Broadband & Neutrality Regulation

One of the very few positive things in the Telecommunication Act of 1996 is Section 401 (codified as Sec. 10 of the Communications Act of 1934, as amended), which requires the Federal Communications Commission to forbear from applying unnecessary regulation to telecommunications carriers or services.

Congress tucked the provision into the 1996 act to improve the chances that pro-competition regulation would be eliminated once fully implemented and no longer necessary to ensure competition.

On Friday the FCC issued a notice of proposed rulemaking requesting public comment on whether the forbearance procedure needs more procedure. Commissioner Michael J. Copps issued a statement indicating dissatisfaction with the whole forbearance concept:

Too often forbearance has resulted in industry driving the FCC’s agenda rather than the reverse being true. Decisions are based upon records lacking in data and the Commission faces a statutory deadline that requires a decision with or without such data. Perhaps most egregious is the fact that if the Commission fails to act, forbearance petitions may go into effect based upon the industry’s reasoning rather than the Commission’s own determination. All of this is to say that I do not believe that forbearance is being used today in the manner intended by Congress.

I admire Commissioner Copps’ confidence that he knows what Congress intended, but I actually sat on the Senate floor when the Telecommunications Act of 1996 was debated and the forbearance provision (which originated in the Senate) wasn’t debated at all. It was included in the committee mark, which was supported by Commissioner Copps’ old boss, the committee’s ranking member and former chairman, Senator Ernest Hollings (D-SC).

Continue reading →

This is just a quick follow-up to the post I made earlier in which I mentioned the new editorial James Gattuso and I penned for National Review about the growth of FCC regulation and spending in recent years. A few people asked me where we got the numbers we used in the piece regarding the growth of the FCC’s budget over time. Here are the relevant numbers and a graph charting that growth. The numbers can all be found in the the FCC’s annual budget reports.

Next time some pro-regulatory advocate says that the agency is engaged in “radical deregulation” or something absurd like that, show them these numbers. There’s still a whole lotta regulatin’ going on over there! FCC Budget Chart FCC Budget Graph

This week in National Review Online, Cesar Conda and Lawrence Spivak ran an editorial entitled “Kevin Martin’s Pro-Market FCC,” arguing that the current FCC has generally been deregulatory and free market-oriented. Today, James Gattuso and I have set the record straight regarding just how off-the-rails this current FCC has really gone…


November 29, 2007

TV Train Wreck Martin, markets, and the potential for regulatory disaster.

By James Gattuso & Adam Thierer

Like cops shooing away onlookers at the scene of an accident, Cesar Conda and Lawrence Spivak argue (“Kevin Martin’s Pro-Market FCC”) that there’s no reason for conservatives to be concerned about the Federal Communications Commission (FCC). Under Chairman Kevin Martin, they say, the FCC has been “characterized by a consistent pro-entry/pro-consumer welfare mandate, the very hallmark of economic conservatism.”

In other words: “Just move along. Nothing to see here.”

Despite Conda and Spivak’s exhortations, however, there is much for the curious crowd to see in the train wreck that is the FCC. The most recent derailment began earlier this month, when Martin leaked plans to invoke an obscure provision of the Communications Act, and to assert nearly unlimited powers to regulate cable television if more than 70 percent of households subscribe to cable.

Continue reading →

EarthLink appears to be getting out of the muni wi-fi business for good. The company is at least is abandoning the major Philadelphia experiment it was in charge of. According to today’s press release:

“After thorough review and analysis of our municipal wireless business we have decided that making significant further investments in this business could be inconsistent with our objective of maximizing shareholder value,” said Rolla P. Huff, EarthLink president and CEO. “Accordingly, at this time, we are considering our strategic alternatives with respect to this business,” Huff added. EarthLink will seek to work closely with the municipalities in which it has operations as it considers these alternatives. The net book value of the assets attributable to EarthLink’s municipal wireless business is approximately $40 million.

A few years ago, many folks were telling us that muni wi-fi was like manna from heaven; the ultimate free lunch that would give us a broadband nirvana. As some of us predicted–reality often proves more complicated. Indeed, one lesson from this experiment is that demand counts. There was always a bit of “if-you-build-it-they-will-come” reasoning behind the Philly deal and other muni wi-fi proposals. But you can’t build a network without a customer base, and recent news reports indicated that demand was lacking.

Continue reading →

In Jerry’s post “Is Comcast discriminating against BitTorrent?” he points out the following about Comcast’s acceptable use policy:

In its acceptable use policy,1 Comcast reserves the right to take any measures it deems necessary to deal with subscribers who use too much bandwidth (although how much is too much is not clearly defined). But if the AP is right, this is targeting a specific application, not specific users.

Jerry is right that targeting specific users would be well outside of Comcast’s acceptable use policy when it comes to bandwidth hogging, however, Comcast can target and block individual users who are running servers, whether they be for email, websites, or file-sharing. Their acceptable use policy also includes:

Prohibited uses include, but are not limited to, using the Service, Customer Equipment, or the Comcast Equipment to:

followed by:

xiv. run programs, equipment, or servers from the Premises that provide network content or any other services to anyone outside of your Premises LAN (Local Area Network), also commonly referred to as public services or servers. Examples of prohibited services and servers include, but are not limited to, e-mail, Web hosting, file sharing, and proxy services and servers;

The policy later says in relation to prohibited activities such as this that:

Continue reading →

Presidential candidate Ron Paul (R-Texas) became the “Internet” candidate this month when 36,672 people contributed more than US$4 million online to his campaign in a single 24-hour period. This impressive feat demonstrates the power of an open source culture, a lesson that should not be lost when it comes to other important issues.

