Blatant Hypocrite Ajit Pai Decides To Move Forward With Bogus, Unconstitutional Rulemaking On Section 230

from the that's-not-how-any-of-this-works dept

For years, FCC Chair Ajit Pai has insisted that the thing that was most important to him was to have a "light touch" regulatory regime regarding the internet. He insisted that net neutrality (which put in place a few limited rules to make sure internet access was fair) was clearly a bridge too far, and had to be wiped out or it would destroy investment into internet infrastructure (he was wrong about that). But now that Section 230 is under attack, he's apparently done a complete reversal. He is now happy to open a proceeding to reinterpret Section 230 to place a regulatory burden on the internet. This is because Ajit Pai is a hypocrite with no backbone, and no willingness to stand up to a grandstanding President.

The key parts of his statement:

“Members of all three branches of the federal government have expressed serious concerns about the prevailing interpretation of the immunity set forth in Section 230 of the Communications Act. There is bipartisan support in Congress to reform the law. The U.S. Department of Commerce has petitioned the Commission to ‘clarify ambiguities in section 230.’ And earlier this week, U.S. Supreme Court Justice Clarence Thomas pointed out that courts have relied upon ‘policy and purpose arguments to grant sweeping protections to Internet platforms’ that appear to go far beyond the actual text of the provision.

“As elected officials consider whether to change the law, the question remains: What does Section 230 currently mean? Many advance an overly broad interpretation that in some cases shields social media companies from consumer protection laws in a way that has no basis in the text of Section 230. The Commission’s General Counsel has informed me that the FCC has the legal authority to interpret Section 230. Consistent with this advice, I intend to move forward with a rulemaking to clarify its meaning.

“Throughout my tenure at the Federal Communications Commission, I have favored regulatory parity, transparency, and free expression. Social media companies have a First Amendment right to free speech. But they do not have a First Amendment right to a special immunity denied to other media outlets, such as newspapers and broadcasters.”

This is bullshit. And what's worse is that Pai knows it's bullshit. And he's still doing it. Because he's a coward. He saw what happened when his fellow Commissioner Mike O'Rielly -- who was effectively fired for daring to point out that the 1st Amendment blocked forcing internet websites to carry his propaganda -- and Pai folded like a cheap suit.

Pai is wrong in almost everything he says above. The FCC has no jurisdiction over internet websites. Previous lawsuits have already held that. Furthermore, the FCC has no jurisdiction over Section 230, which was explicitly written to deny the FCC any authority over websites. The FCC has no power to reinterpret the law.

The final paragraph is the most ridiculous of all. He is correct that social media companies have a 1st Amendment right to free speech. And Section 230 as was written and properly and regularly interpreted by dozens of court decisions -- none of which the FCC has ever said a word about -- helps guarantee that right is not diminished through frivolous, bogus, and mis-directed litigation. That Pai would ignore all of that to keep a whiny President happy should tarnish Pai's legacy much more than his dismantling of net neutrality. The fact that he now goes back on everything he has ever said in the past about the FCC and regulations on the internet is just the fetid, rotten cherry on top of a giant pile of bullshit that he has created over the years.

Also, the claim that the immunity is "denied to other media outlets" is straight up wrong. ANY outlet is protected from liability for 3rd party content on their websites. It's why Fox News and Breitbart can have comments on their websites. It's why things like Parler and Gab can exist. Pai knows this. He's just being disingenuous.

In terms of actual impact, all this will serve to do is rile people up, waste a ton of time, and not actually change anything. Because it can't. But it will create a huge mess in the meantime, distracting everybody, and wasting a ton of resources.

As a final note: we've long disagreed with Pai about his stances on many issues, regarding net neutrality, the digital divide, municipal broadband and more. But at least he was consistent. I'd previously believed that he was misguided, but stuck true to his principles. That is clearly no longer the case. He's a lying hypocrite with no principles, no backbone, and should be regarded as a complete joke. No one can even say that his stance on net neutrality was a principled "small government, fewer regulations" stance any more, because this moves proves it was not. He has no problem moving for regulating the internet when it's politically convenient. And that's just pathetic.

Filed Under: 1st amendment, ajit pai, cda 230, fcc, hypocrite, net neutrality, rulemaking, section 230

FCC's Pai Puts Final Bullet In Net Neutrality Ahead Of Potential Demotion

from the one-more-time-around dept

While the courts partially upheld the FCC's hugely unpopular net neutrality repeal just about a year ago, it also kicked some aspects of the repeal back to the FCC. Most notably, the courts stated the Ajit Pai FCC couldn't ban states from protecting consumers if the FCC is no longer interested in doing so. The courts also noted that the FCC (surprise!) did little to no research into how the repeal would impact public safety or efforts to bridge the digital divide (the latter being kind of important in a massive pandemic).

