FCC Commissioner Ajit Pai Just Loves Net Neutrality Rulemaking Transparency, Except When It's His Turn To Be Transparent

from the walk-the-talk dept

You might recall that to try and thwart the agency's new net neutrality rules, former Verizon lawyer turned FCC Commissioner Ajit Pai launched a last-minute, facts-optional war on net neutrality and neutrality supporters like Netflix. Most of his arguments were nonsensically awful, like claiming that having real neutrality rules would somehow inspire North Korea and Iran to censor the internet, or that Netflix's fairly ordinary use of a CDN suggested it was somehow a hypocrite on the idea of net neutrality and was trying to destroy the internet.

But Pai's biggest complaint about the net neutrality rules was that the FCC wasn't being transparent enough, despite countless years of conversation and fully documented public input. Pai repeatedly and often proclaimed that the entire process wasn't transparent, even going so far as to hint that the White House's public Title II support was somehow part of a secret cabal with the FCC, even though as we noted at the time no rules were broken by the White House's entirely ordinary public statement of support for Title II.

If you know telecom company lawyers, you probably were keyed in early on that Pai and his staff's breathless love of transparency was a bit of a political show pony designed to rile up the folks that believe net neutrality is some vile, secret plot by government to ruin the internet. You also likely realized early on that when the shoe was on the other foot, this love of transparency would probably magically disappear.

And that didn't apparently take long. The House has been conducting an endless stream of political show pony hearings and "investigations" into the FCC's behavior on the net neutrality front under the noble pretense of reform, when the real goal is to punish the agency for daring to stand up to ISP campaign contributors. As the House digs through documents they hope will prove that net neutrality is an unholy, big government cabal (and not, as most realize, a genuine and remarkable grass roots movement) Pai apparently refused to provide documents to the FCC's own lawyer:

"Republican FCC Commissioner Ajit Pai is refusing to make his office’s documents available to the FCC’s Office of General Counsel as part of a House investigation into the agency’s net neutrality decision. Pai has instead promised to provide documents directly to the House Oversight Committee — though a panel spokeswoman said no documents have yet been provided."

Get it? Transparency is really, really important unless it doesn't coincide with partisan patty cake efforts to shame the FCC for finally doing its job and standing up for consumers. Of course in a few years when Pai's back at a telecom company or comfortably ensconced at one of their think tanks, this will all be forgotten, but if the rules get overturned in court by Pai's friends at Verizon, consumers and small businesses will be the ones left holding the detritus from Pai's noble, totally transparent time at the Commission.

Filed Under: ajit pai, net neutrality, transparency
Companies: fcc, netflix, verizon

Yet Another ISP Exec Admits Broadband Industry Lied About Net Neutrality Hurting Network Investment

from the network-investment-bogeyman dept

Time and time again over the last ten years of net neutrality debates we've been told that net neutrality rules are an absolute death knell for broadband network investment. We heard it again, repeatedly, ahead of the FCC's February vote to approve the country's first meaningful net neutrality rules. With factory precision, broadband ISPs (and their assortment of paid flacks, lobbyists, lawyers, fauxcademics and other mouthpieces) have breathlessly declared that net neutrality rules would absolutely destroy sector network upgrades, leaving us all crying over our congested, broken broadband connections should rules be passed.

Funny, then, that as the net neutrality rules take effect this week, all evidence continues to point to that claim being absolute and total bullshit.

While their lobbyists and lawyers were busy trying to pretend that net neutrality was the equivalent of investment napalm, executives from Frontier, Cablevision, Sprint, Sonic and even neutrality public enemy number one, Verizon, have been quietly acknowledging the rules won't do anything of the sort. As the rules approach there's no evidence of a slowdown at all; in fact fear of the rules actually has transit and last mile ISPs cooperating more than ever, and there's no indications that the rules have remotely hurt gigabit deployments by the likes of rule opponents like Comcast.

As Charter looks to acquire Time Warner Cable and Bright House Networks in the industry's latest mega deal, company CEO Tom Rutledge last week joined the chorus of broadband execs admitting on the record they've been participating in a giant, repetitive bluff:

"New U.S. net neutrality regulations have not affected how Charter Communications Inc invests in building its telecoms networks, Chief Executive Tom Rutledge told Federal Communications Commission Chairman Tom Wheeler this week...Rutledge, however, told Wheeler that "the commission’s decision to reclassify broadband Internet access under Title II has not altered Charter’s approach of investing significantly in its network to deliver cutting edge services," according to the disclosure of the June 2 meeting."

