Antitrust & Competition Policy

Tim Lee on Net Neut: “The Durable Internet”

by on November 12, 2008 · 13 comments

Tim Lee’s long anticipated Cato Institute Policy Analysis has been released today.

The Durable Internet: Preserving Network Neutrality without Regulation is a must-read for people on both sides of the debate over network neutrality regulation.

What I like best about this paper is how Tim avoids joining one “team” or another. He evenly gives each side its due – each side is right about some things, after all – and calls out the specific instances where he thinks each is wrong.

Tim makes the case for treating the “end-to-end principle” as an important part of the Internet’s fundamental design. Tim disagrees with the people who argue for a network with “smarter” innards and believes that neutrality advocates seek the best engineering for the network. But they are wrong to believe that the network is fragile or susceptible to control. The Internet’s end-to-end architecture is durable, despite examples where it is not an absolute.

Tim has history lessons for those who believe that regulatory control of network management will have salutary effects. Time and time again, regulatory agencies have fallen into service of the industries they regulate.

“In 1970,” Tim tells us, “a report released by a Ralph Nader group described the [Interstate Commerce Commission] as ‘primarily a forum at which transportation interests divide up the national transportation market.'” Such is the likely fate of the Internet were management of it given to regulators at the FCC and their lobbyist friends at Verizon, AT&T, Comcast, and so on.

This paper has something for everyone, and will be a reference work as the network neutrality discussion continues. Highly recommended: The Durable Internet: Preserving Network Neutrality without Regulation.

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What the U.K. Can Teach the U.S. on Spectrum Reform

by on November 11, 2008 · 6 comments

What’s the right way to allocate the airwaves? For years and years and years, the governing policy of federal communications was that the electro-magnetic spectrum was too “scarce” to be left to the devices of the marketplace. This kind of reasoning has always lacked substance. As I wrote in a piece occoccasioned by the rise of indecency enforcement:

Congress began regulating broadcasters in 1927 on the grounds of scarcity. In return for free and exclusive use of a given wavelength, broadcasters agreed to serve the “public interest, convenience, and necessity” — or at least to do what Congress and the FCC ordered. One element of this agreement was a ban on obscene, indecent and profane language.

This scarcity theory has always lacked substance. Nobel Prize-winning economist Ronald Coase’s reputation is based, in part, on a notable paper he wrote in 1959 that criticized the rationale behind the FCC’s command and control regime of licensing broadcasters. “It is a commonplace of economics that almost all resources in the economic system (and not simply radio and television frequencies) are limited in amount and scarce, in that people would like to use more than exists,” Coase argued in his seminal essay.

From Shouldn’t FCC Rules Over Indecency Just Grow Up? Reflections on Free Speech and Converging Media

The FCC eventually came to realize that it could endow electromagnetic frequencies with property rights-like characteristics. In 1993, under Bill Clinton and a Democratic congress, the United States finally moved to such a system — at least in those frequencies used by cell-phone operators. As in so many other ways, broadcasters have remained immune from historical trends.

This backdrop is important to understand our current moment in wireless policy. Tomorrow, on Wednesday, November 12, at 4 p.m., those near Washington will be able to gain insight into how other nations have approached radio frequency regulation. The Information Economy Project at the George Mason University School of Law (Disclosure: I’m the Assistant Director at the Information Economy Project, a part-time position that I currently hold) will host its next “Big Ideas About Information Lecture” featuring an address by Dr. William Webb, a top policy maker at OFCOM, the U.K. telecommunications regulator.

OFCOM’s ambitious liberalization strategy, announced in 2004, permits the large majority of valuable frequencies to be used freely by competitive licensees, offering an exciting and informative experiment in public policy.  Dr. Webb’s lecture, “Spectrum Reform: A U.K. Regulator’s Perspective,” will offer a timely progress report for the American audience.

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Net Neutrality and White Spaces, from the Wireless Communications Association

by on November 7, 2008 · 5 comments

SAN JOSE, Nov. 7 – This morning I’ve posted two articles on BroadbandCensus.com about the Wireless Communications Association’s conference here.

Net Neutrality Advocates: Wireless Carriers’ Network Management Must be ‘Reasonable’

SAN JOSE, November 7 – Emboldened by their summertime victory against Comcast, advocates of network neutrality said Thursday that the next front in battle for the principle would be against wireless carriers who make “unreasonable” network management decisions. read more

FCC Chairman Kevin Martin’s Incredible Silicon Valley Wi-Fi Adventure

SAN JOSE, November 6 – It was Kevin Martin’s day to suck up praise from Silicon Valley. The chairman of the Federal Communications Commission – for about two more months – came to the Wireless Communications Association’s annual conference here on Thursday to be feted by many Googlers, including company co-founder Larry Page. read more

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If the U.S. Goes With ‘White Spaces,’ What of the Rest of the World?

by on November 5, 2008 · 6 comments

With the Federal Communications Commission’s decision to allow “white spaces” devices at its open meeting on Election Day, it may make sense to ask: how are other nations approaching the issue of “white spaces”? Do other countries that make use of flexible and transferable spectrum licensing find that taking the approach that the FCC took on Tuesday — allowing unlicensed wireless devices to share vacant television frequencies — helps or hinders in getting more spectrum available for the “highest and best use”?

