Articles by Hance Haney 
Hance Haney is Director and Senior Fellow of the Technology & Democracy Project at the Discovery Institute. Haney spent ten years as an aide to former Senator Bob Packwood (R-OR), and advised him in his capacity as chairman of the Senate Communications Subcommittee. He subsequently held various positions with the United States Telecom Association and Qwest Communications. He earned a BA in history from Willamette University and a JD from Lewis and Clark Law School in Portland, Oregon.
Google makes some excellent points in the comments it filed with the Federal Communications Commission in a proceeding examining proposals for network neutrality regulation.
First, Google argues that packet prioritization (i.e., Quality of Service) is a “poor proxy for additional bandwidth.”
[T]he engineers at Internet2 conducted a detailed technical analysis of QoS
in broadband networks. Their conclusion is that QoS is a relatively poor proxy for additional
bandwidth:
In most bandwidth markets important to network-based research, it is cheaper to buy more capacity and to provide everybody with excellent service than it is to mess with QoS. In those few places where network upgrades are not practical, QoS deployment is usually even harder (due to the high cost of QoS-capable routers and clueful network engineers).
Continue reading →
It’s a shame that Frontline Wireless LLC‘s bold plan for a wireless broadband network providing nationwide interoperable public safety services in emergencies — that would be paid for by commercial users who can access the network on a wholesale, open-access basis at other times — includes a requirement that the successful bidder “must adopt open access policies not only on the E Block spectrum, but on any other licensed spectrum it holds.”
The rationale? According to Frontline:
The rationale for extending this requirement is clear: it prevents potential anti-competitive behavior. If the winner of the E Block spectrum holds other spectrum, it will be incentivized to offer consumers a single service device that will work on multiple bands. If the open access rules does not apply to all bands held by the E Block licensee, then the carrier could easily push consumers to other bands and tell them their devices are non-compliant. Consumers would not know (nor should they care) which band they are using, but a licensee acting strategically and in its best interests could readily defeat the purpose of open access requirements imposed on the E Block license.
But Frontline’s proposal already prevents such an outcome through a separate requirement that would prohibit the licensee from using the E Block network capacity for its own retail services or selling it to affiliated third parties. The necessity of an overlapping requirement doesn’t make a lot of sense to me, other than the fact that it has obvious value to Frontline as a restraint on competing bidders.
Continue reading →
Rep. Ed Markey (D-MA), chairman of the House subcommittee on telecommunications, wants the Federal Communications Commission to re-regulate “dedicated special access” services (the telephone services provided to businesses and institutions, as opposed to residential customers). He recently sent a letter to the five commissioners, which said:
My concern is that significant concentration in the special access market through mergers and bankruptcies, combined with the [FCC’s] deregulatory pricing regime, has resulted in higher prices and little competitive choice for special access connections. These are also the conclusions of a November 2006 Report by the General [sic] Accountability Office (“GAO”) ….
I respectfully request each of you to respond to me by close of business on June 11, 2007, as to whether you support or oppose completing any review of special access issues necessary to adopt an Order revising such rules by no later than September 15, 2007.
Markey’s facts are wrong and his prescription will harm rather than promote competition.
Continue reading →
The Senate Commerce Committee’s hearing Wednesday on the Internet tax moratorium demonstrates the necessity of making the ban on state and local taxation of Internet access services permanent. Another temporary extension simply guarantees opponents another chance to overturn it down the road, and creates the possibility they can win new concessions in the meantime.
The hearing showed than opponents are still determined to gut the moratorium. Harley Duncan, the Washington representative of state and local tax administrators, rehashed the old argument that the moratorium is unnecessary, because “the economic evidence is that state taxation of Internet access charges has little or nothing to do with the adoption of Internet services by consumers or the deployment of services by industry.” And he cites a new Government Accountability Office conclusion that taxing Internet access is “not a statistically significant factor influencing the adoption of broadband service at the 5 percent level. It was statistically significant at the 10 percent level.” Even assuming this conclusion is valid, it still doesn’t mean anything. Because once states and localities are allowed to impose taxes on Internet access, they won’t hold the line at 5 percent.
Continue reading →
By all means, let’s consider doing something about television violence. But why don’t we start with the obvious?
Digital set-top boxes will allow parents to buy specialty tiers of programming as well as make use of more powerful parental control technologies. Trouble is, not enough families have them. The Federal Communications Commission emphasized this fact yesterday when it issued a report concerning television violence. The report noted that a significant problem with parental controls is “it does not appear that cable operator-provided advanced parental controls are available on a sufficient number of cable-connected television sets to be considered an effective solution at this time.”
There’s a shortage of parental controls mainly because consumer electronics manufacturers have been concentrating their efforts on high-end devices that incorporate high-definition and recording features, forsaking the low-cost, limited capability devices that generate less profit. Congress unintentionally created this market failure when it ordered the FCC to eliminate proprietary or “integrated” set-top boxes provided by the cable companies to their customers via Section 629 of the Telecommunications Act of 1996, enacted to give a boost to consumer electronics manufacturers who wanted to produce cable set-top boxes and market them directly to consumers.
