AT&T (And Friends) Still Hard At Work Making Up Net Neutrality Job Loss Figures

from the scary-looking-pie-charts dept

As the FCC gets closer to crafting network neutrality rules (assuming they even have the authority to do so), AT&T lobbyists have worked overtime to push the idea that creating such rules would automatically result in job losses. To help nudge this scary meme into the press, they hired their old friend Bret Swanson, formerly employed at the Discovery Institute -- a think tank that created both the "Exaflood" (debunked here countless times) and "Intelligent Design". Back in February Swanson, like most AT&T hired policy wonks, used completely bogus "science" to insist that network neutrality rules would result in 1.5 million job losses. He came to that number simply by adding up all of the people employed by companies that submitted comments to the FCC opposing network neutrality (seriously).

Now AT&T is back at work again, this time pushing the job loss claims through an AT&T-backed group called Mobile Future. Mobile Future has sponsored a new study (pdf) claiming that network neutrality laws will result in 340,000 lost jobs over the next 10 years -- and 1.5 million lost jobs across all sectors by 2020. Using the impact the 1996 Telecom Act and local loop unbundling requirements had on the broadband sector as a broad foundation, the study tries to somehow project that FCC neutrality rules would slow broadband revenues by one-sixth. But as Bob Cringley notes, linking the complicated fight over line sharing (however you felt about it) to network neutrality isn't a coherent foundation:

"...it's hard to see how government regulation was the problem when the Bells largely refused to comply with it. You'd think being forced to share aging copper lines with startups would have encouraged the Bells to invest in better, higher-speed networks, not the opposite. Extrapolating from that regulatory situation to Net neutrality is like taking laws regulating manure production by draft horses to make projections about the future of the space shuttle."

Just as with bogus piracy statistics, there's simply too many moving parts to make these kinds of projections one way or the other (and the study doesn't try too hard to support the idea that neutrality could bolster content industry employment). You'd be hard pressed to get a room full of people to agree on what network neutrality even is after years of muddled debate -- much less find a way to tie concrete job loss figures to the nebulous concept. Meanwhile, the AT&T-funded study unsurprisingly skips over the fact that companies like AT&T and Verizon are already laying off a significant number of employees as they lose landline customers (or in Verizon's case, intentionally hang up on rural markets and slow FiOS deployment).

There's also the small fact that while the FCC has issued proposals for new network neutrality rules, they haven't crafted any concrete rules yet or defined key terms -- making job loss predictions premature at best and completely absurd at worst. Even if the FCC were to craft rules defining "fair" network management practices, it seems likely that the final rules (once they run the lobbyist gauntlet) would be just as timid as the agency's national broadband plan, which avoided tackling competition or truly rattling the status quo for fear of upsetting powerful carriers. For all of the annoying and ridiculous hysteria surrounding network neutrality, the most the rules seem likely to cause is a few sleepless nights for carrier lobbyists -- who have to stay up late designing scary-looking pie charts.

Filed Under: net neutrality, studies
Companies: at&t

Net Neutrality Battle Quickly Turns Into Political Food Fight

from the hyperbole-nation dept

Well, well. For a legal ruling that really has no direct impact on the actual case it's about, the decision that the FCC can't punish Comcast for breaking net neutrality sure got people worked up. Suddenly there's talk of the FCC reaching for the so-called "nuclear option." What's that? It would involve reclassifying broadband as a common carrier service. Of course, this would be a reversal for the FCC, which (under the previous administration) pushed hard to reclassify both DSL and cable broadband as information services (not regulated) instead of telco services (regulated).