As readers of this blog are probably aware, I work part-time at the Information Economy Project at George Mason University School of Law, which sits at the intersection of academic research and telecommunications policy.

IEP is pleased to sponsor one of its “Big Ideas About Information” Lecture next Wednesday, November 12, at the law school in Arlington. The school is conveniently located at the Virginia Square/GMU Metro station, and is a short ride away from downtown Washington.

At 4 p.m. on November 12, William Webb, the head of research and development and the senior technologist at OFCOM, the British telecommunications regulator, will be speaking about this and other subjects. The title of his remarks is: “The Theory, Practice, Politics and Problems of Spectrum Reform: A U.K. Regulator’s Perspective,” and you can learn more about it here, or by clicking on the badge below.

Admission is free, but seating is limited. To reserve your spot, please email me, Drew Clark, at this address: iep.gmu@gmail.com

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Special Election Day Telecom Blog Post and News Report

by on November 4, 2008 · 9 comments

I’ve just posted two new entries over at BroadbandCensus.com (in addtion to the one about FCC v. Fox Televisions Stations) below. Now, I’ve got to go and vote.

The pieces at BroadbandCensus.com include a blog post about the real issue in white spaces: not broadcasters versus techies, but keeping the current Swiss-cheese arrangement in the airwaves versus clearing the broadcasters out of their radio frequencies entirely.

Also, in a special election day news report, myself and Drew Bennett have written about the delay in the vote over the universal service fund and intercarrier compensation overhauls.

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Reform Intercarrier Compensation

by on October 30, 2008 · 5 comments

The Federal Communications Commission began a broad inquiry of intercarrier compensation in 2001 and now it may finally be getting around to acting on it on Nov. 4 while everyone’s thoughts are on something else.

This is about 12 years overdue. Congress in 1996 foresaw that implicit phone subsidies were unsustainable and ordered the FCC to replace them with a competitively-neutral subsidy mechanism. Due to political pressure, regulators have failed to complete the job.

Intercarrier compensation refers to “access charges” for long-distance calls and “reciprocal compensation” for local calls. A long-distance carrier may be forced to pay a local carrier more than 30 cents per minute to deliver a long-distance call, but local carriers receive as little as .0007 cents per minute to deliver calls they receive from other local carriers.

Once upon a time, before fiber optics, there were significant distance related costs. Now distance isn’t a major factor.

The high access charges remain only because the recipients, typically small and mid-size phone companies serving sparsely populated areas, have successfully lobbied regulators and legislators to keep them.

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Twittering from National Press Club on Tech Presidential Campaign

by on October 30, 2008 · 3 comments

WASHINGTON, October 30 – At the National Press Club, Larry Irving and Grover Norquist are debating technology and the presidential candidates. Check out the side of the page on DrewClark.com, or at http://twitter.com/drewclark, for my live Twitters!

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Leading U.K. Telecom Official to Deliver Major Lecture at George Mason University

by on October 23, 2008 · 5 comments

William Webb, Head of Research and Development at OFCOM, to speak about ‘The Theory, Practice, Politics and Problems of Spectrum Reform’ on November 12

ARLINGTON, VA., October 23 – With the transition to digital television in the United States less than four months away, disputes about the airwaves used by broadcasters are raging here and around the globe.  A world-class expert will soon weigh in on how one country, the United Kingdom, views the challenges of bringing radio spectrum allocation into the 21st Century.

On Wednesday, November 12, 2008, the Information Economy Project at the George Mason University School of Law will host its next Big Ideas About Information Lecture, featuring an address by Dr. William Webb, a top policy maker at OFCOM, the U.K. telecommunications regulator.

OFCOM’s ambitious liberalization strategy, announced in 2004, permits the large majority of valuable frequencies to be used freely by competitive licensees, offering an exciting and informative experiment in public policy.  Dr. Webb’s lecture, “The Theory, Practice, Politics and Problems of Spectrum Reform,” will offer a timely progress report for the American audience.

Webb’s lecture will be the sixth in a prestigious series that has included Nobel Laureate Vernon Smith and noted economist David Porter on how FCC license auctions have worked; Martin Cooper, the “father of the cellphone,” on spectrum allocation; Brian Lamb, founder and CEO of C-SPAN, on the policies that enabled the cable network to launch;  former Federal Communications Commission Chairman Dennis Patrick, on the decision to abolish the “Fairness Doctrine” in 1987; and University of Minnesota Professor Andrew Odlyzko, on financial bubbles in high-technology industries.

