PeerFlow

Sensing History: Yoo Re Cherry

Dave Farber posted a response by Chris Yoo to Barb Cherry's post about myths and historical errors. Here's Chris's reponse in full. To me, it seems that he is conceding that she's right about the history, that antitrust says nothing about ISP competition, and that a few ISPs control most of the Internet in the U.S. But read it for yourself:

From: Christopher S. Yoo [mailto:csyoo@law.upenn.edu]

I don't pretend to be an expert on the history of common carriage regulation. Barbara has spent far more time thinking about this than I have, so I always appreciate hearing her reactions and learn from reading her work. That said, here are a few thoughts.

It is true that common carriage long predates both the Granger Movement and the Interstate Commerce Act of 1887. That said, one of the central problems is that the historic justifications for common carriage have not aged very well. Often times the common carriage obligations were regarded as a quid pro quo for a government grant of some economic privilege. Other times they were justified because the industry was "affected with a public interest," a concept that is usually traced to the landmark Supreme Court case Munn v. Illinois (1876). The Supreme Court struggled to imbue that standard with content (along with a number of early treatises trying to make sense of the concept) and would ultimately abandon it as analytically empty in Nebbia v. New York (1934). Legal scholars, such as Thomas Nachbar and James Speta in addition to Barbara, have attempted to recover lessons from this era. I have never spoken to Barbara about this in particular, but both Tom and Jim have noted the difficulty in extracting any useful lessons from the history.

The rest after the jump.

Social Welfare: Reed Asks Yoo

David P. Reed asks a question and Christopher S. Yoo responds on Farber's Interesting People list. I'm posting both in full here, with my thoughts at the end; basically, law isn't a science, and anecdotes can turn into legal cases; some have already regarding net neutrality.

From: David P. Reed [dpreed@reed.com]
Sent: Saturday, May 10, 2008 11:50 AM
To: David Farber
Cc: ip
Subject: Re: [IP] re-distribution of op-ed on Net Neutrality -- a reaction and a reply from one of the authors

I read through the long comment by Chris Yoo below, and as a non-lawyer interested in policy, I ask the following simple question:

Is there a well-regarded (one might ask for scientifically reasoned) argument that antitrust law as currently interpreted and practiced has a substantial impact measured in some currency like $ on social welfare?

Otherwise this entire argument is about nothing more than vaporware proceeding from a faith that competition (however loosely defined) creates social welfare best. AFAIK, this is largely an article of faith, just as the "End of History" was a grand article of faith posited by many of the same people as "truth".

It is just not fair to imply that the core of "today's settled antitrust law" carries even the level of weight as Darwin's Theory of Evolution. There have been no replicable studies of its practice.

Law professors and lawyers who don't challenge its truthiness squarely are merely behaving as dogmatic mandarins always do - asserting authority of professional status, rather than rigor of reasoning, experiment, or argument.

I say this not as FOX News or Hillary Clinton would call an elitist, but as a person who genuinely is unconvinced by magical faith in authorities.

That's Reed's question. Yoo's response, and my thoughts, after the jump.

WSJ Fears Innovation: Net Neutrality As Internet Wrecking Ball

Apparently this WSJ opinion writer couldn't actually argue with Ed Markey's net neutrality bill, so he made up a straw man:

Imagine a town that has all sorts of gasoline pipelines running by it but only one gas pump. Rationing is inevitable. So are price controls.

Everyone gets equal amounts, except of course first responders like police and ambulances, which should get all the gas they want. And, well, so should the mayor. And if you can make a good business case that you work 60 miles away, you can file paperwork and perhaps pull some strings for more gas. How about those kids hot-rodding around town who can't drive 55? They get last dibs, and maybe we can sneak in some gas thinner to slow down their engines and not waste gas.

— Internet Wrecking Ball, By Andy Kessler, Wall Street Journal, February 25, 2008; Page A15

What's especially amusing about this strawman is that it's what the duopoly is planning as they do away with net neutrality, except it's not first responders or governments that will get favored bandwidth: it's Hollywood. Meanwhile, Markey's bill doesn't say any of that. It doesn't include any regulation at all.

Kessler invokes Orwell:

This is the essence of the Ed Markey's (D., Mass.) Orwellian-named Internet Freedom Preservation Act of 2008, which would foist network neutrality on the wild and woolly Internet.

Kessler maybe wasn't around in the earlier days of the Internet, or he would know that net neutrality is what we used to have, until it got chipped away starting in about the year 2000, as the FCC failed to enforce the Unbundled Network Elements (UNE) of the Telecommunications Act of 1996, and reclassified cable modem access as an information service in August 2002, wireline broadband in August 2005, and wireless broadband in March 2007. The FCC stripped common carriage status from Internet provision, something never done before in the U.S. So what Markey's bill is actually trying to do is to preserve the freedom the Internet used to have before the present administration and the duopoly systematically tried to do away with it. That's the opposite of Orwellian: that's the plain truth.

If Kessler did know Internet history, or had been around when we were making it, he would know not to write things like this:

AT&T, Texas Football, and Legislators

AT&T tried to impress Texas legislators by streaming the football game in high definition:

"I'd never seen a football game on a big screen like that. It didn't look very good."

—Rep. Eddie Rodriguez, D-Austin, quoted in UNDER THE DOME Most Austin reps skipped football game - and lobby party, W. Gardner Selby, Austin American-Statesman, Saturday, December 01, 2007

I'm not sure AT&T wanted that kind of reaction to watching a Texas football team in Austin, the capital of the second most populous state. The local cableco in Austin, Time Warner, didn't have the game (Dallas Cowboys and Green Bay Packers), which was on the NFL Network, which has a deal with AT&T. Most legislators didn't even show up to watch. Interesting, considering that legislators and regulators are the real audience of the duopoly.

