Beyond the fact that the Federal Communications Commission (FCC) decided to release the executive summary of its long awaited National Broadband Plan via a PDF of a scanned printed copy, there are other reasons to be concerned about the agency’s ability to centrally plan one of the most important, fast-moving sectors of our economy.  In this video clip, I discussed some of my general reservations with the idea of a gargantuan government industrial policy for the broadband sector, and in this essay I noted how, from what we’ve see of the plan thus far [Executive Summary], the FCC appears to be engaged in some creative accounting techniques to fund the scheme.

Not everything in The Plan troubles me, however, and I hope to touch on some of the more sensible elements in a future post. But, as I was reading through it, I flagged 5 regulatory hot potatoes in the plan that threaten to derail the entire thing.  In this regard, the parallels between the National Broadband Plan and the debate over health care “reform” are really quite striking. Indeed, it appears the Administration has once again settled upon a “go for broke” (potentially quite literally!) strategy. In both cases, they appear hell-bent and trying to do it all in the form of One Big Plan. Now, I won’t lie to you; such everything-plus-the-kitchen-sink public policy gambits make me nervous based simply on the sheer scale of the undertaking. When Washington tries to regulate massive chunks of the economy using bloated bills and bureaucracies inside the Beltway, it troubles me greatly. But even if the sound of Big Government on Steroids doesn’t raise your blood pressure, one would hope that the prospect of political gridlock and litigation hell would force advocates to scale back their ambitions a tad bit. After all, what good is a plan that can never pass or be implemented?

That’s why I was rather surprised to see these 5 regulatory initiatives teed up in the National Broadband Plan:

(1) Return of the Forced Access Regulatory Nightmare? The Plan says the FCC will, “Undertake a comprehensive review of wholesale competition rules to help ensure competition in fixed and mobile broadband services.” As my friend Randy May of the Free State Foundation notes:

In plainer English, this means considering requiring that some Internet service providers unbundle and share their networks with other would-be competitors. The FCC tried that approach of “managed competition” in the late ’90s in implementing the Telecom Act of 1996. The result was not pretty. Investment was stifled. The court ultimately overturned the FCC’s mandatory sharing rules – but not before a lot of damage was done. The FCC shouldn’t even start down this road again.

Indeed, as the southern gentleman that he is, Randy is once again being far too kind in his assessment of things. Forced access regulation was a public policy fiasco of the first order. As I documented in my essay,”Will the FCC’s Nat’l Broadband Plan Be ‘Full Employment for Lawyers’?”, in the years following passage of the Telecom Act, entire forests fell because of the thousands of pages of regulatory and judicial interpretations that were handed down trying to figure out how to interpret what just one word (“cost”) meant. And the economic devastation of infrastructure socialism was substantial since it greatly retarded investment and innovation by incumbents and new “entrants” alike. But those new entrants weren’t really entering the market at all. They were just “networks built on paper,” to use Peter Huber’s wonderful phrase. Our regulators labored under the illusion that they could create the fiction of competition based upon infrastructure sharing. The problem, however, is that sharing is not competing. The only thing that you can accomplish with a forced access regime is that you can milk the regulated monopoly you create until it runs dry; you can force that network provider to share its entire network with “competitors” at regulatory wholesale rates until you basically eat all the seed stock in terms of future investment and innovation on that network. If, on the other hand, you want competitive and highly innovative facilities-based networks, then you must allow carriers to earn a fair return on their investment and be free of arbitrary network-sharing mandates like the FCC is now apparently considering once again.

Even if you disagree with everything I’ve just said about forced access regulation, you cannot deny this: If the FCC walks down this path once again, it will lead to another round of epic legal battles and will tie up The Plan in Congress, the FCC, and the courts for years to come.  That doesn’t seem like a very sensible thing to include the National Broadband Plan if you hope to incentivze new network creation and investment in the short-term.

(2) Set-top Box Regulation: The Plan says the FCC will:

Change rules to ensure a competitive and innovative video set-top box market, to be consistent with Section 629 of the Telecommunications Act. The Act says that the FCC should ensure that its rules achieve a competitive market in video “navigation devices,” or set-top boxes-the devices consumers use to access much of the video they watch today.

