Fairpoint Flare Up, Next Net Neutrality Flare Up Or Another Misunderstanding?

I am seeing in a few places such as App Rising and Slashdot that Fairpoint is planing to force subscribers to use its webmail portal even if they get Yahoo, MSN, or AOL email. This would, of course, be a major violation of the FCC’s “Four Freedoms” by preventing users from accessing the legal content or services they want to access. Which makes me somewhat skeptical that this is actually what Fairpoint intends.

For those just tuning in, Fairpoint acquired most of Verizon’s high-cost rural systems in Maine, NH and VT. Leaving aside the underlying logic and value of the deal to the various parties and local subscribers, the critical point is that Fairpoint will complete its take over of these systems and cease operating them as part of the VZ network on January 31, 2009.

What started the current rumor about Fairpoint’s plans is this article in the Rutlan, VT Herald detailing changes for local subscribers. In particular, the article notes that as a result of the change, users will get Fairpoint.net addresses rather than Verizon.net addresses, and will need to reconfigure their mail clients to pull mail from Fairpoint rather than VZ. Then comes this quote:

Web-based e-mail users can continue to access their e-mail at the Verizon Web site until Feb. 6. After that date, Fastiggi said users will need to log on to www.MyFairPoint.net. Customers then click on Web mail and type in their existing user name@myfairpoint.net and existing password.

AOL, Yahoo! and MSN subscribers will continue to have access to content but will no longer be able to access their e-mail through the third party Web site. Instead, Yahoo! and other third party e-mail will be accessed directly at the MyFairPoint.net portal.

Most folks are reading this as saying that Fairpoint plans to require all users of these services to use the Fairpoint mail portal. But I notice that these are all companies that have various sorts of co-branding agreements with Verizon. This suggests a different interpretation.

Right now, as I understand it, if you are a Verizon-Yahoo customer (or other third party customer) than you have certain access privileges that integrate email to either Verizon or the third-party email service seemlessly. Our VZ-Yahoo customer logs into mail at either VZ or Yahoo’s portal and sees all mail addressed either to xxxx@verizon.net or xxxx@yahoo.com. I should stress that as I am not a VZ subscriber, I am not entirely clear on the details. But it boils down to the fact that VZ has negotiated certain application deals to make itself more attractive and that these deals are seemless to the subscriber. Fairpoint, obviously, does not have these thrid party deals.

What I think the article is trying to say is that whetver special value-add services you got from being a VZ-AOL or VZ-MSN or VZ-Yahoo subscriber, these disappear when Fairpoint takes over on January 31. Rather than have an integrated mail platform for both email addresses, you will need to go to AOL.com and go to their mail portal, which will provide only the mail addressed to xxx@aol.com, and go to the Fairpoint web portal separately to get your email addressed to xxxx@fairpoint.net. But Fairpoint is not planing on interfering with you going to AOL.com and using their website to read your email.

This explanation would make much more sense than the idea that Fairpoint will force you to read any third party email through the Fairpoint web portal. For one thing, it really doesn’t make sense to force all email users to give up their web-based third party emails to use Fairpoint. Nor does it make sense that they would give you access to the entire third party website except their email portal. They could, but why do it? Finally, given what happened to Comcast when they interfered with applications in a much more subtle way that was arguably linked to network management, I can’t imagine what would prompt Fairpoint to court an FCC complaint — especially when state regulators had previously voiced concern about Fairpoint’s ability to provide broadband service for local subcribers.

In any event, I await clarification before going ballistic or engaging in another round of breathless “network neutrality violation” stories. If I’m right and this is just a notice that Fairpoint cannot honor deals made between Verizon and third-party service providers, all well and good. If it is Fairpoint for some reason trying to force customers to abandon third-party email providers and use only Fairpoint, then we have another NN complaint and, most likely, a user revolt and angry letters from various members of Congress and state officials.

Stay tuned . . . .

My Simple Net Neutrality Fix.

In what Rob Friedan accurately describes as an obtuseness so thorough it looks suspiciously like deliberate misinformation, the Wall St. J. has yet another piece on what it imagines the network neutrality fight is about and why the best thing in the whole wide world is to do nothing.

Rather than rehash old ground (Rob does a fairly good job of it in his post), I will move on to my handy and simple network neutrality solution. “Simple,” in the sense of being a fairly straightforward piece of legislation. It would pass the buck back to the FCC for implementation — with all the attendant hassle and complications that brings. But from a Congressional standpoint, it is really quite straightforward. In fact, Congress already resolved this problem once a long time ago, back when the FCC was struggling with them new-fangled mobile wireless networks.

