PeerFlow

Mises Hates Duopoly: Or Only Monopoly and Fictional Wal-E?

I was reading a review of the movie Wal-E, and ran across this quote:

...without the presence of multiple providers of goods in the economy, the single dominant firm is in the same position as a socialist central planner. In the real world, BNL would have no market price signals to help it discern consumer demand for and the relative scarcity of resources. It would not be able to engage in rational economic calculation and would make decisions arbitrarily. Surely, this state would not please many consumers, and the BNL monopoly would be short lived at most.

— WALL-E: Economic Ignorance and the War on Modernity, Daily Article by Gennady Stolyarov II | Posted on 7/4/2008

So is it better if we have a duopoly rather than a monopoly? Is that competitive, then? The current FTC and FCC will say yes. I say no.

Sure, the Austrian school is controversial and all, and I found much of the rest of the review hilariously inapt, but this quote did stick in my mind.

-jsq

L.A. Times to cut 250 Jobs: Less Free Press; More Need for a Free Internet

There's good news and there's bad news:

The Los Angeles Times on Wednesday announced plans to cut 250 positions across the company, including 150 positions in editorial, in a new effort to bring expenses into line with declining revenue. In a further cost-cutting step, the newspaper will reduce the number of pages it publishes each week by 15%.

"You all know the paradox we find ourselves in," Times Editor Russ Stanton said in a memo to the staff. "Thanks to the Internet, we have more readers for our great journalism than at any time in our history. But also thanks to the Internet, our advertisers have more choices, and we have less money."

— Los Angeles Times to cut 250 jobs, including 150 from news staff, By Michael A. Hiltzik, Los Angeles Times Staff Writer, July 3, 2008

One reason for these cuts is the housing downturn in California: fewer real estate ads. But there are deeper reasons:

Announcements of hundreds of reductions were issued only last week by dailies in Boston, San Jose, Detroit and elsewhere. Among Tribune newspapers, the Baltimore Sun said it would cut about 100 positions by early August and the Hartford Courant announced plans to cut about 50 newsroom positions. The New York Times and the Washington Post both instituted layoffs or buyouts to reduce their staffs this year.

Besides the changes in the newspaper industry, Tribune carries the burden of about $1 billion in annual payments on its debt, much of which it took on to finance the $8.2-billion buyout.

Sure, it's happening everywhere. But the L.A. Times is one of the best sources of journalism around. Why did somebody find it worthwhile to buy it out just to load it up with debt and force layoffs?

Whether this newspaper was targetted or not, the handwriting is on the wall for fishwraps. They'll either adapt to the Internet or die. I suspect many of them will die. That means we'll lose many of our traditional sources of real reporting. Fortunately, some new sources are arising, such as Talking Points Memo, which bit into the Justice Department scandals and hung on like a bulldog. Yet blogs like that thus far have a tiny fraction of the resources of big newspapers like the L.A. Times, the New York Times, and the Washington Post. There's going to be a time of unsettlement of the fishwrap plains while the new shops in cyberspace put down roots into the old country.

And we won't have ready access to either the remaining existing newspapers worldwide or to the new online sources of reporting unless we have a free Internet. Yet another reason that net neutrality is important.

Yet another reason not to let the telcos get away with retroactive immunity. Remember, the telcos currently paying off Congress are the same companies that want to squelch net neutrality. If they can get away with handing over every bit to the NSA yesterday, why would they stop at squelching your P2P today?

-jsq

Amnesty Foes 2.0: SenatorObama-PleaseVoteAgainstFISA

I've been waiting for this to hit the bigtime, and it has, it's been slashdotted:

ya really notes a blog posting up at Wired reporting that foes of the Telecom Amnesty Bill have mounted a campaign on Barack Obama's own website. Though the group was created only days ago, on June 25, it has grown to be the fifth largest among 7,000 such groups, just short of Women for Obama. Although it is widely known that Obama changed his stance from opposing telecom immunity to supporting it, many have not given up hope of getting him to switch once again.

Telecom Amnesty Foes On the Move, Posted by kdawson, slashdot, on Tuesday July 01, @08:02AM from the one-week-and-counting dept.

And today the group has more than 9,000 members and is #2 among all MyBO groups.

It's everywhere else, too, Time, WSJ, Wired, Huffington Post, TPM, DailyKos, MyDD, OpenLeft, digg, reddit, and of course facebook. Read all about it on the wiki.

(Yes, I'm a member of the group, since about the second day, and here's what I think about the issue.)