Knowing that Pai could face demotion under a possible Biden administration, the agency is now rushing forward to try and address these concerns and put the finishing touches on the least popular tech policy decision in modern history, short of SOPA/PIPA.

As is his way, Pai published a coy and folksy editorial over at Medium, trotting out several well-tread falsehoods one last time, including the claim that ending net neutrality drove more network investment (this is absolutely false), that net neutrality was just a silly pet project of Silicon Valley elites and Hollywood (the rules had overwhelming, bipartisan public support as well as the support of every U.S. consumer group), and the GOP, telco, and telecom policy tourist favorite -- that the rules must not have mattered because the internet didn't immediately end in a massive rainbow-colored explosion:

"In 2017, numerous Washington politicians, far-left special-interest groups, Hollywood stars, and Silicon Valley tech giants, as well as many in the media, tried to scare the American people about what would happen once the FCC adopted the Restoring Internet Freedom Order. In that order, we overturned the previous Administration’s decision to heavily regulate the Internet like a slow-moving utility under rules developed in the 1930s and restored the longstanding, bipartisan, market-based approach. The American people were told that they would get the Internet one word at a time. They were told that they would have to pay $5 per tweet. They were told that it would be the end of the Internet as we know it. It was frightening stuff to be sure, but it was utter nonsense.

While it's true the repeal saw no shortage of hyperbole on both sides of the fight, this is the same drivel Pai has been spouting since the repeal began nearly four years ago. The FCC's repeal didn't just kill net neutrality rules, it hamstrung the FCC's ability to stand up and police giant telecom monopolies. As a result, AT&T now uses broadband usage caps and overage fees to unfairly penalize users who don't use AT&T's streaming services. Verizon now charges you more money if you'd prefer your video connections not be throttled. Companies charge all manner of bogus, non-transparent fees, including rental fees for hardware consumers already own. This FCC couldn't give any less of a shit about any of it.

To understand the net neutrality repeal properly, you have to view it in context of the FCC's other behaviors. Not only did the Pai FCC kill net neutrality, it killed the FCC's ability to adequately regulate the sector it's in charge of. It also rubber stamped competition and job-killing megadeals before it had even seen any objective data. The GOP killed FCC privacy rules before they could take effect. 42 million Americans lack access to broadband. 83 million more live under broadband monopolies, usually Comcast. The U.S. broadband sector is a broken, uncompetitive mess. Kissing monopoly ass fixes none of this.

Perhaps in fantasyland letting AT&T, Verizon, and Comcast do whatever they want results in Utopian outcomes, but in reality it results in the same competition problems, high prices, atrocious customer service, and spotty broadband coverage Americans have enjoyed for the better part of 30 years. However, Pai clearly still believes he bravely stood up to the evil Google/Netflix empire and the "Hollywood elite" to free the internet from "antiquated regulation."

In reality, he effectively gutted a U.S. regulators' ability to police predatory telecom monopolies with thirty-year track records of clear, anti-competitive, anti-consumer behaviors. Tomato, tomaahto. In Pai's world, he was the victim. And, much like the rest of Trumpland, no matter how much evidence to the contrary is presented, Pai insists his giant middle finger in the face of U.S. consumers and objective data resulted in untold, miraculous outcomes:

"And what’s been the result? The Internet has remained free and open. And it’s stronger than ever. Millions more Americans have access to the Internet today than in 2017. In 2018 and then again in 2019, the United States set records for annual fiber deployment, and we’ve seen network investment hit levels that our nation hadn’t seen for over a decade. In fact, since we adopted the Restoring Internet Freedom Order, average download speeds for fixed broadband in the United States have doubled, increasing by over 99% (so much for getting the Internet one word at a time). And in 2018 and 2019, we added over 72,000 wireless cell sites in the United States, after adding fewer than 20,000 in the prior four years."

Except again, claims of exploding network investment are false (in fact, both AT&T and Comcast trimmed investment this year). The rest of Pai's data points had nothing to do with repealing net neutrality. Much of the fiber growth Pai continues to take credit for were thanks to fiber deployment conditions affixed by the previous FCC to AT&T's acquisition of DirecTV. And to community broadband efforts the Pai FCC have attempted to ban. And one of the biggest reasons the internet didn't explode upon repeal is states stepped up and passed their own version of the rules. That has kept ISPs from behaving even worse, though again Pai's FCC, at AT&T's and Comcast's behest, has tried to ban states from protecting consumers. So important is it to Trumpland and the telecom sector that nobody have the authority to hold it accountable on the federal, state, or local level, the DOJ is even trying to help.

It's telling that Pai has spent four years listening to a laundry list of experts inform him as to why his approach was the wrong one, and not a single falsehood in his repertoire has changed. Pai's still out here claiming regulatory capture somehow results in amazing outcomes the lion's share of broadband-using Americans can clearly see aren't true. This kind of ideology first, facts later partisan hubris has set U.S. broadband policy back years at the worst possible time. Shortly after Pai got done whispering sweet nothings into the ears of telecom monopolies, a massive pandemic struck, only highlighting U.S. broadband shortcomings further.