Yes, Charter's looking to have a deal approved, but you can obviously see the pattern here. As we've noted all along, there's one reason and one reason alone that broadband ISPs oppose net neutrality rules: it will cost them billions of dollars by limiting the "creative" ways in which they can abuse the lack of last-mile broadband competition. Of course they can't just come out and admit that, so they need to lean on disingenuous arguments like the network investment bogeyman, and cling to them repeatedly even in the face of obvious contradiction by the industry itself.

Filed Under: broadband, fcc, investment, net neutrality
Companies: charter communications

AT&T Might Agree To Adhere To Neutrality Rules To Seal Its $49 Billion DirecTV Purchase, But Probably Not

from the believe-it-when-you-see-it dept

There's not a company around that hates the FCC's net neutrality rules more than AT&T, as its two lawsuits against them attest. There's a pretty obvious reason: AT&T's been at the bleeding edge of obnoxious, neutrality-trampling network pricing models for a decade, and obviously doesn't want the government interfering in these ambitions. But at the same time, the telco wants regulators to sign off on its $49 billion acquisition of DirecTV (including the exclusive out of market broadcast rights of NFL Sunday Ticket). As such, the Washington Post claims AT&T is telling regulators it will agree to net neutrality to get the deal approved:

"Among the deal's so-called conditions is expected to be something fairly simple. AT&T is prepared to accept aspects of the net neutrality rules adopted by the Federal Communications Commission earlier this year, according to people familiar with the negotiations, who declined to be named because the deliberations are private."

Can you spot the one word in that paragraph that should cause reservations as to AT&T's sincerity? ISPs have long stated they're fine with some "aspects" of the FCC's net neutrality plan, most notably the no blocking or service throttling provisions -- since they've never really had an interest in that. There's no money in it, and it's a PR minefield. They're focused on notably more clever and less obvious abuses of net neutrality, including usage caps, interconnection, and zero-rated apps, where users and companies can be nickel-and-dimed under the pretense of ordinary business behavior.

And indeed, as the Post moves on to talk about interconnection issues, you'll note AT&T's enthusiasm for cooperation wanes notably:

"Critics of the DirecTV acquisition have asked that, as part of the deal, the FCC require AT&T to route incoming content to consumers without levying a fee on the companies sending the traffic. In reply, AT&T has said that its recent deals with content delivery firms such as Level 3 show that the current system of privately negotiated contracts is working properly."

Of course, the only reason AT&T struck a deal with Level 3 is because it was worried about running afoul of the FCC's net neutrality rules, which actually suggests it's the FCC's neutrality rules (in fact the mere threat of them) that's working properly. AT&T doesn't want the FCC policing caps either; we recently noted it's also trying to argue that any merger conditions that prevent it from abusing usage caps will somehow hurt fixed-line broadband competition, despite the fact AT&T's only using usage caps in markets with less competition in the first place.

So while the Post headline proudly proclaims claims that AT&T's eager to adhere to net neutrality rules to get the deal done, the reality is there's absolutely no indication the telco intends to adhere to any of the parts of the net neutrality rules that actually matter. Most reports suggest regulators will be signing off on the deal all the same, potentially seeing a $49 billion acquisition of a satellite company in the age of cord cutting as telecom seppuku anyway. Still, it's kind of amazing how the outrage over the Comcast deal helped AT&T's deal fly under the radar, despite the fact that the elimination of a direct pay TV competitor likely won't do the pay TV market or consumers any favors.

Filed Under: deals, mergers, net neutrality
Companies: at&t, directv

AT&T: Broadband Usage Caps Are Awesome, And Preventing Us From Abusing Them Is A Horrible Injustice

from the absolutely-nothing-we-say-is-true dept

While AT&T is now a part of two lawsuits to try and overturn the FCC's new net neutrality rules, there's probably no company singularly more responsible for the rules being necessary in the first place. It was AT&T that really got the neutrality debate rolling in the States just about a decade ago, when then CEO Ed Whitacre proudly proclaimed he was going to start charging companies like Google a "troll toll" just for touching his network.