This group is a goldmine of information about which telecoms gave what money to whom.

The most significant part to me is that people are using a candidate's own organizing tools to attempt to organize the candidate. Not stopping there, either, attempting to organize allies for the candidate. Obama claims to be people-powered. Let him say that while other politicians follow money from lobbyists, he listens to the people who give him money, who are the people, and when they said think again he did, and discovered the bogus House FISA "compromise" bill is no such thing, and now he's against it. We'll see.

-jsq

Banana Republic, DC: Telecom Lobbying Revolving Door

Greenwald notes that AT&T spends more in three months for lobbying than EFF's entire budget for a year. Then he spells out how the lobbying revolving door works, and concludes:

The "two sides" referenced there means the House Democratic leadership and the telecoms. Congressional leaders are "negotiating" with the telecoms -- the defendants in pending lawsuits -- regarding the best way for immunizing them from liability for their lawbreaking, no doubt with the help of the former Democratic members and staffers now being paid by the telecoms to speak to their former bosses and colleagues about what they should do. To describe the process is to illustrate its oozing, banana-republic-like corruption, but that's generally how our laws are written.

None of this is particularly new, but it's still remarkable to be able to document it in such grotesque detail and see how transparent it all is. In one sense, it's just extraordinary how seamlessly and relentlessly the wheels of this dirty process churn. But in another sense, it's perhaps even more remarkable -- given the forces lined up behind telecom amnesty -- that those who have been working against it, with far fewer resources and relying largely on a series of disruptive tactics and ongoing efforts to mobilize citizen anger, have been able to stop it so far.

— How telecoms are attempting to buy amnesty from Congress, Glenn Greenwald, Salon.com, Saturday May 24, 2008 06:48 EDT

Remember, AT&T and the other telcos and cablecos are the same companies that want to nuke net neutrality in the name of competition and progress; two other flags they behind, just like the banana republic flag of national security.

-jsq

ATCA Again: Duopoly Against VoIP Long Before Video

Back in 1995, an organization calling itself AMERICA'S CARRIERS TELECOMMUNICATION ASSOCIATION ("ACTA"), petitioned the FCC to regulate Voice over IP (VoIP) services. The gist of the matter was:

Permitting long distance service to be given away is not in the public interest.

In other words, if the telcos couldn't make money off of it, nobody should.

A usually reliable source says:

The ACTA petition was the first time that the FCC confronted VoIP as a policy issue. The FCC, however, never acted on the ACTA petition, and ACTA, the moving party, no longer exists. The question presented by the ACTA petition was whether the FCC had regulatory authority to regulate VoIP Internet software used by individuals to do telephony with each other, with no service provider in the middle.

— VoIP: ACTA Petition, Cybertelecom

It's interesting that the same telcos that now rail against regulation were happy to try to use it back in 1995 when it suit their purposes.

So ATCA failed to control VoIP via FCC regulation. But they can use volume charging to eliminate both VoIP and video they don't provide themselves.

The duopoly's claims of a few people using too much traffic are a smokescreen. The real issue is control: they want to control what passes through "their" networks so they can profit by as much of it as possible. I have no objection to telcos and cablecos making a profit. I do object to them squelching everybody else to do so. On the Internet you can connect any two tin cans, unless the duopoly can cut your string.

-jsq

Byte Charging Rears Its Ugly Head

Here it is again:

Some people use the Internet simply to check e-mail and look up phone numbers. Others are online all day, downloading big video and music files.

For years, both kinds of Web surfers have paid the same price for access. But now three of the country’s largest Internet service providers are threatening to clamp down on their most active subscribers by placing monthly limits on their online activity.

— Charging by the Byte to Curb Internet Traffic, By BRIAN STELTER, New York Times, Published: June 15, 2008

The article names Time Warner, Comcast, and AT&T as the three prospective byte chargers.

I can remember when all the European PTTs charged by the byte. That held the Internet in Europe back by at least four years. The article rightly points out byte charging would interfere with all sorts of business plans. It would also inhibit political speech.

Isn't it lovely when the duopoly that controls U.S. Internet access considers participation a leak that needs to be fixed?

-jsq

T-Mobile Lobbying: $700K in Q1 2008

T-Mobile hasn't made the news like AT&T, Comcast, and Cox for violating net neutrality, but has nonetheless been busy lobbying behind the scenes:

WASHINGTON - Telecommunications carrier T-Mobile USA Inc. spent nearly $700,000 in the first quarter to lobby on spectrum matters and other issues, according to a disclosure report.

