Tales of the Sausage Factory

An insider’s view of the media hegemony

Off to Big Tent In Denver Next Week.

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For anyone who cares, I will be in Denver next week, but not for the Democratic National Convention (although I wouldn’t say no if someone wanted to slip me a pass — hint, hint). I will be attending the Big Tent event for bloggers, progressives, and anyone else who cares to wonder over and see what the changing face of online politics looks like. The event is running in parallel with the Democratic Convention, with significant overlap, although not actually part of it and far enough away geographically to be separate and distinct. I shall leave it to the reader to draw his or her own meaning from this.

Still, the hope is that the Big Tent event will attract significant cross over from the convention. On Tuesday, in conjunction with Common Cause Colorado, there will be a symposium on media issues and all that policy stuff I do over in my day job at Media Access Project. If you’re there, you can catch me speaking on media ownership and its impact on diversity in the afternoon, and/or my colleague at MAP, Parul Desai, talking on network neutrality. In the morning there will be a bunch of other speakers, including FCC Commissioner Jonathon Adelstein, so it should be fun.

Anyway, if you see me out there, feel free to come up and say hi.

Stay tuned . . . .

The Difference Between Free Market Conservatives and Worshippers of the Gods of the Marketplace.

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As regular readers know, I frequently deride those who continue to put their faith in a creed of deregulation despite empirical evidence that this is not suitable to all occasions as worshipers of of the “gods of the marketplace,” after the Rudyard Kipling Poem The Gods of the Copybook Heading (with a fine sense of irony that Kipling would be closer ideologically to the folks I criticize). This leads some to imagine that I am “anti-market” or “pro-regulation” or some other ideology that places process over outcome, rather than a pragmatic sort who believes that the job of public policy is to use all available tools to achieve the goals of prmoting the general welfare, securing domestic tranquility, etc., etc.

I recently came across an illustration of the difference in, of all cases, a collection of Darwin Award Winners (Darwin Awards Iv: Intelligent Design for anyone that cares). The book contains the tale of a “winner” who was a passionate anti-government type who refused to wear a seat belt in protest against mandatory seat belt laws. A car he was in in skidded and flipped over. The the driver and one passenger who were wearing seat belts survived. Our protesting friend was thrown from the car and died.

It occurred to me that this story nicely illustrates the difference between those who favor a free market approach and worshipers of the Gods of the Marketplace. A smart Libertarian may believe that the government has no right to order people to wear seat belts. But, evaluating all the evidence of how seat belts save lives, will voluntarily wear a seat belt even if not required. After all, it would be foolish to put one’s life at risk simply because the government wrongly orders people to do what you think makes good sense.

But an ideological driven soul, indifferent to empirical evidence and elevating process over substance, refuses to wear a seat belt because the government says you should, and therefore wearing a seat belt must be the wrong or inefficient result and believes it the positive duty of all anti-government believers to refuse to wear seat belts.

Now go read the dissenting statements of McDowell and Tate in the Comcast decision, the McCain Tech Policy, or any of a dozen or so speeches by elected representatives or pundits who get their economic education from reciting bumper stickers about free market economics they don’t understand. Then ask yourself, are these guys actually evaluating the evidence and accepting the result? Or are they driving with their seat belts off?

Stay tuned . . . .

The McCain Tech Policy Part II: Why McCain Can’t Fix The “Mercedes Divide?”

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O.K., jokes aside about the lameness and lateness of McCain’s tech policy and associated privacy policy. How does this all really stack up as a substantive plan?

Two quotes from former FCC Chair and McCain tech adviser Michael Powell nicely illustrate the fundamental thrust of the plan. Not so coincidentally, both come from Powell’s first press conference as Chair of the FCC.

Quote 1.

“I don’t believe deregulation is like the dessert that you serve after people have fed on their vegetables, like a reward for competition,” Powell said. “I believe deregulation is instead a critical ingredient to facilitating competition, not something to be handed out after there is a substantial number of players and competitors in the market.”

Quote 2:

“I think the term [digital divide] sometimes is dangerous in the sense that it suggests that the minute a new and innovative technology is introduced in the market, there is a divide unless it is equitably distributed among every part of the society, and that is just an unreal understanding of an American capitalistic system. I think there is a Mercedes divide. I would like to have one, but I can’t afford one. I’m not meaning to be completely flip about this. I think it’s an important social issue, but it shouldn’t be used to justify the notion of, essentially, the socialization of deployment of the infrastructure.”

