Martin Gets the Ball Rolling On “Blocking” Investigation: What Does It Mean And What Happens Next?

As always, I am impressed with the ability of so many people to hate whatever Kevin Martin does, and for so many different reasons! At CES, Martin announced that the FCC would investigate allegations of blocking content and determine whether they violated the FCC’s four broadband principles. Comcast pledged to cooperate in any investigation (although, unsurprisingly, Comcast representatives — along with supposed object of Martin’s affection AT&T and other big telcos and cablecos — said at CES they would restructure or eliminate FCC altogether).

As I said in my PK blog post, while details remain unclear, I am “cautiously optimistic” that this will be a good thing. But it did not take long for the folks in the “Martin is a bastard 24/7 crwd” to express themselves. DSL reports doubted this would go anywhere, while the “why ya gotta hate on cable” crowd at Techdirt opined that Martin would never investigate if it were a telco rather than a cable co.

So we flash forward to yesterday, when new developments began to percolate out of the FCC. Of significance:

1) The FCC issued a public notice asking for comment on our Petition for Declaratory Ruling that Comcast’s “network management practice” of messing with BitTorrent uploads violated the FCC’s “Broadband Policy Statement,” which includes a principle that network operators may not block or degrade content or applications. In a separate public notice (but as part of the same proceeding), the FCC also seeks comment on the Vuze Petition for Rulemaking on how broadband access providers handle and shape IP traffic generally. (Copy of Vuze Petition here, copy of our Petition here).

2) Separately, the FCC issued a separate public notice seeking comment on a Petition filed by Public Knowledge and the usual suspects asking the FCC to declare that wireless carriers cannot deny short codes or block text messaging. This goes after Verizon’s high profile “oopsie” of denying a request by NARAL for a short code. Although, as we pointed out in the Petition, the more likely and pernicious problem is with plain old anticompetitive blocking, such as denying a short code to VOIP provider Rebtel.com and denying applications to major banks offering competing services.

3) Comcast confirmed that the FCC has lanched a formal inquiry into whether it violated the FCC’s broadband policy statement. Comcast reiterated that it will fully cooperate with the FCC, and expects any investigation to show that Comcast did not block content and has engaged in legitimate network management practices.

Not bad for a commitment made a week ago. But what does it mean and where will it go from here? Analysis below . . . .

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Put Up Or Shut Up At the FCC on Net Neutrality “Principles”

When the FCC deregulated broadband by declaring it an “information service,” it also adopted four principles that purported to give broadband subscribers a right to “access lawful content of their choice,” “run applications and services of their choice,” “connect their choice of legal devices that do not harm the network,” and enjoy “competition among network providers, application and service providers.” All subject to “reasonable network management,” of course. So when a bunch of us in 2006 pressed Congress to pass a network neutrality law, a lot of folks claimed we didn’t need one because the FCC already had the authority to deal with any problems that might arise. And, when questioned on this very subject at his confirmation hearing for a second term, FCC Chairman Martin said the FCC had ample authority to deal with any violations of the four principles that might arise.

Thanks to Comcast and their decision to “manage” their network load by degrading BitTorrent,it’s put up or shut up time at the FCC. My employer, Media Access Project, along with Free Press and Public Knowledge, just filed a formal complaint against Comcast and a general Petition for Declaratory Ruling asking that the FCC hold that deliberately messing with a customer’s application while refusing to admit doing it when asked pint blank violates the FCC’s “four principles” and does not constitute a “reasonable network management practice.” This will also press the FCC to find out exactly what the heck Comcast is actually doing (since some folk remain uncertain). Given that Comcast initially denied the very idea as “internet gossip,”, instructed their line staff to lie to customers about it, and are still maintaining that nothing of interest is going on, it looks like the only way will actually find out what the heck is going on and why is to have the FCC pry it out of them.

Hey, maybe they are telling the truth. But the FCC is in a much better position to know whether Comcast is deliberately lying to its customers and, if so, why. Because while my friend and opposite number Jim Harper at Technology Liberation Front may be content to see if the market punishes Comcast for its “lack of transparency”, I see a lot of bad consequences in letting Comcast throttle traffic as a network management tool and then lie (or, at best, mislead) about it when asked about it point-blank by their customers.

