Broadband Politics and Closed-Door Negotiations at the FCC
The last seven days at the FCC have been drama-filled, and that's not something you can often say about an administrative agency. As I noted in my last post, the FCC is considering reclassifying broadband as a "common carrier" service. This would subject the access portion of the service to some additional regulations which currently do not apply, but have (to some extent) been applied in the past. Last Thursday, the FCC voted 3-2 along party lines to pursue a Notice of Inquiry about this approach and others, in order to help solidify its ability to enforce consumer protections and implement the National Broadband Plan in the wake of the Comcast decision in the DC Circuit Court. There was a great deal of politicking and rhetoric around the vote. Then, on Monday, the Wall Street Journal reported that lobbyists were engaged in closed-door meetings at the FCC, discussing possible legislative compromises that would obviate the need for reclassification. This led to public outcry from everyone who was not involved in the meetings, and allegations of misconduct by the FCC for its failure to disclose the meetings. more...
Showing posts with label FCC. Show all posts
Showing posts with label FCC. Show all posts
Thursday, June 24, 2010
New Post at FTT on FCC Drama
I just posted over at Freedom To Tinker.
Thursday, May 27, 2010
Summary of "The FCC’s Authority Over Broadband Access"
[Update: the video and transcripts for Panel 1 and Panel 2 are now posted]
Today I attended the "The FCC’s Authority Over Broadband Access" event in DC. These DC policy events tend to have more talking points than I'm willing to tolerate, but today's event was both balanced and substantial.
[A disclaimer, this post is fairly hastily written and assumes some deeper background knowledge of some of the terms. I recommend Harold Feld's recent blog post if you find unfamiliar language or concepts in here. Susan Crawford also has good stream-of-discussion notes of the first panel.]
Session 1: The History and Context of the Debate
The first panel was mostly a history of how we got here, hitting many of the points I explored in my post on Freedom to Tinker yesterday, "Regulating and Not Regulating the Internet". The panelists were certainly well qualified. John Nakahata is a former FCC Chief of Staff who lived through many of the relevant policy decisions in the late 1990s. Jessica Rosenworcel is the current Senior Counsel for the Senate Commerce Committee (which has authority over the FCC). John Windhausen is one of her predecessors, former Senior Counsel for the committee, who lived through the 1996 Telecommunications Act.
Nakahata reminded the audience that in the mid-1990s, the administration had proposed a new Title VII to the Communications Act that would have explicitly set policy for broadband. However, this approach never progressed and instead the 1996 Act simply codified a version of the Computer Inquiries "basic"/"enhanced" services distinction in the form of "information"/"telecommunications" services... without explicit reference to the internet. This is a layered model, in opposition to the silo-like approach of the Act's overall structure. He also observed that the 1998 "Stevens Report" (to which Brand X refers extensively) noted that if placing broadband under Title II was too onerous, the FCC could forbear from much of it (essentially what Chairman Genachowski is proposing today -- Nakahata seemed to think this was ironic, but it seems more like evidence of good research and historical consistency on the part of the Charman's office). He also noted that since that time there have been changes in the market -- including the elimination of mandatory unbundling or line-sharing -- that alter the broader policy calculus (presumably toward greater regulatory intervention). Finally, he observed that although there may be limited precedent for defining a separate telecommunications portion of an integrated service, pursing this approach on a large scale would be a revolutionary rather than evolutionary development.
John Windhausen confirmed Nakahta's telling of the 1996 Act's "information"/"telecommunication" service legacy in the Computer Inquiries. He laid out two basic principles which he thought had guided regulation of communications going all the way back to common law: 1) Common Carriage and a non-disciminatory duty to serve of public transport providers and 2) The principle of not regulating the communications that are transported. We are having today a variation of the age-old discussion of where to draw the line between the two. He also noted that some of the ambiguity of the 1996 Act was intentional. Congress sought to defer to an expert agency on the details. He emphasized that his reading of Brand X was that it quite clearly concluded that the categorization of broadband services was up to the determination of the FCC under the Chevron doctrine. He also indicated that the Commission had already demonstrated the possibility of classifying a portion of internet service as a telecommunications service when it issued the wireline broadband order and noted that ISPs could still voluntarily offer the service as a common carrier.
Jessica Rosenworcel didn't speak to the issues in as much depth as her fellow panelists, but such reticence to make public pronouncements is to be expected from an actively employed congressional counsel. That being said, she identified some high-level themes. First, technology changes quickly, making it difficult for regulators let alone legislators to keep up. Second, she observed that in the past ten years there appears to have been an effort to (understandably and logically) treat like services alike, regardless of the different technologies used to provide those services. However, this approach is perennially made difficult because of the "siloed" structure of the Act.
Session 2: The Third Way - What Happens Next?
The second panel was a bit more rough-and-tumble as it addressed the current debate over broadband reclassification. First up was Jim Speta, a Northwestern law professor who has long argued for a more antitrust-like approach to communications law. Second was Susan Crawford, a Cardozo law professor who recently did a stint advising the Obama Administration on technology issues. Third was Yochai Benkler, the primary investigator on the Berkman Center's Next Generation Connectivity Report for the FCC (which I contributed to). Finally, there was Jon Nuechterlein, an attorney for the broadband companies (representing only his personal views), who observed that he was the only practicing lawyer on the panel. Nuechterlein is one of the more fun people to critique, because he is so very smart and often so very wrong. You can see my stream of consciousness thoughts about Jon's position in my tweets.
As the panel began, I predicted: Speta: "antitrust!", Crawford: "infrastructure!", Benkler: "innovation!", Nuechterlein: "determinacy!". I meant that Jim would continue to push his antitrust-oriented view of Communications Act reform, Susan would remind us that broadband is general-purpose infrastructure and not just another market, that Yochai would argue that oversight of the broadband market is essential to all sorts of innovation, and that Jon would emphasize that any attempts to reclassify broadband would result in drawn-out court battles that would cast a pall of indeterminacy over the market, chill investment, and slow growth. I was not disappointed.
However, the panel focused far more on the intricacies of whether reclassification would hold up in court, what arguments would hold the day, and whether there were respectable policy justifications for these arguments. I love that stuff, so I can't complain. Speta started by observing that he thought it likely that reclassification would survive, given the Chevron-based deference articulated in Brand X. However, he was not sure that this was a good policy outcome. In particular, he said that he does not agree with the portion of the Schlick memo that claims that forbearance is difficult to reverse. Thus, he's worried about subsequent regulatory overreach. His prescription is a new governance structure based entirely on analysis of whether one firm has unreasonably foreclosed business of another. Susan agreed that reclassification should prevail, and made her typically well-articulated case for precedentially and empirically grounded government oversight of public communications carriers. She also observed that the reclassification position being advanced is that only the access portion of internet services be classified as a Title II service. Yochai began by observing the across-the-board agreement on the legal viability of reclassification, and provided some comparison points from around the world where defer-to-the-market approaches failed (such as New Zealand).
Then came Nuecterlein. His comments might serve as a clue on what might be included in a petition for reconsideration on the FCC's ultimate reclassification order. I was expecting something new and challenging, but frankly I was disappointed. He of course didn't think that reclassification would survive legal challenge (given that he'd be on the side arguing against it). His argument followed the predictable pattern: There is no "telecommunications" component of internet access, and in any case the service offered to end users is integrated with an information service component which is mutually exclusive with any telecommunications component (thus transforming the service into merely an information service). His policy argument was that if reclassification succeeded, many higher-layer services (such as web applications) would be poisoned with overbearing regulation because they inevitably would be classed as telecommunications services as well (I critiqued his first stab at this argument over here). What's more, according to Jon, other portions of the internet might not be classified as telecommunications services and thus bad things could be done there with impunity. I suppose this final point is somewhat new, but the others are rather standard fare and don't really account for the counterpoints already in circulation. The success of his legal arguments will likely hinge on a series of finely focused distinctions in the web of service definitions found in the 1996 Act. He referred briefly to Harold Feld's recent fantasy FCC predictions, but thus far I am far more persuaded by Harold's position than Jon's (especially in the deference-rich environment of Chevron). You can get a sense for my opinion on a few of his specific points in my tweets.
In any case, I'll do a follow-up post on Freedom to Tinker outlining my fantasy FCC reclassification predictions. Sorry about the inevitable typos and harried prose above, but I've got some real baseball to attend to -- I'm about to get off the train to Citi Field to watch the Phillies beat the Mets.
Today I attended the "The FCC’s Authority Over Broadband Access" event in DC. These DC policy events tend to have more talking points than I'm willing to tolerate, but today's event was both balanced and substantial.
[A disclaimer, this post is fairly hastily written and assumes some deeper background knowledge of some of the terms. I recommend Harold Feld's recent blog post if you find unfamiliar language or concepts in here. Susan Crawford also has good stream-of-discussion notes of the first panel.]
Session 1: The History and Context of the Debate
The first panel was mostly a history of how we got here, hitting many of the points I explored in my post on Freedom to Tinker yesterday, "Regulating and Not Regulating the Internet". The panelists were certainly well qualified. John Nakahata is a former FCC Chief of Staff who lived through many of the relevant policy decisions in the late 1990s. Jessica Rosenworcel is the current Senior Counsel for the Senate Commerce Committee (which has authority over the FCC). John Windhausen is one of her predecessors, former Senior Counsel for the committee, who lived through the 1996 Telecommunications Act.
Nakahata reminded the audience that in the mid-1990s, the administration had proposed a new Title VII to the Communications Act that would have explicitly set policy for broadband. However, this approach never progressed and instead the 1996 Act simply codified a version of the Computer Inquiries "basic"/"enhanced" services distinction in the form of "information"/"telecommunications" services... without explicit reference to the internet. This is a layered model, in opposition to the silo-like approach of the Act's overall structure. He also observed that the 1998 "Stevens Report" (to which Brand X refers extensively) noted that if placing broadband under Title II was too onerous, the FCC could forbear from much of it (essentially what Chairman Genachowski is proposing today -- Nakahata seemed to think this was ironic, but it seems more like evidence of good research and historical consistency on the part of the Charman's office). He also noted that since that time there have been changes in the market -- including the elimination of mandatory unbundling or line-sharing -- that alter the broader policy calculus (presumably toward greater regulatory intervention). Finally, he observed that although there may be limited precedent for defining a separate telecommunications portion of an integrated service, pursing this approach on a large scale would be a revolutionary rather than evolutionary development.
John Windhausen confirmed Nakahta's telling of the 1996 Act's "information"/"telecommunication" service legacy in the Computer Inquiries. He laid out two basic principles which he thought had guided regulation of communications going all the way back to common law: 1) Common Carriage and a non-disciminatory duty to serve of public transport providers and 2) The principle of not regulating the communications that are transported. We are having today a variation of the age-old discussion of where to draw the line between the two. He also noted that some of the ambiguity of the 1996 Act was intentional. Congress sought to defer to an expert agency on the details. He emphasized that his reading of Brand X was that it quite clearly concluded that the categorization of broadband services was up to the determination of the FCC under the Chevron doctrine. He also indicated that the Commission had already demonstrated the possibility of classifying a portion of internet service as a telecommunications service when it issued the wireline broadband order and noted that ISPs could still voluntarily offer the service as a common carrier.
Jessica Rosenworcel didn't speak to the issues in as much depth as her fellow panelists, but such reticence to make public pronouncements is to be expected from an actively employed congressional counsel. That being said, she identified some high-level themes. First, technology changes quickly, making it difficult for regulators let alone legislators to keep up. Second, she observed that in the past ten years there appears to have been an effort to (understandably and logically) treat like services alike, regardless of the different technologies used to provide those services. However, this approach is perennially made difficult because of the "siloed" structure of the Act.
Session 2: The Third Way - What Happens Next?
