Tales of the Sausage Factory

An insider’s view of the media hegemony

BitTorrent Employs Self-Help After CRTC Ruling. Net Neutrality Folks Called It Right So Far.

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Well that certainly didn’t take long.

Richard Bennett has an article at The Register describing BitTorrent, Inc.’s new method for circumventing traffic throttling. Essentially (if I understand it), BitTorrent has altered the way in which its uTorrent P2P application will work. Instead of relying on the Transfer Control Protocol (TCP) uTorrent will now use the User Datagram Protocol (UDP) to move packets. Richard describes what this means and the potential impact of this better than I can. Critically, however, Richard describes this as a means by which BitTorrent can avoid Bell Canada’s targeted traffic management by disguising the nature of its traffic as latency-intolerant (like voice over IP (VOIP))and therefore given priority over other traffic. You can see some discussion of this as a response to the CRTC decision to allow Bell Canada to manage traffic here at DSL Reports.

As I observed only last week, the CRTC decision presents a splendid opportunity to grab some popcorn and watch some other country play games with its critical infrastructure. Mind, since the internet is a global “network of networks,” what happens in Canada is likely to impact me here in the U.S. as well. But I can’t do anything about that. So pardon me whilst I munch my popcorn and enjoy a good dose of Cassandrafruede (a term of my own invention which means “the bitter pleasure experienced when something awful you predicted that could have been avoided if people had listened to you comes to pass, even though you also get screwed through no fault of your own”).

More analysis to go with my popcorn below . . . .

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What Next For The FCC? Beats the Heck Out of Me — So I'll Just Describe the Terrain.

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A favorite Washington sport has become trying to out think the Obama transition team. I occasionally get asked about this or that possible pick, or what I think the FCC is likely to do on this or that, issue. I do not have a friggin’ clue.

Certainly I’m happy with some moves. I wildly applauded the appointment of Susan Crawford and Kevin Werbach to the FCC transition team, and am equally happy to see them joined by Dale Hatfield. Similarly, the policy review team has a number of names I recognize as strong thinkers who both understand the policy issues and have a good idea where the bodies are buried here in DC. But none of this tells me anything specific about what the Obama Administration or the FCC might do.

Nor do I put much stock in the daily news articles suggesting this or that candidate is in the running for Chairman. The Obama team has demonstrated a capacity to hold information tight to the chest. Nor do I wish to push any particular candidate. As I like to point out, when the Communist Party wanted to destroy someone back in the Red Scare days, they would praise them in their official publications. I expect that any candidate I favor will be the target of serious opposition from incumbents who would find my approach and priorities less than pleasing.

Mind you, I still think it is important for folks in the media reform and progressive communities to make their preferences known — especially on policy issues and what we think priorities ought to be. It is very nice that the Obama folks appear predisposed to agree on many issues such as network neutrality and media consolidation. But whoever gets appointed to the FCC (or other critical posts) will face a veritable army of folks all armed with excellent reasons why their issue of choice needs to go to the top of the priority list and how this exactly fits with Obama’s stated goals. Anyone who thinks that electing the right people means we can go home and let them figure it out for themselves needs to seriously think again.

But I can describe one thing with some certainty, the terrain at the FCC. Or, more accurately, I can describe the uncertainty around that terrain and how it will likely effect policy. In addition to the power to designate the Chairman, Obama may be looking at appointing no commissioners (very unlikely), one commissioner (reasonably likely), two commissioners (also likely), or three commissioners (unlikely). This uncertainty makes it very hard to predict what happens with the FCC next year. To add to the lack of clarity, the DTV transition occurring in February will pretty much suck up all the attention for the first two months — possibly more if it goes really badly. Add to this the significant turn over in both the House and the Senate Commerce Committees, with accompanying likely changes in staff, and you have a cloud of uncertainty powerful enough to obscure any crystal ball.

I explore these possible scenarios below . . . .

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Pass the Popcorn! CRTC Offers Great Opportunity To Watch Someone Else Play With Critical Infrastructure.

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According to this official news release, the Canadian Radio-Television and Telecommunications Commission (CRTC) denied a request from the Canadian Association of Internet Providers (CAIP) to stop Bell Canada from throttling without notice the traffic of rival ISPs leasing access to Bell Canada’s network. Instead, CRTC punted to a general inquiry on traffic shaping.

According to Michael Geist, expert on all things telecom and Candian and general super-smart guy, this is not the last word from the CRTC on the question. But since — according to the public notice — the first public hearing on the subject is scheduled for July 9, 2009, Canadian ISPs can look forward to a considerable period of time when they live at the mercy of their largest rival.

