Telecom Sense

A Good Question, A Direct Answer, and . . . Mayhem Ensues

Confusing, huh?  Sounds like a movie idea . . . for a really bad movie; but that's what happened recently with an AT&T filing in response to the 25th Public Notice in the National Broadband Plan proceeding.  The Commission asked for public comments on a very important, and very forward-thinking topic: how should the Commission plan for the inexorable obsolescence of the Public Switched Telephone Network ("PSTN").  

The simple fact of the matter is that, due to broadband availability and adoption patterns, increasing availability of mobile VoIP apps, and (morbidly) the dying off of PSTN customers--and the fact that younger customers, with broadband access, are opting for VoIP solutions.  Fortunately, the Commission acted on its own data, and recognized that the costs of the PSTN are being born by a smaller, and smaller group of consumers all the time, and the consumers that lack VoIP as an alternative (because they have not adopted broadband) are those least able to afford these increasing costs--the less-educated, the poor, the elderly, and minorities.  (See, p. 82). The Commission is to be applauded for recognizing a trend, and trying to plan in advance in order to avoid a potentially disastrous crisis in advance.

Among those filing comments in this proceeding, AT&T recognized the problem was as grave as the Commission suspected, and they responded to the Commission's request for comments with all the gravity with which the Commission solicited the comments.  Critics may call AT&T's comments melodramatic, but, judging from the attention they received (even if it was misplaced), I'd say AT&T did a good job of calling public attention to the Commission's very timely concern.  AT&T's policy blog explains their position a lot more succinctly than I could, and the posts contain good links to AT&T's actual comments.  If readers are interested, I would strongly encourage them to read these two posts--the first, and the second.

Bottom line: AT&T isn't seeking to turn off the PSTN, so there's no need for panic.  Hysteria isn't good, but (this time) it can have a good outcome if it brings more awareness to an urgent problem--the need for the Commission to reform USF contributions and distributions, and Intercarrier Compensation Reform, before the network becomes a network for broadband "haves, and have-nots."

A House Divided? The Broadband Plan vs. Net Neutrality

[Note: Yesterday, the Department of Justice, Antitrust Division ("DoJ") filed an ex parte presentation in the National Broadband Plan proceeding, which focused on ways to increase the number of broadband service offerings and broadband competitors.  Most public attention has been focused on the DoJ's spectrum recommendations, which are largely designed to promote further spectrum availability.  One controversial recommendation, which was heavily caveated by the Department, was that there may be situations where the highest bidder for spectrum may not provide the most valuable use for the spectrum.  In other words, in an auction model for scarce, but essential, inputs, the hypothetical monopolist is always willing to pay the highest price in order to keep supply off the market.  The facts that would support such a theory as a basis for foreclosing carriers from spectrum auctions are not present now, or even imminent.  For example, the largest spectrum holder in the country is a new entrant, Clearwire, and the biggest "winner" in the 700 MHz auction--Verizon--spent almost $10 billion on spectrum that it knew would be subject to an "open access" requirement. Therefore, given the attention that this one aspect of the DoJ filing has attracted, this post will not discuss the Department's spectrum recommendations.]

For a long time, opponents of "Net Neutrality" (however they chose to interpret the concept at the time) have argued that, conceptually, Net Neutrality was at odds with the national policy goal of increasing broadband deployment and penetration.  The typical argument against Net Neutrality was as general, and loosely-defined, as the concept of Net Neutrality.  A good example of the Net-Neutrality-Broadband Policy tradeoff is this 2004 paper by Professor Christopher Yoo for the Progress and Freedom Foundation.   This is old news, and not surprising coming from a pro-business group like PFF.  So, why bring up an old argument?

Well, because "Net Neutrality" is no longer an amorphous, generalized, mean-what-you-want-it-to-mean, concept.  No, the FCC has now given Net Neutrality a very specific meaning in its NPRM and proposed rules.   This is what makes yesterday's ex parte filing by the Antitrust Division of the Department of Justice ("the DoJ") in the FCC's Broadband Plan proceeding so interesting. The DoJ's ex parte is interesting for several reasons, but the main one is that it highlights the tension between the goals of the Broadband Plan (as seen through the "consumer welfare" eyes of the DoJ) and the policy and proposed rules set forth in the Net Neutrality NPRM. 


Continue reading A House Divided? The Broadband Plan vs. Net Neutrality

Net Neutrality: What's So Funny . . .

As I walk through
This wicked world
Searchin' for light in the darkness of insanity.

I ask myself
Is all hope lost?
Is there only pain and hatred, and misery?

And each time I feel like this inside,
There's one thing I wanna know:
What's so funny 'bout peace love & understanding?  --Elvis Costello

It's a new year, and I wanted to start on a positive note.  While this (unfortunately) won't be my last post on Net Neutrality, it is the last in the series of posts about the Net Neutrality NPRM that I outlined in the first paragraph of my first Net Neutrality post back on November 19, 2009.  

If you read enough of the advocacy pieces from the opposing sides of the Net Neutrality debate, it's tempting to think that this is some kind of religious war that offers no hope for anything but "pain and hatred, and misery."  On the other hand, if you step back for a minute and just look at what the Commission claims it wants to achieve, as a policy matter in the NPRM (at ¶ 10), it doesn't seem that impossible:

we seek to . . . identify the best means to achieve our goal of preserving and promoting the open Internet. We seek to do so in a manner that will protect the legitimate needs of consumers, broadband service providers, entrepreneurs, investors, and businesses of all sizes that make use of the Internet.

If you want to take it a step further, you might just think, "what's so funny 'bout peace, love, and understanding?"  Although I've pointed out that the substantive part of the NPRM, and the proposed rules it's designed to justify, doesn't show a lot of understanding, I didn't go quite so far as to call it the "darkness of insanity."  But, so what if the NPRM wasn't perfectly on point?  Isn't a greater understanding by the Commission exactly what "Notice and Comment" proceedings are supposed to promote?  The same Commission that wrote the terribly uniformed NPRM, might be a significantly more educated Commission after Comments, Replies, presentations, hearings, and whatever else the FCC has in store for the development of this proceeding.

Let's stay optimistic, and keep on the "peace, love, and understanding" theme.  The FCC's stated goal of preserving and promoting the open Internet--that exists now--and accomplishing the goal with a minimum amount of artificial disruption in the way current and future Internet stakeholders use the Internet is laudable.  Fortunately, the Commission's goal can be accomplished with much more minor, and less complicated, rules than those it initially proposed.  Please note, though, that, in order to be effective, these rules would have to apply to every service provider that contributes to the customer's Internet experience.  Let's look at some alternatives.


Continue reading Net Neutrality: What's So Funny . . .