The second panel was a bit more rough-and-tumble as it addressed the current debate over broadband reclassification. First up was Jim Speta, a Northwestern law professor who has long argued for a more antitrust-like approach to communications law. Second was Susan Crawford, a Cardozo law professor who recently did a stint advising the Obama Administration on technology issues. Third was Yochai Benkler, the primary investigator on the Berkman Center's Next Generation Connectivity Report for the FCC (which I contributed to). Finally, there was Jon Nuechterlein, an attorney for the broadband companies (representing only his personal views), who observed that he was the only practicing lawyer on the panel. Nuechterlein is one of the more fun people to critique, because he is so very smart and often so very wrong. You can see my stream of consciousness thoughts about Jon's position in my tweets.
As the panel began, I predicted: Speta: "antitrust!", Crawford: "infrastructure!", Benkler: "innovation!", Nuechterlein: "determinacy!". I meant that Jim would continue to push his antitrust-oriented view of Communications Act reform, Susan would remind us that broadband is general-purpose infrastructure and not just another market, that Yochai would argue that oversight of the broadband market is essential to all sorts of innovation, and that Jon would emphasize that any attempts to reclassify broadband would result in drawn-out court battles that would cast a pall of indeterminacy over the market, chill investment, and slow growth. I was not disappointed.
However, the panel focused far more on the intricacies of whether reclassification would hold up in court, what arguments would hold the day, and whether there were respectable policy justifications for these arguments. I love that stuff, so I can't complain. Speta started by observing that he thought it likely that reclassification would survive, given the Chevron-based deference articulated in Brand X. However, he was not sure that this was a good policy outcome. In particular, he said that he does not agree with the portion of the Schlick memo that claims that forbearance is difficult to reverse. Thus, he's worried about subsequent regulatory overreach. His prescription is a new governance structure based entirely on analysis of whether one firm has unreasonably foreclosed business of another. Susan agreed that reclassification should prevail, and made her typically well-articulated case for precedentially and empirically grounded government oversight of public communications carriers. She also observed that the reclassification position being advanced is that only the access portion of internet services be classified as a Title II service. Yochai began by observing the across-the-board agreement on the legal viability of reclassification, and provided some comparison points from around the world where defer-to-the-market approaches failed (such as New Zealand).
Then came Nuecterlein. His comments might serve as a clue on what might be included in a petition for reconsideration on the FCC's ultimate reclassification order. I was expecting something new and challenging, but frankly I was disappointed. He of course didn't think that reclassification would survive legal challenge (given that he'd be on the side arguing against it). His argument followed the predictable pattern: There is no "telecommunications" component of internet access, and in any case the service offered to end users is integrated with an information service component which is mutually exclusive with any telecommunications component (thus transforming the service into merely an information service). His policy argument was that if reclassification succeeded, many higher-layer services (such as web applications) would be poisoned with overbearing regulation because they inevitably would be classed as telecommunications services as well (I critiqued his first stab at this argument over here). What's more, according to Jon, other portions of the internet might not be classified as telecommunications services and thus bad things could be done there with impunity. I suppose this final point is somewhat new, but the others are rather standard fare and don't really account for the counterpoints already in circulation. The success of his legal arguments will likely hinge on a series of finely focused distinctions in the web of service definitions found in the 1996 Act. He referred briefly to Harold Feld's recent fantasy FCC predictions, but thus far I am far more persuaded by Harold's position than Jon's (especially in the deference-rich environment of Chevron). You can get a sense for my opinion on a few of his specific points in my tweets.
In any case, I'll do a follow-up post on Freedom to Tinker outlining my fantasy FCC reclassification predictions. Sorry about the inevitable typos and harried prose above, but I've got some real baseball to attend to -- I'm about to get off the train to Citi Field to watch the Phillies beat the Mets.
Monday, February 1, 2010
The Internet and Common Carriage
I spent this past weekend at the Silicon Flatirons broadband conference in Boulder. The gathering draws telecom lawyers, academics, and advocates for a discussion about policy issues in broadband. The Silicon Flatirons community is also responsible for a very good journal (now open access!), and the 2005 book Digital Crossroads (co-written by former Executive Director Phil Weiser and his friend Jonathan Nuechterlein). Nuechterlein is a brilliant telecom attorney, and although Digital Crossroads is fundamental to my understanding of internet law, I find myself in eternal disagreement with his policy positions.
We are all currently awaiting the conclusion of the Comcast/Bittorrent case in DC Circuit Court, which will determine whether the FCC has jurisdiction to enforce its so-called "four internet freedoms" (I described the issues way back when this fight started a year and a half ago). In parallel, the Commission is conducting a proceeding to determine whether it should more explicitly establish "open internet" rules. Neuchterlein generally does not like anything resembling ex ante regulatory obligations on telecom infrastructure providers -- certainly not from the perspective of his clients (like AT&T), and apparently not as a matter of personal opinion either. I disagree, as I have described elsewhere (footnote 161, etc.).
But that's old news. This year there's a new twist. Historically telecommunications were regulated under Title II of the Communications Act, and were referred to "common carriers" (or "telecommunications services"). Under this regime, carriers had to remain non-discriminatory in their service, and were subjected to a host of arguably overbearing price controls and the like. Between 1998 and 2005, the FCC effectively "deregulated" broadband by classifying it under the vague Title I (redefining it from a "telecommunications service" to an "information service"). This took seven years due to a series of court cases that ultimately put the issue in front of the Supreme Court, which affirmed the FCC's authority to classify broadband however it wished. If the FCC loses the Comcast case, it will likely consider whether to re-classify broadband under Title II so as to regain authority to regulate. Susan Crawford has a great description of the state of play.
Nuechterlein thinks that reclassification would be horrible. First, he is afraid of the many onerous elements of Title II that are unrelated to the policy goals of the "open internet" crowd. The FCC has the power to "forbear" from enforcing any or all of these, but Nuechterlein doesn't think they would. Second, he claims reclassification would confer very comprehensive regulation on FCC for "all corners of the internet ecosystem." In particular, he claims that application and content providers like Google and Netflix would fall within reach of the long arm of common carriage. You can see him make the case in the video below, starting at 1:23:00:
Even if Nuechterlein is right, these developments can be seen as direct backlash for years of chipping away at anything resembling regulation. After winning the battle to reclassify broadband, these entities continued to push against the notion that the FCC retained any authority at all to regulate. Harold Feld has argued that keeping oversight in a vaguely defined ex post arena serves incumbents' goals of maintaining the appearance of jurisdiction without any practical authority. However, the Comcast case threatens to expose this ruse (assuming the FCC does lose the case) and re-introduce the specter of Title II.
To be fair, opponents of FCC jurisdiction or ex ante regulation have proposed theoretical alternatives. Weiser, Nuechterlein, and others in the Silicon Flatirons community have long argued for antitrust-like ex post enforcement. Their proposals for how it would be implemented evolve from year to year, but more importantly the practical hurdles to achieving it seem very hard to overcome. [Edit: Speta just came out with an article suggesting yet another variation on the antitrust-like approach.] I have described elsewhere (pp. 118-122) how I think that framing this solely as an antitrust question misses the point, and in my most pessimistic moments I am sympathetic with those that claim it is just a euphemism for doing nothing.
I do agree in part with Nuechterlein's first point -- that bringing the full force of Title II to bear on broadband would be a bad thing. Perhaps he is better at predicting how forbearance will play out than I am. Given that he wrote the book on the matter, I suppose this is likely. On the other hand, we do have ample evidence of Commission forbearance. Indeed, even as the FCC reclassified all broadband services under Title I, it noted that some operators may wish to continue to operate under Title II, and it preemptively chose to forbear from tariffing (see paras. 89-94). Maybe it is a bit like chipping away at Pike's Peak in order to carve a statue, but we are left with few alternatives. In any case, Title II at least carries a rich legacy of non-discrimination norms... even if it also carries baggage.
I am not remotely convinced of his second major claim -- that bringing broadband under Title II necessarily implicates a host of higher-level services in its regulation (like Netflix, Google, and VoIP [edit: although in the case of VoIP there may already be some limited jurisdiction]). We have a very rich history of distinguishing between transport providers and the services that are delivered over that infrastructure. The 2005 Supreme Court Brand X decision affirming the FCC's classification decision mangles these distinctions and is frankly a mess. To the extent that the description of the technology made sense in its time, it is largely inaccurate today, as described by Public Knowledge. In the course of the Brand X litigation, MCI had been making the argument that any information service that made use of a telecommunications service would necessarily be subject to common carriage. The majority opinion notes,
Nuechterlein claims that reclassification would necessarily validate this argument. There are two problems with this. First, the MCI argument on its merits is at odds with decades of precedent that distinguishes between regulatory treatment these two types of services. Second, the Court was discussing this argument in the context of whether the FCC had unreasonably interpreted statute, rather than proactively determining what would necessarily follow if the Commission decided to classify broadband under Title II. In that sense, Nuechterlein and I both agree with the Court: MCI's argument isn't going to fly.
If the Commission were ultimately to classify broadband under Title II, it might be a workable means of gaining necessary jurisdiction to do good policy. It is not without its risks, but I think that the risks are far less severe than Nuechterlein's straw men.
In the final panel of Day 2, Marc Berejka of the Commerce Department observed (starting 2:17:00 in the video) that the hardest thing about doing good internet policy is that we don't have good governance tools. Regardless of what the Commission does in the short run with respect to broadband classification, we need to seriously reconsider the structure of communications regulation, all the way back to first principles and enabling statute.
Bonus: Yesterday, CITP hosted Chris McDonald, who talked about "The Computer Utility and the First Computer-Communications Policy Debate." He gave a very good overview of the first round of debates in this area. The audio is now available.
We are all currently awaiting the conclusion of the Comcast/Bittorrent case in DC Circuit Court, which will determine whether the FCC has jurisdiction to enforce its so-called "four internet freedoms" (I described the issues way back when this fight started a year and a half ago). In parallel, the Commission is conducting a proceeding to determine whether it should more explicitly establish "open internet" rules. Neuchterlein generally does not like anything resembling ex ante regulatory obligations on telecom infrastructure providers -- certainly not from the perspective of his clients (like AT&T), and apparently not as a matter of personal opinion either. I disagree, as I have described elsewhere (footnote 161, etc.).
But that's old news. This year there's a new twist. Historically telecommunications were regulated under Title II of the Communications Act, and were referred to "common carriers" (or "telecommunications services"). Under this regime, carriers had to remain non-discriminatory in their service, and were subjected to a host of arguably overbearing price controls and the like. Between 1998 and 2005, the FCC effectively "deregulated" broadband by classifying it under the vague Title I (redefining it from a "telecommunications service" to an "information service"). This took seven years due to a series of court cases that ultimately put the issue in front of the Supreme Court, which affirmed the FCC's authority to classify broadband however it wished. If the FCC loses the Comcast case, it will likely consider whether to re-classify broadband under Title II so as to regain authority to regulate. Susan Crawford has a great description of the state of play.
Nuechterlein thinks that reclassification would be horrible. First, he is afraid of the many onerous elements of Title II that are unrelated to the policy goals of the "open internet" crowd. The FCC has the power to "forbear" from enforcing any or all of these, but Nuechterlein doesn't think they would. Second, he claims reclassification would confer very comprehensive regulation on FCC for "all corners of the internet ecosystem." In particular, he claims that application and content providers like Google and Netflix would fall within reach of the long arm of common carriage. You can see him make the case in the video below, starting at 1:23:00:
Even if Nuechterlein is right, these developments can be seen as direct backlash for years of chipping away at anything resembling regulation. After winning the battle to reclassify broadband, these entities continued to push against the notion that the FCC retained any authority at all to regulate. Harold Feld has argued that keeping oversight in a vaguely defined ex post arena serves incumbents' goals of maintaining the appearance of jurisdiction without any practical authority. However, the Comcast case threatens to expose this ruse (assuming the FCC does lose the case) and re-introduce the specter of Title II.
To be fair, opponents of FCC jurisdiction or ex ante regulation have proposed theoretical alternatives. Weiser, Nuechterlein, and others in the Silicon Flatirons community have long argued for antitrust-like ex post enforcement. Their proposals for how it would be implemented evolve from year to year, but more importantly the practical hurdles to achieving it seem very hard to overcome. [Edit: Speta just came out with an article suggesting yet another variation on the antitrust-like approach.] I have described elsewhere (pp. 118-122) how I think that framing this solely as an antitrust question misses the point, and in my most pessimistic moments I am sympathetic with those that claim it is just a euphemism for doing nothing.