No matter how many times telecom-loyal politicians, regulators, consultants, think tankers, and policy yes men claim otherwise, kissing Comcast's and AT&T's ass isn't serious adult policy. It's regulatory capture and corruption. And if you can't see the negative impact this has on competition, consumers, tech innovation, and communications markets after 30 years of U.S. broadband monopolization, consolidation, and dysfunction, you're part of the problem.

Filed Under: ajit pai, fcc, net neutrality

The EU Makes It Clear That 'Zero Rating' Violates Net Neutrality

from the tilting-the-playing-field dept

For years now we've discussed how large ISPs have (ab)used the lack of competition in the broadband market by imposing completely arbitrary and unnecessary monthly usage caps and overage fees. ISPs have also taken to exempting their own content from these arbitrary limits while still penalizing competitors -- allowing them to use these restrictions to tilt the playing field in their favor (or the favor of partners with the deepest pockets). For example an AT&T broadband customer who uses AT&T's own streaming service faces no penalties. If that same customer uses Netflix or a competitor they're socked with surcharges.

The anti-competitive impact of this "zero rating," as it's called, should have been obvious. But here in the States, large ISPs have muddied the water by claiming that zero rating is the bits and bytes equivalent of a 1-800 number for data or free shipping. Customers who don't understand that usage caps are arbitrary nonsense from the get go often buy into this idea that they're getting something for free. And Ajit Pai's FCC has helped confuse the public as well by trying to claim that this model is somehow of immense benefit to low income communities (it's not, and in fact data has shown zero rating drives up consumer costs).

Muddled by lobbying influence here in the States, even the previous pro net neutrality Tom Wheeler FCC steered clear of banning zero rating with its initial net neutrality rules for fear of "hindering innovation." Wheeler's FCC was just starting to figure out this was a problem when Trump's election happened, resulting in the Ajit Pai FCC gutting the consumer protections completely (you know, for "internet freedom").

In contrast, a few years ago the European Union passed some fairly decent net neutrality rules that went notably further than the FCC. They not only prohibited ISPs from unjustly blocking, throttling, or restricting access to services the ISP may compete with, they imposed some basic protections governing zero rating -- a practice ISPs here in the US have increasingly been using anti-competitively. Despite the rules, enforcement has thus far been inconsistent and patchy, resulting in some EU wireless carriers continuing to embrace zero rating.

That may soon come to an end however, as Europe's top court this month ruled that yes, zero rating violates net neutrality. In its ruling, the court made it clear that zero rating distorts the entire concept of level playing fields and fair competition:

"Such packages are liable to increase the use of the favoured applications and services and, accordingly, to reduce the use of the other applications and services available, having regard to the measures by which the provider of the internet access services makes that use technically more difficult, if not impossible. Furthermore, the greater the number of customers concluding such agreements, the more likely it is that, given its scale, the cumulative effect of those agreements will result in a significant limitation of the exercise of end users’ rights, or even undermine the very essence of those rights."

Opponents of net neutrality here in the States like to frequently trot out the claim that net neutrality was repealed here in the States and the internet didn't immediately implode, therefore the rules must not have mattered. But that ignores (usually quite intentionally) the fact that companies like AT&T are already clearly using zero rating to try and disadvantage competitors like Netflix. More importantly that logic ignores the fact that when the federal government gave up on consumer protection many states passed their own rules.

With a goal of zero oversight for U.S. monopolies, ISPs, with the Trump FCC and DOJ's help, have tried to ban states from protecting consumers whatsoever. But so far the courts haven't looked kindly on those efforts. In short, the "internet hasn't exploded" in the wake of net neutrality's repeal in the States because ISPs don't want to run afoul of state regulators. They also aren't likely keen on getting too aggressive on this front when it's very possible that a Biden administration passes new net neutrality rules.

Whatever future net neutrality rules look like, zero rating needs to be taken seriously as a real threat to fair online competition free of malicious gatekeepers. It's abundantly clear giants like AT&T want to abuse the idea to inject themselves into business relationships they should have no part of, something groups like Mozilla have long made clear. Big ISPs want to abuse the lack of competition by erecting arbitrary barriers, then charging competitors and consumers extra should they choose a competitor's service. That this was portrayed as a good thing speaks to the effectiveness of U.S. telecom's PR vilification of even the most basic of oversight.

Filed Under: broadband, eu, net neutrality, zero rating

DOJ Continues Its Quest To Kill Net Neutrality (And Consumer Protection In General) In California

from the who-needs-monopoly-oversight? dept

After the FCC effectively neutered itself at telecom lobbyist behest, numerous states jumped in to fill the consumer protection void. As a result, California, in 2018, passed some net neutrality rules that largely mirrored the FCC's discarded consumer protections. Laughing at the concept of state rights, Bill Barr's DOJ immediately got to work protecting U.S. telecom monopolies and filed suit in a bid to vacate the rules.

