that Comcast likely made significantly more than $2.3 million on this scheme. And the FCC may also want to hold off on the celebration; while the FCC did give Comcast a wrist slap in this instance, there's also a long-standing practice of Comcast and other ISPs and cable companies using misleading below-the-line fees to jack up the advertised rate of both TV and broadband services. And then there's the ongoing issue of Comcast's expanding and anti-competitive usage caps and overage fees, which nobody at the FCC seems all too concerned about.

So while it's good the FCC is cracking down on this kind of fraud, it's just tap dancing around the opening of a very deep, dark rabbit hole of dysfunction, one that has long-since passed from minor inconvenience into legend.

Filed Under: charges, fcc, fraud, scams
Companies: comcast

AT&T Stops Charging Broadband Users Extra For Privacy

from the privacy-is-a-luxury-option dept

A few years ago, AT&T came up with an "ingenious" idea: charge broadband consumers more money if they want to protect their privacy. Under this plan, users ordering AT&T's U-Verse broadband service could get broadband for, say, $70 a month. But if you want to opt out of AT&T's Internet Preferences program (which uses deep packet inspection to study your movement around the Internet down to the second) you'll pay $30 to $50 more, per month. AT&T also made opting out as cumbersome as possible, knowing full well that few people would dare take the option.

With its decision, AT&T effectively made user privacy a luxury option.

After years of this behavior, AT&T suprisingly proclaimed last week that it would be eliminating the privacy surcharge and its Internet Preferences behavioral advertising service completely this month:

"To simplify our offering for our customers, we plan to end the optional Internet Preferences advertising program related to our fastest Internet speed tiers," an AT&T spokesperson confirmed to Ars today. "As a result, all customers on these tiers will receive the best rate we have available for their speed tier in their area. We’ll begin communicating this update to customers early next week."

Why the sudden AT&T about-face? While AT&T claims it's just concerned about "simplicity," the real reason is because the FCC is considering some basic privacy protections for broadband users, who often can't vote against bad behavior with their wallet thanks to the lack of competition in the broadband space. AT&T's decision to issue a surcharge for privacy was one of the primary reasons the FCC began the privacy rulemaking proceeding. AT&T's lobbyists and lawyers clearly hope that if they eliminate this controversial program, they'll be more easily able to argue that broadband privacy rules aren't necessary.

Broadband ISPs have consistently tried to argue that consumer broadband privacy protections aren't necessary because carriers are fantastic at self-regulating on this front. Yet time and time again they've proven that's simply not the case. Verizon, for example, proclaimed in 2008 that broadband privacy protections weren't necessary because "public shame" would keep the company on its best behavior. Fast forward to 2014 and Verizon was caught covertly modifying user wireless data packets to track customer behavior around the internet -- without notifying consumers or offering working opt-out tools.

It took security researchers two years before they even discovered what Verizon was doing. It took another six months before Verizon was even willing to provide customers with working opt-out tools. That's fairly consistently what "self regulation" on the broadband privacy front looks like.

While they've been portrayed by ISPs as mammoth overreach, the FCC's proposed broadband privacy rules are relatively basic, simply requiring that ISPs are completely transparent about what they're collecting and selling, while requiring ISPs also provide working opt-out tools. ISPs, eagerly hoping to compete with Google and Facebook on the advertising front (see Verizon's acquisitions of AOL and Yahoo), don't want any regulations that put them at a competitive disadvantage, arguing the playing field should be level as they eye billions in new advertising revenues.

The problem with that argument is that while internet users can choose not to use Facebook and Google, they all-too-often have no such luxury when it comes to broadband. So while regulations aren't entirely ideal, there's an argument that (like net neutrality rules) they're necessary until we can get something vaguely resembling competition established in the broadband space. Until that happens, and without meaningful privacy protections, there's absolutely nothing preventing AT&T's next "great idea" from being aggressively worse.

Filed Under: broadband, charges, deep packet inspection, fcc, privacy, surcharge
Companies: at&t

MPAA Applauds Derailment of FCC Cable Box Competition Plan Because, Uh, Jobs!

from the overlords-of-nonsense dept

Last week we noted how the FCC had to scrap its plan to bring competition to the cable box after an unprecedented PR and disinformation campaign by the cable and entertainment industries. In short, using consultants, think tanks, payrolled politicians, a soundwall of misleading editorials and even the US Copyright Office, the cable industry was able to convince many in the press, public and even at the FCC that the plan would have ripped the planet off its very orbital access, violated copyright, eroded consumer privacy, and even harmed diversity programming.

In reality, the cable sector's opposition was about two things: $21 billion in captive box rental revenues, and a fear of a loss of control. Being an expert in the latter, the MPAA of course was quick to issue a statement applauding the "delay" in the FCC's proceeding:

"The MPAA is pleased that the FCC is taking more time, and we hope they use it to ensure any set-top box proposal remains consistent with copyright policy and avoids harming creators,” said MPAA Chairman and CEO Senator Chris Dodd, who emphasized that his organization, along with “virtually the entire creative community” is “standing up for copyright and the rights of creators."

Except again, the cable box plan has nothing to do with copyright. The rules would have simply required cable companies pass on their existing programming (and all DRM) to third party hardware vendors, resulting in more competition in cable boxes and ultimately more open and cheaper boxes. Because that might just give consumers a little more control, the MPAA joined the hissy fit parade of inaccurate implausibilities. And to justify trying to keep the cable box locked down and shitty, the best the MPAA can apparently do is reiterate some nonsensical talking points about jobs:

"We support the FCC’s goal of promoting set-top box competition, but we continue to urge the Commission to forge a path that does not undermine the creative economy,” Dodd continued. “Copyright employs more than 5.5 million U.S. workers and generates over $1 trillion in economic value – incentivizing innovation and investment in creative works enjoyed by millions around the world."

Except the FCC's proposal wouldn't hurt jobs in the slightest. Under the FCC's plan, customers still would pay for cable, they'd just have more flexibility in how that programming is consumed. And if anything, you'd see more jobs as the cable hardware itself was opened to multiple hardware competitors and streaming vendors looking to make headway in the space. But just like their previous whining session on this subject, the MPAA can't just admit it's terrified of evolution and consumer empowerment, so it apparently has to conflate "copyright" with a loss of control.

Meanwhile, while many media outlets continue to insist this plan is simply on hold, there's really only two likely outcomes moving forward thanks to cable lobbyists, the US Copyright Office, and folks like the MPAA: either the plan gets scrapped entirely, or the end result winds up being so watered down as to be utterly useless.

Filed Under: competition, copyright, fcc, set top boxes, stb
Companies: mpaa