Dr. Webb’s Lecture will review the century-long history of radio spectrum regulation. For almost all of that century, the policy-maker has micro-managed spectrum use, defining services, technologies and business models deployed by wireless operators. The inefficiencies embedded in this approach have triggered calls for liberalization since the pioneering work of economist Ronald Coase in the 1950s.

While efforts to relax administrative control have generally met great political resistance, some substantial progress has been made with the emergence of mobile telephone networks over the past two decades.  Policy makers in some nations are now seeking to achieve bolder changes. The regulator in the United Kingdom, OFCOM, has emerged as a leader in this campaign.

After the Labour Government commissioned a landmark 2002 study authored by economist Martin Cave, OFCOM moved aggressively to assist the emergence of property rights in frequencies, the institutional switch enabling market allocation of radio spectrum.

This lecture, delivered by a key OFCOM policy official and a noted spectrum technology expert in his own right, dissects the liberalization process in Great Britain and offers lessons learned. This experience promises great insight for the U.S. and other countries struggling to enact pro-consumer policy reforms.

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Should Government Funding Be Part of a Broadband Plan? Have Your Say on November 18

by on October 22, 2008 · 7 comments

Readers of Tech Liberation Front may be interested in a new breakfast series that BroadbandCensus.com has recently begun.

The next event in this series, “Should Government Funding Be Part of a National Broadband Plan?” will be held on Tuesday, November 18, from 8 a.m. to 10 a.m., and will include Stan Fendley, the director of legislative and regulatory policy for Corning, Inc., Kyle McSlarrow, CEO of the National Cable and Telecommunications Association (NCTA), and John Windhausen, Jr., president of Telepoly Consulting. I will moderate the discussion.

Two weeks after Election Day, this Broadband Breakfast Club meeting will consider one of the hottest topics in telecom: can and should funding for broadband work its way into a pending fiscal stimulus package?

Future meetings of the breakfast club (December 2008 through March 2009) will consider the role of broadband applications in harnessing demand, how the universal service fund will be changed by high-speed internet, the role of wireless in universal broadband, and the extent of competition in the marketplace.

The Broadband Breakfast Club meets monthly at the Old Ebbitt Grill, at 675 15th Street, NW, in Washington. (It’s right across the street from the Department of the Treasury.)

Beginning at 8 a.m., an American plus Continental breakfast is available downstairs in the Cabinet Room. This is followed by a discussion about the question at hand, which ends at 10 a.m. Except for holidays (like Veteran’s Day), we’ll meet on the second Tuesday of each month, until March 2009. The registration page for the event is http://broadbandbreakfast.eventbrite.com.

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10 Years Under the Digital Millennium Copyright Act – Success or Failure?

by on October 8, 2008 · 5 comments

It’s nearing Halloween, so it must mean the anniversary of the Digital Millennium Copyright Act is just around the corner. In fact, it was 10 years ago, on Sunday, that Congress passed the DMCA, on October 12, 1998. The law was signed by President Clinton on October 28, 1998.

The information and news service that I have launched, BroadbandCensus.com, is “celebrating” the passage of the law with the inaugural event of the Broadband Breakfast Club. The breakfast event will take place on Tuesday, October 14, from 8 a.m. to 10 a.m., at the Old Ebbitt Grill at 675 15th Street NW, Washington, DC.

This event will bring together several key stakeholders together to share perspectives on this topic:

  • Drew Clark, Executive Director, BroadbandCensus.com (Moderator)
  • Mitch Glazier, Senior Vice President, Government Relations, Recording Industry Association of America
  • Michael Petricone, Senior Vice President, Government Affairs, Consumer Electronics Association
  • Wendy Seltzer, Practitioner in Residence, Glushko-Samuelson Intellectual Property Law Clinic, American University Washington College of Law
  • Emery Simon, Counselor, Business Software Alliance

Breakfast for registrants will be available beginning at 8:00 a.m., and the forum itself will begin at around 8:30 a.m., and conclude promptly at 10 a.m. The event is open to the public. The charge for the breakfast is $45.00, plus an Eventbrite registration fee. Seated attendance is limited to the first 45 individuals to register for the event.

Future events in the Broadband Breakfast Club monthly series will feature other key topics involved in broadband technology and internet policy. In fact, you can mark your calendar for the next event on Tuesday, November 18, from 8 a.m. to 10 a.m., also at the Old Ebbitt Grill.

For more information about BroadbandCensus.com, or about the Broadband Breakfast Club at Old Ebbitt Grill – on the second Tuesday of each month – please visit http://broadbandcensus.com, or call me at 202-580-8196.

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