The case against the FCC's Net neutrality plan
Editors' note: This is a guest column. See Larry Downes' bio below.
I've managed to slog through the 107-page "Notice of Proposed Rulemaking" (PDF) issued late last week by the Federal Communications Commission.
Let me save you the trouble of reading the 185 numbered paragraphs, 310 footnotes, and three appendices, including separate statements from each of the five commissioners: there's nothing to see here, folks.
First, let's be clear about what has not happened. No new law was passed. No new federal regulations were enacted. No decisions were made.
Instead, the FCC proposed draft rules to codify the six Net neutrality principles Chairman Julius Genachowski outlined in his speech on September 21. Now begins the process of gathering comments and other testimony. Later, the FCC will vote on whether to adopt the rules or to amend them, or just call the whole thing off.
The basic thrust of the proposed rules, as nearly everyone knows by now, is to keep broadband Internet access providers from managing last-mile network traffic in ways that discriminate, pro or con, based on content, applications, or devices. Access providers would be banned from restricting or throttling services that the provider doesn't like, for example, perhaps because they compete with more expensive alternatives the provider or one of its business partner offers. The proposed rules would apply to all broadband access, including wireless.
The comment process, which runs until March 2010, is open to anyone. The FCC is clearly expecting lots of comment. The document itself asks more than 100 questions, including whether the new rules are necessary, whether the commission should enforce them without detailed regulations but instead on a "case by case" basis, and even whether the commission has the legal authority to enact new rules in the first place.
1. We don't need no stinking jurisdiction
The last question hints at one of many ticking time bombs. Although the FCC has for years published policy statements regarding open networks, the commission's authority to enforce those policies is far from clear. Under the 1996 Telecommunications Act--the last major rewrite of federal communications law--only traditional phone services delivered by traditional phone companies are regulated as common carriers.
If the FCC has any authority to regulate broadband access, it comes from what Genachowski calls the agency's "ancillary jurisdiction." But Comcast has already challenged that jurisdiction, in a lawsuit pending in a federal court of appeals. If the FCC loses that case, the proposed rules may come to a quick demise.
In arguing against ancillary jurisdiction, Comcast has found a surprising ally: the Electronic Frontier Foundation. The advocacy group--strong supporters of the principles of neutrality--believes that the commission has no authority to issue these rules without sweeping new authority from Congress. Regulating neutrality under ancillary jurisdiction, the EFF worries, is a cure far worse than the disease; a "power grab that would leave the Internet subject to the regulatory whims of the FCC long after Chairman Genachowski leaves his post."
Exactly.
What's the risk? For one thing, "ancillary" jurisdiction could also be applied, as the EFF points out, to the creation of new Internet decency standards. (Congress has tried repeatedly to regulate Internet content since 1996, only to be overturned by the courts.) The same FCC that now casts itself as savior of the open network, after all, has grown increasingly aggressive and prudish in policing content in its traditional job as regulator of over-the-air television. A federal court, for example, recently threw out the $550,000 fine levied in the Janet Jackson wardrobe malfunction case from the 2004 Super Bowl.
Speaking of power grabs, recall that the FCC has tried repeatedly, at the strong urging of media lobbyists, to force electronics and software manufacturers to implement the so-called broadcast flag. Responding to a signal embedded in programming, TVs, DVRs, and computers would be forced to limit the ability of consumers to time-shift programming, a capability we've enjoyed since the invention of the VCR.
Another federal court stopped that madness. Mandating the design of electronics and operating systems, the judges sneered, was no more in the FCC's power than "regulating washing machines." That rebuke hasn't stopped the FCC from trying again and again.
Maybe that's why the EFF isn't the only surprising voice calling for caution. Microsoft and Yahoo, leading application providers, have both pulled out of a coalition formed to advance Net neutrality, with Microsoft issuing a statement last year that "Network neutrality is a policy avenue the company is no longer pursuing."
2. Swallowing the rules
Even if the FCC has the power to issue new rules, there are enough exceptions to render them toothless. All the rules are subject to "reasonable network management" by broadband providers, a sensible limitation that is mentioned (though not yet defined) 66 times in the document.