I do agree in part with Nuechterlein's first point -- that bringing the full force of Title II to bear on broadband would be a bad thing. Perhaps he is better at predicting how forbearance will play out than I am. Given that he wrote the book on the matter, I suppose this is likely. On the other hand, we do have ample evidence of Commission forbearance. Indeed, even as the FCC reclassified all broadband services under Title I, it noted that some operators may wish to continue to operate under Title II, and it preemptively chose to forbear from tariffing (see paras. 89-94). Maybe it is a bit like chipping away at Pike's Peak in order to carve a statue, but we are left with few alternatives. In any case, Title II at least carries a rich legacy of non-discrimination norms... even if it also carries baggage.
I am not remotely convinced of his second major claim -- that bringing broadband under Title II necessarily implicates a host of higher-level services in its regulation (like Netflix, Google, and VoIP [edit: although in the case of VoIP there may already be some limited jurisdiction]). We have a very rich history of distinguishing between transport providers and the services that are delivered over that infrastructure. The 2005 Supreme Court Brand X decision affirming the FCC's classification decision mangles these distinctions and is frankly a mess. To the extent that the description of the technology made sense in its time, it is largely inaccurate today, as described by Public Knowledge. In the course of the Brand X litigation, MCI had been making the argument that any information service that made use of a telecommunications service would necessarily be subject to common carriage. The majority opinion notes,
[Respondents] claim that the Communications Act unambiguously classifies as telecommunications carriers all entities that use telecommunications inputs to provide information service. As respondent MCI concedes, this argument would subject to mandatory common-carrier regulation all information-service providers that use telecommunications as an input to provide information service to the public.
Nuechterlein claims that reclassification would necessarily validate this argument. There are two problems with this. First, the MCI argument on its merits is at odds with decades of precedent that distinguishes between regulatory treatment these two types of services. Second, the Court was discussing this argument in the context of whether the FCC had unreasonably interpreted statute, rather than proactively determining what would necessarily follow if the Commission decided to classify broadband under Title II. In that sense, Nuechterlein and I both agree with the Court: MCI's argument isn't going to fly.
If the Commission were ultimately to classify broadband under Title II, it might be a workable means of gaining necessary jurisdiction to do good policy. It is not without its risks, but I think that the risks are far less severe than Nuechterlein's straw men.
In the final panel of Day 2, Marc Berejka of the Commerce Department observed (starting 2:17:00 in the video) that the hardest thing about doing good internet policy is that we don't have good governance tools. Regardless of what the Commission does in the short run with respect to broadband classification, we need to seriously reconsider the structure of communications regulation, all the way back to first principles and enabling statute.
Bonus: Yesterday, CITP hosted Chris McDonald, who talked about "The Computer Utility and the First Computer-Communications Policy Debate." He gave a very good overview of the first round of debates in this area. The audio is now available.
Friday, October 23, 2009
The FCC Releases an Improved Electronic Filing System: ECFS 2.0
This is a super-wonky item, but I am truly excited. This morning, the FCC went live with a new version of its Electronic Comment Filing System (ECFS). Anyone who has worked on policy issues that touch the FCC is probably familiar with this system. Any time the Commission solicits comments on an issue, ECFS is used for filing and lookup. ECFS is the venue for a great deal of data and debate on the core issues of communications policy in the United States. However, the earlier version of ECFS didn't allow very sophisticated searching, direct-linking to search results, RSS feeds, or the like. As such it was often a pain to get a sense of what was on the record or to follow a particular issue or docket.
These limitations were nothing, of course, compared to the physical limitations that existed before ECFS 1.0 (and, thankfully, before I ever had to work on FCC issues).
In the era of ECFS 1.0, I actually spent many hours building a system for automatic download and RSS-ification of dockets. However, this was an extremely painful process, fraught with errors. ECFS 2.0 introduces a series of improvements, which are detailed in the following video of this morning's FCC presentation. Good job FCC! I'm sure we'll have suggestions for improvements, but this is a huge step forward.
These limitations were nothing, of course, compared to the physical limitations that existed before ECFS 1.0 (and, thankfully, before I ever had to work on FCC issues).
In the era of ECFS 1.0, I actually spent many hours building a system for automatic download and RSS-ification of dockets. However, this was an extremely painful process, fraught with errors. ECFS 2.0 introduces a series of improvements, which are detailed in the following video of this morning's FCC presentation. Good job FCC! I'm sure we'll have suggestions for improvements, but this is a huge step forward.
Saturday, September 26, 2009
Android Open Source Model Has a Short Circuit
Last year, Google entered the mobile phone market with a Linux-based mobile operating system. The company brought together device manufacturers and carriers in the Open Handset Alliance, explaining that, "Together we have developed Android™, the first complete, open, and free mobile platform." There has been considerable engagement from the open source developer community, as well as significant uptake from consumers. Android may have even been instrumental in motivating competing open platforms like LiMo. In addition to the underlying open source operating system, Google chose to package essential (but proprietary) applications with Android-based handsets. These applications include most of the things that make the handsets useful (including basic functions to sync with the data network). This two-tier system of rights has created a minor controversy.
A group of smart open source developers created a modified version of the Android+Apps package, called Cyanogen. It incorporated many useful and performance-enhancing updates to the Android OS, and included unchanged versions of the proprietary Apps. If Cyanogen hadn't included the Apps, the package would have been essentially useless, given that Google doesn't appear to provide a means to install the Apps on a device that has only a basic OS. As Cyanogen gained popularity, Google decided that it could no longer watch the project distribute their copyright-protected works. The lawyers at Google decided that they needed to send a Cease & Desist letter to the Cyanogen developer, which caused him to caused him to take the files off of his site and spurred backlash from the developer community.
Android represents a careful balance on the part of Google, in which the company seeks to foster open platforms but maintain control over its proprietary (but free) services. Google has stated as much, in response to the current debate. Android is an exciting alternative to the largely closed-source model that has dominated the mobile market to date. Google closely integrated their Apps with the operating system in a way that makes for a tremendously useful platform, but in doing so hampered the ability of third-party developers to fully contribute to the system. Perhaps the problem is simply that they did choose the right location to draw the line between open vs. closed source -- or free-to-distribute vs. not.
The latter distinction might offer a way out of the conundrum. Google could certainly grant blanket rights to third-parties to redistribute unchanged versions of their Apps. This might compromise their ability to make certain business arrangements with carriers or handset providers in which they package the software for a fee. That may or may not be worth it from their business perspective, but they could have trouble making the claim that Android is a "complete, open, and free mobile platform" if they don't find a way to make it work for developers.
This all takes place in the context of a larger debate over the extent to which mobile platforms should be open -- voluntarily or via regulatory mandate. Google and Apple have been arguing via letters to the FCC about whether or not Apple should allow the Google Voice application in the iPhone App Store. However, it is yet to be determined whether the Commission has the jurisdiction and political will to do anything about the issue. There is a fascinating sideshow in that particular dispute, in which AT&T has made the very novel claim that Google Voice violates network neutrality (well, either that or common carriage -- they'll take whichever argument they can win). Google has replied. This is a topic for another day, but suffice to say the clear regulatory distinctions between telephone networks, broadband, and devices have become muddied.
(Cross-posted to Freedom To Tinker)
A group of smart open source developers created a modified version of the Android+Apps package, called Cyanogen. It incorporated many useful and performance-enhancing updates to the Android OS, and included unchanged versions of the proprietary Apps. If Cyanogen hadn't included the Apps, the package would have been essentially useless, given that Google doesn't appear to provide a means to install the Apps on a device that has only a basic OS. As Cyanogen gained popularity, Google decided that it could no longer watch the project distribute their copyright-protected works. The lawyers at Google decided that they needed to send a Cease & Desist letter to the Cyanogen developer, which caused him to caused him to take the files off of his site and spurred backlash from the developer community.
Android represents a careful balance on the part of Google, in which the company seeks to foster open platforms but maintain control over its proprietary (but free) services. Google has stated as much, in response to the current debate. Android is an exciting alternative to the largely closed-source model that has dominated the mobile market to date. Google closely integrated their Apps with the operating system in a way that makes for a tremendously useful platform, but in doing so hampered the ability of third-party developers to fully contribute to the system. Perhaps the problem is simply that they did choose the right location to draw the line between open vs. closed source -- or free-to-distribute vs. not.
The latter distinction might offer a way out of the conundrum. Google could certainly grant blanket rights to third-parties to redistribute unchanged versions of their Apps. This might compromise their ability to make certain business arrangements with carriers or handset providers in which they package the software for a fee. That may or may not be worth it from their business perspective, but they could have trouble making the claim that Android is a "complete, open, and free mobile platform" if they don't find a way to make it work for developers.
This all takes place in the context of a larger debate over the extent to which mobile platforms should be open -- voluntarily or via regulatory mandate. Google and Apple have been arguing via letters to the FCC about whether or not Apple should allow the Google Voice application in the iPhone App Store. However, it is yet to be determined whether the Commission has the jurisdiction and political will to do anything about the issue. There is a fascinating sideshow in that particular dispute, in which AT&T has made the very novel claim that Google Voice violates network neutrality (well, either that or common carriage -- they'll take whichever argument they can win). Google has replied. This is a topic for another day, but suffice to say the clear regulatory distinctions between telephone networks, broadband, and devices have become muddied.
(Cross-posted to Freedom To Tinker)
Thursday, July 2, 2009
Happy Broadband NOFA Day
NTIA and RUS issued the Notice of Funds Availability (NOFA) for stimulus-related broadband grants.
Analysis:
- Broadband Initiatives Program and Broadband Technology Opportunities Program
- State Broadband Data and Development Grant Program
Analysis:
Saturday, June 27, 2009
Radio Moon Bounce
Everybody loves a good moon bounce. Today's moon bounce didn't involve taking your shoes off and jumping, but it was every bit as fun (if you are a geek). Every so often, when the moon is in the right spot, amateur radio operators ("hams") organize a competition to see who can communicate with the most people across the world by bouncing signals off of the moon. Today was the "Echoes of Apollo Moon Bounce" event -- a global ham celebration of the 40th anniversary of the Apollo 11 mission. The NY Times did a decent overview of the event.
I spent a good chunk of the day listening to these signals. Growing up, my dad was often in the basement with his radios or on the roof tweaking his antennas. I was always fascinated by his equipment and the people he talked to from all over the world, but by the time I got old enough to really get into it I had been bit by the computer bug. My dad sometimes compared what I was doing at age 12 with BBS'es and my 2400 baud modem with some of his ham radio passions. I still remember my first VoIP experience in the early 90's, talking to an Australian guy over dialup.
I never did get my ham radio license, in part because of the pull of computers and the burgeoning internet. Nevertheless, in the years since then I've gained a greater appreciation of the radio spectrum. Spectrum is a valuable shared resource that we have allocated to different users for communication. Sometimes we have tried to choose who is the most important, sometimes we have auctioned use of it off to the highest bidder, and other times we have allowed a "commons" oriented unlicensed use. New technologies shape the way we are able to use this common good, and we have plenty of active policy debate over these issues. Just yesterday I watched a New America Foundation event that was "optimistically" titled "The End of Spectrum ‘Scarcity': Opportunistic Access to the Airwaves."
Amateur radio operators have traditionally operated via analog means as they communicate by voice or morse code. Over time, they incorporated packet radio, allowing computers to transmit over certain frequencies using special analog-to-digital hardware. In the time since my dad's basement tinkering and my first modem, the worlds of radio and computer -- analog and digital -- have converged. The latest example of this was of course the analog-to-digital transition for broadcast television in the United States, and the extent to which this opens up unused "white spaces" for broadband. The most important innovation in wireless digital communications has been the emergence of Software Defined Radio ("SDR") technology that allows tuning, transmitting, and receiving to be done in software instead of special hardware. This means that computing devices can become general purpose radios, and whereas my dad used to have to buy new transistors and diodes at the hamfest, I can just download and install a new radio image for my Android phone.
