The FCCs net-neutrality plan
Wheeler dealing
May 15th 2014
ONE thing was certain when Tom Wheeler, a former cable-industry lobbyist who now chairs the Federal Communications Commission (FCC), formally unveiled his proposal for an open internet at a public meeting on May 15th: few people would like it. Protesters have been camped outside the FCCs Washington, DC digs for days, claiming that Mr Wheeler was out to destroy net neutralitythe idea that all digital traffic should be treated equally by internet service providers (ISPs). Protests have been organised around the country to save the internet. Almost 2m people have signed petitions. Millions of bytes have been crafted into words that are anything but neutral about Mr Wheelers net intentions (some by this publication). Scores of technology firms, several senators and even two of the FCCs five commissioners have already made their displeasure known. Republican senator Ted Cruz is circulating draft legislation that would strip the FCC of any internet authority.
At the heart of the disquiet is Mr Wheelers plan to allow ISPsa business dominated by giants such as Verizon and potential mergees Comcast and Time Warner Cableto do deals with content providers such as Netflix, Amazon and Google for priority transmission of films, videos and other streaming services over the congested last mile to users. That, say supporters of net neutrality, would create a two-tier internet: a high-speed digital toll-road for big content providers with the dollars and market power to make their customers pay, and a digital dirt-road for everyone else.
Ahead of todays meeting, Mr Wheeler has been scrambling to offer assurances that deals between big ISPs and content providers would be carefully scrutinised to ensure that individuals and less-wealthy content companies dont live their lives in the internet slow lane. He says he will appoint an ombudsman with significant enforcement authority whose role will be to ensure that everyone receives fast and robust internet service. Mr Wheeler says he also wants to consider reclassifying broadband as a public utility under Title II (or other parts) of the 1996 Telecommunications Actnot a great idea unless you want tomorrows internet to be governed by rules written for wireline telephone services. He says he will also look at proposals from Tim Wu, a Columbia Law School professor who coined the term net neutrality, the Mozilla Foundation and others that would essentially apply Title II only to the interplay between ISPs and content providers.
None of this will solve American broadbands most pressing problem: a near-total lack of competition. More than three-quarters of households have no choice but to use their local cable monopoly for internet access. They also pay more for it than people in other rich countries, and get slower speeds in return. The ISPs claim they are boosting investment to improve the situation; in truth, the National Cable and Telecommunications Associations own data show that annual infrastructure investment has never regained its $16 billion 2001 peak. On the content side, Americans are faced with quasi-monopolistic pricing power. If you want to watch a box-office hit on demand, your choice is essentially your ISPs own content service, Amazon or Netflixwhich by itself now accounts for a third of Americas peak internet traffic. Those content providers, along with other big technology firms, already use services that help to prioritise their traffic. In other words, the net is already far from neutral.
So what of todays meeting? After some initial disruption by protestors, Mr Wheeler and his four fellow commissioners each discussed his proposals. None of the four were wholeheartedly supportive. Mignon Clyburn, a Democratic commissioner, said she would prohibit paid prioritisation, and noted that even her mother was concerned. Jessica Rosenworcel, another Democrat, declared we cannot have a two-tiered internet and noted that she had wanted to postpone todays vote. Republicans Michael ORielly and Ajit Pai damned the entire proposal, with Mr ORielly calling it a regulatory boondoggle and Mr Pai saying the FCC should cede its internet authority to Congress. Mr Wheeler reiterated that any prioritisation deals that deprived people of the internet service they paid for would be prohibited, and stressed his support for an open internet so many times that this writer, for one, felt he doth protest way too much. The proposal passed by three to two, along party lines (Mr Wheeler is a Democrat).
Interested partiesthat would be every American who uses the internetnow have 120 days to make their thoughts known to the FCC, after which a doubtless slightly modified proposal will be voted on again. And then, in all likelihood, there will be another protracted court battle.
Wheeler dealing
May 15th 2014
ONE thing was certain when Tom Wheeler, a former cable-industry lobbyist who now chairs the Federal Communications Commission (FCC), formally unveiled his proposal for an open internet at a public meeting on May 15th: few people would like it. Protesters have been camped outside the FCCs Washington, DC digs for days, claiming that Mr Wheeler was out to destroy net neutralitythe idea that all digital traffic should be treated equally by internet service providers (ISPs). Protests have been organised around the country to save the internet. Almost 2m people have signed petitions. Millions of bytes have been crafted into words that are anything but neutral about Mr Wheelers net intentions (some by this publication). Scores of technology firms, several senators and even two of the FCCs five commissioners have already made their displeasure known. Republican senator Ted Cruz is circulating draft legislation that would strip the FCC of any internet authority.
At the heart of the disquiet is Mr Wheelers plan to allow ISPsa business dominated by giants such as Verizon and potential mergees Comcast and Time Warner Cableto do deals with content providers such as Netflix, Amazon and Google for priority transmission of films, videos and other streaming services over the congested last mile to users. That, say supporters of net neutrality, would create a two-tier internet: a high-speed digital toll-road for big content providers with the dollars and market power to make their customers pay, and a digital dirt-road for everyone else.
Ahead of todays meeting, Mr Wheeler has been scrambling to offer assurances that deals between big ISPs and content providers would be carefully scrutinised to ensure that individuals and less-wealthy content companies dont live their lives in the internet slow lane. He says he will appoint an ombudsman with significant enforcement authority whose role will be to ensure that everyone receives fast and robust internet service. Mr Wheeler says he also wants to consider reclassifying broadband as a public utility under Title II (or other parts) of the 1996 Telecommunications Actnot a great idea unless you want tomorrows internet to be governed by rules written for wireline telephone services. He says he will also look at proposals from Tim Wu, a Columbia Law School professor who coined the term net neutrality, the Mozilla Foundation and others that would essentially apply Title II only to the interplay between ISPs and content providers.
None of this will solve American broadbands most pressing problem: a near-total lack of competition. More than three-quarters of households have no choice but to use their local cable monopoly for internet access. They also pay more for it than people in other rich countries, and get slower speeds in return. The ISPs claim they are boosting investment to improve the situation; in truth, the National Cable and Telecommunications Associations own data show that annual infrastructure investment has never regained its $16 billion 2001 peak. On the content side, Americans are faced with quasi-monopolistic pricing power. If you want to watch a box-office hit on demand, your choice is essentially your ISPs own content service, Amazon or Netflixwhich by itself now accounts for a third of Americas peak internet traffic. Those content providers, along with other big technology firms, already use services that help to prioritise their traffic. In other words, the net is already far from neutral.
So what of todays meeting? After some initial disruption by protestors, Mr Wheeler and his four fellow commissioners each discussed his proposals. None of the four were wholeheartedly supportive. Mignon Clyburn, a Democratic commissioner, said she would prohibit paid prioritisation, and noted that even her mother was concerned. Jessica Rosenworcel, another Democrat, declared we cannot have a two-tiered internet and noted that she had wanted to postpone todays vote. Republicans Michael ORielly and Ajit Pai damned the entire proposal, with Mr ORielly calling it a regulatory boondoggle and Mr Pai saying the FCC should cede its internet authority to Congress. Mr Wheeler reiterated that any prioritisation deals that deprived people of the internet service they paid for would be prohibited, and stressed his support for an open internet so many times that this writer, for one, felt he doth protest way too much. The proposal passed by three to two, along party lines (Mr Wheeler is a Democrat).
Interested partiesthat would be every American who uses the internetnow have 120 days to make their thoughts known to the FCC, after which a doubtless slightly modified proposal will be voted on again. And then, in all likelihood, there will be another protracted court battle.
