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How the FCC Killed Broadband Competition

Sat, November 12, 2011 | Posted by christopher

Dane Jasper, the CEO of Sonic.net, one of the few ISPs to survive the death of broadband competition over the past ten years, wrote about "America's Intentional Broadband Duopoly."  It is a short history of how the FCC's flawed analysis (helped along by incredible amounts of lobbying dollars, no doubt).

He starts by asking when the last time anyone offered to sell you broadband over power lines (BPL).  The FCC decided that cable and telephone companies shouldn't have to share their wires (which are a natural monopoly) with competitors (creating an actual marketplace for services) because BPL, satellite, and wireless would put so much competitive pressure on DSL and cable.  FAIL.

Then, in the Brand X decision, they ruled that Cable would not be required to allow competitors to lease their lines either. The FCC did this by reclassifying broadband Internet access as an “information service”, rather than a “telecommunications service”. As a result, common carriage rules could be set aside, allowing for an incumbent Cable monopoly. This decision was challenged all the way to the supreme court, who ruled in 2005 that the FCC had the jurisdiction to make this decision.

To close out Powell’s near-complete dismantling of competitive services in the U.S., the FCC took up the issue of ISPs resale of DSL using the incumbent’s equipment, also known as wholesale “bitstream” access. If Cable is an information service under Brand X, why shouldn’t Telco have the same “regulatory relief”? The result: the FCC granted forbearance (in other words, declined to enforce its rules) from the common carriage requirements for telco DSL services.

For those who are thinking that wireless is finally competitive with cable and DSL, don't forget that while 4G appears much faster (because so few people are using it presently), it still comes with a 2GB monthly cap. So if you want to do something with your connection aside from watching one movie a month, 4G is not competitive with a landline connection.

Senate to Vote on Giving Internet Governance to Comcast, AT&T

Thu, November 10, 2011 | Posted by christopher

Update: The Senate voted against turning the Internet over to Comcast, AT&T, and other major carriers. How did your Senators vote?

The US Senate began debating network neutrality yesterday - the historic governing principle of the Internet that ISPs should not be allowed to tell their users where they may or may not go and should not prioritize some connections over others merely because it generates more revenue for the ISP.

As Al Franken has said several times, this is the 1st amendment for the Internet - protecting everyone's speech. It prevents a few massive companies (or even local governments where they offer access to the Internet) from exerting too much influence over what subscribers are able to do on the Internet.

Unfortunately, many Senators are campaigning against this principle, in part because they have been misinformed as to what it means and in part because they are getting a ton of campaign cash from corporations that recognize how much more profitable they would be if they could charge users extra to go to YouTube.

There will be a vote today on a resolution of disapproval for the mild network neutrality rules proposed by the FCC last December (which the FCC Chairman chose to water down in part because he thought it would be less controversial -- FAIL).

We would like to recognize some of those who have stood up to protect the open Internet, starting with Free Press.

The American Sustainable Business Council authored an op-ed:

The truth is that if we want to make sure small businesses can grow with the assistance of broadband, the Internet must remain open. We must, as the FCC says, “ensure the Internet remains an open platform—one characterized by free markets and free speech—that enables consumer choice, end-user control, competition through low barriers to entry and freedom to innovate without permission.”

Senator Kerry made an impassioned plea for not turning the Internet over to Comcast and AT&T:

So they're trying to say to the American people that they want to liberate the Internet when, in fact, what they want to do is imprison the Internet within the hands of the most powerful communications entities today to act as the gatekeepers who will control the ability of the Internet to do the very kind of development that brought us here.

...

But the reason we have a Google today, the reason we've had this incredible development of Internet retail business, of all of these web sites, of Facebook and so many more is because of the open architecture of access to that Internet. Which, I would remind everybody in America, was created by government money in government research.

...

Everything that goes over the Internet today goes either through your telephone at home or television or whatever, through cable, out of your house or the airwaves. But if we're not having an open architecture on the Internet, then the people who control those access points can start discriminating about who gets access at what speed. And if you control who gets access at what speed and begin to charge more for that, you begin to have a profound impact on the ability of any business to develop and a profound impact on the access that consumers have come to anticipate with respect to the Internet.

Minnesota's own Senator Al Franken gave a great speech in addition to publishing an article about the importance of net neutrality:

This isn't a radical concept - it's what each and every one of us experiences every time we use the Internet. Right now, an e-mail from a friend arrives in your inbox just as quickly and reliably as an advertisement from Amazon.com. Consumers can go online and make a reservation at a small fishing lodge in Ely, Minnesota just as quickly as they can at the Hilton.