How did they do it? And what would I do for broadband? See below . . . .

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Why Lary Lessig's FCC Reboot Will Crash.

On of my favorite die-hard Libertarian writers these days is David Friedman. Part of that is because we have known each other 20 years or so (albeit in a somewhat different context), and it is in part because if he can teach law and economics without either a law degree or economics degree, I can do law and economic policy without a degree in economics (I do have a law degree). But the real reason is because Friedman actually makes the argument for Libertarianism in his new book Future Imperfect that I think is the strongest argument and that no one in policy land ever has the guts to make. Friedman argues that while you may get utterly wretched results from a deregulated market and no regulatory authority, you have a better chance of getting a good result than if you centralize the decisionmaking in a government agency.

I happen to think David is wrong about which process will make worse decisions, but I think his approach is basically correct. As regular readers know, most free market enthusiasts I encounter in policy land insist that deregulation is the pathway to salvation and that while regulation will always prove disastrous in the end, the true path of deregulation will only bring joy and happiness. Simply let the market be, and the Competition Fairy will bring wonderful low prices and innovative new services to market. Try to regulate, and the Blessed Competition Fairy will turn her face against you and smite you with higher prices, worse service and a plague of villainous bureaucrats. So finding a Libertarian willing to admit that we may actually end up with crappy outcomes in a deregulated world — even if he thinks deregulation improves the odds for a better outcome — is rather refreshing.

I agree with David that we live in a messy world where we will have a lot of problems and crappy outcomes no matter what we try. But for a lot of reasons I have gone on at length about elsewhere, I think we will end up with at least a chance for better outcomes if we have regulatory structures in place that provide needed oversight and protection against the inevitable exercise of disproprtionate power and information asymtery that promotes real bad outcomes (like, say, a total meltdown of the financial markets). Sure, things can go very badly wrong with a regulatory regime. The problems of agency capture by incumbents and the cost of regulation are real. But using real economics to look at how markets behave tells me I’m screwed for sure if I embrace the Libertarian approach, whereas trying to come up with a well constructed regulatory scheme gives me a fighting chance of actually getting good results from time to time.

I indulge in this lengthy preamble to set up my primary argument for Larry Lessig’s piece in Newsweek to abolish the existing FCC an replace it with an innovation environmental protection agency (iEPA). Larry believes the iEPA, free of the 1930s ideology of regulated monopoly that shaped the FCC’s underlying statutes and designed to encourage innovation, would end up producing superior policies that would do things like encourage new uses of spectrum against the wishes of exclusive licensees, protect us from abuse of market power by enforcing network neutrality rules in a fashion similar to the Comcast/BitTorrent complaint, without stifling everything in tariffs and restrictions that incumbents can manipulate as they have throughout the FCC’s 70 year history.

Maybe. But I think it more likely things would turn out like they did with ICANN. Despite moving management of the DNS out of government into a non-profit supposedly managed by engineers and limited to “voluntary coordination” and “bottom up processes,” ICANN has proven as prone to abuse and capture by incumbents as any federal agency — possibly more so because it lacks judicial oversight or mandatory procedural safeguards (it has adopted some, but they are ultimately voluntary). As I observed in my last post, ICANN didn’t end up like it did because it was designed by bad people. It happened because we live in a messy world and expecting that good intentions and trustworthy actors with the best interest of the “Internet community” at heart could magically overcome the realities of stakeholder incentives and econonmic and political realities is as much a fantasy as the Gods of the Marketplace and the Competition Fairy.

I’m also frankly not so convinced that the FCC we have is such an awful thing. Sure, I can think of a lot I would change if I ran the zoo — both in terms of underlying statutes and how the FCC operates. And I get Larry’s point about how the “DNA” of an agency effects what it can and can’t do. But I also think the FCC has become the thing everyone loves to hate in telecom land, with that delightful air of sophistication when everyone important agrees that it is so obvious that things are wrong that no one could seriously defend the FCC and the only real question is how to fix it and whether it is politically possible to fix. But we in policy wonk land tend to focus on a handful of hard issues where anyone of us, given the power of philosopher king, could naturally make a better job of it. We ignore that most of the business of the FCC is pretty prosaic — such as certifying devices under Part 15, processing requests for license modifications, investigating slamming complaints — and that the rank and file employees at the FCC do their jobs with the same reasonable assortment of hard workers, slackers, geniuses, morons and just plain folks as found in any other corporate headquarters. And while few folks these days think much about such archaic things as tariffs and ensuring that rates for basic voice service are just and reasonable, a lot of us would notice if even the minimal levels of regulation left suddenly vanished. Transforming the FCC’s policy functions to be about “promoting innovation” rather than regulating government monopolies might seem real attractive to us in wonkland, but the actual functions of the FCC need to happen somewhere — and I am fairly certain that outsourcing them or eliminating them are not magic tickets to the Land Flowing With Milk and Competition promised by the Holy Prophets from the University of Chicago.