Once you accept the “Mercedes Divide” frame, you have run out of tools to deal with the issues because, by definition, whatever the market provides is what result you should get. McCain, obviously, does not wish to accept this rather obvious consequence, and therefore falls back on the usual platitudes and reliance on the gods of the marketplace, the competition fairy, and the delightful myth that — Adam Smith to the contrary — getting a collection of companies with similar interests together to regulate themselves will somehow work.

Surprisingly, as David Isenberg noted on his blog, what is amazing is that the plan leaves out the few bright stars of Michael Powell’s tenure at the FCC — notably Powell’s commitment to spectrum reform. While I certainly opposed Powell’s efforts to make spectrum licenses a species of property I enthusiastically applauded his equal willingness to engage seriously on opening more spectrum for non-exclusive unlicensed use (you can see a very old primer of mine from the dawn of the spectrum reform debates here). Perhaps spectrum reform proved too complicated or controversial an issue for McCain to address, even buried at the bottom of a tech policy.

But having ruled out open spectrum, McCain has left himself very few tools to actually provide all the benefits he promises. Rather like the current administration, which will tell you that Bush achieved his 2004 promise of universal broadband by 2007 so shut the heck up about those stupid international rankings, McCain’s tech platform will work swimmingly for true believers unconcerned with the impact on actual reality. Below, I draw out the substantive problems with the McCain tech & privacy plans in greater detail, and explain why the Obama plan actually looks like it would make real improvements in people’s lives because Obama recognizes that there is a real difference between “the government needs to build roads rather than wait for car companies to build them” and mandating that “everyone must have a Mercedes.”

More below . . . .

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McCain Tech Policy — A First Reaction

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When you show up as the butt of a joke on the Colbert Report, you should know you’re in trouble. And when, by merry coincidence, Stephen Colbert does a piece on your self-professed computer illiteracy the night before you release your long awaited technology policy, you are in real trouble. Especially after your campaign gets repeatedly nailed in debates in tech policy fora (such as my employer’s Innovation ’08) for not even having a tech policy, when Barak Obama had a fully developed tech policy and functioning advisory team way back in the beginning of the primary, and after former FCC Chairman and campaign surrogate Michael Powell goes into virtual seclusion for a month to develop your tech plan, you know it had better be Goddamn Frickin’ Awesome. Even if you have already signaled it is going to be an extension of the same “the market solves all our problems and even thinking about regulation angers the terrible market gods, scares away the happy competition fairies, and brings a plague of liberal command and control locust ‘oer the land” nonsense that marked Powell’s FCC tenure and has plunged our telecommunications sector — nay, our entire economy — into the crapper, it should at least be a well written and engaging song of praise to the gods of the market place.

No such luck. It reads like some crotchety technophobe knocked over the bumper sticker rack at an Ayn Rand Reading Revival and tried to rearrange them so it made a policy. Half of it isn’t even particularly tech specific. For example, I don’t find it a coincidence that the first six bullet points are just variations on McCain’s standard “I hate taxes” theme. They could have easily have applied to his agriculture policy, if you substituted “no new taxes on wireless services” for “no new taxes on sorghum.” Nor am I aware of a serious mass movement to tax wireless services (or sorghum).

As for the rest, well, see below. . . .

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Why Verizon Should Give Away FIOS Connections and Get People Addicted to Speed.

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I just got a postcard from Verizon telling me FIOS will soon be available in my neighborhood. While I’m probably one of the last residential CLEC subscribers in the United States, I’m a firm believer in the idea that fiber is better and have been waiting for FIOS to become available so I can look at switching.

Then I saw the prices. Yuck. Verizon prices its FIOS as “competitive” with cable and other providers in my region — for a premium service. But it takes more than competitive to get me to go through the hassle of switching, especially when I am reasonably comfortable with my service right now. Switching doesn’t just mean spending several days going through hook up Hell and having Verizon install some super duper power pack on my premises. It also means changing a whole bunch of things tied to my (or my wife’s) current email address. That’s no small deal.

Meanwhile, as everyone knows, the cable operators did better at gaining new broadband customers in Q2, although uptake for broadband was generally anemic. Not surprisingly, Verizon defends its performance on its policy blog. Besides the usual (when you do poorly) inveighing against looking at a single quarter. Verizon points to a number of indicators that its FIOS system is the top dog system in the U.S., with possible top speeds of up to 50 MBPS and usually providing its advertised speed (I love that as a selling point!). Still, analysts argue that Verizon is pricing itself out of the market, and should go back to DSL.