The DOJ's central argument was that California's attempt to protect consumers was somehow "anti-consumer." And the lawsuit largely centered on language the FCC had included in its net neutrality repeal (again, at telecom lobbyist behest) attempting to ban states from filling the void created by the federal government no longer giving a damn. The courts so far haven't looked too kindly upon that logic, arguing that the FCC can't abdicate its authority over telecom, then try to lean on that non-existent authority to try to tell states what to do.

Last week California filed its first brief (pdf) in its legal battle with the DOJ. ISPs are seeking a preliminary injunction to prevent California from enforcing the rules during the lawsuit. Again though, their primary argument continues to be that states can't enforce net neutrality because the FCC said so. Which, as Stanford Professor Barbara van Schewick continues to point out, is still nonsense no matter how many times industry and the captured U.S. government repeat the claim:

"According to case law, an agency’s decision to deregulate can only block the states from stepping in when the agency has the power to regulate and decides not to use it.

But when the FCC eliminated net neutrality in 2018, it also removed its own authority over broadband providers. In essence, the agency decided that broadband providers are not telecommunications companies that simply shuttle data back and forth (like a telephone company), but information service providers which interact with and alter data, like a website.

This removed any authority that would have allowed the FCC to adopt net neutrality protections. Thus, the elimination of net neutrality did not establish a calibrated federal deregulatory regime, as the U.S. and the ISPs argue; it simply reflected the FCC’s lack of authority. Simply put, the FCC’s 2018 Order created a regulatory vacuum, and you can’t conflict with a vacuum."

Of course one of the reasons you stack the courts with unqualified sycophants and partisan yes men is so basic, fundamental logic doesn't apply. So as usual, while it's likely the courts will laugh at the telecom sector's efforts here, it's certainly not guaranteed. And while the press will cover this story as a "government lawsuit," make no mistake: this is AT&T, Verizon, and Comcast using the federal government as a hand puppet as they attempt to have their cake and eat it too. Namely, no real oversight on the state or federal level, and no pesky market competition to keep their worst impulses in check.

Filed Under: california, doj, fcc, net neutrality, states rights

Trump, Big Telecom Continue Quest To Ban States From Protecting Broadband Consumers

from the have-your-cake-and-eat-it-too dept

As we've noted a few times, the Trump administration's repeal of net neutrality did a lot more than just kill net neutrality rules. It effectively neutered the FCC's ability to hold giant broadband providers accountable for much of anything, from attempting to charge customers a rental fee for hardware they own, to the litany of bogus fees ISPs use to falsely inflate their advertised rates. So when a select group of folks try to claim that "killing net neutrality must not have mattered because the internet still works," they're advertising their ignorance.

Another problematic aspect of the FCC's net neutrality repeal was that it also attempted to ban states from protecting consumers. The goal of the telecom sector, if you haven't noticed, is a complete and total oversight vacuum of one of the least competitive, and most disliked, business sectors in America. And it's fairly shocking how far along they've gotten in their quest without more people generally pointing out it's kind of a bad idea to let the Comcasts and AT&Ts of the world run amok sans regulator oversight or meaningful competition.

Unfortunately for the telecom sector, its quest to block states from filling the consumer protection void hasn't gone that well. The courts so far have generally ruled that the FCC can't abdicate its authority over consumer protection, then turn around and try to dictate what states can or can't do. That's not stopping the Trump administration or telecom giants, which have continued their lawsuits against states like California on a state by state basis. Last week, the DOJ and ISPs filed amended complaints in California in a bid to scuttle that state's net neutrality rules:

"California will likely point to other portions of the DC Circuit order, which found that the FCC's power to preempt is limited because the commission abandoned its Title II regulatory authority over broadband. "[I]n any area where the Commission lacks the authority to regulate, it equally lacks the power to preempt state law," judges wrote in that case. The FCC's "affirmative" sources of regulatory authority come from Title II, III, and VI of the Communications Act, judges wrote. But Pai's FCC chose to apply Title I to broadband, which contains no such authority."

ISPs (and the various policy wonks under their employ) like to whine that states pursuing their own consumer protections (be they privacy, net neutrality, or anything else) creates a "fractured landscape of discordant state laws." But that ignores the fact that this is a problem created by the telecom sector. It in effect wants to have its cake and eat it too, all the while ignoring the broad consensus of the public and experts that the agency's previous net neutrality rules were little more than a modest effort to keep telecom monopolies from abusing their monopoly power in the streaming video era.

