CBIT White Paper: Broadband Transmissions Are Not “Telecommunications”

Posted by | Broadband Internet, Net Neutrality Series, Regulatory State | 3 Comments

lovelily This paper authored by Fred Campbell was filed yesterday at the Federal Communications Commission in General Docket No. 14-28.* The complete paper can be downloaded HERE.

The FCC lacks authority to classify broadband Internet services as “telecommunications services,” because broadband transmissions are not “telecommunications.” The definition of “telecommunications” in 47 U.S.C. § 153(50) distinguishes between (1) plain old telephone services (POTS) that are interconnected with the public switched telephone network (PSTN) and (2) packet switched services that are not interconnected with the PSTN. When determining whether a particular service is subject to common carriage obligations, arguments about the ownership of the underlying network facilities, “gatekeepers,” and innovation are definitionally irrelevant. A transmission is “telecommunications” with in the meaning of 47 U.S.C. § 153(50) only if the transmission is capable of communicating with all circuit switched devices on the PSTN.[1] Read More

Netflix Secretly Holds Subscribers Hostage to Gain Favorable FCC Internet Regulations

Posted by | Broadband Internet | 11 Comments

A stunning revelation is buried in a lengthy Netflix filing at the Federal Communications Commission (FCC): Netflix used its subscribers as pawns in a Machiavellian game of regulatory chess designed to win favorable Internet regulations.

The filing reveals that Netflix knowingly slowed down its video streaming service with the intention of blaming Internet service providers (ISPs). Specifically, Netflix used its relationships with Internet ‘backbone’ providers (e.g., Level 3, Cogent) to deliberately congest their peering links with ISPs, and at the same time, started publishing ‘ISP speed rankings’ to make it appear that ISPs were causing the congestion. It appears that Netflix cynically held its subscribers hostage to reduced service quality in order to pressure the FCC into adopting favorable Internet regulations that would permanently lower Netflix’s costs of doing business.

Netflix’s plan to frame ISPs for sabotaging its service has been surprisingly successful so far. Some subscribers have blamed their ISPs for the service disruptions Netflix itself caused, which prompted the FCC to open an investigation of the Internet backbone market. Now all Netflix needs is for the FCC to adopt new regulations.

This post attempts to shed some light on Netflix’s hostage strategy before it’s too late. After a brief summary of the Internet backbone market, it describes the origins of the strategy and explains how Netflix succeeded in manipulating public opinion. Read More

The FCC Can’t Exempt Netflix from Paying for Interconnection

Posted by | Broadband Internet | 2 Comments

When the Federal Communications Commission (FCC) announced it would investigate the fees Netflix pays Internet services providers, it was careful to avoid any implication that it intended to impose new regulation. At the time, I considered it likely that Netflix’s factual admission against its own interest — that the fees it pays Comcast and Verizon are “too small” to harm consumers — was the primary reason for the FCC disclaimer.

A subsequent review of relevant precedent revealed another powerful reason for the FCC to reject the interconnection rights sought by Netflix: Even if the FCC were to reclassify broadband Internet access as a Title II service while leaving Netflix unregulated, the FCC would lack legal authority to require Internet service providers to interconnect with Netflix at no charge. Read More

Netflix Admits Interconnection Costs “So Small” They Don’t Harm Consumers

Posted by | Broadband Internet, Video | 11 Comments

Federal Communications Commission (FCC) Chairman Tom Wheeler announced last Friday that the agency would investigate whether consumers are being harmed by so-called “interconnection” agreements between Netflix and Internet service providers (ISPs). The Chairman stated that the information is being collected to “find out what is happening”, and that the agency is “not suggesting that any company is at fault.”

Though this disclaimer was likely motivated partly by the recent kerfuffle over the Chairman’s initial net neutrality proposal, he has another reason “to be clear” that the agency is only “collecting information, not regulating”: Netflix has already admitted publicly that “interconnection” fees are “so small” that they don’t affect consumers. Read More

Is the FCC Seeking to Help Internet Consumers or Preserve Its Own Jurisdiction?

Posted by | Broadband Internet, Public Safety | 15 Comments

As the “real-world” continues its inexorable march toward our all-IP future, the FCC remains stuck in the mud fighting the regulatory wars of yesteryear, wielding its traditional weapon of bureaucratic delay to mask its own agenda.

Late last Friday the Technology Transitions Policy Task Force at the Federal Communications Commission (FCC) issued a Public Notice proposing to trial three narrow issues related to the IP transition (the transition of 20th Century telephone systems to the native Internet networks of the 21st Century). Outgoing FCC Chairman Julius Genachowski says these “real-world trials [would] help accelerate the ongoing technology transitions moving us to modern broadband networks.” Though the proposed trials could prove useful, in the “real-world”, the Public Notice is more likely to discourage future investment in Internet infrastructure than to accelerate it. Read More

Don’t Let the Doublespeak Fool You: When CLECs Say “Packet-Mode,” They Mean “Regulate the Internet”

Posted by | Broadband Internet | No Comments

When CLECs say “packet mode,” don’t let the doublespeak fool you. They are asking for heavy-handed economic regulation of the Internet itself, just like many countries at the ITU.

Last week, I wrote about the failure of the CLECs to provide consumers with the additional choices in communications services Congress had envisioned in 1996. I noted that, now that the antiquated telephone network is about to sunset, CLECs must bear responsibility for their own decisions to forgo investment in their own infrastructure and rely on lines leased with temporary government subsidies. The desperation of CLECs to avoid this reality is apparent in their use of doublespeak to conceal their true intent: convincing the FCC to regulate the Internet like plain old telephone service.

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