But many Republicans want to change that so that the large corporations they represent can increase their profit margins at the expense of small businesses and consumers.

To illustrate why net neutrality is so critical to innovation on the web, I like to tell the story of a small online startup that launched in 2005 above a pizzeria in San Francisco. It had a product that now seems simple: it allowed people to upload videos so others could stream them. It was called YouTube - you may have heard of it.

At the time, Google had a similar product - Google Video - but it wasn't as easy to use, so consumers took their business to YouTube. The site took off and, less than two years after it launched, YouTube was purchased by Google for $1.6 billion. Not a bad payday.

But it wouldn't have been possible without net neutrality. If Google had been able to pay Comcast and other large Internet service providers to prioritize its data - and make YouTube's videos load more slowly - YouTube wouldn't have stood a chance. Google's inferior product would have won.

And some have made the connection between Network Neutrality and Occupy Wall Street:

At Occupy Chicago, communications volunteers count more than 33,000 Facebook "likes," 20,000 Twitter followers, and several thousand website hits every day.

So, some are asking, what would happen if the corporate entities that are the targets of protests were able to limit Internet traffic? That was tried at one point by the Egyptian government during the Arab Spring protests, and Betty Yu with the Center for Media Justice says it's a legitimate concern.

The NY Times editorialized on it:

The resolution would render void the modest rules adopted by the F.C.C. in December 2010. Stripped of authority, the commission would have a very difficult time protecting the Internet from those who clamp down on content for ideological reasons or profit. Repealing the rules would free service providers like phone and cable companies to block or slow down their competitors’ content — be it movies, songs or messages — when it is flowing through their broadband pipes.

...

The Republican approach goes back to 2002, when the F.C.C., under the Bush administration, made the bizarre decision that broadband Internet communications were not, in fact, telecommunication services under the law. Last year, the F.C.C. had the opportunity to redefine broadband as a telecommunications service, which would allow greater regulatory oversight. Regrettably, it chose not to, and instead passed a limited set of rules that did not ban the practice of paying to move content faster and largely exempted wireless broadband services.

Atlantic Cities: How the Telecom Lobby is Killing Muni Broadband

Mon, November 07, 2011 | Posted by christopher
Publication Date: 
November 2, 2011
Author(s): 
Emily Badger
Publication Title: 
The Atlantic

An excellent article drawing wide lessons from the referendum battle in Longmont between the community and Comcast.

The city of Longmont, Colo., built its own 17-mile, million dollar fiber-optic loop in the mid-1990s. The infrastructure was paid for by the local city-owned electric utility, though it offered promise for bringing broadband to local businesses, government offices and residents, too.

For years, though, the network has been sitting largely unused. In 2005, Colorado passed a state law preventing local governments from essentially building and operating their own telecommunications infrastructure.

Behind the law was, not surprisingly, the telecom lobby, which has approached the threat of municipal broadband all across the country with deep suspicion and even deeper pockets. Companies like Comcast understandably want to protect their corner on the market from competition with city-run non-profits. What’s less understandable is the route their interests have taken: Residents and state legislators from Colorado to North Carolina have been voting away the rights of cities to build their own broadband, with their own money, for the benefit of their own communities.

Link: 
Full Article: How the Telecom Lobby is Killing Municipal Broadband

Visiting Elected Officials Makes a Difference

Mon, September 26, 2011 | Posted by christopher

Before Josh Levy and five other activists met with Yvette Clarke (D-NY), she had signed a letter of support for the AT&T merger with T-Mobile. After a one hour meeting, just after the Justice Department came out against the merger as anti-competitive, she agreed "This deal must be stopped."

This is a great story that goes far beyond AT&T's attempt to monopolize the airwaves. It is a refreshing story for those of us who have been watching in despair, wondering if the vast funds of big companies will doom our democracy. It is a reminder that we cannot give up but have to make sure we are still reaching out to elected officials to ensure they hear from real constituents rather than only from inside-the-beltway lobbyists.

On our key issue, community networks, elected officials too rarely hear from constituents. It is a technical issue that intimidates many. But we must take some time to reach out, educate, and make sure they know how impmortant it is to all of us that local communities maintain self-determination in the digital age.

We cannot wait to reach out until the bad bills are pushed into the light of day -- we need to contact elected officials early in order to build relationships and being the education process. Elected officials are also intimidated by the technology, something that lobbyists use with their "just trust us" approach while bad-mouthing any alternative.

Take heart, write in, talk to your reps, and if you are so bold, set up face to face meetings. Feel free to ask us for advice if you want -- and if you are in Minnesota, feel free to invite us along.

