Net Neutrality Fans Rejoice: The FCC Will Reclassify Broadband
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gigaom.com
offering of telecommunications for a fee directly to the public, or to such classes of users as to be effectively available directly to the public, regardless of the facilities used.
and an "information service" is:
the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications, and includes electronic publishing, but does not include any use of any such capability for the management, control, or operation of a telecommunications system or the management of a telecommunications service.
a telecommunication service sells the ability to use the coaxial cables. an information service is responsible for everything beyond that. the loophole is when an ISP is considered both, in which case they can't be regulated the way they were meant to be. so comcast, for example, is really a telecomm service, but enjoys the advantages of an information service (a small ISP called Brand X started this whole thing by saying ISPs should be considered both, and that's when the network neutrality debate heated up in 2003).
when ISPs are classified as both "information services" and "telecommunications services," they cannot be regulated the same way and the fcc can't do much when they do stuff like deep packet inspection/injection, port blocking, price discrimination, double dipping, etc.
my personal opinion on the topic has always been this: comcast and other telecomms own the cables in the ground. they are simply moving bits from point A to point B, but they can never manipulate any of those bits. they should never charge you more money to access your bits from youtube, for example. and they should never slow those bits down, for example, if you're using a non-comcast application (whether it's youtube, itunes, google search, bittorrent, or whatever).
My argument: Comcast operates as basically a public utility. They don't completely own those cables. They dug them in public right of ways with a lot of help and subsidies from all levels of government. The people have a legitimate claim to ownership, and thus they have a legitimate claim to not be screwed by Comcast. They're abusing what is effectively a monopoly and should be regulated as such.
Look how the effect of the previous attempt at government control/regulation (1996 Telecommunications Act) led to rapid consolidation of the ISP industry such that most users have only the choice for highspeed between DSL from the incumbent phone company or cable modem from the cable company.
Further, in spite of Comcast's costs for bandwidth, etc. dropping in the last 5 years, my price for their service has stayed the same or gone up (most would consider that evidence of there not being any competition).
If you're gonna do it, FCC, do it the right way.
The Supreme Court nearly said as much in 2005 in the Brand X case: they ruled in favor of the FCC's classification, but essentially only on the grounds that it was plausible enough that under existing agency-deference doctrine it could stand, even if wrong, as long as it wasn't totally insane. And even that only got a 6-3 vote, with 3 members of the court thinking the classification was so plainly erroneous that it shouldn't survive even a deferential review. And one of the six who did vote to give its rule deference, Breyer, admitted it might be "just barely" plausible enough to pass. (And it wasn't even some sort of pro-regulation liberals who dissented; Scalia wrote the dissent, on the grounds that the FCC's decision was simply plainly wrong, by the text of the statute.)
So it seems overall we've at least gotten to a more plausible interpretation of the statute, which should've been the one the FCC adopted initially.
FCC says: we'll grant ourselves the authority by bureaucratic fiat!
No committee of 5 partisan appointees -- guaranteed by formula to be 3 members of the president's party, and 2 from the opposition party -- should have this much power over something as fundamental as "communication".
Would we let the FCC reclassify printing presses as a "transport service", and thus subject to their regulations about ownership, subsidized access, suitable proportion of "public interest" content, and naughty words?
Do we want the internet to be as diverse as unregulated books and magazines, or as pandering to the-powers-that-be as FCC-regulated broadcast TV?
Imagine Facebook as an ISP.
Shiver.
Imagine how HTML6 adoption will be blocked because the FCC will want to get its burocratic oomph into a spec that requires webmasters to specify whether a site is G, PG, PG13, NC17, etc.
Just google for Michael Powell quotes and you'll see that the FCC should be feared.
Regulations try to get a more optimum combination of costs and features given current conditions, but often what they do is prevent alternatives from developing.
to go one step further, telecomms will sue any municipality that tries to install their own fiber optics network as if it were a public utility. even if an entire city supports it and is willing to pay for it, telecomms will ensure that it can't happen, as was the case with monticello.
there are cases where regulation is necessary to prevent an oligopoly and encourage competition. right now, the tables are tipped favorably (imo unfairly) for the telecomms.
When I think of the free market, I don't mean the present situation. This is not a free market. Cities set up exclusive contracts with cable providers like comcast.
In a free market, people would be banding together to negotiate for better terms and to lower infrastructure costs, but not at a city-wide level where they are frozen into the solution negotiated by grafty politicians.
I don't pretend to know how a truly non-coercive free market would play out, but I imagine condo home owner associations being able to choose from a variety of options.
They already do so for other services and would probably do the same for utilities if we didn't have the current system of regulated monopolies.
In a truly free market, the type of suits you refer to wouldn't work. Municipalities wouldn't even be involved.
We can add more coercion to the system, but I think undoing the coercion we already have is a better long term approach. Of course, its not often easy to see that path, especially when it looks so politically impossible.
They are willing to do this because every home has 10+ services on offer and switching is trivial. That has happened because of regulation of the physical infrastructure.
When it comes to natural monopolies if you want a functioning market you have to make one through regulation. I think the UK approach of regulating how the infrastructure is shared is better than the US one of regulating the resulting monopolies but if you do nothing at all then you will end up with $90/mo connections that can do nothing but display disney.com
How can you say that when so much of the rural U.K. is without any broadband? When the rest of the small community that has the/a home of a top dog of BT? only gets broadband when they notice he's the only one who has it? When a tax makes it particularly expensive to get the feeder line out to a community?
If you want easy access to the countryside and all of the nice things it offers then you can't be surprised to find out that there are some drawbacks to making that choice. It's unreasonable to expect people who live in high density environments to subsidize your Internet access.
But that has nothing to do with competition - once BT does enable the exchange all the competing broadband services will be available. You won't be at the mercy of them being able to charge any price they like just because they built the infrastructure, and in a remote location that's even more important than it is in London where building a second competing telecoms network might be profitable.
Owning the last mile will make it a lot easier to strike a good deal utilities and the rationale for monopolies collapses.
Voluntary cooperation leads to more power for the individual than coerced aggregation, which just gives it to those who get control and whoever who buys them off.