The whole thing is a bit of a mess -- and, once again, distracts from the larger issues (i.e., the lack of real competition in the space). Now, there's a reasonable argument to be made that both services do, in fact, have common carrier status. The argument is stronger with DSL, which is built on telco infrastructure that, at one point, was built and run through a gov't-granted monopoly. But, with both, you are dealing with public rights of way, which at least give some legitimacy to the idea that they should fall under a category that involves oversight from the FCC. But, having already flipped the switch one way, going back the other way is not going to be as easy. Unlike five years ago, when this issue was mostly ignored by politicians, this time around, everyone's gearing up. And, unfortunately, rather than a debate on the issues (and, oh boy, are there issues), it's shaping up along partisan lines, which isn't good for anyone.

You've got Rep. Joe Barton warning the FCC not to reclassify, while Senator John Kerry is suggesting the FCC should reclassify. Kerry's statement is pretty damn amusing:

"I am not advocating that the FCC reclassify broadband services as a result of this decision, but I absolutely believe they maintain that legal authority and it would be entirely consistent with the history of communications law in our country if they did."

In other words, "I'm not saying reclassifying, but you should reclassify." Meanwhile, across the aisle, Senator Orrin Hatch is already signaling that any attempt by Congress to give the FCC the necessary mandate will be fought hard by the Republicans. Though, his reasoning is specious. While I agree that the FCC's attempt to regulate the internet is outside its mandate, the following statement is pure drivel:

"This is also good news for the future prosperity of the Internet, because there is now an actual incentive to expand capacity, which benefits consumers and our economy alike."

There is nothing about the ruling that gives anyone incentive to expand capacity. In fact, it does the exact opposite. It gives broadband providers the incentive to limit uses instead of expanding capacity. If there were real competition, however, then there would be incentives to expand capacity. Too bad no one seems focused on that at all. Instead, it looks like we'll get another political food fight that won't actually do anything about making sure that we have the broadband we need.

Filed Under: broadband, fcc, net neutrality, nuclear option

Court Tells FCC It Has No Mandate To Enforce Net Neutrality (And That's A Good Thing)

from the got-it-right dept

This should come as no surprise, given that the court indicated this a few months back, but it's now official that the FCC has no power to mandate net neutrality or to punish Comcast (even with a gentle wrist slap) for its traffic shaping practices. Lots of people seem upset by this, but they should not be. This is the right decision. The FCC was clearly going beyond its mandate, as it has no mandate to regulate the internet in this manner. In fact, what amazed us throughout this whole discussion was that it was the same groups that insisted the FCC had no mandate over the broadcast flag, that suddenly insisted it did have a mandate over net neutrality. You can't have it both ways (nor should you want to). Even if you believe net neutrality is important, allowing the FCC to overstep its defined boundaries is not the best way to deal with it. So for those of you upset by this ruling, look at it a little more closely, and be happy that the FCC has been held back from expanding its own mandate. Otherwise, the next time the FCC tried to do something like the broadcast flag or suddenly decided it could enforce "three strikes," you'd have little argument.

That doesn't mean that Comcast should get off free for its actions. It should still be punished -- but by the FTC, rather than the FCC -- for misleading its customers about what type of service they were getting, and what the limitations were on those services. As for the FCC, if it really wants a more neutral net, it should focus on making sure that there's real competition in the market, rather than just paying lip service to the idea in its broadband plan.

Filed Under: cable, fcc, mandates, net neutrality
Companies: comcast, fcc

Ridiculous Arguments: Net Neutrality Would Mean No iPhones

from the oh-come-on dept

I've said it before, and I'll say it again: I'm very much against enforcing net neutrality through legislation (too many unintended consequences) but I'm stunned at the ridiculous and totally bogus reasons given by those fighting against those regulations in support of their claims. The latest on this front is Stephen Titch, a policy analyst at the Reason Foundation (a group whose work I usually think is quite good), coming out with a policy brief making the ludicrous argument that network neutrality would mean no more iPhones.

Now that's a bold claim, and such a bold claim should require at least some evidence to back it up. But there is none. This is as far as it seems to get:

The non-discrimination principle that Genachowski seeks to mandate would prohibit service providers such as AT&T, Verizon Wireless, T-Mobile and Sprint from using their network resources to prioritize or partition data as it crosses their networks so as to improve the performance of specific applications, such as a movie or massive multiplayer game. Yet quality wireless service is predicated on such steps. The iPhone, for example, would not have been possible if AT&T and Apple did not work together to ensure AT&T's wireless network could handle the increase in data traffic the iPhone would create.

