Tales of the Sausage Factory:
Is Fear of Wireless Foreclosure “Speculative?” Depends. Is this About Intent Or Effect?

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Recently, the Antitrust Division of the Department of Justice  (DOJ) filed these comments with the Federal Communications Commission (FCC) in the proceeding on spectrum aggregation limits (aka spectrum screen v. spectrum cap). The DOJ comments have some good stuff about the economics of the wireless industry and competition (in a theoretical way), and about why it is important to make sure potential competitors have spectrum, particularly low-band spectrum. Mostly, DOJ’s argument rests on the idea of “foreclosure,” that a wireless firm will bid on licenses at auction just to keep them out of the hands of competitors.

Asked about this on a recent earnings call, VZ CFO Fran Shammo basically said that there is no evidence that Verizon is bidding on licenses just to keep them out of the hands of rivals, so DOJ’s argument is “theoretical” and the FCC should not adopt any limits.

VZ basically argues that we should not worry about possible foreclosure unless there is evidence of an actual intent to foreclose. This treats a spectrum screen (and concern about foreclosure) as a precaution against bad actors. As long as bidding on licenses at auction makes sense for reasons other than foreclosure, and there is no evidence of any intent to foreclose, then everything should be just fine even if the outcome has the same effect as a foreclosure strategy (e.g., competitors don’t have enough spectrum to offer viable competing services.)

But the Communications Act does not work this way. Specifically, Section 309(j)(3)(B). Whether Verizon (or any other carrier’s) intent is as pure as the driven snow, or black as any comic opera villain, does not matter one iota. What matters is whether we avoid a “concentration of licenses” and “disseminate licenses among a wide variety of applicants” so that we “promot[e] economic opportunity and competition and ensur[e] that new and innovative technologies are readily accessible to the American people.”

As I will discuss below, the evidence from the 700 MHz auction and subsequent transactions demonstrates that we are feeling the effects of foreclosure, regardless of whether there was an actual intent to foreclose. As a result, the DOJ concern is not “theoretical,” but very real.

 

More below . . .

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Tales of the Sausage Factory:
The Right Cell Phone Policy In Boston.

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The Associated Press reported that cell phone service had been shut down in Boston in the aftermath of today’s tragic Boston Marathon bombing. Happily, this report — sourced to an anonymous official — appears to be mistaken. Verizon and Sprint report that their networks are overwhelmed by the sudden spike in volume (common after a sudden disaster) but they have not been asked to suspend service and are in fact looking to increase capacity.

It is times like this when we remember exactly how dependent we are on cell phones, and why suspending cell service in an emergency like this (as happened with the BART nearly 2 years ago) is such a phenomenally bad idea. As a legal matter, the legality of law enforcement asking for a shut down of local cell service is much stronger than in the BART case. This is, arguably, the “ticking bomb” scenario that arguably justifies a brief shut down to protect lives. But the odds against a terrorist using a cell phone to detonate a follow up device after a shut off order are fairly low (terrorists try to coordinate, the explosions fairly closely, as we saw in Boston, and generally don’t like to rely on cell phones because they are not sufficiently reliable for this purpose).

As we are seeing in action, cell phones become the best anti-panic technology deployable at times like these. Everyone is calmer when they can stay in touch with family and loved ones, or receive updates from the authorities. Every “I’m fine” texted to a frantic relative is one less person tying up the information hotline or — even worse — going out to search. Indeed, with about 35% of people now without any landline service, cutting cell service would isolate about a third of people at just the moment they need to stay in contact. And while I have no information on how people are contacting the tip line, I would imagine that many are doing so with the most convenient phone available — their mobile phone.

The event also highlights the vital contribution of open WiFi hotspots as a furthering communication. At a time like this, every single means of communication comes into play. This is what I mean when I talk about the reliability that comes from redundancy. The ability to shift among networks can cut down on congestion and facilitate communication by public safety authorities. If we deployed mobile hot spots as well as cells on wheels (COWs), we could have substantial impact on the congestion situation. Something to think about as part of overall emergency preparedness. Because, sadly, there will be a next time. And when it comes, we will need to remember that we want to enhance communication and the flow of information and avoid congestion wherever possible.

Last summer, my colleagues at Public Knowledge and a number of other public interest organizations wrote these comments to the Federal Communications Commission (FCC) on why shutting down cell phone service for any extended period would be a very bad idea and probably a violation of law. (See also my colleague Sherwin Siy’s blog post here. The tragic events in Boston demonstrate once again how critical mobile phone service have become to all of us in a disaster, and what a terrible mistake it would be if local officials actually did shut down cell service at a time like this.