Receiving the Earth-Moon-Earth ("EME") transmissions requires a decent parabolic antenna, but I don't have one. So how did I spend the day listening to radio signals bouncing off of the moon? I tuned in via a Dutch dish that was streaming online. Now, it would be pretty cool if the operators of this dish were simply tuning around for signals and sending a single audio stream out to anyone who wished to listen. However, what they did was even cooler. They captured all of the data for a frequency band (1.24-1.3 GHz, what the hams call "23 cm" because of the wavelength) and then they published a web-based application for SDR decoding on that raw stream so that each person could tune to any transmission within that band! The interface includes a draggable tuner and live spectrum analyzer output of signals. You can actually see what location on the dial every other person is tuning to. This combination of SDR and internet-enabled interactivity just blew my mind. I chatted briefly with the folks in the Netherlands:me: geek question: does websdr send all of the receiver data to the end-user and then the java app tunes locally, or is the java app instructing the server how to process before sending the stream?
them: The latter. The raw data stream would be about 3 Mbit/s, that would be too much for many home connections.
me: sdr is on the main cpu or other boards?
them: On the main CPU. The only external hardware is an analogue downconverter.
It really was fun to listen to the moon bounce, and the web-based experience just reinforced how much is possible in the radio spectrum when it is combined with computing. The traditional model of frequency allocation for a specific purpose needs to give way to more efficient spectrum-sharing techniques. The amateur radio operators have developed sophisticated social norms for sharing their radio waves, but they are highly inefficient when compared to something like WiFi, which is in turn highly inefficient compared to more modern approaches. As an example of what a bridging experience the moon bounce was for me, the signal was arriving in the 1.2 GHz band in the Netherlands, which then was piped over the internet to my house and then re-transmitted to my laptop over WiFi at 2.4 Ghz.
As a policy matter, digitization of the airwaves means that we need to re-think how we use them. Today, computers can directly connect and transmit more in a millisecond than an entire ham radio back-and-forth ("CQ, CQ, CQ..."). We need a map of the vast swaths of unused spectrum, and an automated digital means for sharing them. That's part of the upcoming National Broadband Plan being created by the FCC.
That's not to say that ham radio should go away. The thrill of finding a remote station in Russia, the Netherlands, London or Mexico and tuning it in for that brief moment is quite an experience. Everybody loves a moon bounce.
Here are a few excerpts I captured while I was listening (sorry about the lousy tuning in a couple places, it just makes it sound more like the Death Star attack from Star Wars):
Tuesday, January 27, 2009
I Try to Explain the History and Structure of Communications Law
My latest conversation with David Weinberger is posted on Media Berkman. David asked me how and why the internet is regulated (or deregulated). The launched me into a somewhat long description of the history of Communications Law in the US. If you're one of those odd people that enjoys this topic as much as I do (or if you're a lawyer and want to correct my explanation), you can listen here.
And no, it wasn't my idea to use the goofy Western language in the description. Rawhide!
And no, it wasn't my idea to use the goofy Western language in the description. Rawhide!
Thursday, January 15, 2009
Kevin Martin Resigns
He's leaving as of January 20 and headed to the Aspen Institute. I'll update with more. It's interesting to read his list of accomplishments in the press release.
Tuesday, January 13, 2009
The Next FCC: No More Monkey Business?
Today's big news for communications policy wonks is that apparently Julius Genachowski will be tapped for FCC Chairman. The pick is Obama's first big imprint on the Commission. Although it is not a surprise, it is probably a smart move. Genachowski is an FCC veteran with deep knowledge of the technology industry (as General Counsel for IAC and as a tech venture capitalist).The news comes in the midst of growing calls for FCC reform from folks like Silicon Flatirons and Public Knowledge. The theme is that the FCC needs to re-orient its rules and processes to make more sense in a converging, Internet-oriented communications landscape. I heartily agree.
Of course, this is not the first wave of calls for reform. Back in 2005 the DC think-tank Progress and Freedom Foundation spearheaded the "Digital Age Communications Act," which argued that the powers of the Commission should be radically curtailed and that the Communications Act should be rewritten as antitrust policy. This amounted to abolishing most of the Commission's traditional powers. The bill never went anywhere.
Recently, Larry Lessig has argued that we should do away with the FCC and replace it with a new entity. Lessig thinks that the Commission is rooted in outdated notions of monopoly rights and incumbent protection. He says, "You can't fix DNA. You have to bury it." His dream agency has two mandates: 1) agressively police monopoly and 2) ensure openness. Of course these two ideals are both hard to define and sometimes at odds. Nothing about creating a new agency will fundamentally change this reality. What's more, focusing heavily on market forces can often provide an excuse for ignoring the more socially motivated or mundane-but-essential roles of communications policymakers. Market considerations are undeniably important, but proposals to reduce everything to antitrust lose sight of what is unique about communications.
The key to Lessig's approach appears to be "a strong agency head, and a staff absolutely barred from industry ties." I agree with his first prescription, and it's possible that Genachowski could be a step in the right direction. If recent reports are to be believed, he'll likely be an improvement over the outgoing Chairman. To begin with, the House released a blistering critique last month, titled "Deception and Distrust: The Federal Communications Commission Under Chairman Kevin J. Martin." It cites FCC employee's references to being "Martinized" or "blue-boxed" -- their euphemisms for the Chairman's alleged habit of killing fact-based reports that didn't support his policy agenda. Then there was the recently released Federal Human Capital Survey, which showed that an embarrasingly low number of FCC employees -- 38 percent -- felt that "My organization's leaders maintain high standards of honesty and integrity." I am less persuaded that the FCC staff should be "absolutely barred from industry ties." I'm not even sure what that means. Does it mean that they never can have worked in industry? Does it mean that after serving they never can move to industry? It seems like a recipe for inexperienced, disconnected bureaucrats.
One man with a passion for banishing uninformed bureaucrats was the late, great, and entirely deranged televangelist Dr. Gene Scott. During his prolonged battle with the FCC, he would taunt the agency on-screen by representing it with a band of wind-up monkeys. He would often pick up his favorite, banging it on the head and exclaiming, "That's the only way to treat a bureaucrat!" I don't think that the appropriate solution to the shortcomings of the FCC is to beat the commissioners over the head with a stick, and I also don't think the solution is to abolish the agency altogether.
We don't have to "blow up" the FCC or reduce it to doing antitrust (we already have two agencies that are experts in that area). We could certainly use a re-write of the Communications Act that does away with the outdated and technologically siloed model of regulation in favor of an approach more closely matched to reality. We could also use good leaders. I am hopeful that today's announcement sets the course of the agency in the right direction.
Tuesday, December 16, 2008
Radio Berkman: A (Porn) Free Nationwide Internet?
Berkman just posted an audio interview with me, where I discuss the FCC's proposal for the AWS-3 spectrum auction and how it was scuttled.
Listen here.
A scheduled FCC vote on a free nationwide wireless internet, was derailed this week after outcry from both the Bush administration, the ACLU, Congressional Democrats, and the digerati. What was it about the FCC’s proposal that raised the eyebrows of such a diverse group of opponents? David Weinberger interviews Stephen Schultze of the Berkman Center to find out more.
Listen here.
Monday, December 15, 2008
WSJ on Google and Net Neutrality - DEVELOPING
I have done the only sensible thing and put up a Drudge siren. It's appropriate given the level of research and care that went into today's Wall Street Journal article claiming, "Google Inc. has approached major cable and phone companies that carry Internet traffic with a proposal to create a fast lane for its own content, according to documents reviewed by The Wall Street Journal."
Suffice to say, the authors got it fundamentally wrong. They failed to understand basic networking concepts like colocation versus discrimination. Richard Whitt (full disclosure: my old boss and co-author of a forthcoming paper) wrote a charitable but biting reply. The best summary I've seen so far is actually this compendium of quotes: OMG! WSJ net-neutrality own-goal....
I'll keep updating this post as the brawl unfolds. Suffice to say, if you're looking for evidence of the mainstream press under-performing compared to the blog-o-sphere-o-pedia-space... look no further. WSJ has become Drudge, and the blogs are actually getting the story right.
And with that, all I can say is DEVELOPING...
- At 12:49pm, the WSJ posts "Discussing Net Neutrality" which notes, "Today’s Journal story on Google's plans to develop a fast track for its own content has certainly gotten a rise out of the blogosphere." Commenters, including Dan Gillmor, ask them why they aren't retracting or correcting the story.
- At 4:23pm, another WSJ post, "What's Edge Caching?," pulls quotes from blogs describing edge caching, generally making the case that although it is a common and well-known practice, this case is different.
Cheeto-stained keyboards all over the country were burning up this morning after The Wall Street Journal reported that President-elect Obama was flip-flopping on his pro-net-neutrality position and Google was in secret talks to buy preferential treatment for their content from service providers. But as it turns out, WSJ were just ObamaOpposesNetNeutralityRolling us.
And the surge of criticism:
- Lessig Blog: The Made Up Dramas of the Wall Street Journal
- Tim Wu Blog: Google Wall Street Journal - They haven’t got the goods
- TPM: Obama Spokesperson: His Commitment To Net Neutrality Hasn't Wavered One Bit
- Ars: Google backing off net neutrality with ISP deal? Not really
- ZDNet: Media used by cable to create Google scandal
- Wired Blog: WSJ WTF?
- Broadband Reports: The Wall Street Journal's Google Hatchet Job - Opinion: paper helps cable, telcos smear their biggest enemy...
- Scott Bradner: Google as evil, now from The Wall Street Journal: WSJ ends year showing a misunderstanding of technology
- Timothy B. Lee: The Journal Misunderstands Content-Delivery Networks
- Scott Rosenberg: Journal steps in Net neutrality hornet’s nest
- Conde Nast: Google Slams 'Confused' WSJ Story on Network Neutrality
- Wired: Google Blasts WSJ, Says it's Still 'Committed to Network Neutrality'
- PC World: WSJ Accuses Google of Abandoning Net Neutrality: Reality Check
- Reuters: Google says plan would not threaten net neutrality
- Harold Feld: The Google Non-Story On Network Neutrality
- Huffington Post, Tim Karr (of Free Press): WSJ Gets It Wrong. Net Neutrality Still in the Front Seat.
- ZDNet: Google turns on net neutrality (not!)
- IDG: Google, Microsoft Say They Still Support Net Neutrality
- MediaPost: Net Neutrality Advocates Rally To Google's Defense
- Siva Vaidhyanathan: Is Google giving up on Net Neutrality? Hardly.
- Center for Democracy and Technology: Neutrality and Caching
- Public Knowledge: Comment on Wall Street Journal ‘Net Neutrality’ Story
Sunday, December 14, 2008
AWS-3 Vote Postponed Indefinitely
Late Friday, Chairman Martin canceled the October 18th FCC Open Meeting. This is a fairly exceptional development. The Commission was set to vote on the increasingly controversial rules for auctioning off the AWS-3 spectrum -- a 25MHz block of airwaves in the 2GHz range. Martin had been pushing for two fairly unique requirements on the ultimate winner: 1) That the winner must provide no-cost internet access on a portion of the spectrum and 2) That they must filter "objectionable material" (possibly with an opt-out for adults). In July, I co-authored comments explaining why this second condition raised troubling free speech concerns.
Martin has come under increasing pressure from all sides. The ACLU criticized the "family friendly" aspects of the plan, in chorus with comments from public interest groups. Then, the Bush Administration sent a letter to the FCC last Wednesday, stating that "the draft AWS-3 order would constrain a provider's usage of this spectrum, favoring a particular business model and potentially precluding the spectrum from allocation to the most valuable use" (coverage here). Nevertheless, Martin appeared determined to see the plan through, and issued the formal agenda the next day.
