COPE-ing nicely, thank you

Throughout the public interest community, one can find much wailing an gnashing of teeth over today’s Commerce Committee mark up of the Communications Opportunity Enhancement Act of 2006 (COPE). “A Bad Day for Media Democracy” reads the headline at Save Access.

Well, I’m not happy with COPE so far, but I think it turned into a good day for democracy, with better days to come. Because if you thought today was grim, you weren’t here for the absolute spanking net neutrality got in subcommittee in the beginning of April. In the week since the SavetheInternet campaign got underway, four democrats switched their votes on Net Neutrality from “anti” to “pro.” The day before mark up, the Republican chair of the House Subcommittee on Antitrust in the Judiciary Committee and their new task force on telecom declared all out war against the Commerce Committee effort to eliminate a free and open internet. The telcos, who earlier this month boasted they could get the bill past both houses and signed into law before the election recess, don’t sound nearly as confident despite today’s win.

What changed? Until the Subcommittee Spanking, folks let the tech companies do the heavy lifting and fought by the standard lobbying play book. Hill meetings, inside the beltway briefings, insider baseball, blah blah blah. Google v. Verizon, people said, and tuned out. And while the tech lobbyist worked with us public interest folks, one could not help but detect a certain — how shall I put it? — condescension and cluelessness as to how this “public interest” stuff really works. It kinda felt like posing for photo ops, while the “real” decisions about spending money on messaging and what strategies to persue and the ever-important smoke filled room meetings never involved anything as messy as the public.

And, as usual, the tech folks got spanked. Spanked real good. The kinda spanking you usually have to pay good money for if you fancy that kind of thing. Because despite having more money than the telcos and cable cos combined, the tech cos can never win using telco and cable co rules. Because the telcos and cable cos wrote the goddam rules and have played this game by this rulebook for a longer than most tech CEOs have been alive. As a result, the telcos and cable cos are very, very good at it. Meanwhile, as my friend and fellow traveller Jeff Chester at CDD observed the tech companies still can’t figure out how to play this game, or what they want to get out of it if they could figure it out. Or maybe they just like getting spanked, and miss the days when the intellectual property mafia would toast their little bottoms for them with legislation like the Digital Millenium Copyright Act.

So, while still working with the tech lobbyists etc., the folks in the public interest community finally said “Screw this. You guys may be into getting spanked, but we prefer winning. And the way you win in democracy is by busting open the process, getting people to see what’s at stake, and reminding elected officials that their job is to do what’s best for their constituents not to referee industry food fights.” And thus, through the work of Free Press, Common Cause, Moveon and a host of others, was the SavetheInternet campaign born. And when the mainstream media refused to cover the story as too technical or boring or against the interest of their parent mega-companies, 500 bloggers took up the cry. And all this free speech stuff, that the telcos and the cable cos and the memebrs of Congress ignored because it doesn’t have a trade group and you can’t quantify it in dollar terms, really worked. And more and more people are writing letters and calling members and reminding them that there’s an election this fall.

There’s a lesson here; one backed up by the utter triumph of the pro-munibroadband forces against proposed amendments to outlaw munibroadband, or even to grandfather existing state-level bans. YOU CAN’T OUTSOURCE CITIZENSHIP. You can’t let “the tech companies” or even “the consumer advocates” or anyone speak for you. Citizenship carries responsibilities that go beyond the ritual of voting every two years. But when citizens wake up and speak up, and speak to each other, they find — to their surprise — they are strong. They find they have power. And they find that being a citizen may take hard work, but it is so, so, SO much better and more satisfying than being a couch potato. As the great Jewish sage Hillel said: “If I am not for myself, who will be for me? If I am only for myself, who am I? If not me then who? If not now, when?”

Don’t get me wrong. I’m glad the tech companies are on our side. They have a lot to offer, lots of resources, and, if they decide they are tired of of playing by the old rules and getting spanked, can really help push this effort over the top. But if we as citizens let this degenerate to a fight with Google, Microsoft and Silicon Valley venture capitalists who like tech start ups on one side v. AT&T, Comcast and Wall Street analysts who like monopolies on the other, with Congress brokering a deal between the two, then we citizens lose no matter which side wins. We can, we must, speak for ourselves.