AT&T's been on the bleeding edge of exploring creative new ways to violate net neutrality for an extra buck ever since, whether that's blocking video services to drive users to pricier plans, using throttling to drive users to costlier plans, using interconnection to sock content companies with extra costs, or using zero rating to generate new revenue at the cost of a steeply tilted playing field.

Telco CEO Randal Stephenson has been making the media rounds lately proudly proclaiming that AT&T will surely be victorious in court, and the the FCC's net neutrality rules will be vacated. But AT&T lawyers are working hard to prevent regulators from including conditions on its $49 billion acquisition of DirecTV related to neutrality as well. Despite countless instances where AT&T has used usage caps to unfair advantage, AT&T's telling regulators there's no need for neutrality conditions on the merger (with a specific eye on usage caps and zero rating some services) because history shows AT&T is a saint on that front:

"The record does not support Opponents’ request that AT&T be barred from exempting any online video service from any usage-based tracking, metering, or billing in its broadband services," AT&T wrote. "Opponents offer no reason for the Commission to reverse these very recent conclusions and issue a blanket, abstract prohibition that would apply only to AT&T. Doing so would deprive AT&T customers of service offerings tailored to fit their usage and their budget. It would also distort competition by hindering AT&T’s efforts to close the gap and compete with cable’s higher-speed broadband products."

In other words, the company is claiming that merger conditions preventing it from using usage caps uncompetitively -- something it usually only does in uncompetitive markets -- will hurt competition. AT&T logic! It's also trying to argue that ten years of AT&T's clear intent to do harm on this front is a mass hallucination. AT&T already imposes usage caps on its broadband customers (150 GB for DSL users, 250 GB for U-Verse fiber to the node customers) thanks to this lack of competition. Yet hysterically AT&T insists there's no way it could possibly impose aggressive caps because customers would leave AT&T:

"AT&T wrote that its broadband data limits are high enough to "accommodate the great majority of customers." Broadband providers with caps "that significantly impinge on the ability of customers to enjoy OVD [online video distribution] products will not be able to attract new customers or even to retain existing ones," AT&T wrote."

Here's the truly entertaining bit though: as we've noted before, AT&T has no interest in retaining most of these capped DSL users anyway. It's willfully trying to drive them away with rate hikes so it can disconnect them and focus on even more expensive and heavily capped wireless LTE service. It's also worth noting that AT&T's not currently enforcing those 250 GB caps on U-Verse users, because the markets it has upgraded with better service usually see improved competition. In short, AT&T caps markets that lack competition, and doesn't in markets where there's at least a little. Yet AT&T's telling the FCC that restricting their ability to impose what are entirely arbitrary caps that have nothing to do with network congestion -- would hurt its ability to compete.

Of course as we've long noted, net neutrality is a symptom of a lack of competition, and net neutrality rules are only necessary because companies like AT&T are endlessly exploring new ways to abuse this lack of competition. However, while the FCC's neutrality rules do allow users to complain about usage caps and zero rating, they're not explicitly included in the rules, and so far the FCC's given every indication that they see caps as just "creative pricing." While there have been hints the FCC might start policing caps (and unreliable usage meters) should they start getting notably more ugly, it's pretty far from certain as the agency appears to want to steer clear of broadband price controls.

Still, AT&T's working tirelessly on multiple fronts to ensure nobody infringes on its god-given right to use usage caps to abuse uncompetitive markets suffocated by regulatory capture. That was an honor bestowed upon the company after a generation of blood, sweat, tears and millions in campaign contributions, and it will be damned if it's going to have said rights trampled by those new startup and consumer-friendly goody two shoes over at the FCC.

Filed Under: abuse, broadband, fcc, net neutrality, usage caps
Companies: at&t

Google Backs Off Zero Rating In India After Facebook Takes A Global Public Relations Beating

from the laying-low dept

Google appears to be backing away from its plans to support zero rated apps (deals that allow some apps to bypass broadband ISP usage caps) in India after Facebook found itself at the heart of a global public relations kerfuffle for the practice. As we've been noting, Facebook's Internet.org initiative has been under heavy fire in India as the nation debates net neutrality rules. The program, which provides free access to some Internet content curated by Facebook, has been criticized for being a security, privacy (since it doesn't allow encrypted content and creates a one-stop shopping location for aggressive governments) and net neutrality threat.