But on Friday, Congressmen Rockefeller and Waxman weighed in with a letter. These are the two guys who will head up the committees that oversee the FCC, in the Senate and House respectively. Apparently this pushed Martin over the edge, and he canceled the meeting altogether. FCC Spokesman Robert Kenny said:
Wow. This means that the question of what to do with the AWS-3 spectrum will almost certainly fall to the next FCC. They could start the process over from scratch, with new proposals for what to do with the spectrum and another series of notice-and-comment periods. Hopefully that Commission will take an approach that does not present such significant First Amendment problems. The failure of this ill-designed proposal is a bittersweet victory -- at least we didn't get bad rules out of the process. However, we have also potentially delayed the point at which this spectrum can be used to overcome our national broadband woes.
More coverage:
Martin has come under increasing pressure from all sides. The ACLU criticized the "family friendly" aspects of the plan, in chorus with comments from public interest groups. Then, the Bush Administration sent a letter to the FCC last Wednesday, stating that "the draft AWS-3 order would constrain a provider's usage of this spectrum, favoring a particular business model and potentially precluding the spectrum from allocation to the most valuable use" (coverage here). Nevertheless, Martin appeared determined to see the plan through, and issued the formal agenda the next day.
But on Friday, Congressmen Rockefeller and Waxman weighed in with a letter. These are the two guys who will head up the committees that oversee the FCC, in the Senate and House respectively. Apparently this pushed Martin over the edge, and he canceled the meeting altogether. FCC Spokesman Robert Kenny said:
"We received the letter from Senator Rockefeller and Congressman Waxman today and spoke with other offices. In light of the letter, it does not appear that there is consensus to move forward and the agenda meeting has been canceled."
Wow. This means that the question of what to do with the AWS-3 spectrum will almost certainly fall to the next FCC. They could start the process over from scratch, with new proposals for what to do with the spectrum and another series of notice-and-comment periods. Hopefully that Commission will take an approach that does not present such significant First Amendment problems. The failure of this ill-designed proposal is a bittersweet victory -- at least we didn't get bad rules out of the process. However, we have also potentially delayed the point at which this spectrum can be used to overcome our national broadband woes.
More coverage:
Wednesday, December 3, 2008
The AWS-3 Plot Thickens
Martin is trying to sweeten the deal for his AWS-3 spectrum auction proposal by adding a "use it or lose it" provision. If the winner of the auction does not build out their no-fee wireless internet network to all areas within 5 years, it will lose its license in the non-covered areas. Those areas will then apparently revert to an unlicensed regime. The WSJ article and Reuters articles don't give much detail, but it's clear that the Chairman is doing some strategic leaking.
WASHINGTON -- Federal Communications Commission Chairman Kevin Martin is proposing giving innovators free unlicensed access to valuable airwaves if the company that buys a license to the channels doesn't meet tough requirements to build a nationwide Internet network.
The proposal has been added to a pending auction of the airwaves. The FCC is scheduled to vote on rules for the sale on Dec. 18. Mr. Martin wants the company that buys the airwaves to devote at least 25% of the spectrum to free Internet access for 95% of the country. The no-cost Internet service also would be smut-free for users under 18. Adult users could opt out of the filter blocking pornographic content.
Mr. Martin said Wednesday that he has circulated two versions of the auction item -- one with the unlicensed provision and one without -- for the other commissioners on the five-member body to review before the meeting. The FCC will vote on only one version, depending on which version the other commissioners prefer, Mr. Martin said.
Mr. Martin wants to sell a nationwide license to the airwaves rather than give the channels to entrepreneurs because he wants to promote free Internet access. By adding a clause that would give away airwaves where there isn't an Internet network after five years, Mr. Martin hopes that the owner of the channels would have an added incentive to build a network.
Mr. Martin said Wednesday that both versions of the auction item include a "use it or lose it" provision in which the owner of the channels would lose spectrum where there is no Internet access. The owner of the channels would "continue to serve whatever area they've built out," he said.
Martin also recently leaked the fact that he is proposing that adults can verify their identity to avoid the porn filter initially mandated for all users of of the no-fee service. I helped author some comments to the FCC explaining why this filter was a bad idea, so an opt-out mechanism could theoretically be a good development... if age verification were viable, and if you thought that adults were eager to identify themselves as possible porn-lovers, and if we assumed that all adults had credit cards. In short, filtering is not a great option even with those caveats.
It all gets decided on the 18th. You can read the latest comments.
Wednesday, November 19, 2008
FCC Releases White Spaces Order
They voted in favor of the white spaces order on November 4, but it is very common for the Commission to finish hashing out the details of orders after they have approved them (odd, but true). The FCC has finally released the full text of the order, which includes a 100mw power limit for personal/portable devices (40mw on adjacent channels) and 4w for fixed devices. I believe this all means good things for white space devices (those were the numbers many advocates were suggesting), but I'll update this post as more coverage emerges.
Friday, November 14, 2008
Congrats Susan and Kevin
Two communications policy experts I tremendously admire were just named heads of Obama's FCC transition review team. Susan Crawford and Kevin Werbach will "ensure that senior appointees have the information necessary to complete the confirmation process, lead their departments, and begin implementing signature policy initiatives immediately after they are sworn in."
Susan was a member of my thesis committee, and Kevin has been tremendously influential in my thinking. I've never told Kevin, but in addition to informing my writing as recently as this week, I learned how to make web sites in 1995 using his Bare Bones Guide to HTML.
The Commission could not be under better transitional guidance.
Susan was a member of my thesis committee, and Kevin has been tremendously influential in my thinking. I've never told Kevin, but in addition to informing my writing as recently as this week, I learned how to make web sites in 1995 using his Bare Bones Guide to HTML.
The Commission could not be under better transitional guidance.
Tim Lee's Reasonable Retorts
Tim Lee has posted two responses to my critique of his recent article on network neutrality. In his article, he argued that network neutrality is good but that violations of the principle are unlikely to be severe for economic and technical reasons. I find this argument unpersuasive, and he responded with four basic retorts:
1. Net Neutrality proponents don't clearly state what they are seeking to prevent, and thus evade any attempt to disprove their harms.
Lee goes on to list several scenarios, all of which are possible to varying degrees. However, they all fit the simple rubric of network discrimination and they all are harmful. In general, subtle discrimination is more likely than outright blocking. This is something that has been clearly articulated by the mainstream of neutrality proponents for some time. That is why I included reference to Barbara van Schewick's paper. If Tim were choosing to "take one of these ISP strategies seriously" he would have done well to focus on the one that most people are talking about.
2. This type of discrimination is unlikely, isn't that bad, and we can always fix it after the fact.
I am describing a mainstream version of discrimination, which can happen either right now or going forward as operators upgrade their networks but keep non-payers in the slow lane. We have ample evidence of the former in Comcast/BitTorrent. The latter is simply a less visible version of the former -- an even further degree away from Lee's scenario in which consumers have "a taste of freedom", "become acutely aware of any new restrictions," and, "stubbornly refuse efforts to impose them." The fact that carriers are building out faster networks doesn't tell us whether or not this is likely. Carriers will of course build out faster networks, because they typically profit more from them (whether they impose discrimination or not). Given the current uncertain regulatory climate, it is no surprise that they have refrained from additional large-scale discrimination. This climate, however, is temporary. The relevant question is whether or not those network upgrades provide additional shield from the customer backlash that Lee posits. It is clear that they do.
How bad you think this discrimination is depends on how seriously you take arguments about platform economies, dynamic innovation, network effects, and freedom of speech. It also depends on whether or not you think that degrading service achieves most of the ends of outright blocking. I argue that it does. Google's obsession with page load times is not simply because they are hyper-focused engineers. Skype's need for equal network treatment is not just because they want calls to sound nice. The BitTorrent protocol's expectation that connections are not randomly reset is not a matter of convenience.
Lee would have us believe that we will always have the space to regulate these issues, if needed, after the fact. The Comcast order might give us some hope in this regard, except for the tremendous murkiness that surrounds the decision, its implications, and its legal durability. Regulation from the FCC can be roughly thought to fall into two categories: rulemaking and adjudication. Rulemaking explicitly sets out the detailed requirements, whereas adjudication defines basic guidelines and then builds policy through case-by-case enforcement. Lee clearly opposes rulemaking on its face. We are left with adjudication, but in this case he opposes further definition of enforceable principles. This is not ex post regulation, it is no regulation at all.
3. The risks are overblown, and disproved by history.
Lee is not a fan of Lessig's "apocalyptic" predictions in 1999. While Lessig's forecasts undoubtedly have not fully come true ("yet" -- as he notes in the preface to the new edition), we have unquestionably seen some of those trends play out. Increasing control by intermediaries, domestically and abroad, threatens speech and innovation. The "open access" battle that was heating up at that time was not lost until 2005, and since then we have case studies for how the stopgap quasai-neutrality principles are strained. But, I'm not here to defend Lessig (I certainly disagree strongly with him at times).
Rather than debating generally whether past predictions of others have come true, it is more productive to examine the specific issues at hand with the most relevant data points from history and the present. We know that historically corporations tended toward building closed systems like AOL and CompuServe. We know that well-crafted regulatory interventions like common carrier non-discrimination, Computer II, and Carterphone unleashed waves of innovation. We know that carriers today have pursued discriminatory practices and been partially disciplined by somewhat ambiguous regulation. We know that abroad, discriminatory practices have flourished in environments in which intermediaries exercise the most control. We know that domestically in the parallel (and increasingly overlapping) wireless market, market actors impose restrictions that radically limit innovation.
This is not a strong historical or factual case against the need for, or success of, non-discrimination regulation.
4. Steve misunderstands settlement-free peering.
This technical/wonky definition is at the heart of what I consider Lee's most original, but nevertheless misguided, argument. The basic idea he posits is that because a certain set of backbone providers traditionally negotiate no-fee interconnection agreements, there is no ability for last-mile providers to leverage their power in the consumer market into the backbone market.
Let's go back and define a couple of key terms. First, "settlement-free peering" means, as Lee accurately describes, an arrangement between two providers in which they do not exchange money but simply agree to carry each others' traffic. They do so under detailed and confidential interconnection agreements that define the terms of this agreement, including things like jitter, latency, throughput, etc. These agreements often require equal treatment by both parties (although they may not speak to those providers' relationships with other providers). Let's assume for the sake of argument that they always do require equal treatment between the two. The types of companies that have these agreements are "Tier 1" backbone providers at the core of the internet -- Level 3, Sprint, AT&T, etc.
Second, "transit" agreements are contractual relationships between unequals. In this case, one party typically pays the other for carrying its traffic under various terms. This is the type of relationship that Comcast has with the Tier 1 providers. For example, here is an excerpt of the traceroute from my Comcast cable modem to google.com:
See that? My packets go from Comcast -> L3 -> Google. Comcast pays Level 3 to transmit their packets, according to some confidential terms that it agrees to. Comcast has a rather large national network (although it is not a "Tier 1" provider) and thus can route its packets around to locations where it has the best bargaining power with the party at the exchange point (in this case, they sent my packets from Boston to Chicago before plugging into L3). Lee's theory is that the settlement-free peering agreements probably don't allow discrimination based on content or source, and he seems to assume that downstream transit agreements are implicated in this obligation because at some point they must interconnect with those backbone providers. Furthermore, he claims that both parties need each other enough that nobody would ever violate these principles.
In my initial critique, I gave several reasons to doubt this claim. First, there is no practical evidence that Tier 1 providers have pressured their downstream transit peers to remain non-discriminatory. This has not been a factor in discrimination disputes that we have seen to date, like Comcast/BitTorrent or Madison River (instead, regulatory threats have brought players in line). Second, there is ample reason to believe that Tier 1 providers would indeed be willing to de-peer despite Lee's assertion that they simply need each other too much (thus I cite the Cogent/L3 dispute as well as the Cogent/Sprint de-peering from a couple of weeks ago). Third, the universe of settlement-free peering is increasingly giving way to varieties of transit agreements in which concessions are made in exchange for payment. Fourth, there are now emerging unified backbone/last-mile networks for which much of the traffic need not pass through a Tier-1 exchange point at all (eg. Verizon/MCI/UUNET). Settlement-free peering has been a powerful norm in keeping content or source-based discrimination out of the core of the network, but even there their strength is waning.
1. Net Neutrality proponents don't clearly state what they are seeking to prevent, and thus evade any attempt to disprove their harms.