When Ben Franklin left the Constitutional Convention someone shouted to him from the crowd “Mr. Franklin, what have you given us?” He answered “A republic — IF YOU CAN KEEP IT.” The Sausage Factory of democracy is a messy business, but it’s worth it. We can either let other folks make the sausage and eat whatever shit they put in, or we can wade in and make sure it comes out alright. We lost today’s battle. But we are turning the tide in the war. And if we keep growing and going like we have in the last week, we will win.

Stay tuned . . . .

Wyden Introduces Net Neutrality

Wyden (D-Ore) has pushed back against the wussiness of the Enisgn (R-NV) bill. The Ensign Bill has a provision that would require “neuterednet neutrality.” The broadband access provider could still favor its own content and could offer “premium” service to others.

The Wyden “Internet Non-Discrimination Act of 2006” requires real Net neutrality and has a serious enforcement mechanism. If the FCC sits on a complaint, it is deemed granted in 90 days.

Of course I’m partial to the Wyden bill from shear vanity. The bill references the muni broadband paper I wrote last year in the legislative findings.

Stay tuned . . . .

Outsourcing Big Brother

I gave this speech last July at the ACLU Biennial Conference in New Orleans. At the time, the news that major telcos and search engine companies were cooperating with the government by providing all kinds of personal infomration had not yet hit the press. I was just applying logic.

It seems useful to me to publish here as a reminder that the recent headlines are not an aberration or the work of a few evil or gready or misguided men. It is the inevitable result of a system that concentrates power and information in the hands of a few large coorprations with every interest keep those in government happy.

We don’t ask chain saws to distinguish between human beings and trees. They are inanimate tools. If you turn it on, it cuts through things. If you want to make it safer, you need to put on safety locks and other devices, or someone is likely to cut his or her own leg off by accident some day.

Similarly, it is ridiculous to depend on corporations to defend private information. They are designed to maximize revenue for shareholders. This does not make them good or bad, greedy or virtuous. It makes the corporation a tool. If we, as citizens of democracies, care about our civil liberties, then we need to install some safeties.

Stay tuned . . .

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STOP THE WIFI TAX RUMOR

Freaking trade press should know better, or at least learn to read more carefully. There is a steady drum beat of reports, starting I think with this one at RCR Wireless News that the President wants a “wifi tax.” This is, bluntly, a misreading of the plain language of the President’s budget proposal.

Lord knows there is plenty in the proposed budget not to like, but there’s no “wifi tax.” My analysis (and a little context) below.

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Did the Bells Rip Off America? and Is There An Alternative?

I want to put two pieces side by side here: Bruce Kushnik’s magnum opus The $200 Billion Broadband Scandal, accusing the Bell Companies of ripping off the U.S. public to the
and Bob McChesnney’s and John Podesta’s visionary Let There Be Wi-Fi talking about the power of unlicensed spectrum as a broadband solution.

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Memo to RIAA: It's not the “piracy” — your music sucks

For about five or six years now, I’ve been hearing the music industry folks piss and moan about how downloads are killing their profits. My usual response has been to observe that (a) while true that CD sales declined in 2001-2004, those were also years of general economic recesion and it was no surprise sales dropped (the music industry has been pretty quite about this since the CD market rebounded along with the economy in 2005); (b) if you put out an over-priced crappy product, the market will respond.

The problem is that most executives in the entertainment industry have enjoyed their monopoly status for so long that when the market finally responds, they get caught completely by surprise and usually enter a state of denial. (This is equally true for broadcasting and movies and cable, al of which have spent the last ten years or so busily consolidating and producing predictable products. Eventually, sales and ratings decline. And these guys are are surprised and looking for some regulatory fix they can plug to solve their “problem” — like broadcast flag or limits on satellite radio.) As a result, they don’t want to hear that they need to stop abusing their customers and work for a living.

A recent poll provides one more piece of evidence which I predict the music ndustry and their lap dogs in Congress will continue to blissfully ignore. A recent poll shows that most music fans don’t “steal music” and are very happy to pay for quality products — particularly things like downloading that really suit their needs. But music lovers are tired of being treated like trained seals expected to buy whatever the music industry offers at whatever price they chose to sell it in whatever format the music industry insists on providing.