There's a neat little trick in there that hides the blatant falsehood of the premise. What's described in the first sentence as what would be banned is not the same thing that's described in the second sentence as what AT&T and Apple did. Furthermore, the first sentence is not particularly accurate, and appears to be a stretch and misread of what the proposals actually have said -- though, again, the final rules could change. The issue isn't that network providers couldn't prioritize data, but that they couldn't discriminate in terms of who could make use of that prioritization in an anti-competitive manner (i.e., the provider could determine that a VoIP call needs prioritization, so long as all VoIP providers get the same prioritization).

But, back to the key point: this has nothing, whatsoever, to do with the network improvements that AT&T agreed to make in order to get the iPhone (which arguably, haven't worked all that well). AT&T's efforts were focused on upgrades to its network, which had nothing at all to do with discriminating against certain applications or services directly. Of course, since then, AT&T/Apple has chosen to discriminate against certain applications in its app store, but not at the network level, which is the main issue here.

I'm as worried as the next guy about the unintended consequences of network neutrality legislation, but making totally ridiculous and unsubstantiated claims that net neutrality would mean "no more iPhone" makes those arguing against network neutrality rules look petty and willing to flat-out lie to support their position.

Filed Under: iphones, net neutrality, regulations

What Would Broadband Competition Look Like?

from the what-if-Net-Neutrality-were-a-foreign-concept dept

The Reverse MVNO 

There has been a big trend towards MVNO carriers in the mobile space - that is, carriers who are Mobile Virtual Network Operators, and don't actually operate their own cellular towers, spectrum, and network. These MVNOs outsource that part of the business to the big cellular operators as wholesale buyers, and focus on the marketing, the handsets, the retail, the billing, and the services. But in telecom these days, it's highly desirable to offer bundles of services, mixing fixed, mobile, Internet and TV packages to drive up total revenue and customer loyalty. Thus, it's interesting to note the start of a new trend, the FVNO, where the F is for Fixed. In the UK, O2 mobile has decided to expand their business into the fixed telecom sector, and is doing so by reselling the infrastructure of BT (British Telecom) under their own brand.

On Broadband Competition 

Aside from the quirk of building MVNOs backwards, the shift is notable for readers here in the US, because it is illustrative of the kind of competition that can result when incumbent players are required to wholesale their fixed assets. O2, now owned by Spain's Telefonica, was a wireless-only company, but already offers fixed broadband to enterprise customers using BT's all-IP "21st Century Network". This move is indicative of a market where new entrants are free to launch, consumers have a wider range of choices, DSL speeds are faster, and yes, prices end up lower. So how exactly is that telco-cable duopoly working out for us in the US?

American readers not yet upset with the state of broadband in the US should feel free to click any of the links in the preceding paragraph to see the effect that competition has on a market. It makes all the players better, and offers huge benefits to consumers. The USA had exactly the same kind of competition codified into the Telecommunication Act of 1996. The act required incumbents to share their last mile through a regulation called UNE-P. UNE-P had some early effects: You may remember DSL upstarts that sprang onto the market like Speakeasy or Covad. But our UNE-P lacked teeth, and the incumbents were able to charge much higher wholesale prices than in Europe, where competition picked up steam. So by 2005, instead of re-enforcing UNE-P in the Telecom Reform Bill, your Congress killed it completely. In this article, Masnick talks about how it mattered little, because the wholesale price was sabotaging the effort anyway.