Chattanooga Pairs Wireless with Wired

Mon, August 15, 2011 | Posted by christopher

Chattanooga, with the nation's most impressive broadband network (stretching into rural areas even outside the metro), is spending $30 million to put a Wi-Fi wireless network on top of it. At present, it is primarily for municipal uses:

For now, city government plans to retain exclusive use of the network for municipal agencies as it tests it with applications including Navy SEAL-esque head-mounted cameras that feed live video to police headquarters, traffic lights that can be automatically adjusted at rush hour, and even water contamination sensors that call home if there’s a problem beneath the surface of the Tennessee River.

Much of the wireless network is being funded by state and federal grants -- Chattanooga is turning itself into a test bed for the future city, at least for communities that recognize the benefits of owning their own infrastructure. Chattanooga can do what it wants to, it does not have to ask permission from Comcast or AT&T.

The goal for the city’s wireless network is to make the entire city more efficient and sustainable, said David Crockett, director of Chattanooga’s Office of Sustainability.

As Bernie Arnason notes at Telecompetitor, Wi-Fi is increasingly needed by smartphones because the big cellular networks cannot handle the load. The future has wireless components, but without Wi-Fi backhauled by fiber-optics, the future will be extremely slow and unreliable -- traffic jams for smartphones.

A more recent story from the Times Free Press notes that Chattanooga is wrestling with how to handle opening the network to residential and business use.

Wireless symbol

“I want to be innovative,” he said. “I want to do more than just turn it on in the parks.”

It’s a popular idea with technologists, tourism officials and the general public, who would gain the ability to surf around the city at speeds greater than typical cellular speeds.

Bob Doak, president and CEO of the Chattanooga Area Convention and Visitors Bureau, said allowing tourists to log onto the Internet via Wi-Fi “would be tremendous.

Unfortuately, state laws designed to "protect" some of the most powerful corporations in America, AT&T and Comcast, have limited the utility's options when it comes to offering services to the public.

The reason it’s a legal gray area, according to Tennessee state Sen. Bo Watson, is due to a legally “defined service area” that grants companies such as AT&T, Comcast and EPB specific regions and defines the capabilities they can offer.

Comcast and AT&T have proved incredibly powerful in the Tennessee Legislature, preventing any efforts to encourage more competition among broadband providers in the state by loosening restrictions on public entities to invest in their own networks. In the courts, where they have to argue on a level playing field with opponents (checking their unrivaled lobbying clout at the door), they have done much worse -- losing lawsuit after lawsuit intended to disrupt publicly owned networks.

All of us who want access to better broadband networks have to make sure our elected officials are voting for community needs, rather than for increased profits for Comcast and AT&T.

For those who want to learn more about the history of Chattanooga's incredible network, a good start is this interview with Craig Settles on Gigabit Nation.

Listen to internet radio with cjspeaks on Blog Talk Radio

With this wireless overlay, Chattanooga could have an incredible connected future - where anyone can get a great connection to the Internet anywhere in the city from a network that is designed top-to-bottom with the idea of maxmizing benefits to all -- businesses and residents alike.

Christopher Mitchell on PK's In the Know Podcast

Thu, July 28, 2011 | Posted by christopher

Public Knowledge recently had me as a guest on their "In the Know" weekly podcast. Our interview is the last half of the show. The videos we reference in the discussion are embedded below.

Video: 
See video
See video

Longmont Considers Second Vote on Community Fiber Network

Thu, July 14, 2011 | Posted by christopher

Colorado requires a referendum before a local government can build a broadband network as a result of a 2005 law pushed by Qwest to prevent communities from building next-generation networks. So when Longmont wanted to expand its fiber ring to offer residential and business services, they put it to a vote.

They lost with only 44% supporting the measure. But now, more people understand the issue and the community is considering voting again.

We saw the same dynamic in Windom, Minnesota. Almost ten years ago, Windom held a vote to build a muni FTTH network and it failed to gain the Minnesota-required 65% supermajority. After the vote, a number of people wanted to revote because they realized they had been conned by the incumbent phone provider (ahem… Qwest) and only truly understood the issue after the vote had occurred.

City officials wanted no part of another referendum but community champions eventually prevailed and they had a second vote that authorized the community to build the network.

We'll see if Longmont follows suit. An article discussing the re-vote notes that Comcast and Qwest have dumped unprecedented sums into preventing the community from having a new choice:

The first attempt at getting that approval didn't go so well in 2009. According to city records, opponents -- including the Colorado Cable Telecommunications Association -- spent $245,513 to defeat that ballot measure, the largest amount ever spent on a Longmont city election. By contrast, the city legally couldn't campaign on its own behalf, and the explanations that were out there didn't explain well, according to Longmont Power & Communications director Tom Roiniotis.