I have a different take. I think VZ needs to get people addicted to speed.

More below . . . .

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A Reminder Why the PK Petition On Mobile Texting Matters (lest you think I only pick on cable operators).

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Today’s NYT has this op ed on Obama’s use of text messaging to announce his VP pick. It provides a nice reminder about the importance of the pending Petition by PK and others on text messaging. Filed after Verizon denied NARAL a short code but reversed itself within 24 hours the mobile texting petition often gets bundled with the Comcast complaint as if they were essentially two examples of the same thing. They aren’t. The Comcast complaint asked the FCC to follow through on its previous commitment to prevent broadband providers from blocking or degrading content or applications. For all the (well deserved) hoopla around the decision, it was at heart, as Commissioner Tate described, “a normal enforcement proceeding, regarding a particular complaint within the confines of the specific circumstances presented.”

The Petition for Declaratory Ruling on mobile text messaging and short codes is not a complaint (although it is an adjudication). It does not seek to punish Verizon as a bad actor, and it only refers to the NARAL incident as an illustration of why the Commission needs to act. Rather, we ask the Commission to decide — for the first time — whether mobile text messaging is a Title II telecommunications service, like the underlying phone number and voice service. If the Commission decides that it is a actually a Title I enhanced service (like the internet access you can buy separately), we ask the FCC to impose rules that would prevent wireless carriers from denying a short code to someone or from messing with anyone’s text messaging.

Not that Verizon or any other provider would be so foolish as to deny the Obama or McCain campaigns short codes or block their text messages. I’m not even worried about independent candidates like Barr and Nader. No, I’m worried about us ordinary schlubs, or even unpopular folks who can’t count on getting a front page story on the NYT if something happens but still deserve the right to organize and spread their message to willing listeners.

More below . . . .

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Mr. Moffett, I Thought You Said Cable Was Vibrantly Competitive?

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In an interesting turn of events, industry analyst Craig Moffett takes a look at the growth of cable broadband and overall subscriber growth, as compared with that of telcos and satellites, and comes to this interesting conclusion: Cable is a natural monopoly in the making — and has been on course to do so since about 2005.

What is interesting to me is this is the same Craig Moffett who, during the fight last year on whether cable penetration had triggerred the 70/70 rule that would enable the FCC to significantly regulate cable by reaching 70% penetration, rushed to Commissioner Adelstein (the swing vote in last year’s fight) to explain that cable penetration remained stuck at 60% and would never reach 70% because of all the amazing competition.

Mind you, we all make bad predictions (I still remember with considerable heartbreak my Great Google Prophecy). But Mr. Moffett has a habit of telling Wall St. what a great investment cable stocks are while telling Washington how wildly competitive the market is, how cable can’t possibly exercise market power, and how in no way shape or form should anyone even think about regulating this market.

With Kevin Martin repeatedly saying he is unlikely to act on a proposal by small cable operators to unbundle expensive cable programming and retransmission rights for broadcast signals at the wholesale level, the coast no doubt looks clear to start explaining why cable is such a great investment and will crush its competition. But I will be curious to see what happens if, for example, Congress holds hearings on the FCC’s decision in the Comcast complaint and asks whether we need to regulate broadband. Will Mr. Moffett stand by his “natural monopoly” analysis — even if he argues for deregulation for other reasons? Or will he suddenly discover new life in FIOS, WiMax, and other potential broadband competitors?

Stay tuned . . . .

Comcast Needs To Take A Lesson From Verizon: Unions Aren't the Enemy You Think They Are.

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Comcast has certainly had some lousy luck with contractors. Most recently, a Comcast contractor got all nasty on 74 year old trying to get broadband service. Before that, Comcast contractors were caught literally torturing kittens. And who can forget the unfortunate overworked Comcast tech who famously fell asleep on someone’s couch while on hold with Comcast’s repair center.

I don’t think Comcast actually wants these results. To the contrary, I think they are horribly embarrassed about them and really are doing what they can to weed out bad contractors and hire good contractors.