What this means is that the agency wants to muck around with the TV market even more in an attempt to engineer next generation set-top boxes and transmission standards. This battle has been going on for many years, actually. In particular, cable operators and some consumer electronics companies have long been engaged in heated technical disputes over set-top boxes, “digital cable ready” equipment, and “plug-and-play” interactive applications. Basically, it’s a fight about how various features or services available on video distribution networks should work. In the old days the battle was over features like electronic programming guides (EPGs), video-on-demand (VOD), pay-per-view (PPV) services, and other interactive television (ITV) capabilities. And now it’s over the Internet and access to online video services.

But here’s the question that I asked in an old paper on the topic (“Unplugging Plug-and-Play Regulation“) that I found myself asking again after I saw this mentioned in the FCC’s Broadband Plan: Why is this issue — and technical disputes about next generation hardware standards — even before the FCC? Why are regulators being asked to make technical determinations that could skew marketplace developments and innovation for years to come? Again, you won’t be surprised to hear I am skeptical of the agency’s ability to somehow micromanage next generation video standards better than marketplace experimentation would. Moreover, what the heck is the problem here? Who the hell cares about set-top boxes in a world of abundant video choices across a broad range of media devices? And, again, how is all of this going to stimulate more investment and innovation in broadband? You got me.

Again, even if you disagree with everything I’ve just said about this issue as well, ask yourself if it’s really worth putting everything else in The Plan at risk for a regulatory initiative like this.

(3) Privacy Regulation: The Plan says the FCC will:

Clarify the relationship between users and their online profiles to enable continued innovation and competition in applications and ensure consumer privacy, including the obligations of firms collecting personal information to allow consumers to know what information is being collected, consent to such collection, correct it if necessary, and control disclosure of such personal information to third parties.

Wow, who knew the FCC was suddenly a privacy regulator!  Talk about mission creep. This agency has zero experience dealing with something as complicated as online privacy policy and yet here they are embarking on a bold new regulatory project to investigate privacy regulation as part of a plan to promote broadband diffusion.

Although the description of what the FCC plans to do is pretty vague, the phrase “obligations of firms collecting personal information to… consent to such collection” sounds an awful lot like a regulatory mandate by which opt-in would be required as a restrictive default. If you want to better understand why that will be so controversial, read this testimony by Berin Szoka and this testimony by Braden Cox (both to the FCC on this issue), as well as Berin’s excellent testimony to the FTC late last year on the broader issues at stake here.

Again, why muck up The Plan with something this controversial? Makes no sense.

(4) Broadcast spectrum confiscation? The Plan says the FCC will:

Enable incentives and mechanisms to repurpose spectrum to more flexible uses. Mechanisms include incentive auctions, which allow auction proceeds to be shared in an equitable manner with current licensees as market demands change. These would benefit both spectrum holders and the American public. The public could benefit from additional spectrum for high-demand uses and from new auction revenues. Incumbents, meanwhile, could recognize a portion of the value of enabling new uses of spectrum. For example, this would allow the FCC to share auction proceeds with broadcasters who voluntarily agree to use technology to continue traditional broadcast services with less spectrum.

In my essay from earlier today, (“Will the FCC’s National Broadband Plan Really Be Costless?”), I already noted why this idea is so controversial. As I noted:

Most of the spectrum they want to grab is currently occupied by someone else. In fact, a huge chunk of that 500 megahertz would come from licensed television broadcasters, who aren’t exactly excited about getting and an eviction notice from the government. Even if one agrees with the FCC that the broadcast band is currently under-utilized, that doesn’t mean that the broadcasters should be forced to vacate it. Moreover, any attempt to force them off would result in an epic legal battle that would take years to resolve and ultimately would not likely be resolved in the government’s favor.