Some FCC Commissioners, like Jessica Rosenworcel, weren't particularly impressed:

There remains a delusion among a certain subset of tech and telecom policy folks who believe that if you neuter regulatory oversight of an uncompetitive sector like broadband, magic and ponies somehow sprout from the sidewalk. But as U.S. telecom history has made pretty clear by now, when a company like AT&T or Comcast sees neither competition nor meaningful regulatory oversight, they simply double down on the same bad behavior. That means higher prices, worse customer service, patchy availability, and bad privacy and net neutrality practices (you know, like AT&T only excluding its own video services from usage caps).

In Comcast and AT&T's ideal world, nobody, anywhere would be able to do a damn thing as they protect their geographic monopolies from competition and accountability. And shockingly, there's still a small subset of folks (including the Trump administration) who seem to think that's a good idea.

Filed Under: broadband, california, competition, consumer protection, fcc, fees, net neutrality, state's rights

Senators Wyden And Markey Make It Clear AT&T Is Violating Net Neutrality

from the ill-communication dept

For years now, AT&T has imposed arbitrary broadband monthly usage caps and costly overage fees -- but not if you use the company's own streaming TV service. As a result, when you use AT&T's own streaming TV platforms, you won't see any limits. But try to use an AT&T competitor like Amazon, Hulu, or Netflix, and you'll face monthly limits and usage surcharges. Like many big ISPs, AT&T has temporarily lifted its caps on fixed-line broadband networks, but is expected to quietly return to the practice once things semi-normalize.

AT&T has confirmed that the same approach will be applied to AT&T's latest streaming TV service, HBO Max. Use AT&T's broadband service and AT&T's HBO Max? No arbitrary, unnecessary, or costly restrictions. Use AT&T's broadband service but want to use Netflix instead? Suddenly you're facing annoying restrictions and a higher monthly bill. AT&T also lets deep-pocketed companies pay for exclusion from usage caps, something that disadvantages smaller competitors.

AT&T's been doing this for several years without penalty, so the extension to its newest streaming service isn't surprising. But last week Senators Ron Wyden, Ed Markey, and Richard Blumenthal fired off a letter to outgoing AT&T CEO Randall Stephenson (pdf), asking the company to explain how giving preferential treatment to its own services isn't a terrible precedent:

"According to AT&T, HBO Max is benefiting from AT&T’s “sponsored data" system, which allows content companies to pay AT&T for the right to be exempt from data caps. Although HBO Max may technically be paying for this benefit, AT&T is essentially paying itself. This practice of allowing one arm of your company to “pay” another arm of your company for preferential treatment attempts to mask its true impact. The Trump FCC may have gutted critical net neutrality protections, but AT&T nonetheless has a responsibility to avoid any policies or practices that harm consumers and stifle competition. We urge you to provide us with an explanation for the behavior described above by June 25, 2020."

Several other ISPs (like Comcast) have engaged in similar behavior. When pressed, they'll usually trot out a pseudo-technical justification for the practice, insisting that because much of this traffic only touches an ISP's own network, usage caps need not apply. That's not only nonsensical, it ignores the fact that there's simply no technical justification for caps and usage charges in the first place. None. Such limits don't manage congestion. They're simply arbitrary price hikes imposed in uncompetitive markets. And they're not a useful price differentiator either (that's what speed tiers and business class service is for).

AT&T knows full well that since its lobbyists just got done convincing the FCC to effectively not just gut net neutrality rules but also the FCC's authority over telecom, there's nothing the FCC can do about any of this. And users can't really punish AT&T via "the market," because they have no competing ISP to flee to. That leaves either Congress, which is awash in AT&T campaign contributions (making it extremely unlikely we see a net neutrality law anytime soon), and states, whose responses will range from inconsistent to nonexistent.

However folks attempt to justify this, it's an entrenched telecom monopoly imposing arbitrary limits, then selectively removing them to give their own platforms an unfair market advantage. And because AT&T has incredible sway over the lion's share of regulators and lawmakers, nobody's going to do a damn thing about any of it beyond a few polite letters.

Filed Under: data cap, hbo max, net neutrality, playing favorites, ron wyden, sponsored data, zero rating
Companies: at&t

Net Neutrali-what? AT&T's New Streaming Service Won't Count Against Its Broadband Caps. But Netflix Will.

from the fake-barriers-but-real-penalties dept

For a long time, we've noted how broadband usage caps are bullshit. They don't actually help manage congestion, they have nothing to do with "fairness," and are little more than glorified price hikes on the backs of captive customers in uncompetitive markets. Worse, they can be abused anti-competitively by incumbent broadband providers, one of the major triggers of the net neutrality debate.

For example, AT&T for a while has made its own streaming TV services exempt from its usage caps, while competing streaming services (Netflix, Amazon, whatever) count against a user's monthly data allotment. This gives AT&T a distinct advantage in that users are incentivized to avoid competing services lest they face completely arbitrary and unnecessary usage limits and fees. It's bullshit. It has always been bullshit.