(I used to watch the Marathon go by on Heartbreak Hill (Commonwealth Ave, well back from the finish line). I was one of those frantically texting and posting status updates asking if family and friends were safe. I’ve been grateful for every response.)

 

Stay tuned . . . .

Tales of the Sausage Factory:
Will Walden Wipe Out DMCA and CISPA To Take Out Net Neutrality In The Name of “Internet Freedom?”

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Today, the House Energy and Commerce Subcommittee on Communications and Technology will begin mark up of the so-called “Internet Freedom Bill.” As explained in the Majority Briefing Memo, we’re still on about that whole “the ITU will take control of the Internet and black helicopters will come for out name servers” thing.”  Unfortunately, as keeps happening with this, it looks like some folks want to hijack what should be a show of unity to promote their own partisan domestic agenda. Specifically, does the bill as worded undercut the (by accident or design) the Federal Communications Commission’s (FCC) authority to do things like Network Neutrality?

 

As I elaborate below, however, this is not so much a stab at net neutrality and the FCC generally as it is a murder/suicide. You can’t claim that this clips the wings of the FCC to do net neutrality by making a law that the U.S. is opposed to “government control” of the Internet without also eliminating laws that deal with cybersecurity, copyright enforcement online, privacy, and a range of other stuff that are just as much “government control” of the Internet — but that most Republicans opposed to net neutrality actually like. Plus, as I noted last week when discussing the rural call completion problem, taking the FCC out of the equation may have some unforseen nasty consequences that even Republicans might not like.

 

More below . . . .

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Tales of the Sausage Factory:
The Best 10 Ironies About The “Obama Phone”

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There is so much about the “Obama Phone” nonsense that tickles my funny bone in odd places. It’s not just that everything conservatives say about it is factually wrong. It also proves that the cherished progressive belief that every policy ever adopted under Reagan and under W were universally unmitigated disasters for the poor and people of color is also wrong. (No, I’m not saying one good policy makes up for a load of bad policies – but honesty demands acknowledging that the Universal Service Fund (USF), of which Lifeline/Linkup is part, started under Reagan and got expanded to wireless by former Federal Communications Commission (FCC) Chair Kevin Martin under Bush).

 

As if this were not ironic enough, the “Obama phone” was approved by the FCC in part to address the massive sudden need for subsidized mobile phones for Katrina victims. In 2005-06, Tracfone distributed 30,000 phones to Katrina victims under the expanded Lifeline program, and raised awareness of the new program through the devastated Gulf Coast region, i.e, the same red state regions now bellyaching about the program. For Progressives, consider that the “Obama phone” was invented in part as a response to Katrina by the President who “didn’t care about black people.”

 

Even better, it’s an example of how Republicans once upon a time took action to create programs to address the needs of poor people, even when it meant raising rates on the wealthy – a thing neither conservatives or progressives appear willing to acknowledge ever happened. Then, of course, there is the irony that the people most upset about the “Obama Phone,” rural conservatives, are subsidized out of the same program at a much higher rate. For us law geeks, it’s fun to remember that USF started with the FCC exercising its “ancillary authority,” that the D.C. Circuit affirmed this massive expansion of FCC authority, and the Republican Congress would later approve, endorse, and expand this as part of the 1996 Act.

 

Another irony on the Republican side is that USF is exactly the kind of “teach a man to fish” program for the poor that at least some Republicans say holds the key to winning back the working class vote. Rather than just being a hand out, it puts an important tool for participating in the national economy in the hands of the poor so that they can find and keep jobs and become self-sufficient. Anyone who has applied for a job, or just about anything else these days, recognizes that having a mobile phone so your work can find you (especially if you are a day laborer or some other form of self-employed) is critical to success. Republicans should be arguing that this is exactly the kind of program that gives people tools to improve their lives rather than “creating dependencies,” etc.

 

Finally, as with so many of these things, legislation to end the “Obama phone” (as proposed by a number of Senators recently) would probably drive a serious spike into provision of rural wireless – and ultimately rural broadband and telephony generally.

 

So here are my Top Ten Ironies about the “Obama Phone.” Not that I expect actual history to matter much. But for my own amusement, and for the handful of telecom geeks like me that find this stuff entertaining, I elaborate below . . .

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Tales of the Sausage Factory:
Rural Call Completion and the Problem of Network Neuropathy.

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I made a passing reference to the rural call completion problem in a post about 2 months ago. I’ve now written a much longer piece explaining the problem of rural call completion, and the nature of the problem, for the Daily Yonder. You can find the article, and the very nice illustrations they added, over here.