On Net Neutrality 

So now here we are in the US in 2010, still debating Network Neutrality. Does it look like "Net Neutrality" regulation is necessary in the UK? Heck no. Competition has completely obviated the need for Brits to regulate. Regulation is only necessary when monopoly powers are in effect, and the free market can't push Supply to offer what is in Demand. And what of the doomsday outcomes incumbents predict if they are forced to share assets? Did BT fall apart? Go bankrupt? Stop investing in any new infrastructure (as lobbyists say is the obvious outcome.) No! They became global leaders in rebuilding, investing, modernizing infrastructure, and launched the all-IP 21Century Network! BT became very good at wholesale as well as retail. Competition made every UK stakeholder better. So why don't we Americans forget Net Neutrality: Let's focus on bringing competition back to the US market. Our duopoly experiment has failed (surprise, surprise), the European examples are crystal clear. This debate is no longer theoretical.

Filed Under: broadband, competition, net neutrality

Spanish ISP Telefonica Claims Google Gets Free Bandwidth; Says Google Should Pay Up

from the can-we-explain-the-internet-to-you? dept

And I thought Ed Whitacre had moved on to run United States General Motors. You may recall that, half a decade ago, when Whitacre was running SBC (prior to its takeover of AT&T), he made sure that a lot more people heard the term "net neutrality," after he claimed that SBC should charge Google and other big online companies. His explanation was that Google and Yahoo and others were "reaching" his customer's for free. This is, of course, wrong. Very, very wrong. It's actually an attempt to double charge, based on the false belief that when you pay for your internet connect, you are only paying for the connection into the cloud, but then not out to any end point. Google is not getting anything for free. It pays (and pays a boatload) for its bandwidth. What Whitacre was trying to do back then was double dip and get everyone to pay twice for their bandwidth. The reasoning was so bizarre that you would have hoped it had died off by now.

No such luck.

Alan Gerow points us to the news that Spanish telco Telefonica's President Cesar Alierta, appears to be channeling Whitacre, by claiming that big sites like Google and Yahoo get too much bandwidth "for free" and he wants to start charging them for it. Just like Whitacre, he's really looking to double dip. Google pays for its bandwidth. What Alierta really means is he wants Google to pay again just to reach his customers over the bandwidth the customers have already paid for. The claim that Google, Yahoo or any of those companies are getting their bandwidth "for free" is ludicrous. But since Alierta believes that Google is getting bandwidth for free, perhaps he'll agree to pay Google's bandwidth bill.

Filed Under: double dipping, isps, net neutrality, spain
Companies: google, telefonica, yahoo

Once Again, Be Careful What You Wish For With Net Neutrality Once The Lobbyists Get Done With It

from the might-not-be-what-you-wanted dept

We've pointed this out in the past, but those who support regulations in favor of net neutrality should be careful. Once the lobbyists get done with them, any rules won't resemble what you think they should. The EFF is already up in arms over the fact that the proposed net neutrality rules would allow blocking BitTorrent, even though it was Comcast's blocking of BitTorrent that helped kick off the latest round of attention in net neutrality. That does seem a bit ironic... but, again, it shows that, just because you call something "net neutrality," it doesn't mean it is about a neutral network. With the entertainment industry redefining net neutrality to their own liking (i.e., so that file sharing can still be blocked), you can bet that other lobbyists (including the telcos) will work hard to redefine it to their liking as well.

Filed Under: copyright, lobbyists, net neutrality

Entertainment Industry Explains How True Net Neutrality Is Just Another Word For Theft

from the say-what-now? dept

With comments due last week on the FCC's proposed new net neutrality rules, we've already covered some of the filings, while noting the problems of carving out a special exemption for copyright. But, of course, that special exemption for copyright means everything to an entertainment industry that has no interest in adapting its business models. Both the RIAA and MPAA filed their own comments, which were pretty similar, and equally misleading. The RIAA's filing (pdf) repeatedly referred to copyright infringement as "theft" (you would think lawyers would know the difference) and insisted not just that there should be a copyright exemption, but that the FCC itself should require ISPs to act as copyright cops. The MPAA's filing (pdf) is almost a carbon copy of the RIAA's. There is very little difference between the two.