It’s going to take huge sums of money to get the broadcasters to vacate voluntarily. That’s just a reality. People can whine all they want about “the people owning the airwaves,” but it’s bunk that isn’t going to stand up in court. Even if you like your odds of winning a massive spectrum confiscation case, do you have any idea how long it will take to fight the legal battles to resolve that thorny question?

(5) Another M2Z Fiasco? The Plan says the FCC will:

Consider licensing a block of spectrum with a condition to offer free or low-cost service that would create affordable alternatives for consumers, reducing the burden on USF.

Oh my, didn’t the FCC learn anything from the M2Z fiasco? You will recall that former FCC Chairman Kevin Martin had his heart set on engineering a similar plan into existence, but he wanted the free wireless service to be squeaky-clean and filtered to weed out all the naughty bits. M2Z Networks had a plan to offer such a service that was slow as molasses but met the core condition of being free to the public (at least the basic, plain vanilla offering) and highly-filtered. Of course, the rather big catch was that before M2Z would give us The Net for Puritans, they wanted a big slice of juicy spectrum from the government at a greatly reduced lease rate. And Rep. Anna Eshoo (D-CA) floated a similar proposal as part of her ” Wireless Internet Nationwide for Families Act of 2008,” (H.R. 5846).

Bottom line: Rigging auctions will inevitably be hugely controversial, even if it doesn’t include a censorship component.  But, in all likelihood, any plan by the FCC to subsidize a free or low-cost service along the lines of what M2Z already proposed will generate that sort of debate about what standards should govern content on that network. After all, many taxpayers will understandably protest that they shouldn’t have to subsidize content they find objectionable. Of course, the same might be said for other broadband subsidies proposed under The Plan, but when we’re talking about a free service required to be provided as a condition of a sweetheart spectrum deal (rather than simply lowering the cost of paid services), the political pressure for censorship will be difficult to surmount. (For more details, see this old paper by Berin Szoka and me, “What’s Worse Than Rigged Auctions & Internet Censorship? How About Both in One Package!” and this new article by Matt Lasar of Ars Technica, “Free Wireless Broadband Plan is déjà vu All Over Again.”)

Conclusion

No doubt, the FCC and its janissary will claim that each of these regulatory proposals has merit and deserves consideration. But if these provisions remain in the National Broadband Plan, I think the agency is setting itself and its supporters up for a long fight and, ultimately, a very disappointing outcome.  Some might claim that fortune favors the bold and that now is not the time for incrementalism. But this broadband plan would already be quite bold even without these controversial provisions included. For me, it’s just a bit too bold since I don’t believe the government has a very good track record when it comes to building high-tech networks or gauging demand for next generation services.  But regulatory shenanigans like the 5 discussed here could sink the plan and make the whole debate moot.

Chairman Mao–er… Martin–has canceled (WSJ) the FCC’s December 18 meeting, when the Commission was set to vote on Martin’s proposal to rig an auction to give away a valuable piece of spectrum (“AWS-3”) to M2Z networks.  In exchange for a sweetheart deal on the spectrum, the company would have been required to use a quarter of it to provide a free (but very slow) wireless broadband service.  Martin had initially proposed to require that the service be made porn-free, but eventually suggested that users over 18 would be able to opt-out of network-level filtering.

Two weeks ago, when it became clear that Martin would attempt to ram this proposal through while he still could, I asked how the ascendant Left would respond:

Will the defenders of free expression triumph over those who see ensuring free broadband as a social justice issue?  Or will those on the Left who usually joining us in opposing censorship simply remain silent as the government extends the architecture of censoring the “public airways” onto the Net (where the underlying rationale of traditional broadcast regulation–that parents are powerless–does not apply)?

I’m glad to see that the deathblow to this unconstitutional proposal did indeed come from the political Left–specifically, from Sen. John Rockefeller, (D-W.Va.) and Rep. Henry Waxman, (D-Calif.), who will be responsible for overseeing the FCC in the new Congress.  (The Bush administration had already opposed the proposal, as with so many of Martin’s abuses, had failed to stop it.)