Internet.org Project content partners have been dropping out of the project in droves, noting they're not comfortable with an AOL-esque version of the Internet where Facebook gets to decide who is, and who isn't, included. Facebook and Mark Zuckerberg haven't been making things any better for themselves with a series of tone-deaf responses to criticism in which they've tried to argue that a crippled version of the Internet is better than no Internet at all. Oppose Facebook's vision for the developing world, Zuckerberg has repeatedly argued, and you're the one hurting the poor.

Of course, net neutrality supporters and companies like Mozilla have argued that if Facebook wants to really help the poor, it would provide subsidized access to the real Internet and get out of the way. Facebook isn't willing to do this, and continues to operate under the pretense that it's engaged in an entirely selfless, altruistic endeavor that they've insisted has absolutely nothing to do with making money. The assumption is that nobody's quite smart enough to realize Facebook has its eye on being the gatekeeping cornerstone of the developing world's future Internet ad empire.

Google has a similar, though less publicized zero rated initiative called Google Free Zone that they've deployed in a handful of countries like Kenya, Sri Lanka, Thailand and The Philippines. Reports had suggested that Google was starting to push this effort to India, but after watching Facebook take a vicious beating, the company has apparently decided to put its plans for India on hold. At least according to anonymous insiders, since Google itself has been unwilling to formally comment on the matter to the press:

"The Internet giant, which was in early discussions with telecom operators and applications developers to launch a zero rating platform, has now decided to take a wait and watch approach, they said. "Google has shelved the idea of any kind of zero-rating tieup because they are very scared of the backlash which came up against (Facebook's) Internet.org in India," said one of them...Asked about the zero rating plans, a Google spokesperson said, "We don't comment on rumours or speculation." Zero rating — or, the practice of letting users access select applications free of data charges by striking deals with telecom operators — has been hugely debated in India."

While Google is often trumpeted as a net neutrality champion in the media, the reality is the company has been a no-show for years in the net neutrality debate in the States and elsewhere, vacillating between hypocrisy and total silence. This would be a prime opportunity for Google to take the global lead on neutrality issues and speak out against zero rating. Instead, Google's apparently engaging in what's becoming Google's modus operandi on the neutrality front: sitting on the sidelines with a rather dumb look on its face, just hoping none of the net neutrality pitchforks get pointed in its direction.

Filed Under: controversy, india, net neutrality, zero rating
Companies: facebook, google, internet.org

Net Neutrality On The Ropes In Europe As Some EU Members Wimp Out On Real Rules

from the sorry,-we-work-for-the-phone-company dept

While net neutrality may have recently found its way into the Merriam Webster dictionary, it still hasn't managed to find its way to Europe. Most assumed that the EU would have passed net neutrality protections long before the States, so the FCC beating the EU to the punch surprised more than a few people. That was especially true if you'd been watching some of rhetoric coming out of the EU over the last few years. Like that of former EU Commissioner Neelie Kroes, for example, who urged startups to flock to Europe after Verizon defeated the FCC's original, wimpy neutrality rules last year:

Watching US #netneutrality news. Maybe I shd invite newly disadvantaged US startups to EU, so they have a fair chance http://t.co/tB2A9EXgKd

— Neelie Kroes (@NeelieKroesEU) January 15, 2014

That was then, this is now. The U.S. now has some tough net neutrality rules thanks to a new consumer friendly FCC Boss. Meanwhile, Kroes' new job is trying to lure startups to The Netherlands, ironically as the net neutrality rules she championed (sometimes inconsistently) remain bogged down in committee at the EU she left behind.

The EU's net neutrality bill began in 2013 when Kroes introduced a proposal for a Telecoms Single Market (TSM), or a single piece of regulation covering all telecom issues across the EU. That proposal was slowly but surely boiled down to just two major proposals: one aimed at eliminating wireless roaming between EU nations to reduce consumer rates, and one focused on enshrining net neutrality into law. Like initial efforts in the States, however, this proposal was packed with all manner of loopholes pushed for by major telecom carriers, worried their ability to abuse limited last-mile competition would come to an end.

While there has been at least some success at getting net neutrality defined, loopholes have remained, and (like in the States) there's been a lot of debate over whether zero rating should be included in the final neutrality rules. Many member state governments also worry the net neutrality rules will hinder their ham-fisted ability to try and purge the Internet of its naughty bits using over zealous filters.