As drafted, the new rules also allow access providers to prioritize performance-sensitive content, including voice and video, and to offer higher-price access options. This falls under the category of what the proposal calls "specialized" or "managed" services. That's nothing new. Harvard professor and open-network supporter Lawrence Lessig, who told the press that he was "thrilled" with the FCC proposal, has always believed that "broadband providers should be free...to price consumer access to the Internet differently--setting a higher price, for example, for faster or greater access."
The new rules, moreover, say nothing about discrimination by applications and Internet services. Even though access providers would not be permitted to block voice over Internet Protocol, or VoIP, telephone access from Skype and Vonage, in other words, the proposed rules would do nothing to stop Skype and Vonage from blocking calls to certain area codes, offering priority service to paying customers, or limiting the devices (e.g., cell phones) through which users can access their service.
There's no need to regulate applications, according to pro-neutrality groups like the Center for Democracy and Technology, because applications "do not suffer from the same bottleneck problem that the underlying broadband service inherently has." In other words, if Google searches prioritize Google content, and you don't value that kind of discrimination, you can use a different search engine. But today, in many parts of the United States, consumers effectively have only one or two choices for broadband access--their phone company and their cable company.
3. Avoiding the real problem
That, of course, is the real reason everyone, including me, worries about non-neutral behavior. In the absence of real competition, monopolies and duopolies have strong incentives to discriminate in ways that can severely burden some classes of users--whether consumers or service providers or both.
Despite a few isolated incidents of clumsy interference, however, no one really believes that the lack of competition has created true market failures. At least not the kind of failure severe enough to justify the intensive federal regulation visited, with mixed results, on U.S. railroads a century ago or of the telephone monopoly from 1913 until 1982. Pro-regulation advocates, including Chairman Genachowski and Google Vice President Vint Cerf, speak in the conditional tense. The word "could" appears 55 times in the FCC proposal.
Regulating ahead of a market failure makes little sense when, as everyone acknowledges, the underlying technology for access is evolving rapidly and models for making money in Internet provisioning are still in the early stages of development. The risk of non-neutral behavior is significant, but the cost of regulation and the potential for unintended consequences may be higher. "Have we correctly identified the costs and benefits of the alternative approaches?" the commission asks. The answer is that it hasn't even begun to identify either, correctly or otherwise.
And if the real problem today is broadband bottlenecks, why is so little being done to encourage competition? Municipal wireless Internet projects have largely shut down, in large part because state governments and their lobbyist friends maintain that the law allows them to prohibit cities from competing with private-sector communications companies, a view supported by the FCC in 2001.
Offering broadband over power lines, another promising option, has been stymied, with the FCC receiving still more abuse from the federal courts in 2008, for their failure to adequately support the development of the technology.
Net neutrality advocates may be celebrating the start of a process they have argued for since 2005, but here, as with all technology regulation, it's wise to be careful what you wish for. For now, the proposed rules look to be dead on arrival--and of multiple causes.
That's one more reason to wonder why, if there is a problem to be solved sometime in the future, anyone thinks the FCC is the organization best-suited to solve it.
Larry Downes is a consultant and author, most recently of "The Laws of Disruption: Harnessing the New Forces that Govern Life and Business in the Digital Age." He is a nonresident fellow at the Stanford Law School Center for Internet & Society. 
At least the EFF is realizing that we're on our way to another massive Fed power grab under the guise of cutesy Orwellian language. The shrieking "neutrality" fans will have a big party thinking they're getting their bandwidth subsidized, only to realize they've given more media control to Bawney Fwank and company than any "free" country has ever endured.
Just what we need, ISP's heavily regulating their traffic so much so that it pushes their customers into higher tiered more "open" plans. Or they'll have some alternative any traffic plan limiting one to X number of GB's per month, and charge insane amounts for overages. I'm far from an expert on this but from my perspective it feels like we could be moving this way, just M2C. Feel free to educate me if I'm way off base and ranting like so many cnet users.
I wish cnet let us edit our posts.
In the current world, only a small percentage of people purchase cell phones without a contract. The reason is the rediculously cheaper price of the phone when subsidized by the phone company.
Now go back to the time when cable tv first came out. Imagine if comcast, or whatever company, started offering TV's at lower prices with a subscription to their service. Two things would happen: A. people would gradually come to the point where they only purchase a TV with a plan because of the lower price. B. Only the TV companies that Comcast likes, get to sell their TV's.
