Broadband & Neutrality Regulation

The European Commission is now designing software. And that software is Microsoft Windows…

Comments of Adam Marcus & Berin Szoka to the European Commission on the Matter of Microsoft’s Browser Ballot Proposal, COMP/C-3/39.530 — Microsoft (Tying)*

Submitted Nov. 9, 2009 [PDF of filing]

We applaud the Commission for not repeating its earlier approach to concerns about tie-ins to Microsoft Windows by ordering Microsoft to cripple the functionality of its operating system— such as occurred with the Windows Media Player.  While a “browser ballot” is certainly a less restrictive approach, we remain unconvinced that mandating such a ballot is necessary in this case, and concerned about the precedent that government intervention may set here for the future of the highly dynamic and innovative software sector.  If, however, a ballot is to be required, we encourage the Commission to accept Microsoft’s ballot as proposed.

A Browser Ballot Mandate Is Not Necessary

The European Community’s Discussion Paper on exclusionary abuses recognizes that bundled discounts infringe Article 82 only when the discount is so large that “efficient competitors offering only some but not all of the components, cannot compete against the discounted bundle.”[1] In this case, a number of alternative browser producers have successfully competed against Internet Explorer in the past—despite it being bundled with Microsoft’s Windows operating system. Continue reading →

Here’s something that may appeal to transparency enthusiasts, as well as to environmental skeptics…

WASHINGTON, November 9, 2009 – BroadbandCensus.com has been investigating broadband stimulus projects and focusing on the preferred projects from the states. We still lack letters to the National Telecommunications and Information Administration – or notices that states are demanding confidentiality for their letters – from 13 states and territories.

The first person to send any letters from the following states will get a complimentary seat at the November 10 Broadband Breakfast Club at Clyde’s of Gallery Place at 707 7th Street NW, Washington, DC. The breakfast runs from 8 a.m. to 10 a.m., and the topic is “Setting the Table for the National Broadband Plan: The Environment.” Information about the event, and registration, is available at http://broadbandbreakfast.eventbrite.com.

Continue reading →

IDG News reports that the European Parliament has negotiated a telecom bill that “now contains a new Internet freedom provision that states that access to the Internet is a human right of every E.U. citizen, and that if authorities take away that right people must have the opportunity to defend themselves.” If indeed the bill merely creates what Americans would recognize as a “due process” right against government action, that may not be such a bad thing. IDG notes that, “The issue is very sensitive, and not just in Europe, where a number of countries including France and U.K. are passing laws threatening to sever users’ Internet connections if they are found to have breached the copyright on music or movies.” Whatever one thinks of such “three strikes” laws as a remedy for copyright infringement, it seems reasonable that users should indeed have the right to “defend themselves” if accused of copyright violations before their Internet access is turned off.

But we should all be uncomfortable anytime government purports to invent a new “fundamental right” if that right is a “positive” one— i.e., a moral entitlement to a particular product or service that must be guaranteed by other taxpayers paying for something someone can’t afford or simply doesn’t value enough to pay for out of their own pocket. That’s precisely what Finland recently did, guaranteeing Finns the “right” to a 1 megabit broadband connection. That sort of entitlement is pure cyber-collectivism. Cyber-libertarianism recognize instead that:

true “Internet freedom” is freedom from state action; not freedom for the State to reorder our affairs to supposedly make certain people or groups better off or to improve some amorphous “public interest”—an all-to convenient facade behind which unaccountable elites can impose their will on the rest of us.

So if the Europeans want to guarantee a due process right, I hope they would find another term for that concept doesn’t have such cyber-collectivist implications.

I was stunned last week when I saw many prominent tech VCs and CEOs from Silicon Valley sign letters endorsing the FCC’s move towards Net Neutrality, since, if the rule making goes ahead, it will mean regulating the Internet.  I happen to know a bunch of these folks, so I decided to call them to see if they really were endorsing regulations for the Net or if something else was going on.  Something else was going on.  Because the term “Net neutrality” is notoriously difficult to define, and is often put in terms of “free and open,” some people signed the letters without realizing it could lead to new regulations for the Information superhighway (these are busy people who spend more time running their companies than following the ins and outs of the FCC).   That said, unsurprisingly, there was a lot of suspicion regarding the phone and cable companies.  After many conversations, here is a potential solution that could put an end to Net neutrality games and ensure a bright future for the Net.

The upshot for those of you who don’t want to follow the link:

“If the tech industry and the major ISPs want to avoid government regulation and keep the Internet thriving, they need to come up with a way to solve the disclosure problem on their own in the marketplace.

Verizon has already started taking steps toward a more constructive stance by co-signing a letter with Google supporting an open Internet. Now it is time for all companies involved to take it to the next level. If that happens, U.S. innovators will be much safer from the claims of militant rent-seeking activists and regulators who want to get their hands on the Net.