AT&T has added another layer to this bullshit cake. The company has long experimented with something called "sponsored data," which lets companies pay AT&T extra if they want to be exempt from AT&T's (again, completely arbitrary and unnecessary) broadband usage caps. This adds yet another anti-competitive layer to the equation by letting a deep pocketed company (say: ESPN) get a distinct advantage over smaller startups that can't afford to pay AT&T's toll.

Last week AT&T launched yet another streaming TV service, HBO Max. This service also won't count against AT&T's usage caps and overage fees, AT&T confirmed to The Verge:

"According to an AT&T executive familiar with the matter, HBO Max is using AT&T’s “sponsored data” system, which technically allows any company to pay to excuse its services from data caps. But since AT&T owns HBO Max, it’s just paying itself: the data fee shows up on the HBO Max books as an expense and on the AT&T Mobility books as revenue. For AT&T as a whole, it zeroes out. Compare that to a competitor like Netflix, which could theoretically pay AT&T for sponsored data, but it would be a pure cost."

This has been a hard thing for some folks to understand (for whatever reason) so I'll reiterate: this is a regional telecom monopoly, imposing completely unnecessary limits on uncompetitive markets, which don't apply to the incumbent's own services. Efforts to impose net neutrality have always been about preventing incumbent telecom monopolies from abusing their market power by imposing unnecessary barriers to competitors, and this is precisely that. Fortunately AT&T's own incompetence has kept the company from dominating the streaming space so far, but it doesn't make this any less of a bad precedent.

Filed Under: competition, favoritism, hbo max, net neutrality, sponsored data, streaming, zero rating
Companies: at&t, netflix

Telecom's Latest Dumb Claim: The Internet Only Works During A Pandemic Because We Killed Net Neutrality

from the particularly-bad-arguments dept

A few weeks ago, a new talking point popped up among telecom policy pundits opposed to net neutrality. They began claiming that the only reason the internet hasn't buckled during the pandemic was thanks to the FCC's controversial and unpopular net neutrality repeal. That repeal, you'll recall, not only killed net neutrality, but much of the FCC's ability to hold ISPs accountable for pretty much anything, including outright billing fraud.

But to hear various net neutrality opponents tell it, the repeal is the primary reason the US internet hasn't fallen apart during COVID-19 quarantine:

"We should thank our lucky stars that Title II net neutrality regulations were repealed by the FCC in 2017. In doing so, the US avoided the fate of much of Europe today, where broadband networks are strained and suffering from a lack of investment and innovation."

Except none of this is true. This entire narrative is fantasy -- built almost entirely off of the EU simply asking various streaming companies to throttle certain services in an abundance of caution. There remains no evidence that this was due to any serious problems, and, at the same time, there's been no evidence that US networks have measurably outperformed their EU counterparts (indeed, many of the companies that throttled services in the EU did so in the US as well). Investment at many US ISPs actually dropped post net neutrality repeal. And there's literally no indication that US networks are somehow "more robust" than the EU because the FCC decided to ignore the public and obliterate its own authority at the behest of the telecom lobby. It's just not a supportable claim.

In fact, networks in China and Italy, like here in the States, have (with a few exceptions) held up reasonably well under the massive load of telecommuting and home learning. Not because of net neutrality policy, but because network engineers are generally good at their jobs. While there have been some network problems, they're usually of the "last mile" variety in both the EU and US. As in, because of limited competition, your ISP never upgraded that "last mile" to your house, leaving you stuck on a DSL line from around 2007 that struggles to handle Zoom teleconferencing particularly well.

The claim that the EU was suffering some kind of exceptional congestion problems appears to have originated among some EU regulators who simply urged Netflix to reduce bandwidth consumption by 25% to pre-emptively help lighten the load. There was no supporting public evidence provided of actual harm. The move was precautionary, and may not have even been necessary. Somehow this flimsy base was used as the foundation of the claim that because the EU passed some fairly basic and inconsistent net neutrality rules, it suffered more network headaches than the US.

But if you look at Ookla's data of how networks have held up around the globe, you see that the US appears to have performed at about the same level as other places. Here's the US:

There's a small dip in mid-March as a lot of the country began to shut down, but no massive problems. On that, everyone seems to agree. But to hear the various anti-net neutrality folks tell it, the EU was struggling to keep its network up and running. But... uh, the data doesn't show that at all:

In Germany, France, and Spain you see that download speeds actually jumped up before eventually doing a small dip as those countries locked down. There isn't enough evidence to make a definitive claim, but if we were to argue using the same points raised by critics of net neutrality, Looking at all that, you might even be able to make the argument that EU broadband providers handled this situation better and more quickly than the US.