T-Mobile, which is owned by German telecommunications company Deutsche Telekom AG (nyse: DT - news - people ), also lobbied the federal government on legislation involving wireless taxes, privacy and various consumer protection issues.

The company, the nation's fourth largest cellular carrier, also lobbied lawmakers on the issue of "Net neutrality," or the principle that all Web traffic be treated equally. Some Internet providers want to charge content providers extra to get their Web sites to load faster. Lawmakers have proposed legislation to make Net neutrality the law of the land.

— T-Mobile spent $700,000 lobbying in first quarter, Associated Press, 05.30.08, 5:26 PM ET

The T-Mobile lobbyist pictured is Michelle Persaud, former Democratic staff council for the House Judiciary Committee.

-jsq

Payola for the Duopoly

ISP meddling with net neutrality could unite indy musicians and record labels against the duopoly:

For the music business, the failure of net neutrality presents several big problems. Musicians are at the vanguard of digital distribution of music files, video files, and other space-gobbling content. Traffic throttling will almost certainly result in placing severe limitations on the amount and kind of content musicians can put out there — and it’s pretty likely that musicians will then be forced into partnering with businesses that have fewer limits and greater access, no doubt for a fee, to get their gear online. Another issue is that, as covered recently in this column, we are seeing a whole new universe of music-related business models, and we need to see some predictability in terms of licensing methods and how artists and copyright owners get paid. One of the most compelling proposals is that P2P music sharing should be rendered commercially viable and copyright-legal by the imposition of a blanket license that would be paid at the gate (i,e., through the ISPs). Institutionalized throttling would take this plan out at the knees.

Another problem is that record labels, distributors and retail chains who are already in desperate jeopardy can’t compete with ISPs and cellular providers who, having launched their own music stores, have all the incentive in the world to steer music consumers to their own services rather than open the pipe for folks to shop elsewhere.

— Net Neutrality, By Allison Outhit, Need to Know, June 2008

This observation comes from Canada, where current attempts by some to pass legislation similar to the U.S. Digital Millenium Copyright Act (DMCA) has suddenly gotten noticed as a path to something music lovers have seen before:

McKie is referring to proposed changes modelled on the American Digital Millennium Copyright Act (DMCA), which call for a much heavier-handed approach to interpreting what kind of content uses are protected by copyright. At the same time a Canadian DMCA would accord “safe harbour” status to service providers to shelter them from a potential onslaught of copyright litigation provided they act quickly to block infringing and illegal actions on their networks. A Canadian DMCA could impact net neutrality by putting police power in the hands of the networks, while providing ISPs with strong incentives to prefer privately-negotiated content distribution deals over the chaos of user-generated traffic. The bottom line is that musicians have come to rely on the net as their number one go-to distribution and marketing tool. The net got that way by being neutral to all comers. Whether you were a platinum seller on Universal, or a couple of unknown basement-dwellers, your video had an equal chance of going viral. Without net neutrality, all the good pipe will get eaten up by whoever has the power to make the deal. Which sounds a lot like the payola days all over again.

Yep, that's what we'll get if we don't have net neutrality: payola for the duopoly.

-jsq

Porter's Five Forces and Net Neutrality: What If Distribution Channels are Open?

Here's a take on why telcos so adamantly oppose net neutrality:

The eager and almost rabid application of Porter's "Five Forces" (Supplier Power, Customer Power, Threat of New Entrants, Threat of Substitute Products, Industry Rivalry) to technology products and services has bred an entire generation of MBAs in marketing positions dedicated to developing and maintaining closed systems and closed hardware platforms. This is particularly egregious in the case of business models that are effectively based on distribution channels. In conventional analysis there is nothing wrong with making your living on distribution channels. Remember, that in 1979, when Porter developed the Five Forces framework, distribution channels were highly expensive to create and maintain and, owing to these costs, constructing them effectively presented a significant barrier to entry. Your product didn't even have to be particularly good, because the threat of substitutes was reduced via the difficulty and expense of the competition actually getting those substitutes (however good they might be) to your customers. Suppliers, if they wanted access to your customer base as a proxy to sell their raw materials, had to go through you. New entrants had to build an entirely new distribution channel. Customers were stuck. You owned the market. But you had to guard this distribution channel carefully. And you had to make sure you hadn't forgotten something simple and critical. That's not part of a conventional Porter analysis. But why would it be? Conventional distribution channels are quite physical, antique and boring.

