The First Net Neutrality Complaint Has Been Filed, And It's Stupid (But Important)

from the regulatory-fisticuffs dept

For much of the last year, transit ISPs like Level3 and Cogent have been complaining that the residential megaISPs have basically been trying to shake down Netflix and transit operators for additional money. To hear these companies tell it, ISPs like AT&T, Verizon and Comcast, have been doing this by intentionally letting network interconnection points get congested, then using that congestion to justify an end to settlement-free peering, and for new direct Netflix interconnection payments.

Basically, the accusation goes, the big ISPs have been breaking the Internet, then demanding steep new payments should companies like Netflix want it to work properly. While the FCC's new net neutrality rules don't specifically cover interconnection feuds of this type, they do allow companies to file grievances the FCC will examine on a case-by-case basis for anti-competitive behavior. However, once the FCC's new rules were passed, the mere threat of regulatory enforcement magically put the kibosh on many of these complaints. As a result many (but not all) transit and last mile ISPs are now getting along beautifully, showing that the rules are already working.

However, we did see the very first net neutrality complaint filed this week, and by all indications it's rather stupid. A company by the name of Commercial Network Services (CNS) has been complaining to the press for a few weeks that Time Warner Cable has been abusing its monopoly power by refusing to give the company free peering. CNS operates a series of webcams in the San Diego area which, when visited, will likely tell you you can't access the "ultra-HD" version of the cameras because your ISP isn't a peering partner with CNS:
In the informal complaint (pdf) CNS filed with the FCC, the company proclaims that Time Warner Cable's refusal to offer free peering constitutes a violation of the FCC's throttling and paid prioritization neutrality rules:

"I am writing to initiate an informal complaint against Time Warner Cable (TWC) for violating the “No Paid Prioritization” and “No Throttling” sections of the new net neutrality rules for failure to fulfill their obligations to their BIAS consumers by opting to exchange Internet traffic over higher latency (and often more congested) transit routes instead of directly to the edge provider over lower latency peering routes freely available to them through their presence on public Internet exchanges, unless a payment is made to TWC by the edge provider."

Except Time Warner Cable is doing nothing of the sort, and CNS either doesn't understand how interconnection works, or understands it perfectly well and is hoping to abuse the new rules for its own financial benefit. There's nothing that obligates Time Warner Cable to provide free peering to anybody who asks, and refusing CNS' demands on that front has absolutely nothing to do with paid prioritization, throttling, or net neutrality. Settlement-free peering sometimes occurs when ISPs and transit operators agree to offload huge-swaths of relatively similar sized traffic allotments, but as Harold Feld correctly points out, CNS simply doesn't qualify:

"Basically, CNS wants settlement free peering (aka free interconnection) with with Time Warner Cable (TWC). According to CNS’ complaint, they have exchange points where TWC also has a point of presence. They want TWC to exchange traffic with them for free, and allege it is unjust and unreasonable for TWC to offer them the standard deal for entities of their size, i.e. a paid transit agreement.

Entities like CNS haven’t gotten free peering as a matter of course with major carriers since the first great upheaval in the peering market in the mid/late-1990s. CNS does not provide any evidence that it has been treated any differently from any other comparable entity of its size and function. TWC considered their request for settlement free peering under its standard procedures and found that CNS did not qualify."

If CNS is genuinely confused about what the rules do, it wouldn't be surprising, given the amount of nonsense that has been spouted about the rules from neutrality opponents in Congress and by folks like FCC Commissioner (and former Verizon lawyer) Ajit Pai. Of course ISPs and assorted broadband industry flacks will be quick to argue that this kind of frivolous complaint is the perfect example of how neutrality rules create "onerous new hurdles for ISPs." Except there's no hurdle here; the FCC will ignore this complaint because it's stupid, in the process showing the agency only intends to step in when there's clear, document-able proof of anti-competitive behavior.

So far, the net neutrality rules have been good for business, Internet health and consumers alike, despite the endless claims by the mega-ISPs that the rules would most certainly cause the Internet to implode.

Filed Under: cdn, complaints, fcc, net neutrality, peering, webcam
Companies: cns, commercial network services, time warner cable

Eight Years Later, New York City Officials Wake Up To Verizon's Fiber Broadband Bluff

from the fine-print dept

Like Silicon Valley, New York City purports to be a bastion for emerging technology, yet, just like Silicon Valley, it suffers from a pitiful lack of broadband options and competition. In New York, Time Warner Cable enjoys notable market dominance, with either spotty Verizon FiOS or DSL coverage providing the barest semblance of real market competition for the cable giant. It wasn't supposed to be this way: in 2008 Verizon struck a closed-door franchise agreement with then NYC Mayor Mike Bloomberg, one which Verizon strongly implied would result in 100% FiOS coverage for all five boroughs of the city by the end of 2014.