Why this trend is so shocking in the music industry when we see it in a variety of other industries (have YOU driven a Ford lately? Probably not, because they offer crappy behemoth-class cars instead of better fuel efficient ones) I have no idea. I guess being a cartel gives you such a sense of security you forget about that whacky free market you’re always praising in Washington.

Stay tuned . . . .

Adelphia Transaction Advances

Lost in the hub-bub of yesterday, the Federal Trade Commission voted 3-2 along party lines to approve the proposed division of Adelphia between Comcast and Time Warner and accompanying system swaps. What surprises me is not so much the result (getting conditions in this administration, particularly on a cable merger, was always a long-shot) but the timing. The FCC is still chewing over the data request it made in December, and the Adelphia Bankruptcy proceeding has been rescheduled for mid-March. It smacks annoyingly of a political favor done for a stalwart Republican (did we mention Brian Roberts, CEO of Comcast, is a big Bush supporter and fundraiser?) than the careful reasoning of the anti-trust agency charged with protecting the public. But that’s probably just my imagination post-State of the Union grumpiness combined with discovering how many big companies are spying on us for the government.

My analysis below . . .

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Cable Market Power For Dummies

Most folks outside of Washington DC still find their cable company an obnoxious monopoly, despite the presence of competitors like DirecTV, Dish Network, and the occassional overbuilder like RCN. But, despite the fact that customers express far more satisfaction with satellite and overbuilder service, most folks remain subscribed to cable. What gives? And how does cable get away with raising prices and favoring affiliated programming in the face of this “vigorous competition.” Needless to say, the cable folks respond with a host of fancy economic papers that they file with the FCC and present to members of Congress.

My own impression, having spoken with a number of economists, is that the Cable Cos use economics the same way Creationists use intelligent design. The point isn’t to engage in real scientific inquiry. The point is to throw enough scientific sounding stuff out there to confuse the issue and make people believe there are two equally valid sides to the debate. My problem is that the FCC and Congress usually end up playing the the Dover School District Board rather than Judge Jones.

Anyway, in an attempt to cut through some of the nonesense, MAP released a white paper of my authorship yesterday: “The Switching Equation” and Its Impact on the Video Proramming Market and MVPD Pricing. As you can tell by the title, even an attempt to write a simple, plain language version of this ends up more complicated than I’d like. (Sad fact is, economics is hard.)

So here’s the short version — most people find it such a pain in the butt to switch from one service to another that they will put up with higher prices, worse programming, and worse customer service rather than kill two days futzing with unsubscribing to cable and resubscribing to someone else. As long as cable doesn’t stink too badly, they can keep enough market power to make it even harder for competitors by cutting exclusive deals for regional sports programming and jacking up the price of video on demand to competitors (Comcast and Time Warner own 78% of iN Demand, the leading supplier of VoD). If we want real competition, we need to have rules that actually address market power and make it easier for people to switch to competitors. Otherwise, we get a lot of empty rhetoric about “level playing field” and “free market” and blah blah, and we still pay ridiculously high prices for cable and broadband service that still suck.

You want proof? Go read the paper.

Stay tuned . . .

Down to the wire in Indiana

The press has not generally covered the fight in Indiana over their telecom dereg bill, known in the Indiana Senate as SB 245. What coverage there has been has primarily focused on deregulating phone rates or elimination of local franchising of video offerings (i.e., the new telco video products will not need local franchsies). Few stories have observed that Chapter 35 of SB 245, as drafted, would hamstring the ability of local governments to either provide broadband services directly or do so through partnerships with others.

The version of SB 245 that passed the Senate included minor modifications to Chapter 35. In the Indiana House of Representatives, the House eliminated both Chapter 35 and the state franchising provisions. The bill has now gone back to the Senate.

I want to urge folks in Indiana, and elsewhere if you do business in Indiana or otherwise have a connection to the state, to make your views known to the Senate. In I hope people and organizations will tell the Indiana State senators that anything that impedes the flexibility of localities to create effective broadband strategies, such as Chapter 35, cannot be good for the people of Indiana.

I have included a draft letter below. Please feel free to print out or in any other way use it to help stop Chapter 35 of SB 245.

This is also a good time for me to stress that, as usual, I speak only on behalf of myself and not my employer or Wetmachine.

Stay tuned . . . .

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