— The Five Forces/Circles of Hell, a Private Equity Professional, Going Private, 27 April 2008

The article goes on to detail how Blockbuster used the old Porter model of closed distribution channels and Netflix used an existing open distribution channel: the U.S. Postal Service.

To spell out the telco connection:

Positive Externalities: What Yoo Ignores

It turns out Prof. Chris Yoo has been rebutted by legal scholars before:

Our article directly replies to a series of articles published by Professor Christopher Yoo on this topic. Yoo's scholarship has been very influential in shaping one side of the debate. Yoo has mounted a sophisticated economic attack on network neutrality, drawing from economic theories pertaining to congestion, club goods, public goods, vertical integration, industrial organization, and other economic subdisciplines. Yet he draws selectively.

For example, his discussion of congestion and club goods is partial in that he ignores the set of congestible club goods that are most comparable to the Internet - public infrastructure. Yoo focuses on the negative externalities generated by users (i.e., congestion) but barely considers the positive externalities generated by users (he simply assumes that they are best internalized by network owners). Yoo appeals to vertical integration theory to support his trumpeting of 'network diversity' as the clarion call for the Internet, but he myopically focuses on the teaching of the Chicago School of economics and fails to consider adequately the extensive post-Chicago School literature. And so on.

In our article, we explain the critical flaws in Yoo's arguments and present a series of important arguments that he and most other opponents of network neutrality regulation ignore.

— Network Neutrality and the Economics of an Information Superhighway: A Reply to Professor Yoo, BRETT M. FRISCHMANN, Loyola University of Chicago - Law School; Fordham University - School of Law, BARBARA VAN SCHEWICK, Stanford Law School, Jurimetrics, Vol. 47, 2007, Stanford Public Law Working Paper No. 1014691, Stanford Law and Economics Olin Working Paper No. 351

Hm, "positive externalities generated by users" as in participation and ad hoc content creation.

The authors also address David P. Reed's point that competition is not the holy grail of networking:

By focusing only on the market for last-mile broadband networks, Yoo not only neglects the importance of unfettered application-level innovation for realizing economic growth and the role of a nondiscriminatory access regime in fostering the production of a wide range of public and nonmarket goods. His argument also neglects other ways to solve the problem of broadband deployment that would not impede competition and innovation in complementary markets.

-jsq

Freedom v. Market Mythology

Here's a question that answers itself:

...what is it about individual freedom that "conservatives" like the Spectator and Armey don't like?

To be fair, the debate is larger than the Spectator and Armey. Most congressional Republicans oppose the idea of giving consumers freedom on the Internet. They take shelter in their anti-government, anti-regulation rhetoric, preferring to allow Internet freedom to apply to the corporations which own the networks connecting the Internet to consumers, rather than to consumers themselves. There could, of course, be a larger discussion about the meaning of "conservative" and Republican, and whether the two are synonymous.

(To be fairer still, it's not only Republicans. Many a Democrat also speaks out against Internet freedom. They don't have the fig-leaf of misbegotten ideology to hide behind, as they largely back worthwhile government action in many other areas. They are simply servants of corporate and/or union interests. The question applies equally: What about freedom don't they like?)

— Why The 'Right' Gets Net Neutrality Wrong, Art Brodsky, HuffingtonPost, Posted May 5, 2008 | 10:21 AM (EST)

The clue is "servants of corporate ... interests". (Unions occasionally get into this act; corporations much more frequently.) And it's not simple greed for corporate lobbyist money or kickbacks or the revolving door: many politicians and people really believe the "free market" will solve all problems. That's the origin of the doctrine of "market failure" that has pervaded all U.S. federal departments and agencies. Nevermind that when it's a major airline or automobile manufacturer or, even worse, a financial institution such as Citibank, these same people support all sorts of governmental market manipulations and bailouts. We're talking mythology here, kind of like the "rational actor" myth of economics.

Brodsky digs into the misconceptions behind this myth:

[Peter] Suderman's analysis: "In fact, not only were all of these companies [eBay and Google] born in an era with no mandated net neutrality, it's utterly unclear that a lack of neutrality would've impeded them in any way whatsoever."

That is not how it happened. This is how it happened:

Blocking Civil Suits: Telecoms Lobbied White House Hard for Immunity

Well, it seems the telcos are a bit worried about those lawsuits:

The Bush administration is refusing to disclose internal e-mails, letters and notes showing contacts with major telecommunications companies over how to persuade Congress to back a controversial surveillance bill, according to recently disclosed court documents.

