AT&T Buries Language In Missouri Traffic Bill To Hinder Broadband Competition

from the the-best-lawmakers-money-can-buy dept

Prompted by AT&T, Missouri passed a state law in 1997 that hamstrings towns and cities looking to build local networks to shore up broadband coverage gaps. Since then, AT&T has made repeated attempts to expand those restrictions further, fearing a growing rise in public/private partnerships from the likes of Google Fiber, Ting, or the countless towns and cities tired of AT&T's pricey, slow broadband service. After a failed attempt last year, AT&T this year introduced protectionist bill HB 2078, shortly after shoveling $62,000 in campaign contributions to state leaders.

AT&T's bills vary in scope across the twenty-odd states in which they've been passed. Some ban community broadband altogether. Some saddle towns and private partners with additional restrictions so combating the incumbent duopoly is financially impossible. Others, like HB2078, employ language that forces towns to hold time-consuming public referendums, at which point AT&T can bury the proposal with a wave of negative PR and lawyers.

All of them have tried to sow partisan discord under the pretense of AT&T just being concerned about taxpayers funding the bill for such projects. But the laws serve just one purpose: protect AT&T's stranglehold over an uncompetitive broadband market. That's obviously a much easier sale in states willing to quite literally let AT&T write state law in exchange for cash donation.

The problem for AT&T is that as Google Fiber and other similar efforts have shown a light on the benefits of public/private partnerships to shore up lagging broadband markets, AT&T's behavior has become increasingly unpopular among both political parties. So when HB2078 stalled after passing through the Missouri House committees on Utility Infrastructure and the Select Committee on Utilities earlier this year, AT&T lobbyists got decidedly more clever. They convinced Missouri House Representative Lyndall Fraker to bury the language of HB2078 into an unrelated bill dealing with Missouri traffic issues:

"The bill seems to have lost momentum since mid-March but its sponsor, Rep. Lyndall Fraker, is taking another approach to make sure his bill gets passed, come hell or high water. Session ends May 13th, so he is now banking on procedural tricks, rather than the substance of his legislation. On May 2nd, when a bill relating to traffic citations, SB 765, came before the body, Fracker proposed to amend it with language from HB 2078. Some of the amended language is even more destructive than the original proposal in HB 2078."

As Ars Technica notes, whether the bill can get conference committee approval now that the public has noticed what AT&T and Fraker attempted to do isn't clear. Though should AT&T succeed, it would only help cement Missouri as a broadband backwater, keeping consumers from fleeing to alternative broadband options as AT&T prepares to impose major new usage caps and overage fees across the majority of the ISP's markets later this month.

Filed Under: broadband, lobbyists, missouri, muni broadband
Companies: at&t

Ted Cruz Pushing Bill Protecting Large ISPs From Competition

from the defenders-of-the-status-quo dept

We've long noted how ISPs have convinced (read: paid) more than twenty states to pass protectionist broadband laws that prohibit towns and cities from improving their own broadband infrastructure. The bills not only saddle community broadband with onerous restrictions to make them less viable, they often even block towns and cities from striking public/private partnerships with companies to improve broadband. Last year, the FCC voted to take aim at two such laws in Tennessee and North Carolina, arguing the laws do little but protect the status quo, hindering the development of alternative broadband delivery options.

Pressured by ISPs, both states quickly rushed to sue the FCC, saying that the agency was violating "states rights" (ignoring the rights violated by letting ISPs write awful state law). The FCC, in contrast, says its Congressional mandate to ensure "even and timely" broadband deployment under the Communications Act gives it full legal authority to take aim at such restrictions.

Enter Presidential hopeful Ted Cruz, who is now pushing amendments alongside Nebraska Senator Deb Fischer that would make a few changes to the FCC Process Reform Act. According to an early version of the proposal provided to industry trade magazines, the bill would tie the FCC's hands when it comes to trying to eliminate state broadband protectionism:

"FCC Chairman Tom Wheeler says those laws are pushed by incumbents to prevent price and service competition and the FCC has stepped in to preempt state laws in Tennessee and North Carolina. The FCC is currently in a court battle over that decision. The amendment, according to the amendment list obtained by Multichannel News/B&C, "Prohibits the FCC form preventing states from implementing laws relating to provision of broadband Internet access service by state and local governments."