Heres another analogy:
State Gov't departments of transportation currently control the highways and tolls, similar to how ATT and Verizon and Comcast control access to the internet.
What if you drove to the highway and the DOT wouldnt let you on because you were driving a Chevy, and the DOT only authorizes Hondas and Toyotas to use the Highway because they are more efficient. Plus, they have never certified chevies to use the highway, so they are not sure about how they will operate and dont want to jeapordize the entire highway.
These scenarios dont seem to good, but it is suprising what people will tolerate once they become used to it. If cable companies would have had the power to control TV like they can control the internet, things would have happened alot different.
I have not had a decent multiplayer session ever since they started throttling.
75% of the time I am kicked from game server due to dropped packets(sandvine) or high latency.
The bandwidth is there but they refuse to allow me to use it. So I jumped ship and now I have FIOS.
No more lag. Keep your stinky bloody ape paws off my multiplayer gaming!!!! Now and forever!
Seems to me they refuse to speak about IPV6 at all when all they are doing is squeezing the IPV4 as much as possible.
Now is the time for IPv6 but they refuse to go there because they want to charge more money for IPV4.
Wiithout the underlying connectivity and freedom that the internet has each connection is worthless. AOL, Prodigy, and Compuserve (and others) were essentially private internets. They all died.
And the slippery slope against government are ridiculous. This is really simple if you don't like fascists running the FCC then don't put one in the white house.
The point was to limit government's role in our lives so that it wouldn't even be a possibility--politicians would come and go but they wouldn't be able to just dictate whatever they pleased and push us toward Omnipotent Government at the drop of a hat.
But so you know I feel, write letters, AND I vote... you may wish to do more than just feel 8^)
Cox cable, you have been warned!
Also the slippery slope arguments against government are ridiculous. This is really simple if you don't like fascists running the FCC then don't put one in the White House. Problem ? Solution!
In its past attempts though, the FCC has appeared as the political push button for corporate initiatives, when it should be neutral, so it gets shot down. I think it would have a better chance of adhering to the concept of freedom of information philosophy the internet was founded on when it was initially rolled out to educational institutions.
For the time being, it sounds like they need to go back to the drawing board on this one. The current revision sounds too much like Net neutrality while still providing provisions for the same kind of throttling it is touting itself as trying to prevent.
Then we could have space on the other side of the central office for companies to come and put in some gear. Then these companies could COMPETE and sell us voice, video, Inet access over our fiber connections.
Gee, that would be nice, but it sounds to much like a dirty capitalist idea to catch on.
However, the FCC could and should act to address the market failure that exists in access *to* the Internet. They decided in 2005 that DSL should not be common carriage any more; ILECs can keep to themselves and not let other iSPs on it. That is what opened up the whole can of worms in the first place. If any ISP could (as was the rule before 2005) get DSL on the same terms as the telco's ISP affiliate, then misbehavior on the Internet side could be greeted by market entry or greater market share by competitors who pay to use the same monopoly wire.
The FCC (different leadership then) blatantly lied about their motivation. They said that the Supreme Court made them do it. Flat-out wrong; the Supremes merely said that it was okay if cable did not have to have the same obligations as phone companies. (The law is actually pretty clear on that.) They could simply admit that their predecessors' decision was wrong, and fix it. This *open* access to the wire, which must be totally bit-neutral, would take care of "neutrality" the right way.
Who do we trust more Google, Amazon, etc... OR AT&T, Comcast, etc... ?
For most major Internet companies, they also have other services. Internet is becoming a direct competitor to the other services that the company offers. Why would the AT&Ts and Comcasts not want Internet to become faster and better, and why do they not want a neutral network? Because it is not in their best business interests. That is why we have to require neutral networks for these companies. We do often here "could" when hearing the warnings against non-neutral networks, but the reason we do is because those companies who control the networks shouldn't want the competition with their other services.
Just think if you could watch all the TV you wanted over the Internet, when and where you want to, why would you need cable TV?
I don't trust the government, but I trust less a company that says they will continue to compete against their own interests just to be nice to their customers.