With President-elect Obama having declared that, “Here in the country that invented the Internet, every child should have the chance to get online,” it seems almost certain that the Administration will press ahead with some kind of universal broadband proposal of its own.  But what would such a proposal look like?  If it’s another public broadband utility, would it include network-level filtration like Martin’s proposal?  If so, will the Democratic opponents of government censorship stick by their principles and fight that, too?

I suspect we may find that what’s constitutional is politically impossible (unfiltered free Internet) and what’s politically possible (filtered free Internet) is unconstitutional.

As a constitutional matter, the courts have rejected network-level filtering mandates because user-installed filtering tools are a “‘less restrictive” alternative.   In comments filed on this proposal in July, a broad coalition of free speech groups (including my PFF colleague Adam Thierer) explained why Martin’s proposal violated the First Amendment–and why even allowing users to opt-out of the required filtering would not make the proposal constitutional:

First, … [the] filtering mandate is so sweeping in its scope that it would violate the rights of older minors to receive content to which they have a constitutional right to access (but which arguably might be “harmful” to a five-year old).  Second, the stigma of having to sign up for a central, nationwide list of – effectively – “people who want access to adult content” would be a chilling and unconstitutional burden on adults’ right to access lawful content.  Under the First Amendment, the government cannot force people to “sign up” in order to receive lawful speech…  This is especially true because of the broad sweep of content blocked by [the proposal] and the availability of highly effective and less restrictive alternatives in the form of client-side filtering tools. Third and finally, wholly apart from the constitutional rights of those accessing the Internet through the AWS-3 network, the proposed filtering mandate would also violate the constitutional rights of speakers and content providers on the Internet who want to speak to the broadest audience possible.  It would be flatly unconstitutional for the government to select and anoint one, or even a limited number of, filtering “blacklists” of content that must be blocked – even if a private party (the AWS-3 licensee) does the selection under an FCC mandate.  Unless the filtering “blacklist” only contained sites that had been adjudicated to be illegal for minors (on a nationwide basis, presumably), the filtering mandate would be precisely the sort of unconstitutional prior restraint squarely rejected by the Supreme Court in Bantam Books, Inc. v. Sullivan.

But as a political matter, it may turn out that this kind of free broadband proposal just won’t fly without network-level filtering requirements (and an opt-out)–however unconstitutional that might be.  While the courts and any reasonable person might recognize that client-side filtering (installed by users) offers  parents highly effective controls over what their children can access, the truly Puritanical element in America probably won’t care–at least on the level of political rhetoric.  One can easily imagine the opposition from “social conservatives” to the idea of using the public airwaves to make “smut” available to minors.  Coming from the Obama Administration, such a proposal could easily be lampooned as a “Porn Bailout.”   Republicans–who so often seem to prefer fighting the “culture wars” over trying to promote something as arcane as, say, constitutionally limited government–might try to cast any public broadband utility without network-level filtering as a “liberal” plot to corrupt America’s children (think Jocelyn Elders’ endorsement of masturbation as Surgeon General).  After all, why should I have to pay for your porn–let alone your kid’s porn?

Even if Obama and Congressional Democrats have the votes to override such opposition, would they have the political nerve (or think it worth the political capital) to ram through a free broadband scheme that relies on parents to do their own filtering–and that could thus be attacked (however unfairly) as making porn available to kids?  Or would they conclude (probably correctly) that existing broadband subsidies could be significantly expanded without facing such a strong political push to impose filtering mandates as a condition of public support–and choose this “safer” course?  The problem, of course, is that unless broadband is completely free, some people still wouldn’t pay for it and even if it were free, others still wouldn’t use it.

Or perhaps Kevin Martin could continue his crusade to free the world from content he (and the traditionalist Republican base he’s been cultivating) finds objectionable by insisting that subsidies should only go to broadband providers that offer censored Internet packages (essentially opt-in for filtering).  This is, of course, essentially what he has done throughout his time as Chairman in his relentless “war on cable”–looking for every opportunity to coerce cable providers into “voluntary” agreements to provide cable programming on an a la carte basis.  What better way for Martin to revive his political career?  Though Martin’s native North Carolina is trending Democratic, its socially “conservative” voters might hail well Martin’s ostentatious commitment to “protecting the children.”