The existence of these documents surfaced only in recent days as a result of a Freedom of Information Act lawsuit filed by a privacy group called the Electronic Frontier Foundation. The foundation (alerted to the issue in part by a NEWSWEEK story last fall) is seeking information about communications among administration officials, Congress and a battery of politically well-connected lawyers and lobbyists hired by such big telecom carriers as AT&T and Verizon. Court papers recently filed by government lawyers in the case confirm for the first time that since last fall unnamed representatives of the telecoms phoned and e-mailed administration officials to talk about ways to block more than 40 civil suits accusing the companies of privacy violations because of their participation in a secret post-9/11 surveillance program ordered by the White House.

At the time, the White House was proposing a surveillance bill—strongly backed by the telecoms—that included a sweeping provision that would grant them retroactive immunity from any lawsuits accusing the companies of wrongdoing related to the surveillance program.

— Just Between Us, Telecoms and the Bush administration talked about how to keep their surveillance program under wraps. by Michael Isikoff and Mark Hosenball, TERROR WATCH, Newsweek, Apr 30, 2008 | Updated: 6:09 p.m. ET Apr 30, 2008

It's sad to see professional military men like Lt. General Ronald L. Burgess, Jr., Office of the Director of National Intelligence, shilling for an administration that is so blatantly protecting itself and big corporations against justice for its own wrongdoing. White House stonewalling over first the existence of these documents, and now, since a judge ordered them to reveal that, release of the documents, isn't about any "war on terror". It's about protecting lawbreakers and control of the people:

Hamlet in DC: To Legislate or Not to Legislate, That is the Question

The U.S. Senate takes up net neutrality again, to legislate or not to legislate:

At a Senate Commerce Committee hearing entitled "The Future of the Internet" on Tuesday, Democratic politicians argued for passage of a law designed to prohibit broadband operators from creating a "fast lane" for certain Internet content and applications. Their stance drew familiar criticism from the cable industry, their Republican counterparts, and FCC Chairman Kevin Martin, who said there's no demonstrated need for new rules, at this point.

— Net neutrality battle returns to the U.S. Senate, by Anne Broache, C|Net News.com, 22 April 2008

Some of the senators seemed to think the Comcast debacle indicated there was need for legislation:

"To whatever degree people were alleging that this was a solution in search of a problem, it has found its problem," said Sen. John Kerry (D-Mass.). "We have an obligation to try and guarantee that the same freedom and the same creativity that was able to bring us to where we are today continues, going forward."

Kerry is one of the backers of a bill called the Internet Freedom Preservation Act, chiefly sponsored by North Dakota Democrat Byron Dorgan and Maine Republican Olympia Snowe, which resurfaced at the beginning of 2007 but has gotten little attention since. A similar measure failed in a divided Commerce Committee and in the House of Representatives nearly two years ago.

Unsurprisingly, Martin says he doesn't need a law to enforce, because he can make it up as he goes along:

Revisionism by PRI

This is amusing:

The attempt to force network neutrality on wireless carriers will result in disaster and is based on faulty assumptions, including one that there ever was neutrality on the Internet, according to a newly released analysis from the Pacific Research Institute (PRI).

— Researcher Rebukes Wireless 'Net Neutrality' Advocates, NewsBreak, Telecomweb - USA, 26 March 2008

Well, I guess that waves away all the well-documented steps the FCC took to strip away common carrier status from each facet of Internet provision

You have to register to read the rest at Telecomweb, but PRI has more, including this rather amusing claim:

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:

Internet Freedom Policy Act

Rep. Ed Markey (D-MA) and Rep. Chip Pickering (R-MS) have introduced the Internet Freedom Preservation Act of 2008, which will amend Title I of the Communications Act of 1934 to say Internet freedom, commerce, innovation, participation, and speech are the policy of the United States. It's interesting what this bill does not say. It doesn't specify any regulations, so that those who oppose net neutrality don't have a leg to stand on when they say net neutrality is all about regulation. It doesn't say "net neutrality": it says "freedom", "marketplace", "innovation", and other positive benefits. (I think I'll take a cue from Commissioner Copps and start referring to Internet freedom.) It doesn't say "consumers" except a few times, including once where that word is immediately qualified by

(i) access, use, send, receive, or offer lawful content, applications, or services over broadband networks, including the Internet;

Let's see, if "consumers" can send their own content, applications, and service, they're not really consumers in the traditional sense, now are they?

This is all very nice, in that Markey and Pickering apparently get it about what Internet freedom is about. However, why does this bill have no teeth, unlike Markey's bill of last year or the Snowe-Durgan bill before that?

