Telecom & Cable Regulation

Pundits are foaming at the mouth about AT&T’s just-announced end to unlimited data packages for smartphones. Here is Jeff Jarvis calling the move “cynical,” “retrograde,” and “evil.” However, he provides no evidence that this is anything but AT&T facing economic reality. The iPhone was a revolution, and how much data people consume given an awesome device turned out to be much more than AT&T was ready for. Now they’re asking their customers who use the most data to pay more, and this is evil?

Not only is it not evil, it’s incredibly fair. Most people will probably pay less for service. The cheapest of AT&T’s new plans is $15 for 200 MB of data. That’s $15 cheaper than their current $30 for unlimited iPhone use. According to AT&T, 65 percent of their customers use less than 200 MB of data a month. I consider myself a heavy iPhone user, and I just came back from a trip to NYC on which my iPhone was the only device I took with me, and yet with 2 days left in my billing cycle, I’ve used 154 MB of data. So, AT&T’s change will actually be a price-cut for me and the majority of AT&T customers.

Yup, real evil.

The announcement yesterday from key Congressional Democrats of an effort to reform the Communications Act put me in a nostalgic mood. Here follows one of my longest efforts yet to bury the lede.

One of my favorite courses in law school was Abner Mikva’s “Legislative Process” course, which he taught while serving on the D.C. Circuit Court of Appeals and before his tenure as White House counsel to President Clinton. Mikva had previously served in Congress; indeed, one of the first votes I ever cast was for Mikva while an undergraduate at Northwestern University.

(It was a remarkable period at the law school. The year Mikva signed on as a lecturer was also the first year on the faculty for three professors just starting their academic careers: Larry Lessig, Elena Kagan, and Barack Obama. I took two classes with Lessig, including an independent study on the impact of technology on the practice of law, but regrettably none from the other two.) Continue reading →

I was very pleased to hear this announcement today from leading Senate and House Democrats regarding a much-needed update of our nation’s communications laws:

Today, Senator John D. (Jay) Rockefeller IV, Chairman of the U.S. Senate Commerce, Science, and Transportation Committee, Rep. Henry A. Waxman, the Chairman of the House Committee on Energy and Commerce, Senator John F. Kerry, the Chairman of the Senate Subcommittee on Communications, Technology, and the Internet, and Rep. Rick Boucher, the Chairman of the House Subcommittee on Communications, Technology, and the Internet announced they will start a process to develop proposals to update the Communications Act. As the first step, they will invite stakeholders to participate in a series of bipartisan, issue-focused meetings beginning in June. A list of topics for discussion and details about this process will be forthcoming.

This is great news, and an implicit acknowledgment by top Democratic leaders that the FCC most certainly does not have the authority to move forward unilaterally with regulatory proposals such as Net neutrality mandates or Title II reclassification efforts.

I very much look forward to engaging with House and Senate staff on these issues since this is something I’ve spent a great deal of time thinking about over the past 15 years. Most recently, Mike Wendy and I released a paper entitled, “The Constructive Alternative to Net Neutrality Regulation and Title II Reclassification Wars,” in which we outline some of the possible reform options out there. We built upon PFF’s “Digital Age Communications Act Project,” (DACA) which was introduced in February of 2005 with the ultimate aim of crafting policy that is adaptive to the frequently changing communications landscape. You can find all the white papers from the 5 major working groups here.  I also encourage those interested in this issue to take a look at the video from this event we hosted earlier this month asking, “What Should the Next Communications Act Look Like?” Lots of good ideas came up there.

Anyway, down below I have included the video from that event as well as a better description of the DACA model for those interested in details about how that model of Communications Act reform would work. I think DACA holds great promise going forward since it represents a moderate, non-partisan approach to reforming communications policy for the better.  I pulled this summary from the paper that Mike Wendy and I recently penned: Continue reading →

In what might just be the most audacious bureaucratic punt in recent memory, the Federal Communications Commission said yesterday that the U.S. wireless market was so complicated that it was impossible to conclude whether there was effective competition.

Even after 308 pages of examining the multiple service providers, the extensive wireless coverage areas, the scores of handsets, the diversity of services and the decline of prices, the best Chairman Julius Genachowski could say in the FCC’s 14th annual report of competitive market conditions in the wireless sector was:

This Report does not seek to reach an overly-simplistic yes-or-no conclusion about the overall level of competition in this complex and dynamic ecosystem, comprised of multiple markets. Instead, the Report complies with Congress’s mandate to assess market conditions by providing data on trends in competition and choice over time – an approach that fits best with the role of the FCC as a fact-based, data-driven agency responsible for promoting competition and protecting consumers, and fostering investment and innovation.

Translated from bureau-babble, Genachowski’s statement means, “I’m not going to let the facts get in the way of my aggressive agenda to regulate the entire Internet.”
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Over the weekend, I published an op-ed in The Des Moines Register encouraging the FCC to heed the lessons of the first national broadband plan, the one Secretary of the Treasury Albert Gallatin sent to Congress in 1808.

Gallatin was a remarkable figure in the early history of the federal government, and his accomplishments include being the longest-serving Treasury secretary (1801-1812) to date. His report on the Subject of Public Roads and Canals, completed at the request of Congress, remains one of the seminal documents in the history of American infrastructure. It is a masterpiece of dispassionate policy-making and clear-headed writing.

Alas, the document is available nowhere online, and the only in-print copy I can find is published by the aptly-named Dodo Press. This is indeed unfortunate given the renewed interest in network infrastructure as a form of national technology. The NBP published in March by the FCC, despite its nearly 400 pages and thousands of footnotes, makes no reference to Gallatin or his plan. Continue reading →

I appeared this afternoon on the inaugural edition of TechCrunch TV to talk about–what else?–Net Neutrality.