I’ve found that any time I take one of these ISP strategies seriously and put forth an argument about why it’s unlikely to be feasible or profitable, the response from supporters of regulation is often to concede that the particular scenario I’ve chosen is not realistic...
Lee goes on to list several scenarios, all of which are possible to varying degrees. However, they all fit the simple rubric of network discrimination and they all are harmful. In general, subtle discrimination is more likely than outright blocking. This is something that has been clearly articulated by the mainstream of neutrality proponents for some time. That is why I included reference to Barbara van Schewick's paper. If Tim were choosing to "take one of these ISP strategies seriously" he would have done well to focus on the one that most people are talking about.
2. This type of discrimination is unlikely, isn't that bad, and we can always fix it after the fact.
First, notice that the kind of discrimination he’s describing here is much more modest than the scenarios commonly described by network neutrality activists. Under the scenario he’s describing, all current Internet applications will continue to work for the foreseeable future, and any new Internet applications that can work with current levels of bandwidth will work just fine. If this is how things are going to play out, we’ll have plenty of time to debate what to do about it after the fact.
I am describing a mainstream version of discrimination, which can happen either right now or going forward as operators upgrade their networks but keep non-payers in the slow lane. We have ample evidence of the former in Comcast/BitTorrent. The latter is simply a less visible version of the former -- an even further degree away from Lee's scenario in which consumers have "a taste of freedom", "become acutely aware of any new restrictions," and, "stubbornly refuse efforts to impose them." The fact that carriers are building out faster networks doesn't tell us whether or not this is likely. Carriers will of course build out faster networks, because they typically profit more from them (whether they impose discrimination or not). Given the current uncertain regulatory climate, it is no surprise that they have refrained from additional large-scale discrimination. This climate, however, is temporary. The relevant question is whether or not those network upgrades provide additional shield from the customer backlash that Lee posits. It is clear that they do.
How bad you think this discrimination is depends on how seriously you take arguments about platform economies, dynamic innovation, network effects, and freedom of speech. It also depends on whether or not you think that degrading service achieves most of the ends of outright blocking. I argue that it does. Google's obsession with page load times is not simply because they are hyper-focused engineers. Skype's need for equal network treatment is not just because they want calls to sound nice. The BitTorrent protocol's expectation that connections are not randomly reset is not a matter of convenience.
Lee would have us believe that we will always have the space to regulate these issues, if needed, after the fact. The Comcast order might give us some hope in this regard, except for the tremendous murkiness that surrounds the decision, its implications, and its legal durability. Regulation from the FCC can be roughly thought to fall into two categories: rulemaking and adjudication. Rulemaking explicitly sets out the detailed requirements, whereas adjudication defines basic guidelines and then builds policy through case-by-case enforcement. Lee clearly opposes rulemaking on its face. We are left with adjudication, but in this case he opposes further definition of enforceable principles. This is not ex post regulation, it is no regulation at all.
3. The risks are overblown, and disproved by history.
It’s worth remembering that alarmism about the future of the Web is almost as old as the Web itself.
Lee is not a fan of Lessig's "apocalyptic" predictions in 1999. While Lessig's forecasts undoubtedly have not fully come true ("yet" -- as he notes in the preface to the new edition), we have unquestionably seen some of those trends play out. Increasing control by intermediaries, domestically and abroad, threatens speech and innovation. The "open access" battle that was heating up at that time was not lost until 2005, and since then we have case studies for how the stopgap quasai-neutrality principles are strained. But, I'm not here to defend Lessig (I certainly disagree strongly with him at times).
Rather than debating generally whether past predictions of others have come true, it is more productive to examine the specific issues at hand with the most relevant data points from history and the present. We know that historically corporations tended toward building closed systems like AOL and CompuServe. We know that well-crafted regulatory interventions like common carrier non-discrimination, Computer II, and Carterphone unleashed waves of innovation. We know that carriers today have pursued discriminatory practices and been partially disciplined by somewhat ambiguous regulation. We know that abroad, discriminatory practices have flourished in environments in which intermediaries exercise the most control. We know that domestically in the parallel (and increasingly overlapping) wireless market, market actors impose restrictions that radically limit innovation.
This is not a strong historical or factual case against the need for, or success of, non-discrimination regulation.
4. Steve misunderstands settlement-free peering.
“Settlement-free” means that no money exchanges hands. If D and E are peers [this example assumes that D is a "last mile" backbone provider like Verizon and E and F are competitive "tier 1" providers such as Level 3 or Global Crossing], that by definition means that E pays D nothing to carry its traffic, and vice versa.
This technical/wonky definition is at the heart of what I consider Lee's most original, but nevertheless misguided, argument. The basic idea he posits is that because a certain set of backbone providers traditionally negotiate no-fee interconnection agreements, there is no ability for last-mile providers to leverage their power in the consumer market into the backbone market.
Let's go back and define a couple of key terms. First, "settlement-free peering" means, as Lee accurately describes, an arrangement between two providers in which they do not exchange money but simply agree to carry each others' traffic. They do so under detailed and confidential interconnection agreements that define the terms of this agreement, including things like jitter, latency, throughput, etc. These agreements often require equal treatment by both parties (although they may not speak to those providers' relationships with other providers). Let's assume for the sake of argument that they always do require equal treatment between the two. The types of companies that have these agreements are "Tier 1" backbone providers at the core of the internet -- Level 3, Sprint, AT&T, etc.
Second, "transit" agreements are contractual relationships between unequals. In this case, one party typically pays the other for carrying its traffic under various terms. This is the type of relationship that Comcast has with the Tier 1 providers. For example, here is an excerpt of the traceroute from my Comcast cable modem to google.com:
7 pos-0-3-0-0-cr01.chicago.il.ibone.comcast.net (68.86.90.57)
8 xe-10-1-0.edge1.newyork2.level3.net (4.78.169.45)
9 ae-2-79.edge1.newyork1.level3.net (4.68.16.78)
10 google-inc.edge1.newyork1.level3.net (4.71.172.86)
See that? My packets go from Comcast -> L3 -> Google. Comcast pays Level 3 to transmit their packets, according to some confidential terms that it agrees to. Comcast has a rather large national network (although it is not a "Tier 1" provider) and thus can route its packets around to locations where it has the best bargaining power with the party at the exchange point (in this case, they sent my packets from Boston to Chicago before plugging into L3). Lee's theory is that the settlement-free peering agreements probably don't allow discrimination based on content or source, and he seems to assume that downstream transit agreements are implicated in this obligation because at some point they must interconnect with those backbone providers. Furthermore, he claims that both parties need each other enough that nobody would ever violate these principles.
In my initial critique, I gave several reasons to doubt this claim. First, there is no practical evidence that Tier 1 providers have pressured their downstream transit peers to remain non-discriminatory. This has not been a factor in discrimination disputes that we have seen to date, like Comcast/BitTorrent or Madison River (instead, regulatory threats have brought players in line). Second, there is ample reason to believe that Tier 1 providers would indeed be willing to de-peer despite Lee's assertion that they simply need each other too much (thus I cite the Cogent/L3 dispute as well as the Cogent/Sprint de-peering from a couple of weeks ago). Third, the universe of settlement-free peering is increasingly giving way to varieties of transit agreements in which concessions are made in exchange for payment. Fourth, there are now emerging unified backbone/last-mile networks for which much of the traffic need not pass through a Tier-1 exchange point at all (eg. Verizon/MCI/UUNET). Settlement-free peering has been a powerful norm in keeping content or source-based discrimination out of the core of the network, but even there their strength is waning.
Wednesday, November 12, 2008
Tim Lee's Twin Fallacies
[Edit: Tim replies. I reply.]
Cato has finally gotten around to publishing Tim Lee's article, "The Durable Internet: Preserving Network Neutrality without Regulation." I first saw a draft of his paper in March, and Tim engaged in a good spirited back-and-forth with me over email. The primary failings that I perceived then remain un-addressed in this final version. They are twofold:
1. The fallacy that any non-discrimination regulation is the same as the combined force of all misguided regulation since the advent of administrative agencies
The first problem with Lee's article is that it repeats one of the most common mistakes of certain libertarian sects: assuming that any government regulation is as bad as all government regulation. In Lee's case, the devilish regulation equated with network neutrality is the Interstate Commerce Act, the Civil Aeronautics Board, and the sum of all Federal Communications Commission regulation. This approach mirrors earlier claims by Bruce Owen, Larry Downes, and Adam Thierer, which I rebut here.
Lee begins by observing that "The language of the Interstate Commerce Act was strikingly similar to the network neutrality language being considered today." We should not be surprised that at least some of the non-discriminatory principles found in modern day neutrality proposals resemble those in the ICA. Indeed, net neutrality is inspired in part by elements of common carriage, which cross-pollinated into communications law in the 1910 Mann-Elkins Act (see pp. 21-23 of my thesis for more on this history). The gating question is whether or not the elements of the Interstate Commerce Commission that led to the inefficiencies that Lee claims are at all related to the non-disciminatory language that he claims connect the two. If and only if the answer is "yes," then a responsible analysis would consider whether or not the markets are relatively analogous, whether or not the administrative agencies tend toward the same failures, and whether the costs of regulation truly outweigh the benefits. In short, it is not enough to simply assert that net neutrality smells like the ICA, therefore it is doomed to fail.
I won't discuss the relationship to the Civil Aeronautics Board because I think the analogies are tenuous at best.
Finally, we arrive at the FCC discussion, which holds the most promise for actually being relevant. Unlike Bruce Owen, who inexplicably compares neutrality proposals to the AT&T antitrust proceedings, Lee seeks to equate neutrality with FCC rate-subsidization and market entry prohibitions. He concludes that, "like the ICC and the CAB, the FCC protected a client industry from the vagaries of markets and competition." Perhaps, but why is this similar to non-discrimination regulation?
A more accurate analogy with FCC rulemaking would be to compare neutrality to the non-disciminatory part of common carriage, the Computer Inquiries, Carterphone, or all three. Most scholars recognize that these rules allowed the discrimination-free operation of dial-up ISPs, and facilitated the explosion of the internet. The case of FCC non-discrimination mandates presents a stark counter-example to Lee's assertion of uniform regulatory failure.
2. The fallacy that there is an underlying "durability" of the technology/market structures of the internet that will successfully resist strong carrier incentives
Lee provides a somewhat novel argument when he claims that the internet has built in safeguards against welfare-harming practices like network discrimination. He begins by praising the effects of the "end-to-end" architecture of the internet, in which carriers simply deliver data and allow the "edges" of the network to determine what is sent and how. He thinks that this characteristic does not need to be backed up by regulators because the technology and the market will preserve it.
With respect to markets, his argument is twofold. First he claims that outright "blocking" of services would cause such backlash (from end-users or from content providers) that it would be untenable. Second, he claims that attempts to simply degrade service would not be terribly destructive in the short term, and would provide ample time to craft a regulatory response if necessary.
Lee justifies his customer backlash theory by pointing to cases such as the Verizon/NARAL dispute in which the company initially refused to give the non-profit an SMS "short code" but relented in the face of public outcry. In reality, the outcry came from inside-the-beltway advocates who threatened regulation, but in any event we have a more relevant example in the case of BitTorrent/Comcast, which he also discusses. The regulatory solution in this case is even more obvious, with the FCC ultimately issuing an order against the company (which is now on appeal). There is no evidence whatsoever that these resolutions were driven by users that have "had a taste of freedom" and have, "become acutely aware of any new restrictions," and, "stubbornly refuse efforts to impose them" -- resisting via technical or financial means. Nor is there evidence that, left alone, the markets would have settled on a non-discriminatory solution.
Lee tries to make the case that the technical structure of the internet would have allowed BitTorrent users to simply adopt better ways of hiding their traffic, and would have prevailed in that cat-and-mouse game. This is of course speculation, but it's also irrelavent. Whether or not highly technically savvy users can temporarily evade discrimination has little to do with how such practices would effect the activities of the majority of the population. In fact, we have strong examples to the contrary worldwide, as various regimes develop more and more sophisticated means for filtering their citizens' speech (such as the news today from Argentina). In those situations, there are often many people who can subvert the filters but the practice nevertheless fundamentally alters the nature of what is said, and what innovations flourish (see for example, the rollout and adoption of Google vs. Baidu in China).