This is far from the first effort of this kind. Tennessee Representative Marsha Blackburn pushed a similar measure last year. Usually, the measures try to sow partisan discord by claiming the FCC has just gone power mad, again hoping nobody notices giants like Comcast and AT&T performing state lawmaker puppetry in the periphery to the detriment of local communities.

Note these towns and cities aren't getting into the broadband industry because they think it's fun; they're exploring alternative options because the private sector has failed across huge swaths of the country. Unfortunately, large ISPs like Comcast, AT&T, and Time Warner Cable quite literally control most state legislatures, ensuring things stay that way. ISPs could prevent these kinds of efforts by providing better, cheaper broadband -- though obviously lobbying our compromised state legislative systems is notably less expensive than deploying new fiber -- or lowering prices to compete.

The problem for Cruz is that while ISPs have historically tried to frame municipal broadband as a partisan debate to sow discord, that has been less effective over time as public/private efforts from the likes of Google Fiber or Tucows have highlighted the need for some bigger picture thinking. The majority of such networks are now being built in more Conservative leaning areas, and the idea of municipal broadband tends to have broad, bipartisan support. Apparently, disdain for duopoly apathy and high prices is one of the few things most Americans can agree on.

As such, rushing to defend giant telecom providers from competition doesn't seem like the brightest bet for somebody trying to win hearts and minds ahead of a national election.

Filed Under: broadband, competition, lobbying, muni broadband, states, ted cruz

Nervous About Regulatory Action, Comcast Bumps Usage Caps To One Terabyte Per Month

from the giving-you-a-little-more-rope dept

After taking a PR beating for several years on the matter, Comcast has announced that it's significantly bumping the company's usage caps. Since 2013 Comcast has been conducting a "trial" in many of the company's less competitive markets, capping usage at 300 GB per month, then charging users either $10 per each additional 50 gigabytes, or providing users the option of paying $30 to $35 per month extra to avoid the cap entirely. But according to a new blog post by the cable giant, the company will be bumping that usage allotment to one terabyte per month starting June 1.

Users will still need to pay $10 per each additional 50 gigabytes of data consumed should they go over the cap. And they still have the option of paying a penalty should they want to avoid usage caps entirely, though Comcast has bumped the price of such an option to an additional $50 per month. Comcast's quick to insist that the terabyte cap is so generous, few consumers will ever find themselves running into the limit:

"A terabyte is an enormous amount of data. It’s far more than most of our customers will ever use in a month. Today, more than 99 percent of our customers do not come close to using a terabyte. Our typical customer uses only about 60 gigabytes of data in a month – that’s far less than a terabyte (in fact, 940 gigabytes less), or less than six percent of a terabyte."

Of course, while that's true today, that doesn't mean it will be true tomorrow. And while the increase is certainly welcome, that doesn't change the fact that usage caps on fixed-line networks still aren't necessary. As we've repeatedly noted, Comcast's cost to provide broadband service remain fixed or in decline, and the company's own support documents and engineers have suggested the caps have nothing to do with congestion or network necessity. That's because they have everything to do with protecting TV revenues from Internet video competitors.

While Comcast's announcement implies Comcast is graciously responding to consumer feedback, the origins of the company's decision lie elsewhere.

With the FCC imposing a seven year ban on usage caps as a Charter merger condition this week, many believe the FCC is signaling it intends to finally crack down on usage caps. The agency has tap-danced around the issue for years, but with a growing number of companies exploring the option -- and a growing number of companies (including Comcast and Verizon) exempting their own content from such caps, pressure has mounted steadily on the FCC to wake up from its regulatory coma on the subject. If that's to happen, it will likely happen after the industry's lawsuit against the agency over net neutrality is settled.

