[Air-l] net neutrality

Heidelberg, Chris Chris.Heidelberg at ssa.gov
Thu Apr 27 11:38:53 PDT 2006


There is definitely an international impact with the potential passage
of COPE of 2006. The telecommunications and cable companies will have
the power to punish and reward content providers through pricing. This
is one way to prevent foreign competition on their marketplace. In
effect, the telecommunications and cable companies would have the
ability to place a toll on content providers such as Google, Yahoo,
Amazon, Ebay, Microsoft, Apple and other content providers. The result
would be that these companies would pass the costs directly to the
consumer in form of "premium content" or some
Other euphemistic term that disguised its true nature. Oh, but there is
more. The telecom and cable companies could also have the ability to
charge a rich medium access charge similar to how cable television
charges you additionally for premium channels and pay per view for those
of us who want things on demand on our portable handhelds. Handhelds
like Blackberry's, pocketPCs and iPods may find themselves paying a
handheld device fee whereas handhelds marketed by Verizon and AT&T may
initially have this fee waived or have a plan that hides this waiver.
This is a competitive advantage that the telecom and cable firms have
over everyone and the prices will impact international consumers as
prices rise. Here is some food for thought: What will happen in two to
three years when the power companies are seriously ready to enter the
Internet services game and satellite firms discover how to truly exploit
wireless connectivity?  Yes colleagues, prices are going up because the
telecom and cable companies have built expensive fiber optic networks to
handle the rich media content like video, gaming and VOIP and now Wall
Street wants its profits from these expensive investments. So the K
Street warriors have started handing outs campaign contributions and
other inducements on the Hill to get this law passed in the name of
consumer choice, affordable access and more competition. The reality is
that there is no true choice and access will not be affordable and there
will be less competition. The Center for Public Integrity actually has a
really good book on the history of lobbying and the telecom industry.
The real villain here is not the telecom and cable companies as much as
it is the Congress and the policy makers who are too busy getting money
and promises for their next job to worry about being stewards for the
people. The people are simply outgunned and outmanned by the companies
which are allowed under the First Amendment to lobby heavily as a result
of the Virginia Pharmacy and Bellotti cases in 1976. Before that time,
corporations were seen by the courts as a creature created by the law
and not possessing rights more powerful than the individual. The
international impact could also transform into more international anger
with America by countries such as France and now Denmark with American
companies like Microsoft and Apple that have used their market
superiority to create both competitive advantages and stifle
competition. Read Bagdikian's media monopoly and any of Lawrence
Lessig's books such as Code.

-----Original Message-----
From: air-l-bounces at listserv.aoir.org
[mailto:air-l-bounces at listserv.aoir.org] On Behalf Of Janna Anderson
Sent: Thursday, April 27, 2006 11:39 AM
To: air-l at listserv.aoir.org
Subject: Re: [Air-l] net neutrality

April 26, 2006
Net Neutrality Debate Heats Up
By Roy Mark/JupiterMedia's Internetnews.com
 
WASHINGTON - Looking at possible antitrust implications of having
telecoms and cable companies controlling 99 percent of U.S. broadband
connections, a special task force of the House Judiciary Committee took
up network neutrality. 

Like other committees that have heard testimony on network neutrality,
the Judiciary panel heard conflicting interpretations on whether
legislation is needed to ward off discrimination by broadband providers.

Verizon and AT&T have publicly stated they intend to charge content
providers different fees based on bandwidth consumption to access
consumers, but will not block, degrade or impair delivery of the content
to consumers.
Tech companies and a growing coalition of consumer groups contend the
plan amounts to discrimination since those who can pay the broadband
providers'
rates will have a competitive advantage over those who can't.

"All sides of the net neutrality debate agree that consumers should be
control of their Internet experience," Walter McCormick of the U.S.
Telecom Association said. "Where we differ is on whether consumers alone
should foot the bill for the advanced networks that drive the Internet's
growth and evolution." 

McCormick said Internet content providers seeking to profit on new
high-speed fiber networks should not expect a free pass on all costs
associated with the increased bandwidth capacity to deliver services and
applications. 

"If you want more, then you pay more, is as American as it comes," he
said.
"It is a straightforward market proposition. As companies move into live
video and gaming and advanced services, they will be seeking more
bandwidth." 

Columbia University Professor Tim Wu spun it another way.

"It's as if the electric company one day announced that refrigerators
made by General Electric would henceforth not work quite as well as
those made by Samsung," Wu said. "That would be a shock, because when it
comes to the electric grid and the Internet, people are used to a
network that they are free to use as they wish."

Wu said the issue of network neutrality is really an issue about market
power concentration.

"Whatever AT&T and others may claim as motives, the potential for abuse
of market power is obvious to everyone," he said. "Ninety-four percent
of Americans have either zero, one or two choices for broadband access.
Many of us wish things were otherwise, but they are not."

Given the concentration of market power between the telcos and the cable
companies, Wu said it was clear AT&T, Verizon, Comcast and other power
players coiuld make more money by distorting competition between
Internet firms. 

"It [AT&T] can, through implicit threats of degradation, extract a kind
of protection money for those with the resources to pay up," Wu said.
"It's basically the Tony Soprano model of networking, and while it makes
sense for whoever is in a position to make threats, it isn't
particularly good for the nation's economy, innovation or consumer
welfare."

The House Judiciary debate came on the eve of a vote in the House
Commerce Committee on the Communications Opportunity, Promotion and
Efficiency Act of
2006 (COPE). 

The centerpiece of COPE is national video franchising for IPTV providers
such as Verizon and AT&T. With the goal of increasing competition in the
pay television market, the proposal enjoys wide support on both sides of
the aisle. 

More controversial is network neutrality.

Republicans see little problem with the tiered access approach proposed
by the telecoms and leave enforcement of network neutrality violations
to the Federal Communications Commission (FCC).

Democrats and a growing coalition of tech companies and consumer groups,
want the FCC's network neutrality principles, which have no force of
law, turned into statutory law. Rep. Ed Markey (D-Mass.) is expected to
propose an amendment to COPE to do just that.

A similar proposal three weeks ago was handily defeated by the
Republicans, 23-8. 



On 4/27/06 11:33 AM, "Nancy Baym" <nbaym at ku.edu> wrote:

> Can someone with greater expertise than mine offer a quick primer on 
> the net neutrality debate and bills now before the US congress/senate,

> including how, if at all, it would have ramifications outside the US? 
> I know there are many people on here who pay a lot of attention to 
> these kinds of issues, and I would really like to hear what you see 
> going on here,
> 
> Thanks,
> Nancy
> _______________________________________________
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--
Janna Quitney Anderson
Assistant Professor of Communications
Director of Internet Projects
School of Communications
Elon University
andersj at elon.edu
(336) 278-5733 (o)
(336) 446-0486 (h)

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