Back in June, Adam Thierer and I denounced (PDF) Kevin Martin’s plans to create broadband utility to provide censored (and very slow) broadband for free to all Americans.  The WSJ reports that this scheme is now at the top of Martin’s December agenda:

The proposal to allow a no-smut, free wireless Internet service is part of a proposal to auction off a chunk of airwaves. The winning bidder would be required to set aside a quarter of the airwaves for a free Internet service. The winner could establish a paid service that would have a fast wireless Internet connection. The free service could be slower and would be required to filter out pornography and other material not suitable for children. The FCC’s proposal mirrors a plan offered by M2Z Networks Inc., a start-up backed by Kleiner Perkins Caufield & Byers partner John Doerr.

Adam’s August follow-up piece is also well worth reading.  

One could speculate as to how big an impact this service would really have.  Having just spent two weeks “wardriving” around Paris, Abu Dhabi and Dubai (looking for open wi-fi hotspots to try to get Internet access on my otherwise non-functional smart phone), I could certainly imagine scenarios in which some people might well use even a slow wireless service at least as a supplement to another provider–if their devices supported it.  But however useful the service might be to some people, and whether any company would actually want to build such a system in the first place if they have to give away such service, I think it’s a safe bet that if this is actually implemented, it will represent a victory for government censorship over content some people don’t like.

If this idea is still alive and kicking when the Obama administration has security escort Martin out of FCC headquarters in January–to hearty applause from nearly all quarters in Washington, no doubt–it will be interesting to see which impulse prevails on the Left, both within the new Administration and in the policy community.  Will the defenders of free expression triumph over those who see ensuring free broadband as a social justice issue?  Or will those on the Left who usually joining us in opposing censorship simply remain silent as the government extends the architecture of censoring the “public airways” onto the Net (where the underlying rationale of traditional broadcast regulation–that parents are powerless–does not apply)?  

Hope springs eternal.

Several of us here have outlined our reservations about the proposal to allocate a block of the Advanced Wireless Services (AWS) spectrum for a free, nationwide wireless service. (Here’s a filing I signed on to that critiques the portion of the plan that requires censorship of the entire band once allocated).

But, strictly from an economic perspective, this is the best overview and critique of the plan I have seen so far: “The Static and Dynamic Inefficiency of Abandoning Unrestricted Auctions for Spectrum,” by Bob Hahn, Allan Ingraham, Greg Sidak, and Hal Singer. It’s a response to a paper favoring the M2Z plan that was penned by Simon Wilkie of USC, who also formerly served as the Chief Economist of the FCC. (Wilkie’s work on behalf of M2Z can be found on the M2Z site here). It’s a good debate and I encourage you to look at both papers if you are interested in this issue.

This week I was pleased to join a diverse collection of think tanks and public interest groups in submitting joint comments to the FCC opposing the proposed content filtering mandate that would be part of a future AWS-3 auction. That’s the proposed auction that would create a “free” nationwide wireless broadband service. As part of the deal, the company would need to need to take steps to provide a “clean” Internet connection by filtering content. This joint filing points out why that is a bad idea:

• the reach of the filtering mandate is extraordinarily broad, and would attempt to censor content far beyond any content regulation regime that has been previously upheld in the face of constitutional challenge.
• even if the scope of the filtering mandate were more narrowly focused, it would conflict with the First Amendment analysis that the Supreme Court applied to Internet access in the seminal Reno v. ACLU decision.
• even if the Commission were to require filtering on an “opt out” or “opt in” basis, the Constitutional problems would not be avoided. Opt-out filtering would impose an unconstitutional burden on listeners and recipients of Internet communications, and both opt-out and opt-in filtering would violate the First Amendment rights of speakers and other content providers on the Internet. Simply put, the First Amendment does not allow a government mandated “blacklist” of websites to be blocked.
• would also violate the terms and intent of two federal statutes – 47 U.S.C. § 326 (which prohibits the Commission from “interfer[ing] with the right of free speech”) and 47 U.S.C. § 230 (which promotes user control over content and limits burdens on service providers).
• would also limit what people could do online using the free AWS-3 service so dramatically that the usefulness of the service would be radically reduced.
• would also certainly lead to legal challenges that would delay the implementation of the proposed access service. The reason I believe this fight is so important is because, ultimately, it represents an effort by the FCC to begin treating wireless broadband more like broadcast spectrum. That is, regulators want to create the classic regulatory quid pro quo: We’ll rig the wireless allocation process to make it easy for you to get spectrum, and you’ll be a good little boy and clean up the Net for us! This is the game the FCC has been playing for 70 years in the broadcast television and radio licensing space. And not they want to extend that nonsense to wireless broadband. As Commander Jean-Luc Picard would say: “The line must be drawn here!” We don’t want the Internet regulated like broadcasting.

Many thanks to John Morris of CDT for coordinating this filing and asking me to sign on. The comments can be found on the CDT website, and I have also embedded them down below as a Scribd file. Also, Leslie Harris of CDT has a short editorial about the issue over at ABC News.com.

Berin Szoka and I just released a short article on the FCC’s proposed follow-up to the failed 700 mhz D Block auction:  a free, nationwide wireless service that would serve public safety users as well as consumers.  It’s attached down below or the PDF can be found here.

What’s Worse Than Rigged Auctions & Internet Censorship? How About Both in One Package!

a PFF Progress Snapshot Release 4.12 June 2008

by Adam Thierer and Berin Szoka

The big spectrum policy debate in town these days continues to be the fight about how to redo the botched D block auction. As we all know, FCC Chairman Kevin Martin’s previous effort to micro-manage that auction failed miserably. Sadly, the follow-up plan isn’t much better, as the Wall Street Journal notes in an editorial today:

You’d think Chairman Martin would have learned from this experience. It’s not the role of regulators to pick winners and losers to achieve their preferred social outcomes. Private competition and the price mechanism can most fairly and efficiently find the best use for scarce spectrum. The FCC’s clumsy attempt at social engineering resulted in a failed auction that has prevented otherwise desirable spectrum from being put to commercial use. Alas, Mr. Martin has now proposed another wireless auction for a separate piece of spectrum. And this time he wants to require the winner to offer free Internet access that filters out pornography–conditions that obviously would decrease the value of the license and turn off potential bidders. It just so happens that Mr. Martin’s proposed auction seems tailor-made for the business plan put forward by M2Z, another politically connected Silicon Valley start-up looking to enter the wireless broadband telecom market.

The declared goal of the new plan is to provide “free” broadband to the masses while also satisfying public safety spectrum needs (though little is understood about how the propose service will support public safety). Supporting legislation introduced by Rep. Anna Eshoo (D-CA), H.R. 5846, the “Wireless Internet Nationwide for Families Act of 2008,” would require the winning bidder to:

offer, at a minimum, always-on wireless broadband services within 2 years from the date of receipt of the license, and complete the construction of such wireless network with a signal covering at least 95 percent of the population of the United States and its territories within 10 years from the initial operation of the network; [and] a data service that is faster than 200 kilobits per second one way for free to consumers and authorized public safety users without subscription, airtime, usage, or other charges.

Good luck getting anyone to bid much on that plan! It’s not really clear why anyone would think that a 200 kbps public utility service–even at zero cost–will have all that much appeal to the masses. Today, through server-side data compression, any of us can already squeeze 300 kbps out of our old dial-up lines–a service now free from companies like NetZero and generally costing less than $10/month. Even most existing wireless data plans today provide greater bandwidth. How many people are really going to want to use a “free” wireless network that pumps out far less? After all, you’re not going to be able to download many videos or big files or do anything very data-intensive on the proposed network. While a certain segment of basic smart phone users might be satisfied with such sluggish speeds for rudimentary web uses such as email, blog-reading, calendars and basic locational searches, existing equipment would not be able to connect to the proposed network because of the bands used. So, while such PDA users might seize the opportunity to use slow-but-free municipal wi-fi networks, they could not use the proposed network: an entirely new generation of wireless technologies would have to be equipped to support yet another wireless standard.