Comcast's also responding to the fact that AT&T is planning to impose its own usage caps starting May 23. AT&T plans to begin imposing usage caps ranging from 300 GB to 1 terabyte, and, like Comcast, charge $10 per each additional 50 GB consumed. Also, like Comcast, AT&T intends to begin charging customers a $30 premium should they want to avoid the charges, effectively charging customers significantly more money for the same service they had yesterday. Comcast bumping its cap to more closely match AT&T's is the U.S. broadband market's rather twisted version of competition.

It seems likely that some news outlets will frame what Comcast's doing as "generous." And while a definite improvement, it shouldn't overshadow the fact that these caps are little more than glorified price hikes on uncompetitive broadband markets, and an anti-competitive weapon against the threat of Internet video disruption.

Filed Under: 1 terabyte, broadband, cable, data cap, fcc, usage cap
Companies: comcast

As Broadband Usage Caps Expand, Complaints To The FCC Skyrocket

from the pay-more-for-the-same-service dept

For several years now, broadband providers have been taking full advantage of the lack of competition in the broadband market by expanding usage caps and overage fees. More recently, companies like AT&T, Comcast and Suddenlink have taken this practice one step further by charging users a $10 to $35 per month surcharge if consumers want to avoid usage caps. In other words, consumers are paying more money than ever for a service that costs less and less to provide, thanks again to limited competition in the broader broadband market.

And while companies like Comcast have used the same approach seen in the boiling frog metaphor to slowly expand its usage cap "trials" and hope nobody notices, people are definitely noticing the rising temperatures. The Wall Street Journal filed an FOIA request with the FCC, and has found that consumer complaints about broadband caps have been skyrocketing over the last year:

"Fearful of crossing data limits, some customers say they are canceling the streaming services, including Netflix, Sling TV and Sony PlayStation Vue. Consumer complaints to the Federal Communications Commission about data caps rose to 7,904 in the second half of 2015 from 863 in the first half, according to records reviewed by The Wall Street Journal under the Freedom of Information Act. As of mid-April, this year’s total was 1,463."

Though we've warned about this for years, the Journal almost-but-not-quite comes to the realization that usage caps have nothing to do with congestion or financial necessity, and everything to do with hamstringing Internet video and protecting legacy TV revenues. Companies like SlingTV and Netflix make that abundantly clear in their comments to the Journal, though Comcast clings to a familiar narrative in trying to justify why it's charging more money for the same service:

"Comcast says its aim is to ensure the heaviest users are paying more than lighter ones, since 50% of its bandwidth is consumed by just 10% of its customers. Comcast set up the trials to show “people who are consuming the most should carry more of the bill rather than raise everybody’s bill by the same amount,” says Marcien Jenckes, executive vice president of consumer services at Comcast."

But we've long noted how that justification is nonsense. The cable industry itself admitted years ago that congestion had nothing to do with usage caps. Comcast's own leaked support documents and comments from company engineers have also acknowledged as much. Meanwhile, if a small fraction of your customers are consuming an "excessive" amount of bandwidth (and ISPs never provide hard data on this front), you could easily push them to business-class tiers without having to impose a draconian and confusing new pricing paradigm on your entire customer base.

No, Comcast is imposing usage caps to simultaneously cash in on, and thwart, Internet video. Granted the company can't just come out and admit that, so we often see flimsy claims that imposing huge new rate hikes on its entire userbase is about fairness, even if Comcast's cost to deliver broadband services remains fixed or declining. Not too surprisingly, Comcast tells the Journal that the company's a gift to the Internet and would never, ever behave anti-competitively:

"We everyday contribute to the use and the growth of the Internet,” Mr. Jenckes says. “There is absolutely no anticompetitive belief or objective."

The reality is that when it comes to complaints about caps, we're only starting to see the tip of the consumer annoyance iceberg. Not only are companies expanding usage caps, companies like Comcast are now exempting their own content from these caps -- a fantastic way to give their otherwise underwhelming Netflix alternatives an unfair advantage in the market. Other companies like AT&T are using usage caps to attack cord cutters in another way, by socking them with overage fees unless they sign up for traditional TV services they may no longer even want (something AT&T tells the Journal is just a "really compelling" offer).