The creation of TRUSTe helped the tech industry mobilize and avoid heavy-handed privacy regulations like those that befell Europe. Now it is time for ISPs to support an independent, private body to monitor neutrality issues. Such a move would deflate the pro-regulation lobby and allay the concerns of the industry that is driving U.S. growth.”

It’s a quiet, rainy evening at home for me tonight, and I chanced to watch a segment from the Daily Show with Jon Stewart dealing with ‘net neutrality regulation.

The segment’s title, typical of the show’s tenor these days, was, Duh, It’s So Obvious That the Administration is Right Again. Anyone Who Doesn’t Think So Is Just So Dumb. I Can’t Even Believe It.

Watching it, I noticed that a clip they used to show “krazy konservative TV people being obviously stupid” was the beginning of a segment I appeared in on Fox! See it, the first of the two clips, here. (“Well, Senator John McCain wants the government to keep its hands off the Innnterrnet.”)

But did they find some blundering overreach in my commentary? Somewhere in which I went a step too far, opening a flank to comedic ruin? No. The Daily Show people, having reviewed my segment, turned to mocking Phil Kerpen from Americans for Prosperity instead.

The obvious conclusion? What I said was too sensible to be lampooned—a tacit admission by Daily Show producers that I was right. Net neutrality regulation really is a transfer of power from consumers to Washington bureaucrats. Jon Stewart practically says so. Watch me again, getting it right, as confirmed by Jon Stewart.

WAR IS PEACE

FREEDOM IS SLAVERY

IGNORANCE IS STRENGTH

So declared the Party in George Orwell’s classic novel  1984. The corruption of language with a constant theme of Orwell’s work, most notably his 1946 essay “Politics and the English Language.” So Orwell would not have been surprised to see the term “Internet Freedom” captured by those who advocate an increased role for government (i.e., Big Brother) online. Nor would Orwell had been surprised to see these advocates claim Orwell for themselves, insisting that opponents of government regulation are the ones corrupting language. There is perhaps no better example of this than MSNBC’s Rachel Maddow’s comments in an interview with Boing Boing’s Xeni Jardin about the divisive issue of “Net Neutrality” regulations:

Rachel Maddow [dripping with sarcasm]:  Sen. McCain’s bill, as you mentioned, is actually called the  “Internet Freedom Act of 2009,” and he’s deriding the government effort to keep telecoms from walling off the Internet as “government intrusion” and “trying to regulate the Internet.” What that means is that he’s picked better branding, he’s picked better names.  It doesn’t really relate the facts of what he’s doing. I’m wondering if it’s too late for a rebranding of the other side here. We need to get better about talking about this, because the language seems sort of corrupt at this point.

What makes Maddow’s comments so stunning is not her view that corporate America, rather than government, is the real enemy of freedom. That view is simply part of the long-regnant political orthodoxy. No, what’s stunning is that she actually thinks that her side is losing the “war of words” just because Sen. McCain had the gall to use the term “Internet Freedom” as a rallying-cry for the outdated, bourgeois notion that “freedom” means the absence of coercion by the one entity that can enforce its commands at the point of a gun and call it “justice”: that coldest of all cold monsters, the State. That’s precisely what “liberalism” used to be about until people like Rachel appropriated that word and words like “liberty” and “freedom” as slogans for control. Xeni Jardin picks up where Rachel left off by appropriating the concept of rights, too:

Xeni Jardin: the Internet really is a basic right, it’s a necessity,such a fundamental way for communicating and accessing information now.  Telecoms shouldn’t be able to throttle, to block, to slow down our access to something that might not be in their corporate interests.

This is pure, unadulterated cyber-socialism: Rights become not the sacred defense of the individual, but a positive assertion of entitlement to a vaguely defined principle of access: by guaranteeing this access through ever-expanding “neutrality regulation”, government gains unlimited control over the Internet itself.

As Adam Thierer and I have warned, that way lies madness: Inviting the government to regulate online content and services in the name of “neutrality” (or “privacy” or any of the many “glittering generalities” ending in “-y” Orwell would have denounced) would be the death of real Internet Freedom, which requires a strict “Separation of Web and State.” Continue reading →

Some people have labored under the impression that “net neutrality” regulation was about the government stepping in to ensure that large corporations would not control the Internet. Now that the issue is truly joined, it is clear (as exhibited in this Wall Street Journal story) that the debate is about one set of corporate interests battling another set of corporate interests about the Internet, each seeking to protect or strengthen its business model. The FCC is surfing the debate pursuing a greater role for itself, meaning more budget and power.

Tim Lee’s paper, The Durable Internet, dispells the idea that owners of Internet infrastructure can actually control the Internet. The better approach to “net neutrality” is to let Internet users decide what they want from their ISPs and to let ISPs and content companies do unmediated battle with one another to create and capture the greatest value from the Internet ecosystem. If the FCC were to reduce its power by freeing up more wireless spectrum—either selling it as property or dedicating it to commons treatment—competition to provide Internet service would strengthen consumers’ hands.