The cable and phone companies created an astroturf group called "No Blank Check" that then used standard fear, uncertainty, and doubt tactics to spread misinformation around the community. A quarter of a million dollars is a drop in the bucket to stop the only real threat of competition these companies face anymore -- locally owned community networks.

The situation in Longmont has attracted the interest of the Boulder Weekly, which focused on the opposition of Qwest and Comcast:

According to city records, opponents spent nearly $250,000 — the most ever spent on election ads in Longmont’s history — on the “No Blank Check” campaign, which painted the initiative as a tax guzzler that would reduce funding for local police officers and firefighters. According to reports, the primary campaign contributor was the Colorado Cable Telecommunications Association (CCTA), which counts Comcast among its members.

Public safety departments in Longmont should talk to their counterparts in Wilson, North Carolina, who recently testified about the many tremendous advantages they have from owning their own fiber network.

Longmont Power and Communications

Roiniotis says the “No Blank Check” claims were misleading, to say the least, because any city-owned telecommunication service would operate as a self-funded enterprise, relying solely on the fees it collects instead of tax dollars.

“We run it just like a business, but we’re nonprofit,” he says.

If anything, Roiniotis says, it would make money for Longmont’s emergency services, because it would send 8 percent of its revenue to city coffers in the form of a franchise fee.
“It was actually just the opposite of what No Blank Check was saying,” Roiniotis told Boulder Weekly. “They were saying we were going to have to lay off police and firefighters. Nothing could be further from the truth. That’s never been proposed. In fact, telecommunications would actually generate money for those departments. But they had models dressed up as firefighters, looking very sad."

The article goes on to quote Comcast and CenturyLink who say that communities never succeed at building a networks… failing to mention that their best networks cannot even come close to matching the impressive networks built by Chattanooga, Lafayette, Wilson, Salisbury, Monticello, North Kansas City, and a number of other communities. CenturyLink -- with its pathetic last-generation DSL service -- wanting to educate local governments on how to build a network is like Coyote offering tips on stride to the Road Runner.

Like others, Longmont has credited the Google gigabit initiative as a rallying and organizing cry to reorganize and build the network they need.

The proposed question this time around is:

Shall the citizens of the City of Longmont Colorado re-establish their City's authority to provide all services restricted since 2005 by Title 29, article 27 of the Colorado Revised Statutes, described as "advanced services", "telecommunications services" and "cable television services," including any new and improved high bandwidth services based on future technologies, utilizing community owned infrastructure including but not limited to the existing fiber optic network, either directly or indirectly with public or private sector partners, to potential residential and commercial subscribers within the City and the service area of the City's electric utility enterprise?

The challenge of any ballot initiative on broadband is to explain to voters what is at stake. These technologies are intimidating and confusing to most voters - particularly as those who don't vote on a measure are often counted as nays.

Link: 
City Council Video of Discussion Around Referendum

Louisiana Leg uses Porn Excuse to Target LUS Community Network

Thu, June 30, 2011 | Posted by christopher

We occasionally see big cable and phone companies getting creative in their efforts to shut down community networks. In socially conservative communities, restrictions on providing adult content is a common approach.

This technique came up several times in North Carolina, where TWC-sponsored elected officials proposed disallowing public providers from offering the same adult content channels that private providers offer. The reason has nothing to do with morals, but rather with the substantial revenue adult content generates. Incumbent providers know that if community networks cannot offer adult content to those who wish to purchase it, they will be deprived a significant source of revenue needed to pay the debt from building a modern network.

Bear in mind that no one is forced to see this content or even a scrambled channel (as was common in the "old" days). Community networks allow each family to decide for themselves what content is appropriate -- to the extent community networks differ from private providers in this regard, they provide more tools to filter out content that some may find inappropriate.

Last week, the Louisiana House briefly considered a bill to limit Lafayette's authority to make adult content available to subscribers that request it. House Bill 142 exists solely to put LUS Fiber, an impressive muni FTTH network, at a disadvantage.

John at Lafayette Pro Fiber has excellent coverage of the situation, with both an initial post featuring eyes-a-rollin' as well as an in depth followup "Lafayette delegation kills anti-LUS bill."

LUS Fiber Logo

The latter is essential reading for those new to understanding how any legislature works. And anyone building a network that will compete with big companies like AT&T, Cox, Time Warner Cable, et al. had better know how legislatures work because those companies live in the Leg. Their competitive advantage lies in lobbyists, not providing superior telecom services.