Finally, I grant Lessig’s point that underlying statutes — the regulatory DNA — matter. It made all the world of difference when we changed the Atomic Energy Commission with its role of promoting nuclear power to the Nuclear Regulatory Commission with the job of making sure nuclear power plants were safe. But even in its fundamental statutes, I think the FCC does better than most people credit. For one thing, I think the fact that the FCC is an independent agency with members of both parties making decisions is a criticaly important safety mechanism for the agency that controls how we receive news and communicate with one another. Given how the Bush Administration has used the IRS and the DoJ to intimidate political opponents, the Office of Management and Budget to veto regulations it doesn’t like, and the Government Services Administration to award patronage and further political ends with a blatancy not seen since we abolished the “spoils” system, the fact that the Commissioners are immune to direct political influence by the President is not nearly so trivial a matter as cynics like to presume. I also think the FCC has alot of good, progressive stuff in its DNA that — all too often — gets lost in implementation. Look at Section 1 of the Act, which talks about developing a state of the art communications system by wire and wireless accessible to all people of the United States regardless of race or gender, or Section 257 reaffirming the purpose of the policy of the United States “favoring diversity of media voices, vigorous economic competition, technological advancement, and promotion of the public interest, convenience, and necessity.” Or Section 201 and 202, declaring all unreasonable discrimination or unreasonable practices in deployment of communications services illegal.

Yes, the FCC was born in an era when it seemed communications was about regulating government monopolies. But it was also born in a a progressive era when Congress understood that government had a role in protecting everyday citizens from the abuse possible in an unregulated market, and that government had a role in ensuring that everyone benefited from advances in communications technology and had access to vital services. Those aren’t bad building blocks for creating a telecommunications regulator that will encourage innovation and prevent a few huge companies from exercising market power.

So, contrarian that I am, I think that for our messy complicated world, the FCC muddles through pretty well, all things considered. It gets more right than wrong in its underlying DNA, and many of its problems come from nature, not nurture. We cannot hope to cure the underlying problem that people often make bad decisions when confronted with complex problems, because it derives from the overall messiness of the world. Rather than try to create an iEPA that will have its own problems, why not make the FCC we have work right. Yes, the old philosophy that Congress should delegate to an expert agency that would somehow resist human weakness and make decisions based only on merit — or even that all reasonable people could agree on the “right” expert answer — now seems hopelessly naive. But the notion that we should junk the whole flawed apparatus because “the market always knows better than some elitists in Washington” has proven equally naive.

Rather than try again to create some perfect system that will always produce the right answer, I say stick to the more realistic goal of making the current FCC work better. With the political winds shifting back in line with the FCC’s more progressive DNA, let’s seize the day and make what we have work for us. It’s fun to blame the FCC for all that’s wrong in the world, and imagine that we can set up some kind of philosopher king who will make only good regulations that neither “favor incumbents” nor “impose undue regulatory costs.” But I think that is about as likely as the Competition Fairy.

Stay tuned . . . . .

Note to Obama Administration: Please Reform the NTIA-ICANN Relationship.

One of the sad legacies of the Clinton Administration is the never ending circus of internet governance known as the Internet Corporation for Assigned Names and Numbers, or ICANN. The idea, in those optimistic “anything not government is good” days, was to insulate management of the domain name system (DNS) from politics by setting up a structure outside government to handle the name and number system of the internet. The notion was that you could take a critical foundation of the internet’s architecture, on which a company called “Network Solutions” had built a huge business on maintaining a friggin’ database, and prevent people from trying to control it by moving it out of big bad government and into a noble non-profit corporation. As a double protection, they expressly limited ICANN’s mission to “technical coordination” via “private contracts” and absolutely not, not, NOT governance. Oh, and fixing trademark and cyberquatting issues. And having governments involved via the “Government Accountability Committee” (GAC). And creating competition in the domain name registration biz. And DNS security. But other than that, no governance.