-jsq

Clogged: Internet Demise Predicted, Again

I predict this prediction will be misused by the duopoly to lobby for more favoratism for the duopoly:

User demand for the Internet could outpace network capacity by 2010, according to a study released today by Nemertes Research. The study found that corporate and consumer Internet usage could surpass the Internet access infrastructure, specifically in North America, but also worldwide, within the next three to five years.

...

As Internet capabilities continue to expand and users strive to be constantly connected, usage of the Internet via the mobile phone, set-top boxes and gaming devices has exponentially increased thus limiting bandwidth capacity. This is due in large part to voice and bandwidth-intensive applications, including streaming and interactive video, peer-to-peer file transfer and music downloads and file sharing. According to ComScore, nearly 75% of U.S. Internet users watched an average of 158 minutes of online video in one month alone and viewed more than 8.3 billion video streams.

— Internet could clog networks by 2010, study says, By Sarah Reedy, TelephoneOnline, Nov 19, 2007 1:03 PM

If I had a nickle for every time imminent demise of the Internet has been predicted. This has been going on since before the Internet even existed, and the results have been different than in this prediction.

Copper-Based Competitors

The chutzpah:

Ed Shakin, a lawyer for Verizon, said network-sharing requirements are no longer needed in certain cities now that cable companies and other competitors have rolled out Internet and phone service. "What competitors want are artificially low prices," he said. "It comes down to a fight about price, not availability."

— Telecom Changes Put Competition on the Line, By Kim Hart, Washington Post Staff Writer, Thursday, September 6, 2007; Page D01

So Verizon is reducing the number of competitors, but as long as there is at least one, that's enough, they say. Apparently Verizon thinks its competition is the Highlander: There Can Be Only One.

-jsq

Warp Speed From Behind

As we've mentioned before Japan has Internet connections much faster than those in the U.S. This point is getting more mainstream media play:

Broadband service here is eight to 30 times as fast as in the United States -- and considerably cheaper. Japan has the world's fastest Internet connections, delivering more data at a lower cost than anywhere else, recent studies show.

Accelerating broadband speed in this country -- as well as in South Korea and much of Europe -- is pushing open doors to Internet innovation that are likely to remain closed for years to come in much of the United States.

The speed advantage allows the Japanese to watch broadcast-quality, full-screen television over the Internet, an experience that mocks the grainy, wallet-size images Americans endure.

— Japan's Warp-Speed Ride to Internet Future, By Blaine Harden, Washington Post Foreign Service, Wednesday, August 29, 2007; Page A01

So is it just for video? If so, maybe we'd better let the telcos have their way.

It's Good to be King!

How are those merger conditions coming along?

Remember the story back in June about how AT&T had extremely quietly started offering $10 DSL as was required in its deal to buy BellSouth? The company was promoting many other, more expensive, DSL options, but the only way you could get the required $10 version was if you specifically knew to ask about it. Broadband Reports points to an interview from an Atlanta newspaper with AT&T CEO Randall Stephenson where he's asked about the $10 DSL. The interviewer points out that no story about AT&T resulted in a more irate response from AT&T customers as its story about the hidden offer for $10 DSL, suggesting that this was a huge issue for AT&T customers. Stephenson's response? First he denies that the company made it hard to find, and then he says that they're not promoting it because customers don't want it. This, despite the clear response from customers to the very newspaper who was conducting the interview. Then, he basically admits that the $10 DSL doesn't work very well, saying that they don't promote it because they don't want to give customers a product that sucks. Of course, he says that as if it's not his company that has quite a bit of control over whether or not the product sucks.

— AT&T CEO: We Don't Promote $10 DSL Because No One Wants It, Techdirt, 1 August 2007

This is even though the AJC reporter introduced the question with:

Of all the things the AJC has written about AT&T lately, none has caused more reader irritation than AT&T's $10 a month DSL offer, which was required by the Federal Communications Commission when you bought BellSouth.

— Q&A: AT&T CEO Randall Stephenson, By Scott Leith, The Atlanta Journal-Constitution, Published on: 07/27/07

The techdirt writer goes on to point out that this is what SBC used to do with naked broadband, too, i.e., dance around and do nothing. After all, without regulation or competition, it's good to be king!

-jsq

Global Media Consolidation

In case you thought media ownership in increasingly fewer hands was a uniquely U.S. problem, here's a handy graphic illustrating its worldwide scope. There are links to the research behind it.

-jsq

AT&T's Striped Bass

You may recall that the FCC at the last minute in 2006, after the elections and before the electees took office, agreed to some conditions on the merger of Bellsouth with AT&T. Among them was a $10/month DSL plan.

The merger commitment specifies that the plan had to be offered. That means to me that it has to be put forth as an option!!! (If there's a fifty pound striped bass somewhere out there in the ocean, that's not an offer of fish!)

So I don't think AT&T is honoring its $10/month commitment.

— Is AT&T Honoring its Merger Commitments? David Isenberg, isen.blog, Friday, July 06, 2007

This is the same $10/month service USA Today announced AT&T was developing back in January. Maybe they'll just keep "developing" it until the 48 month time limit expires, or make it available to a few people and claim they've honored their commitment.This is what SBC used to do: claim availability if one person per ZIP code could get a service, and the FCC let them get away with that.

Isenberg asks:

Do you think the FCC will investigate?