Lee also lays out an argument for why the structure of the network itself makes it unlikely that last-mile carriers can successfully threaten blocking. He argues that because the core of the internet is highly interconnected, it would be practically impossible to discriminate against any particular site, and that those sites which are important enough to pay attention to could in turn threaten to stop serving customers from that carrier. In short, they need each other. In many cases this is true, although it doesn't necessarily mean that in all cases this relationship will be more attractive to the last-mile provider when compared to various exclusive relationships (or that even if it is, the provider will behave rationally). Things get even more dicey when we examine them from the perspective of second-tier sites or services, which have not yet achieved the "must have" status but nevertheless present revenue opportunities or competitive risk to the carriers.
Lee claims that even if this occurred, it would not be a real problem because it wouldn't be severe. "To be sure, such discrimination would be a headache for these firms, but a relatively small chance of being cut off from a minority of residential customers is unlikely to rank very high on an entrepreneur’s list of worries." His assumption that the chance of being cut off is "small" is belied by recent experience in the Comcast/BitTorrent case. The idea that one would be cut off only from a "minority of residential customers" is technically true because no one firm currently controls over 50% of residential connections, but there are some truly significant market shares that entrepreneurs would undoubtedly care about. Last-mile providers have duopoly over their subscribers, and a "terminating access" monopoly over current subscribers.
These problems are all made much more severe in an environment in which carriers practice partial discrimination rather than outright blocking. In our email back-and-forth, I told Lee that:
The last-mile carrier "D" need not block site "A" or start charging everyone extra to access it, it need only degrade (or maintain current) quality of service to nascent A (read: Skype, YouTube, BitTorrent) to the point that it is less useable. This is neither a new limitation (from the consumers perspective) nor an explicit fee. If one a user suddenly lost all access to 90% of the internet, the last-mile carrier could not keep their business (or at least price). But, discrimination won't look like that. It will come in the form of improving video services for providers who pay. It will come in the form of slightly lower quality Skyping which feels ever worse as compared to CarrierCrystalClearIP. It will come in the form of [Insert New Application] that I never find out about because it couldn't function on the non-toll internet and the innovators couldn't pay up or were seen as competitors. As Barbara van Schewick observes, carriers have the incentive and ability to discriminate in this fashion.
Finally, Lee makes the argument that the current norm of "settlement-free" peering in the backbone of the internet will restrict last-mile providers' ability to discriminate and to create a two-tiered internet because they will be bound by the equal treatment terms of the agreements. This is not supported by practical evidence, given the fact that none of the push-back against existing discriminatory practices has come from network peers. It is also not supported by sound economic reasoning. It is certainly not in backbone-provider E's business interest to raise prices for all of its customers (an inevitable result). But, assuming E does negotiate for equal terms, the best-case scenario is that E becomes a more expensive "premium" backbone provider by paying monopoly rents to last-mile provider D, while F becomes a "budget" backbone provider by opting out (and hence attracts the "budget" customers).
We are already seeing cracks in the dam of settlement-free peering. The Cogent/L3 meltdown happened between two backbone-only providers and was in the context of volume-based disagreements. Two weeks ago, Sprint disconnected from Cogent because of a dispute over sharing. When you add the only recent pressure of last-mile leveraging and discrimination-based disagreements, these dynamics are troubling. Lee is making the case that history is on his side, but he doesn't have much supporting history to draw from. Common carriage prevented last-mile discrimination until 2005. Kevin Werbach, on the other hand, sees major risks from emerging market power, specialized peering, and what he calls possible "Tier 0" arrangements between vertically integrated providers. The Verizon/MCI/UUNET network was only recently unified, creating something close to this type of an arrangement.
Conclusion
Tim Lee's article repeats but then goes beyond the standard refrain of no-government-regulation libertarianism. However, his novel arguments for why the internet will take care of itself are not persuasive. Ultimately, we are left with his well-put argument for the benefits of network neutrality, but without any assurances that it will be preserved. Into this vacuum might flow reasonable discussion of how targeted government regulation might be the only means of achieving the ends we both seek.
Cato has finally gotten around to publishing Tim Lee's article, "The Durable Internet: Preserving Network Neutrality without Regulation." I first saw a draft of his paper in March, and Tim engaged in a good spirited back-and-forth with me over email. The primary failings that I perceived then remain un-addressed in this final version. They are twofold:
1. The fallacy that any non-discrimination regulation is the same as the combined force of all misguided regulation since the advent of administrative agencies
The first problem with Lee's article is that it repeats one of the most common mistakes of certain libertarian sects: assuming that any government regulation is as bad as all government regulation. In Lee's case, the devilish regulation equated with network neutrality is the Interstate Commerce Act, the Civil Aeronautics Board, and the sum of all Federal Communications Commission regulation. This approach mirrors earlier claims by Bruce Owen, Larry Downes, and Adam Thierer, which I rebut here.
Lee begins by observing that "The language of the Interstate Commerce Act was strikingly similar to the network neutrality language being considered today." We should not be surprised that at least some of the non-discriminatory principles found in modern day neutrality proposals resemble those in the ICA. Indeed, net neutrality is inspired in part by elements of common carriage, which cross-pollinated into communications law in the 1910 Mann-Elkins Act (see pp. 21-23 of my thesis for more on this history). The gating question is whether or not the elements of the Interstate Commerce Commission that led to the inefficiencies that Lee claims are at all related to the non-disciminatory language that he claims connect the two. If and only if the answer is "yes," then a responsible analysis would consider whether or not the markets are relatively analogous, whether or not the administrative agencies tend toward the same failures, and whether the costs of regulation truly outweigh the benefits. In short, it is not enough to simply assert that net neutrality smells like the ICA, therefore it is doomed to fail.
I won't discuss the relationship to the Civil Aeronautics Board because I think the analogies are tenuous at best.
Finally, we arrive at the FCC discussion, which holds the most promise for actually being relevant. Unlike Bruce Owen, who inexplicably compares neutrality proposals to the AT&T antitrust proceedings, Lee seeks to equate neutrality with FCC rate-subsidization and market entry prohibitions. He concludes that, "like the ICC and the CAB, the FCC protected a client industry from the vagaries of markets and competition." Perhaps, but why is this similar to non-discrimination regulation?
A more accurate analogy with FCC rulemaking would be to compare neutrality to the non-disciminatory part of common carriage, the Computer Inquiries, Carterphone, or all three. Most scholars recognize that these rules allowed the discrimination-free operation of dial-up ISPs, and facilitated the explosion of the internet. The case of FCC non-discrimination mandates presents a stark counter-example to Lee's assertion of uniform regulatory failure.
2. The fallacy that there is an underlying "durability" of the technology/market structures of the internet that will successfully resist strong carrier incentives
Lee provides a somewhat novel argument when he claims that the internet has built in safeguards against welfare-harming practices like network discrimination. He begins by praising the effects of the "end-to-end" architecture of the internet, in which carriers simply deliver data and allow the "edges" of the network to determine what is sent and how. He thinks that this characteristic does not need to be backed up by regulators because the technology and the market will preserve it.
With respect to markets, his argument is twofold. First he claims that outright "blocking" of services would cause such backlash (from end-users or from content providers) that it would be untenable. Second, he claims that attempts to simply degrade service would not be terribly destructive in the short term, and would provide ample time to craft a regulatory response if necessary.
Lee justifies his customer backlash theory by pointing to cases such as the Verizon/NARAL dispute in which the company initially refused to give the non-profit an SMS "short code" but relented in the face of public outcry. In reality, the outcry came from inside-the-beltway advocates who threatened regulation, but in any event we have a more relevant example in the case of BitTorrent/Comcast, which he also discusses. The regulatory solution in this case is even more obvious, with the FCC ultimately issuing an order against the company (which is now on appeal). There is no evidence whatsoever that these resolutions were driven by users that have "had a taste of freedom" and have, "become acutely aware of any new restrictions," and, "stubbornly refuse efforts to impose them" -- resisting via technical or financial means. Nor is there evidence that, left alone, the markets would have settled on a non-discriminatory solution.
Lee tries to make the case that the technical structure of the internet would have allowed BitTorrent users to simply adopt better ways of hiding their traffic, and would have prevailed in that cat-and-mouse game. This is of course speculation, but it's also irrelavent. Whether or not highly technically savvy users can temporarily evade discrimination has little to do with how such practices would effect the activities of the majority of the population. In fact, we have strong examples to the contrary worldwide, as various regimes develop more and more sophisticated means for filtering their citizens' speech (such as the news today from Argentina). In those situations, there are often many people who can subvert the filters but the practice nevertheless fundamentally alters the nature of what is said, and what innovations flourish (see for example, the rollout and adoption of Google vs. Baidu in China).
Lee also lays out an argument for why the structure of the network itself makes it unlikely that last-mile carriers can successfully threaten blocking. He argues that because the core of the internet is highly interconnected, it would be practically impossible to discriminate against any particular site, and that those sites which are important enough to pay attention to could in turn threaten to stop serving customers from that carrier. In short, they need each other. In many cases this is true, although it doesn't necessarily mean that in all cases this relationship will be more attractive to the last-mile provider when compared to various exclusive relationships (or that even if it is, the provider will behave rationally). Things get even more dicey when we examine them from the perspective of second-tier sites or services, which have not yet achieved the "must have" status but nevertheless present revenue opportunities or competitive risk to the carriers.
Lee claims that even if this occurred, it would not be a real problem because it wouldn't be severe. "To be sure, such discrimination would be a headache for these firms, but a relatively small chance of being cut off from a minority of residential customers is unlikely to rank very high on an entrepreneur’s list of worries." His assumption that the chance of being cut off is "small" is belied by recent experience in the Comcast/BitTorrent case. The idea that one would be cut off only from a "minority of residential customers" is technically true because no one firm currently controls over 50% of residential connections, but there are some truly significant market shares that entrepreneurs would undoubtedly care about. Last-mile providers have duopoly over their subscribers, and a "terminating access" monopoly over current subscribers.
These problems are all made much more severe in an environment in which carriers practice partial discrimination rather than outright blocking. In our email back-and-forth, I told Lee that:
The notion that "D cant' degrade them all, because that would make D's Internet service completely useless" does not hold when you assume that D maintains a baseline level of connectivity (perhaps even at current levels of service) but only offers enhanced delivery to services/sites that pay up. Consumers don't see any change, but the the process of network-wide innovation gives way to source/application-based tiering. Imagine this starting in the era of dialup (you'd have to imagine away the last-mile common carrier safeguards in that scenario). Today I'd only get web-based video from ABC, Disney, etc.
The last-mile carrier "D" need not block site "A" or start charging everyone extra to access it, it need only degrade (or maintain current) quality of service to nascent A (read: Skype, YouTube, BitTorrent) to the point that it is less useable. This is neither a new limitation (from the consumers perspective) nor an explicit fee. If one a user suddenly lost all access to 90% of the internet, the last-mile carrier could not keep their business (or at least price). But, discrimination won't look like that. It will come in the form of improving video services for providers who pay. It will come in the form of slightly lower quality Skyping which feels ever worse as compared to CarrierCrystalClearIP. It will come in the form of [Insert New Application] that I never find out about because it couldn't function on the non-toll internet and the innovators couldn't pay up or were seen as competitors. As Barbara van Schewick observes, carriers have the incentive and ability to discriminate in this fashion.
Finally, Lee makes the argument that the current norm of "settlement-free" peering in the backbone of the internet will restrict last-mile providers' ability to discriminate and to create a two-tiered internet because they will be bound by the equal treatment terms of the agreements. This is not supported by practical evidence, given the fact that none of the push-back against existing discriminatory practices has come from network peers. It is also not supported by sound economic reasoning. It is certainly not in backbone-provider E's business interest to raise prices for all of its customers (an inevitable result). But, assuming E does negotiate for equal terms, the best-case scenario is that E becomes a more expensive "premium" backbone provider by paying monopoly rents to last-mile provider D, while F becomes a "budget" backbone provider by opting out (and hence attracts the "budget" customers).