But if you want to see an even more extreme argument, check out the filing from the Songwriters Guild of America (SGA) (pdf), who we'd already pointed out was running around aimlessly screaming that network neutrality would mean more unauthorized file sharing (they call it "piracy"). In the SGA's filing, they claim that net neutrality wouldn't solve any actual problem, and the real problem is the inability of songwriters to get paid in the way they used to, back in the idyllic days before the internet existed. So they'd much rather that the FCC break the internet in order to bring back those days. That's a bit of a paraphrase, but it's really not that far off.

The language used by the SGA goes even beyond that of the others, referring to things like "rampant looting" and insisting that with net neutrality we would face the end of songwriting. Seriously. While the SGA claims that it wants to promote new innovation and technology, it appears to only mean technology that can be used to block file sharing. It's very excited about those technologies, and not at all concerned about all the technologies (even the ones used by lots of folks every day) that would be broken without a neutral internet.

Not that any of these filings are all that surprising, but it does show how low the entertainment industry has decided to stoop in trying to get others to bring back old business models, rather than adapt to the changing times.

Filed Under: net neutrality, rules, theft
Companies: mpaa, riaa, sga

Google And Verizon Find A Tiny Bit Of Common Ground On Net Neutrality... But Still Aren't That Close

from the in-the-spirit-of-cooperation dept

It's no secret that a lot of the network neutrality debate has been positioned as pitting online companies -- such as Google -- against infrastructure companies -- such as the telcos. That's a bit of an unfair characterization, because there are lots of issues at play when it comes to network neutrality, but it's getting a lot of attention that Google and Verizon filed a joint statement to the FCC about net neutrality. Of course, despite the PR value of this, I wouldn't read too much into it. The letter itself (pdf) lays out their "common ground" in incredibly broad and vague language that is borderline meaningless at times. And, of course, at the same time both companies filed their own separate statements in which they disagree heavily (Verizon even calls out Google by name). By way of comparison:

• Joint Submission by Google and Verizon: 9 pages
• Google's submission: 98 pages
• Verizon's submission: 139 pages

There's obviously still a lot that they don't agree on at all. Still, it is nice that they at least tried to come together a bit to find some common ground. That is pretty rare in a political culture often driven by extremes on each end playing tug o' war and hoping that the end result is somewhere in the middle. It would certainly be nice if this sort of thing became a little more common -- with more folks trying to find what the points of agreement are, separate from the points of disagreement.

Filed Under: common ground, fcc, filings, net neutrality
Companies: fcc, google, verizon

This Is Why We Worry About Net Neutrality Regs: Loopholes For RIAA/MPAA

from the be-careful-what-you-wish-for dept

We've mentioned a bunch of times that while we support the concept of net neutrality (and think any ISP that goes away from it is making a big, big mistake) we're quite worried about the unintended consequences of having it put into law. As a perfect example of why we should be worried, the EFF is putting together a petition to protest the "copyright loophole" that's already in the proposed FCC rules:

Buried in the FCC's rules is a deeply problematic loophole. Open Internet principles, the FCC writes, "do not... apply to activities such as the unlawful distribution of copyrighted works."

For years, the entertainment industry has used that innocent-sounding phrase -- "unlawful distribution of copyrighted works" -- to pressure Internet service providers around the world to act as copyright cops -- to surveil the Internet for supposed copyright violations, and then censor or punish the accused users.

From the beginning, a central goal of the Net Neutrality movement has been to prevent corporations from interfering with the Internet in this way -- so why does the FCC's version of Net Neutrality specifically allow them to do so?

This is what we worry about. It's great that the EFF is catching this particular loophole, but as more lobbyists get their hands on net neutrality regulations, they're going to slip in more and more loopholes like this that will turn what may have great intentions into something else entirely.

Filed Under: copyright, lobbyists, loopholes, net neutrality, petition, regulations
Companies: eff, riaa