Real competition has to be encouraged. Where it is, people have lots of bandwidth. Where they are not, the restriction is artificially low.
An example is the town in Wisconsin that had to build their own fiber to the home network before a company that was supposed to do it was willing to. Business interests are diametrically opposed to the public good. When that is the case, regulation is called for.
Also if you are not talking about laying a brand new network are you saying cable and phone companies should not be allowed to run internet services over the infrastructure that they built and own? If this is the case I'm sure they would want compensation for it's use.
Isn't this what capitalism is all about.
It is true that much of that data flow is spammy crap. But, we have all come to expect that this is the price of freedom. No one likes the guy who stands at the corner screaming about the inequities of his life. But the principles of freedom prevents the annoyed from legally shutting him up.
In response to your three bullet points, I present these:
1: (Jurisdiction)
That is something that Congress should rectify by not only giving the FCC the authority to create and enforce net neutrality rules. But to make net neutrality the law of the land.
2: (Toothless)
I agree with you here. There should be no exceptions other than blatantly obvious ones -- like the recent disconnect from that rogue ISP which knowingly and actively housed so much illegal activity.
3: (No competition)
We agree here once again. Recall that when a town tried to run their own broadband, (because the ISP claimed it would be too expensive to put in the infrastructure), the ISP took them to court to block them from doing just that. There is nothing more a-holey than monopolistic shenanigans like that! Congress should take action here as well. Remove any anti-trust immunities that these buggers have, then let the Justice Department take it from there.
Now, it may be that certain networks will truly not be able to handle -- let's say, streaming video on a mobile network -- for instance. If that is the case, said network should then not allow streaming video from any source, including their own. They cannot claim that on the one hand, streaming video will bog down their network, while on the other hand, they are streaming from their own servers all across the country.
One final comment. About this 'bottleneck' crap. Last I heard, there is still a whole hell of a lot of dark fiber that was laid down during the boom years. Once you remove all obstacles to competition, all of a sudden, you're going to see these dark fiber lanes light up like a super nova!
Net neutrality. I am definitely all for it.
Dude, they did it anyway. Google the "CCI Byte" and you'll discover what's happened to the broadcast flag.
From TWC, posted here: http://www.tivocommunity.com/tivo-vb/showthread.php?p=7562980#post7562980
Thank you for writing. I apologize for the delay for communication regarding the content protection settings (also referred to as "CCI bits"). Time Warner Cable, like other distributors of multichannel video programming, negotiates the distribution rights for the content it carries independently with individual rights holders. These bilateral commercial negotiations take into consideration many different factors, including the content protection and digital rights management requirements of the rights holder; applicable law, license and regulations; and the interests of subscribers. Each of these commercial negotiations, and the terms of the agreements that result, are unique to the specific distributor and programmer involved. Accordingly, Time Warner Cable cannot comment on the rights and obligations of other distributors under their separately negotiated agreements. With respect to Time Warner Cable?s content protection settings, however, they are established in accordance with applicable law and its own agreements with programmers.
Consistent with those settings, content delivered by Time Warner Cable that has been flagged ?copy one generation (0x02)? can only be copied once. Therefore, and as described on TiVo?s website (http://support.tivo.com/app/answers/...d/100041/sno/1), TiVo?s multi-room viewing and TiVoToGo? features only permit content that has been flagged as ?copy freely (0x00)? to be transferred to a second TiVo DVR or a PC. That is because both of these features make a second-generation copy on the downstream device. Certain content delivered by Time Warner Cable, including local broadcast television stations? digital (SD and HD) signals, is flagged ?copy freely (0x00)? and can be transferred to other TiVo DVRs and PCs.
Time Warner Cable appreciates your feedback and will take your concerns into consideration going forward. Thanks again for being a Time Warner Cable customer.
Regards,
John Orzolick
Customer Care Advocate
Time Warner Cable Corporate Office
- by dlsweb October 29, 2009 9:40 PM PDT
- Thank You for the overview.
- Like this Reply to this comment
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Showing 1 of 2 pages (49 Comments)I really was for it before I am against it.
We need to be careful in giving the federal government the authority to make any rule they may want to impose over us.
If you are aware of the views of the FCC's Diversity Czar, Mark Loyd, you may want to be afraid.