None of this has stopped the telecom sector and its allies from embracing this whole flimsy argument anyway. In a speech at the Inter American Development Bank last week, FCC boss Ajit Pai made, albeit more subtly, similar claims:

"In the end, I believe trusting the markets rather than solely relying on mandates resulted in more consumer-friendly policies than we would have achieved with a more heavy-handed government intervention, and I know that we were able to make these changes more quickly. I’d also argue that the general regulatory approach that we have in the United States have applied to the broadband marketplace gave us much stronger infrastructure in the first place, as it gave companies the incentives to invest in resilient, robust networks that could withstand unprecedented consumer demands."

Again though, Pai's not telling the truth. US broadband investment didn't magically improve due to the net neutrality repeal, no matter how many times he makes the claim. In fact, AT&T and Comcast dropped overall CAPEX despite massive deregulation and billions in tax cuts. There's zero evidence any of this industry ass-kissing made US networks more resilient to a pandemic. In fact, respected former FCC advisors like Gigi Sohn have argued that gutting FCC authority over ISPs has made it harder than ever to hold them accountable for bad behavior, pandemic or otherwise.

Using a pandemic to justify regulatory capture is grotesque, especially given there's just no evidence to support the claims being made here. That didn't stop FCC General Counsel Tom Johnson, who also tweeted out his support for a new Wall Street Journal opinion column (not coincidentally) making most of the same claims:

Notice how the telecom industry doesn't even have to publicly make these false claims, because they've got think tankers and government employees now doing it for them. These arguments are rife with cherry picking and selective reasoning (for example you'll see none of these folks highlighting how EU consumers pay far less for broadband than those in the US, in part because regulators are generally more active when it comes to protecting competition and consumer welfare). The Wall Street Journal story also suggests that US networks are more resilient to COVID-19 thanks to killing net neutrality, broadband privacy rules, and other "heavy handed" US telecom consumer protections:

"In Europe, networks have struggled to meet bandwidth demand, leading officials to ask popular services such as Netflix and YouTube to degrade the quality of their streaming video from high definition to standard definition. U.S. networks have faced fewer problems adjusting to the increase in demand. Public policy explains the different outcomes. The European Union has embraced a heavy-handed regulatory scheme designed to allocate access to the existing network, while the U.S. has emphasized private investment to expand network capacity."

But again, there's no evidence that European networks have fallen apart during the COVID-19 crisis. Or that any differences in performance have anything to do with deregulation or net neutrality. Netflix's decision to throttle back its bandwidth usage by 25% was done entirely pro-actively. There was no underlying network data provided by regulators to justify the move. It was just EU regulators being cautious (perhaps overly so).

Indeed, similar steps have been taken here in the States. YouTube for example has downgraded video quality to conserve bandwidth. So has game platform Steam, which is slowing some game downloads. You can't selectively highlight the EU's efforts on this front then ignore the US ones because it supports your flimsy narrative. Well I guess you can, but you should be laughed at.

It takes a particular type of person to look at a brutal pandemic and think that it provides a wonderful opportunity to justify one of the most controversial, scandal prone, and fact-averse regulatory policy decisions in modern history. Using COVID-19 to justify mindless telecom sector coddling sets a new, even lower bar for a sector whose argumentative integrity was already at ankle height.

So why do it? It's a distraction from several things the sector would prefer you not pay attention to. One being that an estimated 42 million Americans still can't access broadband during a pandemic, and millions more can't afford service because of a lack of competition among regionally power monopolies. They'd also really like it if you forgot how the FCC ignored the public, made up a bunch of data, and ignored a whole bunch of fraud to gut oversight of one of the most problematic business sectors in America--leaving consumers and regulators alike on precarious footing in the wake of an historic global crisis.

Filed Under: congestion, covid-19, eu, fcc, net neutrality, throttling, us

Ex-FCC Staffer Says FCC Authority Given Up In Net Neutrality Repeal Sure Would Prove Handy In A Crisis

from the self-sabotage-is-our-forte dept

It's worth repeating for the folks in the back: the FCC's hugely unpopular, facts-optional and fraud-slathered repeal of net neutrality did a lot more than just kill "net neutrality." It gutted the FCC's already dwindling authority over giant telecom monopolies, shoveling any remaining authority to an FTC that lacks the authority or resources to police the US telecom sector (the whole goal of telecom lobbyists). As a result, you've now got ISPs free to engage in problematic behavior (like bullshit fees, or charging people "rental fees" for modems they already own) that the government is incapable and unwilling to address.

And the government's decision to ignore the public and pander to the telecom lobby has deeper ramifications as well. As telecom lawyer and former FCC staffer Gigi Sohn writes in an editorial at The Verge, there has been a multi-decade effort to kill telecom oversight under the (clearly false) claim that the miracle of the free market will somehow magically fix a sector that's been clearly broken for decades:

"This digital divide did not happen by accident. It is the result of years of scorched-earth deregulation and consolidation pushed by large cable and broadband companies and a government that, despite mountains of evidence to the contrary, believes that somehow the so-called “free market” will take care of the unconnected."