And despite the soaring complaints, and the broad anti-competitive implications of such arbitrary limits, the FCC has remained largely mute about usage caps -- often supporting the industry narrative that this is just "creative pricing experimentation." The hope at the FCC has been that its policies to encourage broadband competition will make a specific crackdown on usage caps unnecessary, but so far it certainly hasn't worked that way. Though less talked about, it's also a problem that the FCC has failed to ensure that ISP usage meters are accurate; as a result they often aren't, with some consumers being billed for usage when their modem is off or the power is out.

Broadband competition isn't going to magically fix itself, and outside efforts like Google Fiber or community broadband are only helping a fraction of the market. As such, complaints submitted to FCC systems will only grow as more and more consumers realize that usage caps and overage fees are a giant con perpetrated on an already annoyed and captive market.

Filed Under: broadband, complaints, consumers, data caps, fcc, isps, usage caps

As ISPs Push Harder On Usage Caps, House Pushes Bill Preventing The FCC From Doing Anything About It

from the stripping-the-fcc-of-its-power-to-protect-consumers dept

In recent weeks, we've noted how ISPs are now moving beyond broadband usage caps and overage fees, and have begun charging users a $30-$35 premium if they want to avoid usage caps entirely. While the industry often dresses this up as everything from "improved flexibility and choice" to something necessary for the sake of fairness, it is, quite simply, an aggressive rate hike on uncompetitive markets. Users are being socked with dramatic new limits and fees -- simply because most have no real competitors to flee to.

Entirely uncoincidentally, the House is now pushing for new legislation that would hamstring the FCC's ability to regulate broadband rates. The "No Rate Regulation of Broadband Internet Access Act" (pdf) is set to be debated this week in Congress, and would, according to a press release by the Energy and Commerce Committee, prevent the FCC from regulating rates charged for broadband Internet, "just as the administration promised when they reclassified access to the Internet as a utility under Title II of the Communications Act."

Except according to a Medium post by attorney Harold Feld, the bill tries to use a special definition of "rate regulation" to ban the FCC from, well, doing much of anything:

"H.R. 2666’s language would protect broadband providers from any “review” or “enforcement” of their prices, and prevent the FCC from even “declaring” — let alone addressing — any broadband prices or fees as even “unreasonable.” To make this even more clear, the bill prohibits the FCC from reviewing any prices, fees, or overages “regardless of any other provision of law.” That goes way beyond the FCC’s traditional rate setting authority. “Any other provision of law” includes the FCC’s mandate to promote competition and its consumer protection authority."

So basically, the House, at the behest of large ISPs, is looking to further neuter the FCC. Not only so it can't protect consumers from usage caps and price gouging, but to try and derail the FCC's plan to expand consumer broadband privacy protections, or say, open up the cable set top box to additional competition.

It should probably be reiterated that while the FCC says it does have the authority to regulate some rates under Title II and its net neutrality rules (preventing "paid prioritization," for example), the agency so far has shown no interest in really doing so. Whether it's a $300 million national broadband map that fails to show broadband prices (at industry behest), to the agency's continued blind eye to hidden fees, usage caps and zero rating, the FCC has made it abundantly clear that it finds a large amount of the broadband industry's current price gouging just "creative experimentation."

But while the FCC hasn't done much about broadband prices directly, it has tried to shore up competition in the market so prices drop organically, including support for municipal broadband. Between this, the agency's push for privacy rules, and net neutrality, the House has made it abundantly clear it plans to punish the FCC for standing up to giant ISPs like AT&T, Verizon and Comcast. As such, if it isn't a series of pointless, FCC "fact finding" hearings, it's yet another bill like this one that aims to tie the FCC's arms securely behind its back.

As it stands, there remain just two serious ways to roll back net neutrality and the FCC's decision to reclassify ISPs as common carriers under Title II: win the election and gut the FCC and its decision, or win the ongoing lawsuits against the FCC (a ruling on that front is expected soon). The House likely knows this, but is apparently keen to try and earn its telecom campaign contributions by putting on one hell of a taxpayer-funded show.