To give a very brief recap for why y’all should click through to learn the details of rural call completion — rural call completion is an unexpected side effect of the transition of the Public Switched Telephone Network (PSTN) to an all-IP based network. Using IP-packets gives you greater flexibility to pick how you route calls. To avoid very expensive rural termination fees (which subsidize rural systems and keep them operating), Least Call Router systems can send calls through lots of hops, creating latency or even trapping the call in a perpetual loop. As a result, calls to some rural systems don’t go through, or quality degrades to where rural areas may not be able to have reliable phone service or reliably reach 9-1-1. The FCC has issued a Notice of Proposed Rulemaking to address the problem, and every Commissioner has emphasized that making sure the phone netwok remains reliable is a core mission of the FCC.

I and my Public Knowledge colleagues have emphasized both network reliability and service to all Americans as part of our “Five Fundamentals Framework” to guide the transition of the PSTN to all-IP. The rural call completion problem demonstrates precisely why we need a framework to guide us, rather than jumping right away into the “deregulation v. regulation” fight so many people want to have instead of focusing on the real issues.

It is also an example of a phenomenon I call “network neuropathy,” how problems in networks may first manifest themselves in failures of service around the extremities.

More below . . . .

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Tales of the Sausage Factory:
Exit Julius Genachowski

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FCC Chairman Julius Genachowski will announce his intent to leave the FCC today.  Well, it is the season of the Exodus, and I expect that perhaps Genachowski will be able to say with particular vigor at his seder ”last year we were slaves, this year we are free.”

I will hopefully get something more up later, as I am in the midst of my own Passover preparations and then embarking immediately thereafter on the next leg of my “What Do You Have Say That’s So Important?” Tour. So I will limit myself at the moment to simply this. It is extremely easy to let the disappointment and bitterness over the high hopes I (and others) had back when Genachowski started in 2009 color his sins (whether of commission or omission) blacker than they should be. By the same token, it is easy to allow the lowered expectations we all had after 2010 to make his accomplishments seem better than they where.

For now, what is far more important than any attempt to summarize Genachowski’s putative legacy in a few paragraphs is determining who will succeed him. Certainly I agree with those who have said we want to see someone who will be a champion of the public interest, someone willing to stand up to a hostile Republican-controlled House and powerful incumbents. But I will add one particular plea to the President: Send us no scholar. Send us no visionary to lead us into the promised land of gigabit broadband, nor an ideologue wedded to a philosophy. Send us no seekers of grand bargains or painful compromises. Instead, send us someone who likes to get their hands dirty.

Even more so than in 2009, we stand at a peculiar juncture in the evolution of our national communications infrastructure. After years of anticipating convergence, it is upon us. Every aspect of our communications infrastructure — wireless, wireline, broadcasting, cable — is undergoing dramatic upheaval. There are at once tremendous opportunities for a rebirth of independent media and renewed competition, or a collapse into consolidation and control. We are at a delicate point in what Tim Wu in his 2010 book The Master Switch called “The Cycle,” the point where potentially open and disruptive communications technology reach a new equilibrium and begin to become closed and tame, serving a new elite as the previous structure served the old. Stopping that Cycle takes more than just vision (though vision is certainly required). It takes someone who loves the details with wonkish delight, but who can step back enough from them to stay focused on the bigger picture. Someone with a guiding philosophy that inform decisionmaking rather than an ideology that governs decisionmaking. Someone willing to make the hard call and piss people off, but mindful that the person who always does what he or she thinks is right regardless of cost eventually runs up a heck of a tab. Someone who captures the wisdom of Ecclesiastes 7:16-17: “Do not be too righteous, nor too wise — wherefore would you destroy yourself? Be not too wicked, nor too foolish — wherefore would you die before your time?”

In 2009 we wanted hope and change, in 2013 we need grit and courage.

Stay tuned . . . .

Tales of the Sausage Factory:
Some Reflections on McDowell Departure, And What Happens Next.

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At yesterday’s open Federal Communications Commission (FCC) meeting, senior Commissioner Robert McDowell announced he would be stepping down sometime in the next few weeks. As regular readers know, I was often at odds with Commissioner McDowell’s positions. Despite coming from Comptel (the trade association for competing telecoms), McDowell generally hewed to a fairly rigid Libertarian line which holds that government intervention in the market to create or enhance competition doesn’t work and that the only reason for regulation is demonstrated market failure — with a standard for market failure so high as to constitute an almost insuperable barrier to action.