Of course the telecom Utopia that's promised never actually arrives despite decades of this game of deregulatory theater. Deregulated telecom monopolies, too big to fail, fused to the NSA, and constrained by neither government oversight nor competition, just wind up doubling down on the same bad (or worse) behaviors. There's a segment of telecom policy "experts" who enjoy denying this factual reality, but the facts on the ground (more than 50 million Americans lack access to more than one ISP at speeds of 25 Mbps, and US consumers pay some of the highest prices for data in the developed world) don't lie.

Deregulation can certainly spawn innovation when you're talking about functioning, competitive markets. But U.S. telecom, where a handful of giants dominate most U.S. markets and all but own state and federal lawmakers, has never been that. That we keep pretending otherwise is a stunning level of denial driven largely by partisan ideology. Sohn goes on to note that the FCC's decision to neuter itself at telecom lobbyist behest left the FCC to adequately police the sector during a pandemic:

"One might think that during a national emergency, the chairman of the FCC wouldn’t have to plead with broadband providers to do what is necessary to ensure that every American is connected. But in 2017, at the behest of cable and broadband companies, the Trump FCC abdicated its responsibility to protect consumers and promote competition in the broadband market when it repealed its network neutrality rules. Not satisfied with simply eliminating the rules, which prohibited broadband providers from blocking, throttling, and otherwise favoring certain internet content and services, the Trump FCC blithely threw away its legal power to oversee the activities of these companies by reclassifying them as unregulated “information services” rather than regulated “telecommunications services."

So while certain folks like to make claims like "the internet didn't implode therefore repealing net neutrality wasn't important," that's a simplistic, dumb, or just plain disingenuous way of framing what actually happened. This is what actually happened: the FCC ignored the public, ignored rampant fraud, and ignored all hard data to neuter itself at the behest of giant telecom monopolies. That should never, ever get lost in the partisan bickering over policy.

With less authority than ever, the FCC was forced to recently resort to a sort of stage play to try and keep ISPs from ripping off financially-constrained broadband customers during a pandemic. That included a recent FCC "Keep Americans Connected Pledge" that involves ISPs pinky swearing that they won't kick U.S. telecom customers suffering from financial hardships offline during the COVID-19 quarantine for 60 days. But while the promise isn't necessarily a bad thing, it's entirely voluntary, and the FCC has no real authority to police ISPs that don't behave. It's policy theater, Sohn notes:

"A voluntary pledge isn’t adequate to ensure that Americans can work, learn, have access to health care, and communicate during this trying time. Without legal authority over broadband providers, the agency cannot hold any of those companies to their promises — they can simply walk away after 60 days or before. Nor can the FCC require broadband providers to take critical steps beyond the pledge, like relaxing data caps, providing low-cost or free connectivity, or other steps that would help those desperately in need during this crisis, if even on a temporary basis. The Communications Act of 1934 gives the FCC a great deal of flexibility to ensure that the public is protected during a national emergency. But when it comes to broadband internet access, this FCC is powerless."

On the Libertarian end, this neutering of the FCC is usually applauded alongside ample fear mongering that a potent FCC would run amok. But decades of U.S. broadband policy has never supported this empty assertion. For a generation now the U.S. FCC, under both parties, has (with a few exceptions like Wheeler) almost uniformly pandered to the interests of U.S. telecom monopolies, stripping away authority and consumer protections under a steady parade of promises that never materialize. For most of us (especially the less affluent), the end result of feckless telecom oversight and ceaseless pandering should be fairly obvious.

Again, with neither competition (a problem opponents of Sohn's arguments simply ignore or downplay at their convenience) nor regulatory oversight, telecom giants like AT&T and Comcast have been free to charge some of the highest rates in the developed world, engage in clear and repeated billing fraud, deliver some of the worst customer service in history (with no pressure or incentive to fix it), be utterly non-transparent, crush or acquire competitors through mindless consolidation, engage in rampant privacy abuses (again with little or only tepid repercussions), and so much more.

Folks claiming it's the FCC that is running amok or has too much power in this equation are engaged in some potent head-in-the-sand denialism. These companies are so powerful they're literally writing state and federal telecom law with an exclusive eye on protecting their revenues from accountability and competition. That was a problem during the best of times, but it's going to be doubly so as America enters a protracted crisis where broadband connectivity has shifted from "nice to have" to utterly essential to survive.

Pretending the U.S. broadband market isn't broken, and that regulatory capture and rampant corruption didn't play a massive role in that dysfunction, is disingenuous, dangerous folly whose multi-decade tenure as a dominant policy paradigm needs to be put out to pasture.

Filed Under: broadband, competition, covid-19, fcc, gigi sohn