The agreement, both Bloomberg and Verizon tried to proclaim at the time, would mean uniform fiber for the whole city, putting an end to the broadband "cherry picking" that plagued franchise agreements of years past:

"Our investment in the City is historic, which is reflected in the citywide nature of our plan," (Verizon's Monica) Azare said. "When our fiber deployment project is completed it will reach to each and every borough, neighborhood, boulevard, avenue and street, without regard to the demographics of a particular area. More importantly, City residents will be able to take advantage of the power of fiber optics delivered straight to their doors."

2014 has of course come and gone, and most estimates peg New York City FiOS penetration at somewhere between 45 and 55%, with most of the city's least affluent areas left in the broadband dark. Despite plenty of warning signs from reporters at the time, and the fact that city lawyers could have read the agreement at any time, New York City officials are only just starting to realize that the deal allowed Verizon ample room to wiggle around and under most of the uniform deployment obligations.

A new city report (pdf) released last week has found, shockingly, that Verizon went right ahead and used these loopholes to cherry pick only select neighborhoods, just as the company had intended. The biggest trick Verizon used to bluff its way past obligations was by bringing fiber somewhere close to many residences (as in buried in the street one block over), then declaring that these users could get fiber. Of course when the city began to look, they found Verizon refused to finish the job:

"As 2014 progressed, and Verizon’s (supposed) build-out approached 100 percent, DoITT began to receive anecdotal evidence, largely in the form of consumer complaints, suggesting that Verizon was simultaneously taking credit for “passing” households and declining to accept orders for nonstandard service installations from those households. The anecdotal evidence, in combination with discussions of the particular households involved with Verizon personnel, led DoITT to be concerned that these anecdotes did not reflect occasional irregularities, but possibly broader failures by Verizon to fulfill the obligations it undertook in the 2008 franchise agreement."

Possibly! Again, this was all pretty much spelled out in the franchise agreement Bloomberg's office signed with Verizon years earlier. As we've often covered, Verizon also has a long, proud, history of similar shenanigans in New Jersey and Pennsylvania, getting significant tax breaks and subsidies in exchange for fiber optic service that never winds up getting deployed. Verizon, as you might expect, denies that it in any way failed the city, and blames difficult city landlords for its failure to deliver promised fiber to roughly half the city:

"We indeed have met the requirement to install fiber optics through all five boroughs," a Verizon spokesperson told Ars. "Our $3.5 billion investment and the 15,000 miles of fiber we have built have given New Yorkers added choices and a robust set of advanced, reliable, and resilient services. The challenge we have is gaining access to properties which of course would expand availability. We look forward to working with the City to seek solutions to this issue."

Verizon had been trying to blame crotchety landlords for these expected FiOS coverage gaps for some time, and while there certainly are some difficult building managers, reporters have found in many of these instances that Verizon incompetence was actually to blame. In some instances, Verizon was accused of telling building owners that it would only actually connect buildings to the FiOS network if every resident in the building was required to get service through Verizon and nobody else.

So, the better part of a decade later New York City officials are annoyed at the sweetheart deal their predecessors signed, and insist that they'll be holding Verizon's feet to the fire:

"Through a thorough and comprehensive audit, we have determined that Verizon substantially failed to meet its commitment to the people of New York City,” said Mayor Bill de Blasio..."What the audit reveals is an alarming failure on the part of Verizon to deliver on its franchise agreement with the City,” said Counsel to the Mayor Maya Wiley. “Verizon must make good on its commitment and do so with transparency, accountability and better service delivery going forward. New Yorkers deserve no less."

The agreement says the city "may "seek and/or pursue money damages" if Verizon fails to live up to its side of the agreement, but the loophole-filled wording of the contract will likely make that impossible. If Verizon's business history is any indication, what will actually happen is the company's lawyers will keep the bureaucratic wheels spinning indefinitely, while the city spends another decade paying lip service to the transformative power of broadband. That New York City is at least making a stink about it is at least marginally promising; Pennsylvania and New Jersey officials threw billions of dollars at the company, let it off the hook for any and all obligations, and then just hoped nobody would notice.

Filed Under: broadband, competition, fiber, fios, new york city, promises
Companies: time warner cable, verizon