Shades of NSFNet: EDUCAUSE Proposes 100Mbps Nationwide Broadband

Shades of NSF:

EDUCAUSE, the association whose mission is to advance higher education by promoting the intelligent use of information technology, today proposed bringing the federal government, state governments, and the private sector together as part of a new approach to making high-speed Internet services available across the country.

The group, whose membership includes information technology officials from more than 2,200 colleges, universities, and other educational organizations, said that a new "universal broadband fund" would be necessary so that "Big Broadband" — services of 100 mbps — could be made widely available.

— EDUCAUSE Proposes New Approach to Broadband Development, Wendy Wigen, Peter B. Deblois, EDUCAUSE, 29 Jan 2008

Back in the 1980s, in the time of standalone dialup Bulletin Board Systems (BBSes), the National Science Foundation (NSF) deployed a nationwide backbone network called NSFNet that eventually ran at the blazing fast for the times speed of 1.55Mbps. NSF also promoted development of NSFNet regional networks, many of which eventually figured in the commercialization of Internet that took off in 1991 when former dialup network UUNET started selling Internet connectivity and former personnel of an NSFNet regional formed PSINet and also started selling Internet connectivity.

Nowadays, when the fastest most people can get as so-called broadband is 1-3Mbps DSL from telcos or maybe 3-5Mbps from cablecos, maybe it's time to do it again. Is this a plan that would work?

Canadian Net Neutrality

In Canada, an ISP has even gotten up to blocking striking employees' website:

During the Telus strike in 2005, the corporation blocked access to a website run by striking Telus employees called “Voices for Change” (and at least 766 other websites). Those familiar with network-control issues in Canada also accuse Rogers and Bell of limiting peer-to-peer (P2P) applications, which people use to share audio, video and other digital data with one another. So, here we have ISPs blocking or at least limiting the use of what is likely the most innovative, creative and participatory use of the Internet. In response to customer concerns, Bell recently admitted that they “are now using Internet Traffic Management to restrict accounts that are using a large portion of bandwidth during peak hours. Some of the applications that are included are the following: BitTorrent, Gnutella, LimeWire, Kazaa….”

— The Fight for the Open Internet, Steve Anderson, Canadian Dimension magazine, January/February 2008 issue

The rest sounds very familiar:

AT&T Filtering: Has Tim Wu Not Been Paying Attention?

Katharine Graham by Diana Walker

Tim Wu asks in Slate: Has AT&T Lost Its Mind? It seems he's discovered that:

Chances are that as you read this article, it is passing over part of AT&T's network. That matters, because last week AT&T announced that it is seriously considering plans to examine all the traffic it carries for potential violations of U.S. intellectual property laws. The prospect of AT&T, already accused of spying on our telephone calls, now scanning every e-mail and download for outlawed content is way too totalitarian for my tastes. But the bizarre twist is that the proposal is such a bad idea that it would be not just a disservice to the public but probably a disaster for AT&T itself. If I were a shareholder, I'd want to know one thing: Has AT&T, after 122 years in business, simply lost its mind?

No one knows exactly what AT&T is proposing to build. But if the company means what it says, we're looking at the beginnings of a private police state. That may sound like hyperbole, but what else do you call a system designed to monitor millions of people's Internet consumption? That's not just Orwellian; that's Orwell.

— Has AT&T Lost Its Mind?A baffling proposal to filter the Internet. By Tim Wu, Slate, Posted Wednesday, Jan. 16, 2008, at 10:15 AM ET

Come now; what did you think they were up to?

Principles: the FCC's Don't Mean Squat --Cleland

Duopoly apologist Scott Cleland spells out what everybody should have already known:

The petitions assume that the FCC's policy of network neutrality principles have the legal and binding effect of formal FCC rules or law and that they trump all existing law and rules. This is preposterous.

— The Common Sense Case Why Network Management Trumps Net Neutrality, Scott Cleland, Precursor Blog, 15 Jan 2008

Indeed, it is preposterous to think that the FCC ever meant to enforce its net neutrality "Policy Statement" of August 2005. Even if it did, the very way the four "principles" in that statement are worded, every one in terms of consumers, excludes the very existence of participatory services such as BitTorrent.

Cleland's blog goes to great lengths to spell out what he considers common sense (which means he knows he doesn't actually have a legal argument). Don't be surprised if his items get parrotted by other anti-Internet-freedom blogs. And don't be surprised if the FCC rules in favor of Comcast, even though any competent network engineer can tell you that there are ways to do network management that don't involve faking reset packets, a technique that would be considered malicious denial of service if it came from any entity other than an ISP, not to mention Comcast's BitTorrent stifling seems closer to the fraudulent promise of unlimited service that got Verizon fined by New York State.