Filed Under: congress, consumer protection, fcc, fees, isps, rate regulations, regulation, scams

Netflix Reveals It Throttles AT&T, Verizon Customers To Save Them From Usage Caps, Overage Fees

from the neutrality-soap-opera dept

Netflix this week admitted that the company has been throttling the video streams of most wireless customers around the world to 600 kbps, a practice the company claims is necessary to protect users from usage caps and wireless overage fees. It was the first time Netflix acknowledged the practice, which the company said it's been engaged in for five years. The more interesting part? The company admitted to the Wall Street Journal that it's apparently not throttling the video streams of companies whose consumer policies Netflix agrees with:

"Netflix said it doesn’t limit its video quality at two carriers: T-Mobile and Sprint Corp., because “historically those two companies have had more consumer-friendly policies.” When customers exceed their data plans on Sprint or T-Mobile, the carriers usually slow their network connections, rather than charge overage fees."

The Netflix reveal came after T-Mobile CEO John Legere spent last week defending T-Mobile's controversial Binge On service, which throttles partner video streams to 1.5 Mbps or 480p. Legere spent much of the week poking various news outlets with claims that AT&T and Verizon throttle video streams even further than Binge On, something both companies spent much of last week denying. It didn't apparently take long for the Journal to dig deeper and get an admission out of Netflix that it was the one doing the throttling.

Despite the clear admission from Netflix that it's the one throttling, Legere continues to take to Twitter to blame AT&T and Verizon, meaning he either didn't understand the story he'd read, or he's intentionally being misleading in an attempt to redirect people from recent Binge On criticisms:

2/ I called out @verizon and @att just last week about this – they denied, tried to make it about throttling and called me ‘dopey’!

— John Legere (@JohnLegere) March 24, 2016

AT&T, meanwhile, hoping to cash in on the story and paint Netflix as a hypocrite, had its top lobbyist pretend to be "outraged":

"We’re outraged to learn that Netflix is apparently throttling video for their AT&T customers without their knowledge or consent,” said Jim Cicconi, AT&T’s senior executive vice president of external and legislative affairs."

AT&T's "outrage" likely stems from the fact that the throttling kept AT&T users from hitting their usage caps and incurring overage fees sooner, costing AT&T money.

After revealing its throttling to the Journal, Netflix posted a new blog post in which it pretended it was revealing its throttling practices by choice, "announcing" it was working on tools that would help customers better manage their data consumption:

"We believe restrictive data caps are bad for consumers and the Internet in general, creating a dilemma for those who increasingly rely on their mobile devices for entertainment, work and more. So in an effort to protect our members from overage charges when they exceed mobile data caps, our default bitrate for viewing over mobile networks has been capped globally at 600 kilobits per second. It’s about striking a balance that ensures a good streaming experience while avoiding unplanned fines from mobile providers.

This hasn’t been an issue for our members. Our research and testing indicates that many members worry about exceeding their mobile data cap, and don’t need the same resolution on their mobile phone as on a large screen TV to enjoy shows and movies. However, we recognize some members may be less sensitive to data caps or subscribe to mobile data plans from carriers that don’t levy penalties for exceeding caps. As we develop new technologies, we want to give all our members the choice to adjust their data consumption settings based on their video preferences and sensitivity to their ISPs data overage charges. We’ll provide more details as we get closer to launch.

So to be clear: Netflix should have been more transparent about what it was doing and provide users with better controls (desktop users can adjust streaming quality rather easily), especially if it's going to lecture ISPs on transparency. That said, given Netflix's positions on net neutrality and usage caps, you're sure to see the story blown up into more than it is by ISPs and their various mouthpieces, who'll likely either call this a net neutrality violation itself (it's not; throttling yourself isn't like throttling a competitor, and users have a choice of streaming services) or continue the industry claim that Netflix is a shady villain that treats giant, lumbering telecom duopolies unfairly.