This does not depress me, as I do not live in Canada. Rather, I am excited at the prospect of some other country (for a change) deciding to make offerings to the Gods of the Marketplace and play games with its critical infrastructure while I get to watch. Until now, Canada has generally been outranking us in the international rankings on penetration, although it ranks less well on affodability and only so-so on speed (as compared to countries with real broadband). Those who see such things as relevant (and not everybody does, the situation is complex and the data messy, hard to come by, and subject to multiple interpretations) generally regard this as a consequence of bad policy choices by the FCC (again, not everyone agrees, the data — to the extent we even have data — is very messy and complex). In particular, a lot of us think that the decision to eliminate mandatory wholesale access and rely on “intermodal” competition was a phenomenally bad idea.

Now we may get a chance over the next few years to test this hypothesis, and at someone else’s expense! Go Canada!

More below . . . .

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Adelstein Is Right On FCC Authority to Launch An Investigation Into Arbitron Portable People Meter.

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FCC Commissioner Adelstein wrote Chairman Martin a letter yesterday asking Martin to launch a formal inquiry into Arbitron’s use of the new portable people meter (PPM). As I noted back in September when the FCC put the Petition for an inquiry out on Public Notice, this issue means a lot to minority-oriented stations and their audiences, as they believe the PPM undercounts listeners to minority radio programming.

Also as I said back then, I think the FCC has very broad authority to investigate just about anything related to its core mission of, in the words of Section 1 of the Communications Act, “to make available, so far as possible, to all the people of the United States, without discrimination on the basis of race, color, religion, national origin, or sex, a rapid, efficient, Nation-wide, and world-wide wire and radio communication service with adequate facilities at reasonable charges, for the purpose of the national defense, for the purpose of promoting safety of life and property through the use of wire and radio communications.”

Mind you, having the power to launch an official inquiry does not mean you have the power to actually do anything. The FCC’s mandate is fairly broad, but it has limits. But one of the questions the FCC can ask is: “So, if we discovered something we didn’t like, what could we do about it?” That answer may be nothing more than “tell Congress this sucks,” a conclusion the FCC has reached in the past on occasion when it concluded it could take no action under existing law. But it also allows the FCC to explore other options. For example, the FCC could decide that concerns over the ppm make Arbitron ratings unreliable for certain measurements relating to its rules, like determining whether or not a station is in the “top four” for purposes of permitting a merger. Or the FCC could decide, after seeing lots of opinions and legal research from interested parties pro and con, that the FCC does have authority even if it has never exercised this authority. Adelstein cites 47 U.S.C. 257, which requires the FCC to eliminate market barriers to entry. I think a fairly strong case can be made that regulation of ratings services falls under the FCC’s ancillary authority over broadcasting. That’s a little difficult after American Library Association v. FCC (the broadcast flag case), because a ppm is not a “communication” and ALA held that ancillary jurisdiction must regulate an actual communication or transmission rather than simply have some possible impact on the future of television. OTOH, ratings are so clearly integral to the entire broadcasting industry that the connection with the “statutorily mandated” responsibilities and goals of the Communications Act is very strong.

Neither of these views may bear out on close investigation as authority to act. But again, this is why the FCC conducts inquiries. While it is easy to point to things that might have an impact on broadcasting that clearly lie outside the FCC’s jurisdiction, such as building the Sears Tower in Chicago, and easy to point to things that lie squarely inside the authority of the FCC to regulate (such as media ownership limits), there is also a middle ground of things that are rather murky. In a case such as this, where interested parties have submitted a mess of evidence that raises questions on a matter that potentially impacts millions of people getting access to diverse programming, I think the FCC ought to go ahead and have an inquiry.

Stay tuned . . . .

Apparently, I Am Even Less Influential Than I Thought . . . .

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Or so says Paul Kapustka with his list of “Top Ten Net Neutrality Influencers”, on which I do not rank even an honorable mention.

Tip of the hat, however, to friend-of-the-blog and occasional sparring partner Richard Bennett included in the honorable mention slot.

On the plus side, no one will care if I take Wednesday and Friday off.

Stay tuned . . . .

Guest Post: Bailout Or Bust

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I’m pleased to post a guest blog posting from Professor Alan L. Feld of Boston University School of Law. Two disclaimers are in order. First, the views expressed herein by Prof. Feld are his own, and not those of B.U. Second, he is my Dad — a matter on which I am quite pleased and proud.

For his position on the proposed auto industry bail out, see below . . . .

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Update: Cable Cos Respond, FCC Reviewing.

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To update on the question of whether cable companies think they are above the law. According to this piece by Ted Hearn in Multichannel News, all 13 cable cos responded to the FCC’s letter of inquiries (LOIs) issued in response to the consumer complaints. The FCC is apparently now reviewing the adequacy of the response.

Mind you, according to the article, we are still likely to find that the cable cos responded in a less than thorough way, and will necessitate the FCC coming back with another request. But this is merely the usual fun and games by which large companies avoid obeying the law, rather than an outright statement of defiance that the law simply doesn’t apply to them.