But Comcast needs to learn a basic lesson here. Having a quality work force is not compatible with cutting costs by hiring the cheapest contractors available. To have a quality work force, you need to invest in your workforce, make long term commitments to provide a good wage and good living conditions and, dare I suggest it, permit workers to come together in collective bargaining units so that workers and management can negotiate realistic contracts that meet everyone’s needs?

Meanwhile Verizon just averted a strike by reaching a tentative new contract with Communications Workers of America and the International Brotherhood of Electrical Workers. The contract, as usual, provides concessions on both sides, but will certainly cost Verizon a bundle more in pay raises and in future benefits than Comcast’s labor force, which depends largely on hiring local contractors and non-union labor.

But in exchange for its financial concessions, Verizon is preserving a skilled and experienced workforce with a proven track record. A workforce that, because of its union-negotiated benefits, will likely remain relatively stable and dedicated even during difficult economic times. Rather like buying itself a large bundle of wireless minutes so it doesn’t run over and pay huge charges, Verizon has ended up paying more in salary and benefits to avoid a boatload of customer service headaches.

Comcast already missed the boat once by opting to build a crappy network that can’t handle broadband capacity like Verizon can handle with FIOS — even though FIOS cost more to build. Perhaps Comcats should consider a similar lesson in its labor practices and encourage, rather than resist, efforts to unionize its workforce.

Stay tuned . . . .

Really Getting Away From It All for Bit.

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I’m off for my annual escape from the 21st Century. Don’t look for me until after August 10. Sadly, this means I will miss the conclusion of the Comcast bittorrent complaint on Friday, and will no doubt miss a ton of other really cool and important things. Such is life. Frankly, if y’all think I’m a snarky SOB now, you should see me if I didn’t get some vacation.

Stay tuned . . . .

Something Nice About Comcast for a Change

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Lest it be said that I refuse to acknowledge a virtue when I see it, allow me to voice my agreement with Mehan Jayasuriya over at Public Knowledge on Comcast’s efforts to track down problems on Twitter and elsewhere.

Mehan refers to this NYTimes piece, which discusses how Comcast customer service folks are looking for complaints about Comcast or its services on open blogs or social network sites and trying to reach out to disaffected customers. Frankly, I see nothing “creepy” about it. I actually think this is a pretty good idea for a number of reasons.

First and foremost, if I am complaining about the service I am getting, I would actually like someone to fix the problem. Most companies have laid off workers and have you go through endless phone trees before you can confirm for someone that yes, I’ve already tried the obvious and would like to get someone who can move past the script and help me with my actual problem. Even sending an email can take a few days for response. I had one incident where I was having difficulty with my cell phone service, sent an email, then resolved the problem, and got a call back two days later (at my work number as requested — they were not completely stupid, just way too slow). This is not useful response time for a service on which I rely pretty heavily.

So I think it’s actually a smart idea to have people monitoring publicly available info to see if you can reach out and solve problems. It may save the company major publicity headaches and help users get their problems resolved.

The other thing is I think it’s a good thing to remind users that what they write on social networking sites or blogs is open to everyone unless they take action to make it private. In this case, the reminder is harmless, perhaps even beneficial. But if you find it “creepy” that a Comcast customer care agent found your complaint about a billing glitch on your personal blog, consider what happens if your boss or coworker discovers your post about what you think of your current assignment and team workers. Heck, even a sophisticated Federal judge can sometimes be surprised with what goes public on the web.

My one caveat is that this works great as long as Comcast, or any other company, identifies itself honestly when making contact just as they do one the phone. For example, if I get a follow up call from my Saturn dealer after my nth gajillionth mile check up, the person identifies himself or herself as calling from Saturn and wanting to know how my service appointment went. From the article provided, it would appear that Comcast staff are identifying themselves as Comcast staff and generally offering help as Comcast customer service staff. Go them.

But it doesn’t take a genius to guess that folks may well begin to wonder whether they can start to use this for direct marketing. Perhaps when you gripe about Comcast on your blog the person that responds won’t be from Comcast but will be from AT&T, offering you a better deal. No problem with that, as long as you remember to change your defaults if you don’t want to be relentlessly market to in this manner. But the real problem is when folks selling products will disguise themselves or their identities. If the helpful commentor that points you to a promotional on DISH is actually working for DISH, but doesn’t identify himself or herself as working for DISH, it starts to get into some very dicey territory.

But again, Comcast actually seems to have a bright idea here. Good for them.

Stay tuned . . .