But the crux of the problem here remains usage caps, not Netflix. Sure, Netflix isn't being entirely altruistic. Annoyed customers banging their heads against usage caps watch less streaming video, which for many fixed-line ISPs like Comcast is the entire point. For wireless carriers it's obviously different, with the goal being to drive consumption however possible. But the fact that a company was forced to offer a lower quality service -- instead of competing to provide the best stream possible -- shows how arbitrary usage caps by their very nature distort and damage markets. And that's before you even get to the anti-competitive implications of zero rating.

Filed Under: mobile service, net neutrality, throttling, videos
Companies: at&t, netflix, sprint, t-mobile, verizon

Angolans Turning Zero-Rated Wikipedia, Facebook Into Ad Hoc File Sharing Services

from the internet-users-continue-to-be-amazing dept

Zero-rating -- the nifty trick companies use to edge around net neutrality rules -- is being offered to developing countries as a way to provide cheap internet access to their citizens. There's a bit of altruism in the offerings, but there's also a lot of walls surrounding gardens. Facebook's "Free Basics" is a zero-rated platform that functions like a twenty-first century AOL, funneling users into Facebook's version of the internet.

Wikipedia is similarly offering zero-rated access to countries with limited internet options. It -- along with Facebook -- has partnered with a local telecom to give Angolans access to data without having to pay provider rates for it. This includes its associated properties, like its Wikimedia Commons.

Angolans have taken to this pair of walled gardens and, ingeniously, turned them into an ad hoc zero-rated Pirate Bay, as Motherboard's Jason Koebler reports.

Enterprising Angolans have used two free services—Facebook Free Basics and Wikipedia Zero—to share pirated movies, music, television shows, anime, and games on Wikipedia. And no one knows what to do about it.

Because the data is completely free, Angolans are hiding large files in Wikipedia articles on the Portuguese Wikipedia site (Angola is a former Portuguese colony)—sometimes concealing movies in JPEG or PDF files. They’re then using a Facebook group to direct people to those files, creating a robust, completely free file sharing network. A description for a Facebook group with 2,700 members reads: “created with the objective of sharing music, movies, pictures, and ANIMES via Wikimedia.”

One possible solution is no solution at all: pulling the services from Angola. No one wants to look like they're depriving impoverished citizens of what's likely their only access to the internet. On the other hand, neither entity is too thrilled to be hosting possibly infringing material. Another solution is also no solution at all: playing whack-a-mole with content and new Wikipedia/Facebook accounts.

The third solution, though, is even worse. As Koebler explains, this proposed solution is predicated on some terrible assumptions about how people must behave to "earn" internet access privileges.

Many on the listserv are framing Angola’s Wikipedia pirates as bad actors who need to be dealt with in some way so that more responsible editors aren’t punished for their actions. This line of thinking inherently assumes that what Angola’s pirates are doing is bad for Wikipedia and that they must be assimilated to the already regulated norms of Wikipedia’s community. If the developing world wants to use our internet, they must play by our rules, the thinking goes.

Playing by the rules -- which basically means curbing infringement to appease rights holders -- may be a bad thing for Angolans in the long run, even if it seems like a plausible short-term solution. The "loopholes" in these zero-rated services aren't limited to spreading pirated content. They could also serve as handy tools for activism and dissent.

Angolan's pirates are learning how to organize online, they're learning how to cover their tracks, they are learning how to direct people toward information and how to hide and share files. Many of these skills are the same ones that would come in handy for a dissident or a protester or an activist. Considering that Angola has had an autocratic leader in power for more than 35 years, well, those are skills that might come in handy one day.

Shutting down dubious uses of the services will only result in greater local control of internet access, which is the last thing the country needs. The fact that people are using a service in ways it was never intended to be used is a feature, not a bug. Erecting walls only encourages people to find ways to route around them. These are important communication tools that democratizes Angolan internet access. (To a certain extent -- citizens with funds to pay for data charges will get the "real" internet, rather than the Facebook/Wikipedia version.). And this little bit of access -- no matter how controlled and contained -- is indisputably better than nothing at all. Further limiting this use will do more damage to those using this limited access to escape government control than it will to the file sharers so aptly illustrating how futile the "walled garden" concept actually is.

Filed Under: angola, copyright, file sharing, net neutrality, zero rating
Companies: facebook, wikipedia