I suspect the cable cos will do their best to run out the clock, in the hopes that the next FCC will be more tolerant of their exercise of market power. Whether that is true or not (and it will certainly NOT be true if either Adelstein or Copps is chair), I would hope that all the FCC Commissioners, but especially the two Democrats, back Martin on this investigation and make it clear to the cable cos they will not tolerate any efforts to run out the clock.

As President-elect Obama observed at his first press conference: “The United States only has one President at a time.” Similarly, the FCC has only one Chairman at a time. Certainly when it comes to investigating consumer complaints, all FCC Commissioners need to stand united in making it clear to industry that a time of transition is not a time when you can get away with screwing consumers.

Stay tuned . . .

Obama FCC Transition Team Now Includes Totally AWESOME Additions!!!!

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Good news right before Sabbath kicks in. According to this article, Obama’s FCC transition team will now include Susan Crawford and Kevin Werbach!!!

These are not just people who “get it.” These are people who “got it” waaaaayyyyyy ahead of the curve. They are also so totally not captured by any interest — but are also sufficiently “mainstream” that they will not be marginalized as radical left-wing progressive cooks. (Defensive? Me? How dare you suggest it!)

Gotta shut down now before sunset, so can’t wax nearly as enthusiastic as I would like. Suffice it to say t makes a very pleasant way to close out the week.

Stay tuned . . . .

Cable Industry Flips Off FCC, Fines To Follow? Expect Other Industries to Tell FCC To [Fleeting Expletive] Off Too.

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I clearly missed a class in law school. Not once in my Administrative Law class did my professor ever tell me that you could respond to a federal investigation by telling the agency “We know you have authority, but we’d rather not answer these questions because you are a great big meany.” But then, I’m not working for the cable industry, which has repeatedly shown it has trouble with the concept that federal law really applies to them and that the FCC is supposed to be a regulator not a lap dog.

Today’s episode of “I Can’t Believe The Chutzpah” comes from the ongoing investigation by the FCC over whether cable operators are using the confusion around the DTV conversion to push users into buying digital tier service, and rent new digital set-top boxes in violation of the rules on set-top box interoperability, or just generally violating the law by changing channel line ups without notice to either subscribers or local franchise authorities, migrating stuff off basic tier without warning, or charging for additional tiers to get channels required by law to be available on the basic tier. Mind, I’d also like them to explicitly ask whether the cable guys are unfairly migrating unaffiliated channels to digital in violation of Section 616, but that’s just me.

Anyway, after getting a bunch of consumer complaints and reading Consumers Union’s letter to Congress (or at least hearing about it on NPR), the FCC sent out a bunch of letters of inquiry to the named cable companies and Verizon asking them to provide a boatload of information which would allow the FCC to determine if the consumer complaints were, ya know, true. Given that this is lots of people being potentially ripped off big time, the agency told the everyone that got a letter they had two weeks to reply.

Mind you, this is hardly an original process or unique to the cable industry. I should know. The FCC did the same thing in response to my complaint about the wireless microphone guys back in August. The FCC (also under Martin I should add) acted with similar swiftness and intensity back in 2006, when Verizon and BellSouth tried to keep charging USF fees on DSL after they were phased out. The phone companies, apparently under the same misconception that I was that even if you are a big company you actually have to obey the law, backed off. The cable companies have other ideas. And, if they get away with it, I’m sure the Bells, broadcasters, and every one else will follow suit.

So yesterday, NCTA,the trade industry for the cable guys, sent a lengthy letter to the FCC explaining that the FCC is not allowed to investigate the cable industry. They recommend that the FCC rescind the letters of investigation and, instead of having the Enforcement Bureau actually act on consumer complaints, the FCC should hold a nice, quiet Notice of Inquiry instead. Then, if Martin gets all the other Commissioners to agree, and the FCC asks nicely and without any legal compulsion to answer honestly or completely, cable operators might consider responding.

Now I just know, KNOW that there are people out there who hate Kevin Martin so much that they will decide that it is really O.K. for cable to tell the FCC to “fleeting expletive off and die,” because it is the poor helpless widdle cable guys and the evil Kevin Martin (I cannot help but observe that Verizon does not seem to have any problems complying with this request, but of course they are an evil minion of Kevin Martin, or the other way around. Besides, Kevin Martin hates the cable industry, so there!)

As what is often called a “consumer advocate,” I’m a little alarmed that we will now have a new doctrine that says “consumers can complain, but the FCC can’t protect them if we think the FCC Chair might enjoy it.” And while I would flippin’ think that the idea that the cable companies need to obey the law like everyone else would be bloody self-evident, not to mention that the consequences of letting industry dictate to the federal watchdog agency what it will and won’t respect on enforcement go well beyond the poor picked on widdle cable guys to whatever industry you don’t like (in my case, wireless microphone manufacturers — I can hardly wait for Shure to refuse to cooperate with the FCC next), I long ago learned that even bloody obvious things need explaining when it comes to the cable industry and their rabid defenders.

So I address the actual legal issues below . . . .

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