Multiple media sources are now reporting that the FCC, contrary to reports from earlier this week, has decided to go ahead with an effort to change the classification of broadband Internet service from a Title I “information service” to a Title II “telecommunications service,” if only to salvage the proposed rulemaking on the open and transparent Internet.  (See stories on The Wall Street Journal and The Washington Post as well as Ars Technica.)

Those of us who aren’t on the FCC’s official leak list will have to wait with the rest of the rabble to get a look at just how the FCC proposes to effect this radical change in communications law.  Will it apply to all broadband Internet–including cable, fiber, DSL, satellite, wireless and broadband over power lines?  Will the FCC propose to regulate only as much as needed to get the jurisdiction the D.C. Circuit says it doesn’t have under Title I to implement the NPRM, or will they throw in some additional provisions to achieve other goals–such as the reform of the Universal Service Fund?  Will state and local regulators get to share in the fun of telling ISPs how best to run their business?

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On Friday, May 7th from 9:00 a.m. – 10:45 a.m. at the National Press Club, The Progress & Freedom Foundation will hold a panel discussion entitled, “What Should the Next Communications Act Look Like?”  This event will consider the implications of the recent Comcast v. FCC court decision, the FCC’s pending “Net Neutrality” Notice of Proposed Rulemaking, as well as other developments which have lead many experts, officials, policymakers and a diverse array of companies to call on Congress to update the Telecommunications Act of 1996. Leading industry veterans will make their case for change, and explain how their proposals can be implemented. Our expect panel will include:

  • Thomas J. Tauke, Executive Vice President – Public Affairs, Policy and Communications, Verizon Communications
  • Peter Pitsch, Associate General Counsel and Executive Director of Communications Policy, Intel
  • Walter McCormick, President & CEO, United States Telecom Association
  • Ray Gifford, Partner, Wilkinson, Barker, Knauer, LLP
  • Michael Calabrese, Vice President, New America Foundation
  • Barbara Esbin, Senior Fellow, The Progress & Freedom Foundation

Please RSVP here is you plan to join us on May 7th for this event. Again, it will take place from 9:00 a.m. – 10:45 a.m. at the National Press Club (Holeman Lounge, 13th Floor, 529 14th Street NW).  Hope to see you there.

Low-income states have a much higher degree of facilities-based competition than wealthier ones, according to a new report from ID Insight, a consulting firm that provides authentication, verification and fraud prevention solutions to financial services companies, credit issuers, retailers, online merchants and broadband providers.

The results, which surprised even its two authors, Adam Eliot and municipal broadband advocate Craig Settles, turns on its head the notions that only consumers wealthy markets are seeing the benefits of broadband competition and that Internet service providers have abandoned low-income rural areas as too costly to serve. One policy consequence already, the report says, is that most of the $7.2 billion broadband stimulus awarded so far has been directed to states and regions where there is robust competition and no shortage of service.

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Just a reminder that PFF is hosting a panel discussion on “Cable, Broadcast & the First Amendment: Will the Supreme Court End Must-Carry?” this Tuesday (April 27th) from 10:00-11:45 a.m at Hogan & Hartson LLP (555 13th Street NW, Washington, DC). To hold a seat, please RSVP for the event here.

The event features an all-star cast representing all sides (cable, broadcast and programming) of the fight over the FCC’s must-carry rules, which require cable television systems to dedicate some of their channels to local broadcast television stations. The Supreme Court narrowly upheld these “must-carry” rules in the mid-1990s. But last year’s DC Circuit decision striking down the FCC’s 30% cap on cable ownership lead Cablevision to challenge the must-carry rules. The Supreme Court will soon announce whether it will review the Second Circuit’s decision last June upholding the rules. Speakers at our event include:

  • Dan Brenner, Partner, Hogan & Hartson LLP; former director of regulatory and legal affairs at the National Cable & Telecommunications Association (NCTA)
  • Matt Brill, Partner, Latham & Watkins LLP; counsel for Discovery Communications, amicus in Cablevision case; former Senior Legal Advisor to FCC Commissioner Kathleen Abernathy
  • Jack Goodman, Counsel, WilmerHale; former general counsel of the National Association of Broadcasters (NAB)
  • Howard Symons, Member, Mintz Levin; counsel for Cablevision; former Senior Counsel to House Subcommittee on Telecommunications

Berin Szoka and I will co-moderate the session. Hope to see you Tuesday. Register for the event here.

After reading over some of the postings from the few weeks and exchanging emails with TLF’s Richard Bennett, I am coming to see how disastrous a decision it was for the FCC to pursue sanctions against Comcast over its throttling of BitTorrent files.

True, the case, and the court decision has allowed activists to foam at the mouth about a “crisis” in Internet service.

Yet despite the breathless warnings, none of this resonates with the public. The results of a recent Rasmussen Reports poll, posted here by Adam Thierer, that found that 53% of Americans oppose FCC regulation of the Internet.

Perhaps Americans are sanguine because there is no Internet censorship problem. Even though the issues in the BitTorrent case are a bit technical, the public groks on some level that claims by proponents of  regulation that the recent U.S. Court of Appeals decision in favor of Comcast would lead to rampant Internet censorship don’t ring true.

That’s because first and foremost, the BitTorrent case was not about blocking or “censorship.” In fact, in the more than four years of debate, the only real instance of a network neutrality violation, that is, an outright flouting of the guidelines set up by former Chairman Michael Powell, came in 2005 when Madison River Communications blocked Vonage’s VoIP service. And Madison River got caught and fined.

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