Former FCC Boss Turned Top Cable Lobbyist Says Cable Industry Being Unfairly Attacked, 'No Evidence' Of Consumer Harm

from the nobody-believes-the-words-coming-out-of-your-mouth dept

Given the fact that the FCC has recently bumped the standard definition of broadband to 25 Mbps to highlight competition gaps; reclassified ISPs as common carriers; passed real net neutrality rules for the first time ever; taken aim at the industry's use of protectionist state law to keep the duopoly intact; pushed for improved broadband privacy rules, and is now taking aim at the cable industry's monopoly over cable set top hardware, it's not really surprising that the cable industry isn't happy right now.

One could argue (especially if you've studied regulations across the pond) that this is just what it looks like when a telecom regulator is doing its job after falling asleep for arguably fifteen years. But former FCC boss turned top cable lobbyist Michael Powell sees things differently. Powell took the opportunity at the cable industry's annual INTX trade show in Boston to throw a bit of a hissy fit, complaining repeatedly that the industry was under "relentless" and unprovoked "regulatory assault":

"We find ourselves the target of a relentless regulatory assault,” Powell told attendees. “The policy blows we are weathering are not modest regulatory corrections. They have been thundering, tectonic shifts that have crumbled decades of settled law and policy."...What has been so distressing is that much of this regulatory ordinance has been launched without provocation," said the NCTA head. "We increasingly are saddled with heavy rules without any compelling evidence of harm to consumers or competitors."

Who says telecom lobbyists can't be comedic geniuses? Of course the cable industry enjoys some of the worst customer satisfaction ratings of any industry in America thanks to generations of regulatory capture and little real competition in broadband. After a generation of treating captive consumers poorly there's really not a more hated sector than cable, and the industry's reputation is only getting worse as it rushes to take advantage of limited competition and impose usage caps. As a result, complaints to the FCC have been skyrocketing.

"Compelling harm" should be apparent to everyone just by looking at their cable and broadband bill, and every time they call Comcast customer support.

And despite a lot of cable sector chirping about "innovation," as AT&T and Verizon back away from unwanted DSL markets, cable broadband's monopoly is only growing in the face of less competition, meaning less incentive than ever to compete on price or improve customer service across huge swaths of territory.

And you really can't find a man more responsible for keeping this status quo intact than Powell, who ran the FCC from 2001 to 2005. Powell was a vibrant example of sector dysfunction and revolving door regulators; completely incapable of even admitting the TV or broadband sectors had or has problems. His tenure was just one chapter of a more-than-fifteen-year, bipartisan stretch during which the FCC was little more than a lapdog to the sector it was supposed to be policing. As such, cable enjoyed decades of almost total local, state and federal regulatory capture, all while crowing about the immense benefits of "free markets."

The result of this aggressive dysfunction forged the cable industry we all know and love today.

Powell is best remembered for his decision to try and push broadband over powerline as a major third avenue of sector competition, thereby justifying regulatory inaction on other fronts. But Powell intentionally ignored something everybody in telecom had known for years: the technology would never actually work due to the massive radio interference it caused. But by braying about broadband over powerline being the "great broadband hope," Powell managed to deflect criticism that he was busy actually making the sector substantially worse through total inaction and ineptitude. Other FCC bosses like Kevin Martin and Julius Genachowski carried on that proud tradition.

Fast forward a decade and Powell's now lobbying for the very companies he once "regulated," complaining about unfair persecution of an industry that has been begging for a kick in the teeth for the better part of most of our adult lives. And while there are certainly plenty of sectors that deserve a hands-off regulatory approach to protect fledgling organic market evolution, the cable sector is a unique, braying beast built on the back of apathy, revolving door regulation, and an utter disdain for the captive consumers the sector serves. As such, Powell won't find too many people crying themselves to sleep just because the FCC finally decided to do something about it.