We are already seeing cracks in the dam of settlement-free peering. The Cogent/L3 meltdown happened between two backbone-only providers and was in the context of volume-based disagreements. Two weeks ago, Sprint disconnected from Cogent because of a dispute over sharing. When you add the only recent pressure of last-mile leveraging and discrimination-based disagreements, these dynamics are troubling. Lee is making the case that history is on his side, but he doesn't have much supporting history to draw from. Common carriage prevented last-mile discrimination until 2005. Kevin Werbach, on the other hand, sees major risks from emerging market power, specialized peering, and what he calls possible "Tier 0" arrangements between vertically integrated providers. The Verizon/MCI/UUNET network was only recently unified, creating something close to this type of an arrangement.
Conclusion
Tim Lee's article repeats but then goes beyond the standard refrain of no-government-regulation libertarianism. However, his novel arguments for why the internet will take care of itself are not persuasive. Ultimately, we are left with his well-put argument for the benefits of network neutrality, but without any assurances that it will be preserved. Into this vacuum might flow reasonable discussion of how targeted government regulation might be the only means of achieving the ends we both seek.
Wednesday, November 5, 2008
A Good Day for Openness
Nov 4th brought some exciting developments for openness in several different domains.
First, we elected a president dedicated to government transparency and accessibility. I hope that Obama's "Google for Government" bill is a harbinger of things to come in his administration. Making more information freely available and searchable will allow the better functioning of our government.
Second, a slightly more wonky development. The FCC approved unlicensed use of the "white spaces." This is the culmination of a 4+ year-long process, with heavy lobbying in the past year or so. It opens up huge swaths of spectrum, which any citizen or innovator can put to use for things like wireless broadband.
Third, a geeky development. Somebody rooted the G1 -- the first handset based on the open-source Android operating system. Although the operating system itself is open-source, T-Mobile had locked down all of the interesting stuff. Now that it's unlocked, we will likely see a plethora of interesting development on the platform.
First, we elected a president dedicated to government transparency and accessibility. I hope that Obama's "Google for Government" bill is a harbinger of things to come in his administration. Making more information freely available and searchable will allow the better functioning of our government.
Second, a slightly more wonky development. The FCC approved unlicensed use of the "white spaces." This is the culmination of a 4+ year-long process, with heavy lobbying in the past year or so. It opens up huge swaths of spectrum, which any citizen or innovator can put to use for things like wireless broadband.
Third, a geeky development. Somebody rooted the G1 -- the first handset based on the open-source Android operating system. Although the operating system itself is open-source, T-Mobile had locked down all of the interesting stuff. Now that it's unlocked, we will likely see a plethora of interesting development on the platform.
Monday, October 27, 2008
White Spaces and Red Herrings
Even dry policy wonks occasionally find themselves engaged in timely cultural commentary. Thus, we are thrust into debate with country music legends, heavy metal stars, and mega-church leaders. This is the domain of electromagnetic spectrum -- that ephemeral public good that is as essential to modern life as the air we breathe.
The FCC is set to decide what to do with the vast, unused swaths of spectrum between television channels in its open meeting on Election Day. When the rest of the country is paying attention to an historic contest for the ultimate game of King of the Hill, the Commission will be deciding how we are to share (or hoard) one of our most unappreciated public resources.
Back in ancient times, you would turn your television dial through channels received over "bunny ears" and wonder why so many of them showed static. Since then, most of us have transitioned to cable or satellite television, and few of us have noticed that these occasional flurries have turned into a blizzard. In fact, most stations are currently broadcasting in both analog and digital, but in February of 2009 they will have to turn off their analog transmissions (thus doubling the unused space).
What if we could instead use those channels to watch YouTube videos of cats being vacuumed? The future is now. On November 4th, the FCC will be deciding whether or not wifi-like devices can make use of the spaces between television broadcasts. They have spent more than four years investigating this question, and from all accounts they appear to be poised to say "yes." This is where Dolly Parton, Ozzy Osbourne, and Rick Warren come in.
See, all of those folks rely on wireless microphones that already use broadcast television channels when nobody is using them for TV. There are actually a few people who are licensed to do this, but the reality is that none of those I've listed are acting legally. Perhaps we would expect this from bat-biting Ozzy, or perhaps even Dolly... but Rick? How scandalous.
All three of these constituencies have filed comments at the FCC opposing innovative new uses of valuable spectrum. They do so from their understandably biased perspectives. Each wants to preserve their ability to use wireless microphones as they have become accustomed -- in Dolly Parton's case, it is essential that she maintain the integrity of audio fidelity in her live performances of the musical adaptation of "9 to 5."
Don't get me wrong. That was one of my favorite movies as a child, and I have a fondness for her music (it is the saving grace of the entire "country" genre which no longer resembles its roots in the least). However, I disagree with Dolly on this matter. Perhaps I can proceed by familiar analogy.
In "9 to 5" Dolly Parton and her clever co-conspirators exhibited innovation and flexibility, standing up to the incumbents of old. Is it too much of a stretch to claim that legacy broadcasters are similarly generating system-wide inefficiencies through their opposition to flexible use of the spectrum? Probably. But nevertheless, I think that Dolly is on the wrong side of this one. It's time to open the airwaves (if only in the limited fashion proposed). Even the houses of worship are going to have to deal with the fact that they have been misled by representatives from the microphone companies who never bothered to tell them that they were advising them to break the law.
Representative Dingell, Chairman of the House Committee on Energy and Commerce (and ultimate overseer of the FCC, along with the parallel Senate committee), recently wrote a letter to the Commission raising a couple of valid but uninformed questions about white spaces proposals. He asked first why the Commission hadn't considered a licensed approach to the frequencies. Of course, this debate was well-trod long ago. The licensed approach is the instantiation of a classic "Coasian" perspective, which has been debated since the beginning of time (or, at least, the 1950's). The FCC itself convened a task force in 2002 which concluded that:
That whole "commons" thing sounds a bit communist (or, gasp, socialist!) but in fact reasonable sharing of a shared resource makes quite a bit of sense. Despite the full force of the FCC's engineering conclusions to the contrary, the mega-churches assert that "Today, there is no reliable technology that can protect existing services from what would be crippling interference from new portable devices," Ozzy's sound engineer urges that, "The FCC must take steps to insure that catastrophic interference does not occur," and Dolly explains that:
Dingell's second argument is that the FCC's technical findings may not have been peer reviewed. This point appears to hinge on a much-debated statute that tasks the OMB with "ensuring and maximizing the quality, objectivity, utility, and integrity of information (including statistical information) disseminated by Federal agencies." The OMB's rules are even more debated, and have been viewed by many as an excuse for the powers that be to kill off reports that it disapproves of. Indeed, there was an earlier peer-review of studies related to the white spaces [update: and a similar peer-review of this round of testing has now been posted], and the recent AWS-3 technical study did not undergo a similar process.
Could it be that these objections are merely a red herring?
In other news, the ranking member of Dingell's parallel committee in the Senate, a vocal opponent of open internet access, was today found guilty of multiple felony charges related to his unethical ties to an industry he oversaw.
The FCC is set to decide what to do with the vast, unused swaths of spectrum between television channels in its open meeting on Election Day. When the rest of the country is paying attention to an historic contest for the ultimate game of King of the Hill, the Commission will be deciding how we are to share (or hoard) one of our most unappreciated public resources.
Back in ancient times, you would turn your television dial through channels received over "bunny ears" and wonder why so many of them showed static. Since then, most of us have transitioned to cable or satellite television, and few of us have noticed that these occasional flurries have turned into a blizzard. In fact, most stations are currently broadcasting in both analog and digital, but in February of 2009 they will have to turn off their analog transmissions (thus doubling the unused space).
What if we could instead use those channels to watch YouTube videos of cats being vacuumed? The future is now. On November 4th, the FCC will be deciding whether or not wifi-like devices can make use of the spaces between television broadcasts. They have spent more than four years investigating this question, and from all accounts they appear to be poised to say "yes." This is where Dolly Parton, Ozzy Osbourne, and Rick Warren come in.
See, all of those folks rely on wireless microphones that already use broadcast television channels when nobody is using them for TV. There are actually a few people who are licensed to do this, but the reality is that none of those I've listed are acting legally. Perhaps we would expect this from bat-biting Ozzy, or perhaps even Dolly... but Rick? How scandalous.
All three of these constituencies have filed comments at the FCC opposing innovative new uses of valuable spectrum. They do so from their understandably biased perspectives. Each wants to preserve their ability to use wireless microphones as they have become accustomed -- in Dolly Parton's case, it is essential that she maintain the integrity of audio fidelity in her live performances of the musical adaptation of "9 to 5."
Don't get me wrong. That was one of my favorite movies as a child, and I have a fondness for her music (it is the saving grace of the entire "country" genre which no longer resembles its roots in the least). However, I disagree with Dolly on this matter. Perhaps I can proceed by familiar analogy.
In "9 to 5" Dolly Parton and her clever co-conspirators exhibited innovation and flexibility, standing up to the incumbents of old. Is it too much of a stretch to claim that legacy broadcasters are similarly generating system-wide inefficiencies through their opposition to flexible use of the spectrum? Probably. But nevertheless, I think that Dolly is on the wrong side of this one. It's time to open the airwaves (if only in the limited fashion proposed). Even the houses of worship are going to have to deal with the fact that they have been misled by representatives from the microphone companies who never bothered to tell them that they were advising them to break the law.
Representative Dingell, Chairman of the House Committee on Energy and Commerce (and ultimate overseer of the FCC, along with the parallel Senate committee), recently wrote a letter to the Commission raising a couple of valid but uninformed questions about white spaces proposals. He asked first why the Commission hadn't considered a licensed approach to the frequencies. Of course, this debate was well-trod long ago. The licensed approach is the instantiation of a classic "Coasian" perspective, which has been debated since the beginning of time (or, at least, the 1950's). The FCC itself convened a task force in 2002 which concluded that:
No single regulatory model should be applied to all spectrum: the Commission should pursue a balanced spectrum policy that includes both the granting of exclusive spectrum usage rights through market-based mechanisms and creating open access to spectrum "commons"...
That whole "commons" thing sounds a bit communist (or, gasp, socialist!) but in fact reasonable sharing of a shared resource makes quite a bit of sense. Despite the full force of the FCC's engineering conclusions to the contrary, the mega-churches assert that "Today, there is no reliable technology that can protect existing services from what would be crippling interference from new portable devices," Ozzy's sound engineer urges that, "The FCC must take steps to insure that catastrophic interference does not occur," and Dolly explains that:
I don't know all the legalese concerning the issue so I've had some very smart people inform me about the legalities here. [...] I have deep concern over the Commission's announcement that it intends to vote on an order allowing devices using spectrum sensing technoogy to occupy the "white space" radio frequencies on November 4, 2008 (Election Day). [...] As you may know, I am an inductee to both the Country Music and Songwriters Hall of Fame and am currently on a world tour supporting my latest album. New regulations could have direct impact on many ventures in which I am directly involved, including: 9 TO 5: THE MUSICAL [...] Dollywood [...] Grande Ole Opry
Dingell's second argument is that the FCC's technical findings may not have been peer reviewed. This point appears to hinge on a much-debated statute that tasks the OMB with "ensuring and maximizing the quality, objectivity, utility, and integrity of information (including statistical information) disseminated by Federal agencies." The OMB's rules are even more debated, and have been viewed by many as an excuse for the powers that be to kill off reports that it disapproves of. Indeed, there was an earlier peer-review of studies related to the white spaces [update: and a similar peer-review of this round of testing has now been posted], and the recent AWS-3 technical study did not undergo a similar process.
Could it be that these objections are merely a red herring?
In other news, the ranking member of Dingell's parallel committee in the Senate, a vocal opponent of open internet access, was today found guilty of multiple felony charges related to his unethical ties to an industry he oversaw.
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