But wait.
Comcast, the nation’s largest cable operator, recently asked the Federal Communications Commission for a waiver of the ban so it can distribute low-cost, limited capability set-top boxes to subscribers who don’t want higher-end devices costing several hundred dollars (see this and
this.
Continue reading →
Fine-tuning patent law (as I have argued here and here) is a task the Supreme Court is best suited to handle, and the Leahy-Hatch / Berman-Smith Patent Reform Act of 2007, introduced yesterday in the Senate and House, thankfully is silent on some of the more contentious patent reform issues. According to Rep. Howard Berman (D-CA),
There are a number of issues which we have chosen not to include in the bill primarily because we hope they will be addressed without the need for legislation. For instance the Supreme Court recently resolved questions regarding injunctive relief. In that category we include amendments to Section 271(f) and the obviousness standard as both issues are currently before the Supreme Court. If either of those issues are not resolved, Congress may need to re-evaluate whether to include them in a patent bill.
Click here for Rep. Berman’s web page containing the text of the proposal and a section-by-section analysis. A very quick initial read indicates that a number of the ideas in the Congressional proposal sound okay in theory but could in practice lead to more uncertainty and new forms of abuse.
Continue reading →
The IRS likes to talk about how it’s primarily concerned with improving taxpayer services, particularly this time of year. But don’t be fooled. Earlier this year, the Bush Administration proposed to require “brokers” to report online sales of tangible personal property to the IRS.
This is really another giant surveillance program, like the trial balloon the administration has previously floated to require internet service providers to retain customer data to combat crimes committed against children (as I’ve discussed here and here). In both cases, the government is trying to harness the unique capacity of the Internet to identify and document conduct in ways that were never feasible nor possible before — in this case ordinary commercial transactions that just happen to be conducted online. According to press coverage, the proposal is specifically aimed at online auctions (see this and this).
Continue reading →
Japan has 7.2 million all-fiber broadband subscribers who pay $34 per month and incumbent providers NTT East and NTT West have only a 66% market share. According to Takashi Ebihara, a Senior Director in the Corporate Strategy Department at Japan’s NTT East Corp. and currently a Visiting Fellow at the Center for Strategic and International Studies here in Washington, Japan has the “fastest and least expensive” broadband in the world and non-incumbent CLECs have a “reasonable” market share. Ebihara was speaking at the Information Technology and Innovation Foundation, and his presentation can be found here. Ebihara said government strategy played a significant role. Local loop unbundling and line sharing led to fierce competition in DSL, which forced the incumbents to move to fiber-to-the premises.
Continue reading →
The patent system “has overall worked very well in encouraging innovation and, particularly in our case, in allowing us to grow to a significant company,” remarked Qualcomm co-founder Irwin Mark Jacobs at the Heritage Foundation last week. To many, the patent system works too well. Our present system awarded a patent for a garbage bag that looks like a pumpkin, for example. Someone else patented a method for swinging on a swing. Jacobs acknowledges patent quality is critical and wants Congress to allow the Patent & Trademark Office to retain all of its user fees, but warns that other reforms could have unintended consequences.
Besides ending the diversion of some $90 million in PTO fees to fund other government programs, the chairman of the House subcommittee responsible for intellectual property, Rep. Howard L. Berman (D-CA), also wants to “improve patent quality, deter abusive practices by unscrupulous patent holders, and provide meaningful, low-cost alternatives to litigation for challenging patent validity.”
Continue reading →
A Federal Communications Commission staffer reports that commissioners are considering a 30% cap on the number of households a single cable operator may serve. Multichannel News notes that the cap would primarily affect one company:
Citing Kagan Research, Comcast recently told the FCC that it serves 26.2 million subscribers, or 27% of the country’s 96.8 million pay TV subscribers. Under a 30% cap, Comcast could, in a few years, find itself refusing service to customers seeking to sign up for its fast-growing voice-video-data triple-play bundle. The 30% cap would also effectively block Comcast from buying a cable company with more than 3 million subscribers.
If cable operators were the only source of video programming, it might make sense to have a rule like this. But, as everyone knows, they aren’t. There are the broadcasters, the Direct Broadcast Satellite providers and now the big telephone companies and the Internet. It’s hard to imagine any one company dominates this media galaxy. But if so, that’s why we have the Antitrust Division.
Intuitively, some people feel if we have more cable TV owners and CEOs, it stands to reason we’ll get more diverse views and programming. In reality, most investors and managers are motivated not by individual political, cultural or artistic agendas, but on serving customers, i.e., providing whatever sells. Others recall that, for whatever reason, back when we had heavy-handed regulation television seemed much more “tasteful” than it does today. But that’s only because society’s values used to be different. It’s impossible to legislate taste and morality.
A 30% cable cap will allow the FCC to extort anything it wants from Comcast, the only cable company with a market share approaching 30%. Because, eventually, Comcast will need to seek a waiver. We don’t know who will be running the FCC when that happens, nor what their political, cultural or artistic agenda may be.
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.