At any rate, whether folks think we should regulate this kind of behavior or not (and I recognize that a number of smart folks not employed by cable operators feel we shouldn’t regulate this even if everything bad said about Comcast is true), we deserve to know whether the FCC has the authority to regulate this behavior, and the willingness to do so on an enforcement basis. Because if the cable and telco companies that swore up and down that we didn’t need new rules now come in and say the FCC has no authority to take complaints about their behavior after the fact or no authority to order any remedies, then we should know that. And if the FCC is going to leave us high and dry when broadband providers start degrading applications, then we should know that. Because while some folks may think that lying to your customers is an acceptable network management technique, or even an acceptable technique for managing elected members of Congress, I think most Americans would disagree. And I certainly want to know that by November ’08.

Stay tuned . . . .

Atkins & Weiser “Third Way” Paper, Isenberg Responds, and My Own Response

A few months back, Robert Atkins and Phil Weiser wrote this paper called a A “Third Way” on Network Neutrality. I recommend reaing the paper, but to summarize: The paper asserts that the NN debate has polarized between the telcos & cable cos, who want an unlimited right to control traffic, and the pro-net neutrality advocates, who want all packets treated equally by the network operator. Atkins & Weiser see this polarization as obscruing the fact that both sides of the debate raise legitimate concerns about market abuse and investment in networks on the one hand, and about government intrusiveness into network management on the other.

Atkins & Weiser therefore recommend an approach they believe addresses both sets of legitimate concerns. Congress should permit network operators to have considerable discretion with tiering — including favoring content based on origin as well as by nature of service. However, to protect consumers from abuses of market power, network operators must (A) fully disclose which packets are favored and why. In this way, consumers can ascertain readily if their lousy connection with mediastreamerA and great connection with mediastreamerB is a consequence of mediastreamerA having a bad service or their ISP cutting a deal with mediastreamerB; (B) Congress should affirm the FCC’s responsibility to monitor the broadband ISP market for anticompetitive abuses and permit the FCC to resolve any abusive practice that may emerge either by adjuidcation or by rule; and (C) the government should provide other incentives — such as tax credits or subsidies — to facilitate broadband deployment.

Recently Dave Isenberg wrote a a strong critique of the paper. Isenberg chastises Atkins and Weiser for falling into what I shall characterize as the attractive trap of the apparently “reasonable compromise.” Isenberg argues that, on the one hand, Atkins and Weiser lack vision. They fail to appreciation of the revolutionary aspects of the internet and the damage to the power of the internet as a disruptive technology if broadband network providers can exercise the kind of control over content and services that Atkins & Weiser would permit under traditional antitrust analysis. On the other hand, Isenberg maintains that Atkins & Weiser fail to appreciate the “Realpolitik” problems of relying on the FCC for enforcement instead of enacting a prophylactic, self-executing rule. Given the potential for agency capture and the length of time it will take the agency to act, a rule which does nothing but set up the FCC as a watch dog with discretion is worse than useless. Only by prohibitting tiering and requiring network neutrality can save the power of the internet as a disruptive technology capable of challenging the core businesses (such as video and voice) of the network providers themselves.

About a month ago, Phil Weiser and I debated this point over on the Public Knowledge policy blog. You can see our back and forth here: Phil’s first post, my response, Phil’s reply to me (with my reply in the comments), and Phil’s final summation.

As folks might imagine, I tend to side with Dave Isenberg on this one, although I recommend the Atkins & Weiser paper to folks interested in alternative views. Atkins and Weiser are no industry shills or ideological Neocons refusing to recognize the potential dangers. And, as I have always said, anyone who wants to formulate real policy rather than foster religious ideology needs to consider other views and recognize where someone else has a valid point. I don’t agree with Atkins & Weiser (for reasons I’ve covered at length in the links and elsewhere), but I’m glad to have considered what they had to say.

Stay tuned . . . .