On the other hand, as I have also noted previously, McDowell came by his convictions honestly and defended them eloquently and thoroughly — his dissents were always well-researched and sprinkled with a plethora of citations. He was not a shill for any special interest, shifting his position based on the shifting financial interest of some industry patron. He was (and is, after all, he’s not dead) intellectually rigorous and intellectually honest, willing to engage intellectually, personally charming and quick witted — an articulate champion of a philosophy of governance I find anathema and that I believe disserves the public.

Which is, of course, what makes public policy and democracy work. We get together in the public square and duke it out in the marketplace of ideas to see who can carry the day.  While dealing with Commissioner McDowell was often frustrating from an advocacy perspective, it does not diminish my personal respect for the man.

Some additional thoughts, including on what happens next, below . . . .

 

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My Thoughts Exactly:
Happy Finno-Irish-American Weekend, Y’all

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That great annual harbinger of spring, that mid-Lent quasi-Catholic dual name-day celebration for two saints (at least one of whom probably existed), that diphthong of drinking excuses, the elision of St. Urho’s Day and St. Patrick’s Day is again upon us — and on a weekend, no less!

Now, it’s well known that Irish Americans can be very loud and unsubtle about celebrating their (our) heritage of leprechauns and bullshit artists and crooked politicians from South Boston and great singers like Ella Fitzgerald. And so of course everybody in America and around the world knows that tomorrow is Evacuation Day, I mean St. Patrick’s day, in honor of the great Romano-British Christian missionary who returned to the land of his captivity and bondage as an apostle of peace and went on to drive the serpents into the sea, (or maybe not), and so Guinness will be consumed, and cabbage, and yea, Harp Lager too, begorrah.

Alas throughout much of this country that is not the upper Midwest, the name day of St. Urhu, who drove the grasshoppers from Finland (today, March 16) is sadly neglected, to the point that we can  expect virtually no mention of it by color commentators in television broadcasts of today’s NCAA basketball games. But let it never be said that Wetmachine has forgotten the confabulated patron saint of the Finno-American diaspora (of which I am a proud member), the great St. Urhu, whose famous utterance Heinäsirkka, heinäsirkka, mene täältä hiiteen (grasshopper, grasshopper, buzz off why dontcha?) still stirs our hearts everywhere.

 

Statue of St. Urho in Minnesota

That saintly collusus!

 

It’s OK to mark this day without alcohol, but consumption of traditional all-starch foodstuffs is encouraged. So if you can find some Karjalanpiirakka, go for it.

Tales of the Sausage Factory:
Announcing the “What Do I Have To Say That’s So Important Everyone Want To Hear It” Speaking Tour!

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I have a fairly busy travel schedule (for me at least) over the next month. When I explained to my Mom why I needed to bug out immediately after Passover, my Mom said: “Wow, what do you have to say that’s so important that everyone wants to hear it?” Which she meant a lot better than it sounds. But it did give me a name for my speaking tour over the next few weeks. If you are going to be at any of these events, or if there is something in particular you think I ought to see or do while out there, let me know. And, of course, I hope I will see you all there.

 

Harold Feld’s “What Do I Have To Say That’s So Important Everyone Wants To Hear It?” Tour

March 13-14 California Advanced Services Fund (CASF) Broadband Consortia Summit and California Emerging Technology Fund (CETF) Workshop, Sacramento CA

I’ll be doing a keynote Thursday morning on “How to get people in DC to PAY THE #$@! ATTENTION TO STUFF GOING ON OUTSIDE THE BELTWAY/How to engage effectively on Federal policy issues.

 

April 1-5 WISPAmerica 2013 , Covington KY (aka Cincinnati South)

America’s premier WISP event/tradeshow, put on by the Wireless ISP Association. I’ll be doing a lunch Keynote Thursday April 4 with Steve Coran to discuss What Up In DC on spectrum ‘n stuff.

April 5-7 National Conference For Media Reform (NCMR), Denver CO

From the premier WISP event to the premier Media Reform event. NCMR is put on by Free Press. I will be speaking on a panel at 10 a.m. Friday morning April 5 on “What’s Next For Internet Policy?” (Spoiler alert! I will probably talk about PSTN Transition and spectrum.)

If I can accumulate enough speaking engagements, I will do some tour t-shirts.

Stay tuned . . .

Neutrino:
A Farewell to the Higgins

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Mixed into all of the “OMG! SNOW!” coverage on the local TV news as I got ready for work last Friday was a small and very sad item: The Higgins Armory Museum will close at the end of the year. The Higgins is in Worcester MA, a few miles from where I went to college. I didn’t go to the museum until my sophomore or junior year, which is pretty shocking since my friends and I were all D&D geeks. How could we have not known about a steel art-deco castle-like building that was crammed full of swords and armor such a short distance away? Finally we could see exactly what a glaive looked like.

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