[Clarified:] It's not about network management. It's about a few corporations and their political allies trying to stifle net neutrality and Internet freedom against the best interests of everyone else, including their own customers.

-jsq

Duopoly Helping Net Neutrality: By Obviously Subverting It

With enemies like these...

Until recently, net neutrality was a difficult issue to explain at a dinner party. It was even more of a struggle to get anybody worked up about it. Now, thanks to the major Internet service providers (ISPs) Comcast and Bell-Sympatico, the stakes are crystal clear and the acrid scent of a smoking gun hangs in the room.

— How the Grinches Stole 'Net Neutrality' Internet service providers play favourites with video, large files and political sites. By Wayne MacPhail, the Tyee, Published: December 27, 2007

...it may seem we don't even need friends, but we do.

A pretty good pro-net neutrality writeup follows. This is the gist:

Is it in the carriers' best interest to allow upstart cheap phone companies like Skype or Vonage to suck up bandwidth with its inexpensive and excellent service? Nope, but in a free market and a neutral Internet, upstarts happen. The traditional players just don't like it much and want the nonsense to stop.

You want upstarts? You want net neutrality.

That plus the duopoly wants to control content:

Censored News 2007

As usual, net neutrality was the top censored news story of 2007:

Throughout 2005 and 2006, a large underground debate raged regarding the future of the Internet. More recently referred to as “network neutrality,” the issue has become a tug of war with cable companies on the one hand and consumers and Internet service providers on the other. Yet despite important legislative proposals and Supreme Court decisions throughout 2005, the issue was almost completely ignored in the headlines until 2006.1 And, except for occasional coverage on CNBC’s Kudlow & Kramer, mainstream television remains hands-off to this day (June 2006).2

Most coverage of the issue framed it as an argument over regulation—but the term “regulation” in this case is somewhat misleading. Groups advocating for “net neutrality” are not promoting regulation of internet content. What they want is a legal mandate forcing cable companies to allow internet service providers (ISPs) free access to their cable lines (called a “common carriage” agreement). This was the model used for dial-up internet, and it is the way content providers want to keep it. They also want to make sure that cable companies cannot screen or interrupt internet content without a court order.

— #1 Future of Internet Debate Ignored by Media, Top 25 Censored news stories of 2007 Project Censored, The News That Didn't Make The News Sonoma State University, 2007

This is the first I've heard that "Internet service providers" other than cable companies are on the side of consumers. Doubtless AT&T will be gratified to hear that version. Oh, wait: later the same writeup refers to "cable supporters like the AT&T-sponsored Hands Off the Internet website." Also, what's this about free access?

Consolidation Flood: What Will Really Stifle Internet Innovation

Advocates of the "exabyte flood" political campaign against net neutrality claim they are for innovation and that the coming flood of Internet usage will stifle innovation unless they get their way.

What will really stifle innovation on the Internet is this:

The Federal Communications Commission, at the urging of Chair Kevin Martin, voted 3-2 on Tuesday to relax longstanding rules that block corporations from owning a broadcast TV station and a newspaper in the same city.

— Uproar Over FCC Vote on Media-Ownership Rules, By Frederick Lane, Top Tech News, December 19, 2007 10:14AM

No, not specifically newspaper and television consolidation. Further consolidation of media and information distribution in the hands of a tiny number of companies. This December the FCC lets newspapers and TV stations consolidate. Last December it let SBC buy Bellsouth. Internet access is already in the hands of a tiny number of companies (typically at most two in any given area) that are increasingly moving to control the information they carry on behalf of a small number of companies including themselves and movie and music content producers.

The exaflood politics isn't really about how much infrastructure the duopoly has to build out. It's about maintaining the duopoly and extending its control of information, to the duopoly's short-term profit and the long-term detriment of of us all, including the duopoly.

-jsq

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

Decreasing Competition: Teletruth Documents FCC Harm to Wireline

Here are the main points:

• 56% Drop in Competitive Local Exchange Carrier Lines: Loss of 10 Million Competitive Lines Since 2004 -- and Falling.
• Lack of Competitive Choices Led to Massive Local and Long Distance Price Increases; Billions in Investor Losses.
• FCC's Deregulation Picked Winners and Losers -- The Duopoly -- Creating Economic Harms to Wireline-Competition, Favoring Cable Companies.

...