While the EU Commission, the EU Parliament, and the Council of the EU have been meeting nearly every week for a "trialogue" to try and hammer the rule wording out, there's now indications that there's a very strong push afoot to kill net neutrality rules entirely. A leaked version of the latest "non paper" outlining the Telecoms Single Market regulations (written by the presidency of the Council of the EU) appears to have watered down roaming restrictions, and stripped all reference to net neutrality completely:

"As its name suggests, this "non-document" is just a proposal from the presidency for a meeting of the EU Council, made up of representatives of EU governments, which was held yesterday. However, the fact that every mention of net neutrality was excised from the existing text is a clear indication that there is no interest in protecting it among this group. According to La Quadrature du Net, the presidency has adopted this anti-net neutrality position "as a bargaining chip to get a compromise on roaming, perceived as more consensual, allegedly easier to understand and more marketable to voters."

In other words, instead of an all-encompassing, consumer and startup friendly telecom regulation package promised by Kroes years ago, the EU's looking at some relatively wimpy reform that may leave net neutrality left on the cutting room floor. European supporters of net neutrality are obviously annoyed, and are pushing for action ahead of the June 12th Council meeting of Telecommunications ministers. Of course if you've followed the net neutrality fight in the States for the last decade, there were countless times where the fight appeared utterly hopeless. So while Kroels ridiculed the States for being neutrality unfriendly a year and a half ago, the U.S. battle is now an example of how seemingly intractable, wealthy and powerful telecom interests really can be defeated.

Filed Under: eu, europe, net neutrality

Charter Acquires Time Warner Cable, Promises It Will Suck Less Than Blocked Comcast Merger

from the Godzilla-eats-Mothra dept

Driven by the relentless M&A lust of company chair and cable industry mainstay John Malone, Charter Communications has announced that the company will be spending $55 billion to acquire Time Warner Cable. Malone and Charter had been pursuing Time Warner Cable for two years, but found their ambitions blocked when Comcast made a better offer. With Comcast's merger attempt blocked by federal regulators, Charter got a second chance. The deal was accompanied with the usual assortment of prepared CEO statements promising that this merger will surely be the one that magically makes the cable industry suck less:

"The teams at Charter, Time Warner Cable and Bright House Networks are filled with the innovators of our industry...That spirit of innovation will live on, and it will create real benefits and great long-term value for the customers, shareholders and employees of all three companies," said Tom Rutledge, President and CEO of Charter Communications. "With our larger reach, we will be able to accelerate the deployment of faster Internet speeds, state-of-the-art video experiences, and fully–featured voice products, at highly competitive prices."

"With today's announcement, we have delivered on our commitment to maximizing shareholder value," said Robert D. Marcus, Chairman and CEO of Time Warner Cable. "This agreement recognizes the unique value of Time Warner Cable, and brings together three great companies that share a common philosophy of strong operations, great products, robust network investment and putting customers first."

Yes, putting "customers first" is surely why Time Warner Cable has the worst customer satisfaction rankings not only in telecom, but in any U.S. industry. In fact, it's exactly the cable industry's relentless love for mergers and acquisitions that has resulted in cable operators growing so quickly, they're unable to scale their customer service systems accordingly. Meanwhile, the lack of competition in many markets means there's little incentive to actually improve, and any cost savings from greater size and leverage certainly won't be passed on to consumers. Combine that with the job losses as companies eliminate redundancies, and you've generally got deals that benefit nobody outside of Wall Street.

While this deal probably won't improve much of anything for cable customers, it's generally agreed that it's not as horrendously awful as the Comcast merger -- simply because the combined company won't have quite the same programming and advertising clout as mega-Comcast would have had. Comcast itself sent a short, two-sentence statement to the media saying the deal makes "all the sense in the world" (you know it must be good if Comcast signed off on it). In fact, reports suggest FCC boss Tom Wheeler personally called the heads of Charter and Time Warner Cable to assure them their deal would likely be approved.

That said, it's still a massive deal. In addition to acquiring Time Warner Cable for $55 billion, the combined company will also be acquiring the nation's sixth-largest cable operator: Bright House Networks, for an additional $10.3 billion. The new, combined company will serve 23.9 million customers in 41 states, and become the second largest cable operator in the nation behind Comcast. Surely it's this merger that's going to prod the cable industry to offer the kind of "competitive prices," "state-of-the-art video experiences" and excellent customer service we've all been waiting for, right?

Filed Under: broadband, customer service, mergers, net neutrality
Companies: charter, comcast, time warner cable