Filed Under: cable, competition, consumer harm, innovation, michael powell
Companies: ncta

EU Parliament Wants To Break Up Google... Because It's Big & American Or Something

from the gotta-any-better-reason? dept

On Friday, the Financial Times broke the story that the European Parliament is going to call for breaking up Google. Of course, the European Parliament can't actually do that, but it appears designed to put pressure on the EU Commission, which has been talking about antitrust actions against Google for quite some time. While it had looked like there was a settlement earlier this year, those plans more or less appeared to fall apart. Just recently, we wrote about efforts to force Google to change some of its search results in Europe -- and noted how problematic it gets when governments start telling search engines how to program their algorithms.

But, actually breaking up Google would go a hell of a lot further. The idea had been floated earlier this year by a top German official, but who would have thought anyone would take it seriously.

And here's the thing: as far as I can tell, there isn't any real reason for trying to break up Google, other than the fact that it's very big and very not European.

There's no discussion about any actual harm... just the fact that some people don't like the fact that the company is so big (and not European):

Since his nomination to be the EU’s digital commissioner, Germany’s Günther Oettinger has suggested hitting Google with a levy for displaying copyright-protected material; has raised the idea of forcing its search results to be neutral; and voiced concerns about its provision of software for cars.

Google has become a lightning rod for European concerns over Silicon Valley, with consumers, regulators and politicians assailing the company over issues ranging from its commercial dominance to its privacy policy. It has reluctantly accepted the European Court of Justice’s ruling on the right to be forgotten, which requires it to consider requests not to index certain links about people’s past.

If they were alleging real consumer harm, that would be one thing, but no one seems to be discussing that.

The NY Times has more details on the expected resolution, which talks about "unbundling" Google's various other services from the search engine:

The language in the draft resolution calling for the break up of powerful search engines does not attack Google directly. Instead, according to a version seen by The New York Times, the resolution calls on the European Commission “to consider proposals with the aim of unbundling search engines from other commercial services” to introduce more competition into online search in Europe.

The resolution was written by Andreas Schwab, a member of the center-right European People’s Party from Germany, where powerful publishing groups have strongly campaigned for measures to rein in Google’s market power.

If true, then it seems that Microsoft -- one of the leading drivers behind antitrust actions in Europe -- may have shot itself in the foot here, since it, too, is a "search engine" that has plenty of other "commercial services."

While I do think antitrust is an important tool in stopping abusive monopolistic powers that block out any and all competition, it seems only reasonable that you should at least have to show some sort of actual consumer harm. Furthermore, it's difficult to see how this plan would actually do what its backers seem to want to accomplish. Breaking up Google, if it can even be done realistically, doesn't magically lead to more search engines in the market. There are lots of upstart search engines out there trying -- we hear about new ones all the time. And they're not, in any way, "blocked" by Google. So what would this move do other than punish Google for being successful?

Filed Under: antitrust, breakups, competition, consumer harm, eu, eu commission, eu parliament, search engines
Companies: google, microsoft

FTC Supposedly Getting Ready To Go After Google For Antitrust Violations

from the what-consumer-harm dept

Reuters is reporting that 4 out of 5 FTC Commissioners have decided they have enough evidence to go after Google for violating antitrust laws to "hurt its rivals." Details remain sparse, but it will be interesting to see any specifics once they're out, and how they show any kind of consumer harm. From what's been said in the past, it really feels like this is yet another case of going after a company because it's big, rather than because of any demonstrable problem. Tim Wu, who's been advising the FTC, has argued in the past that all you have to be is big to be a monopolist, but I don't see how that makes any sense. As we've discussed before, no one has provided a reasonable suggestion as to why Google should need to promote other search engines. Especially in this day and age when different services are eating away at Google from a variety of angles (Apple and Facebook have been quite successful), and considering that if the search results are bad, it's easy to switch to another search engine (I regularly use DuckDuckGo myself these days), I'm really curious as to what the harm here is. It sounds like we may find out soon.

Filed Under: antitrust, competition, consumer harm, ftc, search