DROP 10,330,000 lines -56%

Only 7.1% competitive lines.

— Part One: Harm to Wireline Competition: Harm to Customers and Investors. TeleTruth, 15 November 2007

Many details are in the report. The bottom line is that there is no effective competition in wireline POTS in the U.S.

-jsq

Pirates of the Duopoly: AT&T Plans Anti-Piracy Content-Recognition

Yo ho:

Remember YouTube's content filtering system? AT&T is mulling setting one up across its whole network. BusinessWeek's reporting AT&T's in talks with NBC Universal and Disney to possibly use content-recognition tech developed by Vobile—a company they've all invested in—to block pirated material from being sent to and fro along its network.

— tips@gizmodo.com Net Neuterality: AT&T Considering Scary, Content-Recognizing Anti-Piracy Filter for Entire Network, Gizmodo, by Matt Buchanan, 8 Nov 2007

Perhaps Disney, NBC, and AT&T have forgotten that Disney has made pirates very popular.

Meanwhile, it's one thing for YouTube to do content filtering. It's quite another for AT&T, as one of the duopoly of Internet access in most of the U.S., to do the same. You know, the same AT&T that censored Pearl Jam and other bands for expressing political views.

I wonder how big a backlash there will be when AT&T's customers discover more false positives than fingerprints?

-jsq

Net Neutrality Won't be Fixed by Anti-Trust: B. Cherry

At TPRC Sunday, Barbara Cherry walked through the evolution of bodies of law in the U.S., and made some fascinating observations, including:

• Net neutrality is a manifestation of moving from a Title II industry-specific business legal regime under the Communications Act of 1934 to a Title II-based regime and greater reliance on a general business regime of antitrust and consumer protection laws, as the FCC did in August 2005 for wireline broadband access service to the Internet and in 2002 for cable modem access service.
• Simply mMoving among traditional and deregulatory legal regimes for transportation carriers does did not strip common carriage status; it merely changesd the legal overlay that enforcesd it.
• FCC stripping broadband of common carriage was a radical departure: nothing classified as common carrier has ever been declassified before.
• Anti-trust doesn't automatically cover problems from previously addressed in the Title II industry-specific regime when a business is moved to the Title II general business regime. Anti-trust needs modification to do this.
• Liability is also different between regimes. Without tariffs some legal protections for limited liability constraints are gone, and common carriers are now potentially fully liable for damages. The final filed rate doctrine should have no applicability to a detariffed world.

The above is, I think, a reasonably close paraphrase of some of her points.

I infer from this that the economists and politicians and telco and cableco executives who say that we shouldn't regulate because we don't know what will happen and anti-trust will catch problems if they occur are not taking into account that anti-trust doesn't automatically apply to or address problems in the new legal regime into which broadband has been thrust.

In other words, people see things in the context of what they know, and economists don't usually know about legal evolution.

Telco and cableco executives, on the other hand, may well have business and political reasons for claiming there's no need for regulation, whether or not they know that existing anti-trust law is inadequate. doesn't apply.

You can't have markets without some form of property rights of contract law. There is also basic legal infrastructure you need for communication infrastructure.

I see little or no understanding of these points in FCC, FTC, or Congress.

Prof. Cherry's whole paper is well worth reading: Consumer Sovereignty: Redrawing the Boundaries Between Industry-Specific and General Business Legal Regimes for Telecommunications and Broadband Access Services, by Barbara A. Cherry, TPRC, 30 Sep 2007

-jsq

PS: Markup for increased accuracy kindly supplied by Prof. Cherry.

Why Amazon Won't Get Its Own Channel: Amazon MP3 Without DRM

Amazon has started a DRM-free music store:

Every song and album on Amazon MP3 is available exclusively in the MP3 format without digital rights management (DRM) software. This means that Amazon MP3 customers are free to enjoy their music downloads using any hardware device, including PCs, Macs™, iPods™, Zunes™, Zens™, iPhones™, RAZRs™, and BlackBerrys™; organize their music using any music management application such as iTunes™ or Windows Media Player™; and burn songs to CDs.

— Amazon.com Launches Public Beta of Amazon MP3, a Digital Music Store Offering Customers Earth’s Biggest Selection of a la Carte DRM-Free MP3 Music Downloads, Amazon.com, BusinessWire, 25 Sep 2007

Interesting how they didn't mention Linux or Unix or any other free software platform.

Still, this is probably enough to keep Amazon from getting its own channel on the telco and cableco-planned closed Internet.

PS: Seen on BoingBoing.