These are notions I have tried to get across in some recent television interviews, which you’ll find after the jump. Continue reading →

Joe Tighe, an IT Infrastructure Consultant, has an interesting essay up over at Circle ID.  He takes a hard look at Rep. Ed Markey’s proposed “Internet Freedom Preservation Act of 2009” and makes an argument that many of us here have made ad nauseum — regulation involves trade-offs and unintended consequences:

One of the main problems with the proposed legislation is the lack of recognition of costs to provide internet services. Some applications, such as video are bandwidth hogs and require significantly greater network infrastructure and associated costs to deliver when compared to the network infrastructure costs to deliver email access. Under the proposed legislation, services providers would have to charge the low bandwidth users (casual browsers and email readers) more to offset the higher costs of the video users. One result of the proposed legislation would be less consumer choice and a hidden “bandwidth hog tax”. Today, most service providers offer tiered products and pricing to consumers and businesses to account for the additional costs to deliver bandwidth intensive applications. You pay more if you use more under the tiered pricing model. These are not “discriminatory” practices. Rather, tiered pricing and application prioritization are sound business models delivering reliable, profitable product choices and unburdened internet ecommerce. Consumers and businesses currently have choices. The proposed legislation takes away choice and increases costs to consumers and businesses.

Quite right.  Read the whole essay here.

Pre-release rumors and press reports were making it sound like the Obama administration let Rep. Ed Markey draft the FCC’s Notice of Proposed Rulemaking to “Preserve the Free and Open Internet.”

Maybe there was a last-minute change of plan.

There were rumors and/or reports that the NPRM would contain a “viewpoint diversity” mandate and only allow forms of network management which someone has managed to prove to the FCC satisfy a “strict scrutiny” test.

In the Markey-Eshoo bill, the strict scrutiny test is defined as follows:

[A] network management practice is a reasonable practice only if it furthers a critically important interest, is narrowly tailored to further that interest, and is the means of furthering that interest that is the least restrictive, least discriminatory, and least constricting of consumer choice available.

But in paragraph 137 of the NPRM, the commission declines to adopt a strict scrutiny standard.

We recognize that in a past adjudication, the Commission proposed that for a network management practice to be considered “reasonable,” it “should further a critically important interest and be narrowly or carefully tailored to serve that interest.” We believe that this standard is unnecessarily restrictive in the context of a rule that generally prohibits discrimination subject to a flexible category of reasonable network management. We seek comment on our proposal not to adopt the standard articulated in the Comcast Network Management Practices Order in this rulemaking.

There were also reports the NPRM would include a carve-out for application and service giants like Google. But the definitions in the draft regulations included in the NPRM are so broad that many applications and services arguably could be included:

Broadband Internet access. Internet Protocol data transmission between an end user and the Internet. For purposes of this definition, dial-up access requiring an end user to initiate a call across the public switched telephone network to establish a connection shall not constitute broadband Internet access. Broadband Internet access service. Any communication service by wire or radio that provides broadband Internet access directly to the public, or to such classes of users as to be effectively available directly to the public.

Continue reading →

by Berin Szoka & Adam Thierer, Progress Snapshot 5.11 (PDF)

Ten years ago, Nobel Prize-winning economist Milton Friedman lamented the “Business Community’s Suicidal Impulse:” the persistent propensity to persecute one’s competitors through regulation or the threat thereof. Friedman asked: “Is it really in the self-interest of Silicon Valley to set the government on Microsoft?” After yesterday’s FCC vote’s to open a formal “Net Neutrality” rule-making, we must ask whether the high-tech industry—or consumers—will benefit from inviting government regulation of the Internet under the mantra of “neutrality.”

The hatred directed at Microsoft in the 1990s has more recently been focused on the industry that has brought broadband to Americans’ homes (Internet Service Providers) and the company that has done more than any other to make the web useful (Google). Both have been attacked for exercising supposed “gatekeeper” control over the Internet in one fashion or another. They are now turning their guns on each other—the first strikes in what threatens to become an all-out, thermonuclear war in the tech industry over increasingly broad neutrality mandates. Unless we find a way to achieve “Digital Détente,” the consequences of this increasing regulatory brinkmanship will be “mutually assured destruction” (MAD) for industry and consumers.

New Fronts in the Neutrality Wars

The FCC’s proposed rules would apply to all broadband providers, including wireless, but not to Google or many other players operating in other layers of the Net who favor such broadband-specific rules. With this rulemaking looming, AT&T came after Google with letters to the FCC in late September and then another last week accusing the company of violating neutrality principles in their business practices and arguing that any neutrality rules that apply to ISPs should apply equally to Google’s panoply of popular services. In particular, AT&T accused Google of “search engine bias,” suggesting that only government-enforced neutrality mandates could protect consumers from Google’s supposed “monopolist” control.

The promise made yesterday by the FCC—to only apply neutrality principles to the infrastructure layer of the Net—is hollow and will ultimately prove unenforceable. Continue reading →