The campaign to raise money for Rep. Paul was open source in a number of ways. First, it was a decentralized effort, promoted by people all over the country simultaneously. Indeed, Paul’s campaign was so hands-off that the candidate told The New York Times that he “had nothing to do with it.” It was two independent people who started the ball rolling.

James Sugra posted an online video proposing a big day of fund-raising for Paul, and Trevor Lyman separately created a site, www.thisnovember5th.com, that featured the video. Lyman’s site is now planning another big day on Dec. 16, the anniversary of the Boston Tea party.

On that day, Paul’s open source campaigners are hoping to encourage 100,000 people to donate $100 each.

Choosing a historical day may not be a particularly new fundraising tactic, but the additional open source cultural spin is that the site is automatically updating how many people have pledged so far. This transparency complements the home page of Ron Paul’s Web site, which constantly pops up names of his campaign donors. Those revelations stand in direct contrast to traditional campaigns, which tend to be silent and proprietary about who is donating.

Paul’s “donation feed” is reminiscent of the somewhat addictive “newsfeed” on social networking site Facebook,and it appears to have the effect of increasing donations. In a society where privacy is shrinking, it seems many embrace the idea of sharing more information, not less. Paul’s supporters are not alone in their recognition of the power of a voluntary open source culture.

Internet giant, Google, announced this week that it is offering $10 million in prizes for people who build the best software for Android, the company’s new open platform for mobile devices. This move shows that Google knows its tech history. Back in 1985, Apple made a huge mistake of saying no to a young Bill Gates who wanted the company to open up its proprietary architecture to developers. We all know how that ended, and now a similar story is likely to play out if the big phone companies stay closed while Google opens things up.

This reality, unfortunately, has led many to the erroneous conclusion that since openness is good, the government should force it, no matter what the cost. However, government force rarely leads to the open societies people seek. Take Net neutrality advocates, for example.

[…]

Read more here.

Comcast’s decision to limit Internet traffic from the peer-to-peer software BitTorrent would be against the law if Democratic presidential hopeful Barack Obama had his way, an aide to the Democratic Senator said Thursday.

In a conference call organized by the campaign for Sen. Obama, D-Ill., high-profile technology experts Lawrence Lessig, Beth Noveck and Julius Genachowski endorsed the technology and innovation agenda that Obama released on Wednesday. Also on the lines were three Obama aides, who declined to speak for attribution.

“What I find compelling about the Senator’s [stance] is a strong commitment to Net neutrality,” said Lessig, a law professor at Stanford University, referring to the notion that broadband providers be barred from favoring business partners with speedier Internet delivery.

Obama “addresses the problem of Net neutrality in a way that could actually be enforced,” said Lessig. By contrast, Democratic hopeful Hillary Clinton “can’t stand up for Net neutrality.”

Continue reading →

In the recent Verizon Uprisin’ (successor to the Comcast Kerfuffle – how’m I doin’?), the blogospheric back-and-forth between TLFer Tim Lee (writing at TechDirt) and TLFriend Ed Felten illustrates nicely the difficulty with both parts of the case for ‘net neutrality regulation.

The first question is whether there is a problem that needs solving. The two disagree about whether Verizon’s operation of its DNS servers is a ‘net neutrality violation at all.

The second question is whether the problem is better solved by regulation or by market processes (expert agitation, consumer pressure, etc. that carry with them the threat or reality of lost customers and profits). As a technical matter, Tim points out that people are free to point their computers to another DNS server, such as OpenDNS. Ed says “it might turn out that the regulatory cure is worse than the disease.”

Even among those who disagree on whether there’s a substantive ‘net neutrality violation here, regulation doesn’t seem to be the cure. Even Harold Feld hasn’t written a triumphal post. (Though, in fairness, he seems to be distracted – and oh so giddy – about cable regulation.)

SMTP Blocking

by on November 15, 2007 · 17 comments

In response to a post I did on Verizon’s obnoxious DNS policies, a Techdirt reader writes:

Verizon DOES block your ability to use 3rd-party mail servers. GMail is web-based, son. A server at a friend’s ISP, connecting over port 25, is BLOCKED by Verizon, period end of story. Now, I use another port and so go my merry way, but Verizon, having blocked port 25, can block any ports they wish under the same guiding principle. Verizon sets limits.

And another reader responds:

Isn’t that standard practice? To (somewhat) prevent spoofing email, ISPs require outbound mail to go through in-house servers, but inbound on port 110 can be any source you have access to.

Does anyone know if this is true? I’ve occasionally encountered Wifi connections in hotels or coffee shops that block outbound SMTP, but I’d always assumed that real residential ISPs don’t do that sort of thing. Such a policy does little or nothing to combat spam, but it sure is a pain in the butt for those of us who use real mail clients and don’t use our ISP’s SMTP servers.

Relatedly, would such a policy a violation of network neutrality? It sure seems like it violates the letter of Snowe-Dorgan, which would imply that thousands of annoyingly-configured hotspots would instantly become illegal if network neutrality regs passed.

It’ll cost ya’.

H.R. 3919, The Broadband Census of America Act of 2007, would cost over $2.50 per U.S. household. At that price, you might expect them to literally go door to door, but they’re not going to.