So why would any company pony up serious money at an auction to win the right to provide such a lackluster service to a minimum of 95% of the nation, including costly-to-serve low density areas, within two years? You don’t need to be a Harvard Business School grad to see why that plan doesn’t make much sense for most investors. (Never mind the fact that the auction of this much valuable spectrum with so many regulatory encumbrances will yield far less at auction to the U.S. Treasury.)

Of course, the winning bidder will likely have the right to “up-sell” customers to a higher-speed paid service. But we have no idea how well that plan will work out and, even if it did, it would call into question the logic of rigging this auction in the first place: Is the purpose truly to provide free universal broadband access, or just to hand someone a chunk of somewhat cheaper spectrum to let them up-sell customers to higher-speed, paid plans? If it’s the latter, the plan seems a little unfair to the private carriers who are already aggressively competing in the market today, having paid top-dollar for their spectrum and invested heavily in wireless data networks.

Or will the lucky auction winner be expected to rely in part on advertising revenues to pay for the up-front costs of winning the auction, building out the network and providing service–much as M2Z originally planned to do? If so, the provider would doubtless prefer to offer more profitable behaviorally targeted advertising customized for each user. The Federal Trade Commission has wisely chosen not to regulate such advertising, given its complexities and ongoing evolution, and to rely instead on enforcement of existing unfair and deceptive trade laws, while issuing voluntary guidelines for industry. But of course, the FCC would have jurisdiction over the proposed service and would likely face enormous political pressure to include its own regulatory regime for online behavioral advertising while drafting service rules. The controversy over such rules could delay the deployment of the proposed service, while any FCC regulations would inject the FCC into the ongoing debate over how to govern a practice that provides the revenue stream necessary to support a variety of content and services.

But this new spectrum-rigging plan is troubling for an entirely different reason: It demands Internet censorship. The original M2Z plan included a promise to sanitize this little patch of spectrum to make sure it was “kid-friendly.” What better way to win a spot in the heart of legislators and regulators than to promise network-wide Net filtering! After all, many lawmakers have long considered this the Holy Grail of Internet policy. Eshoo’s bill would mandate such filtering by requiring that the licensee “offer such free data service with a technology protection measure or measures that protect underage users from accessing obscene or indecent material through such service.”

It’s surprising that so few people are discussing the dangers of this portion of the proposal. After all, what we are talking about here is a blueprint for widespread, government-mandated censorship of the Internet. Many folks, including the Wall Street Journal in today’s editorial, seem to be under the impression that the mandate is strictly directed at “pornography”–and nothing more. But Rep. Eshoo’s bill clearly requires filtering of “obscene or indecent material.” Defining obscenity is difficult enough. But including “indecent” content will open up a Pandora’s Box of regulatory shenanigans. One need do nothing more than read a few pages of broadcast regulatory history to appreciate the practical challenge that awaits both providers and regulators as they attempt to monitor the network to ensure that everything is “decent” for the masses. (Moreover, is that really what the Internet that the masses want?)

Regardless, the important question is not what will be censored, but how it will be censored–a critical detail that neither Chairman Martin nor Rep. Eshoo have spelled out. But, in all likelihood, we’re talking about something more that just downloadable filters for consumers to install themselves if they so chose–leaving the decision to individuals and parents, where it belongs in a free society. Instead, it seems clear that we are talking about server-side, network-wide filtering that will essentially be forced on all users of the network. Such a technological solution will greatly slow down the already primitive network being proposed under this plan. But, more importantly, we have to wonder what sort of precedent is being established here for other broadband networks and the rest of the Net.

Of course, policymakers will respond by saying that the plan is simply another regulatory quid pro quo: We rig the auctions to drive down the cost, and you, the winning carrier, clean up the Net for us. That’s all easier said than done, and it raises a host of constitutional issues in the process. There are many better ways to protect kids, and there are certainly better ways to run a spectrum auction.