Apparently, the Legislators pushing this bill (on behalf of Cox - there is no other rational explanation) first claimed it was about banning the use of state credit cards from buying adult content (or services) when officials were traveling… but John notes that is already prohibited.

Legislators defending Lafayette (and all the citizens of Louisiana who have suffered enough at the hands of AT&T and Cox) sought a compromise that would have ensured a "level playing field" for adult content by applying the law to all providers equally. This killed the bill. But John wonders if there was something more at play:

Extra Credit: Decide whether the real point of this exercise was purely PR — was it never intended to pass, only to try and lay on LUS (again--this ploy fizzled badly during the fiber fight) the onus of selling "porn?" Or was the hope to impose another long, embarrassing and distracting lawsuit on Lafayette? (This worked pretty well during the fiber fight.)

Community networks and defenders, be prepared for similar fights at a legislature near you.

WiscNet Under Continued Attack, Contact Elected Officials

Wed, June 15, 2011 | Posted by christopher

As we feared, the compromise may have been compromised by the uncompromising power of AT&T lobbyists. Once again, we learn that they struck at the last hour and may have put local schools and libraries on the chopping block.

If WiscNet goes and stimulus funds are returned, local institutions will have to double and triple their telecom budgets just to continue receive adequate service. This is intolerable. Until we hear otherwise, we encourage people to continue contacting their elected officials [pdf] in Wisconsin to express their opinion on the matter.

Some more details here and here.

Update: The Assembly will now be meeting at 1:00 rather than this morning. Rumors abound that they are still discussing how to "compromise" on AT&T's attack on the schools and libraries.

Unfortunately, this afternoon, I'll be leaving for a short camping trip (AT&T is not going to ruin my trip) and I have some canned posts queued up, so I won't be able to cover what happens in Wisconsin immediately. For news on the stimulus grant impact, follow WI_Broadband and for news about WiscNet, follow ijohnpederson and his live blog.

2nd Update: To understand how AT&T has so much power in Wisconsin, check out who "donates" the most money.

Positive Update from Wisconsin on WiscNet, Stimulus Awards

Tue, June 14, 2011 | Posted by christopher

The word from Wisconsin is mostly good. A deal has been struck that will spare WiscNet, though it will be studied for two years and then could be killed. But a fair, open study will allow WiscNet to clearly demonstrate its value -- WiscNet thrives in the light while AT&T thrives at secretive, last minute measures to gut its competitors.

Additionally, the stimulus grants appear to be safe. The Legislature apparently will not require them to be returned long after the recipients had begun implementing them. But again, there is some bad news in that UW Extension will be restricted from receiving federal grants in the future to build the networks otherwise unavailable to schools and libraries. So that is disappointing. Returning those funds would have cost a few communities $27.7 million over just 5 years.

However, nothing is settled until the Legislature fully votes on it (today and Thursday) and the Governor signs the bill. AT&T lobbyists don't get paid to create fair compromises and surely aren't finished scheming. So make sure you have made your thoughts on this matter known to your elected officials. The Rootstrikes make it easy. Don't forget to tell the Governor too -- the line-item veto is a powerful tool.

Some more details have emerged regarding the damage to local budgets that would occur if the Leg requires the stimulus awards to be returned, in the Superior schools, for instance:

"We would pay about five times more for the internet access than we already pay through Wiscnet," said Nordgren [Associate Vice Chancellor of UW Superior].

The Superior School District said they would also lose money, because they have already invested $300,000 in anticipation of the project.

"We utilized the funding from this broadband grant in order to purchase and update our website that was archaic," said Janna Stevens, Superintendent at the Superior School District.

logo-league-wi-munis.png

The Wisconsin League of Municipalities vociferously opposes language harming WiscNet [pdf]:

Finally, we strongly oppose JFC’s decisions to dismantle WisNet and to reject $37 million in federal dollars for promoting broadband service in rural Wisconsin. Many libraries and city halls around the state save taxpayers’ dollars by using WisNet as their Internet provider. This change benefits private Internet service providers at an additional cost to taxpayers. At a time when both the Administration and the Legislature are preaching government frugality, it doesn’t make sense to take away some of the very tools local governments use to reduce spending. We urge the Legislature to reverse these JFC amendments.

If there is one lesson we can take away from this fight, it is the need to build strong networks that can quickly respond to the tricks companies like AT&T can do in their power-center: state capitals and DC. This provision was obviously intended to benefit AT&T and a few other companies at the expense of all Wisconsin, particularly its schools and libraries. But WiscNet and defenders responded quickly and powerfully to the attack. And when they did respond, they did so with various arguments, including the cost to libraries and schools. If you can't tell a legislator how it impacts a budget somewhere, you probably aren't being heard.