Some of us at the time warned (a) that there was nothing magic about government v. non-government, control over a critical resource just about ensured that government-like stuff would happen, (b) you can’t be “no governance, just technical coordination, except whatever” anymore than you can be “absolutely all abstinence except for the no sex part,” and (c) Anyone who thought governments — including the U.S. government — would just let DNS go its merry way and limit input to an “advisory committee” for a “technical coordination body.”

Guess what? Turns out we were right. So now the Obama Administration gets to inherit the perennial problem of how to deal with all the conflicting interests around ICANN and management of the DNS system — a most unrewarding job given the number of conflicting interests and the fact that while the issue is potentially of significant importance to the smooth management of the internet, the actual pay off for any specific decision is pathetically puny compared to the massive headache caused by making a final decision. Which is why this has festered for ten years.

A bit more, and an outrageously simple suggestion, below . . .

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What are laws for?

Why do we have laws? It seems to me that the only good reason for creating a law or regulation is to protect an identifiable victim. Other arbitrary purposes, such as defining or imposing morality, are simply not good enough. But is this distinction a founding principal of our governing civil institutions? I don’t know. Anyone? (Harold….?)

We do have a variety of non-secular institutions that define rituals, beliefs, behavior, and other constructs along different lines, and these are not bound by the principal of protecting an identifiable victim. Does our separation of civil and religious institutions cover this principal, or does our Western and Judaic tradition blur the distinction?

While civil governments do issue proclamations, such as defining an official seal of the state, or designating a day of commemoration, this seems to me to be a separate function of government outside that which can be decided and acted on by the court system. A political body or office-holder may well declare that one plus one is two — or three — but there are no legal consequences for disagreeing. Unless we can define a specific and testable group to be protected by an answer of two or three, it would be inappropriate to elevate either proclamation to be a law or regulation.

Did 3.65 GHz Really Cause TV Interference In Philly? Why I'm Skeptical.

Harry Jessell over at TVNEWSDAY has this story about a possible interference problem between operation of 3.65 GHz band equipment and the neighboring C-Band satellite receiver operated by CBS-owned KYW in Philadelphia.

According to the article, KYW experienced interference on its C-Band downlink near the 3.70 GHz frequency in February 2008, and resolved the problem by shifting to a higher frequency. The interference stopped a short time later, then flared up again in September, prompting KYW to call the FCC. That seems to have taken care of the problem, indicating it was a byproduct of some human operation addressed by the FCC enforcement — although possibly not. According to the article, the FCC won’t talk about it — which is standard procedure in an enforcement complaint.

According to the article, KYW Chief Engineer Rich Paleski thinks the problem was a “WiMax operator” using the 3.65 GHz. Paleski worries that 3.65 GHz will not be compatible with C-Band satellite downlink operation and warns “that should concern every station that imports programming via C-band satellite, which is to say just about every station in the United States.” He wants all television broadcast engineers to be alert for interference in the lower part of the C-Band near 3.70 GHz.

Given the rule limitations on use of the 3.65 GHz band, I am extremely skeptical of Paleski’s conclusion. Why? Because given the rules for operation in the band, no one should have been operating on the band in Philadelphia. And even they were operating illegally, they would have needed to hack the equipment to get within 25 MHz of 3.70 GHz, or have anything like the power needed to cause the kind of interference Paleski reports.

Given the growing popularity of the 3.65 GHz band for WiMax (as evidenced by projects like these), I think it’s important to look at this very carefully and not go leaping to conclusions. The 3.65 GHz band holds out a lot of hope for rural broadband by wireless ISPs (WISPS) running small businesses and priced out of licensed spectrum. Before anyone starts speculating from this single incident that use of 3.65 GHz poses a danger lets take a careful look at some of the facts around the use of 3.65 GHz and why I don’t think this is an industry-wide issue. It’s always easy to blame the new neighbor — especially when you think “their kind” is trouble. But how likely is it really?

More below . . .

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The Google Non-Story On Network Neutrality — And Once Again Why Citizen Movements Are Citizen Driven.

Both Dave Isenberg and Tim Karr have already cast a rather skeptical eye over the Wall St. Journal story claiming that Google is in secret negotiations to get “fast lane” treatment for its content in violation of Network Neutrality principles. I’ll therefore limit myself to a few additional points. I’ll not along the way that one of the nice things about having a blog is that I can point to stuff I said a long time ago for the inevitable accusation that I am simply an apologist for the Great Google Overlords.

More below . . . .

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