Category: Law

Finally, nominees for the FCC

Amy Schatz of the WSJ reports that a deal has been struck to move the new nominees into the FCC:

Work has slowed to a crawl at the Federal Communications Commission, since President Barack Obama’s pick to be chairman, Julius Genachowski, is still awaiting Senate confirmation.

But the logjam could be broken soon: Republicans appear to have settled on two people to fill the GOP seats on the five-member board, paving the way for a confirmation hearing in June. Senate Republicans have agreed on former Commerce Department official Meredith Attwell Baker and current FCC Commissioner Robert McDowell, officials close to the process say.

This is good news. McDowell has been the best of the FCC commissioners since his appointment, and allowing him a second term is a very bright move. Uncertainty over McDowell’s future was the cause of the slowdown in confirmation hearings, since these things go forward with the whole slate of nominees. So the new FCC is going to look this this:

Chairman Genachowski, new blood
Dem Copps, old hand
Dem Mignon Clyburn, new blood
Rep McDowell
Rep Meredith Baker, new blood

It’s interesting that Baker and Clyburn are both nepotism candidates, as Clyburn is the daughter of powerful Congressman James Clyburn and Baker is the daughter-in-law of the Bush family’s consigliere, James Baker. That’s not necessarily a bad thing, as the best Chairman of recent times was Colin Powell’s son, and neither of the daughters is particularly unqualified. But if you want to get a laugh out of Blair Levin, the former “sixth commissioner” who wasn’t nominated, tell him you understand that he’s not qualified to serve on the FCC because his daddy’s not in politics. You won’t get a laugh exactly, more like a moan.

The first item of business for the nominees, once they’re confirmed, will be the list of 120 questions Copps put to the world. Good luck to the Commission with that.

FCC Comments due in National Broadband Plan

See IEEE Spectrum for a few observations on the FCC’s request for comments on the National Broadband Plan:

Comments are due Monday, June 8, at the FCC on the National Broadband Plan (NBP.) The Notice of Inquiry lists some 120 questions that the Commission would like filers to address, running the gamut from goals and benchmarks to open access to privacy to entrepreneerial activity to job creation. Anyone who compiles a list of so many questions clearly hasn’t given much thought to the problem under discussion, so it’s clear upon reading the NOI that we’re many years away from a good NBP, although we may have some vague and probably counter-productive guidelines much sooner: the FCC is supposed to report a plan to Congress by next February. Bear in mind that it took the US 20 years to convert from analog to digital TV, and we’re not even there yet.

There’s more.

Interlocking Directorates

The New York Times reports that regulators have an interest in the structure of the Apple and Google boards of directors:

The Federal Trade Commission has begun an inquiry into whether the close ties between the boards of two of technology’s most prominent companies, Apple and Google, amount to a violation of antitrust laws, according to several people briefed on the inquiry.

I doubt this will go very far, as the interlocking directors (Eric Schmidt and former Genentech CEO Arthur Levinson,) will simply resign before any enforcement action is imminent, but it does raise some interesting questions about the market for mobile phone operating systems, currently split between Apple, Google, Microsoft, Palm, and a few others. These systems are rife with limitations, each of which could be considered a network neutrality violation when viewed in just the right way.

I imagine Apple itself might wish to give Dr. Schmidt his walking papers before he becomes an anti-trust problem, which he actually isn’t at this point. The FTC’s interest in this obscure situation is probably a signal that the Administration wants to be viewed as an anti-trust hawk without doing anything substantial.

But this is what the law calls an “occasion of sin.” Dear me.

The Privacy Hearing

Here’s some news on Boucher’s privacy campaign:

It’s not clear how broad a law Boucher has in mind, though it’s likely to be some codification of generally accepted data-privacy practices. Those include telling people when you collect data and why, letting them choose to join in or not, using the data only for the reason you collected it, letting people see and correct the information and destroying it when its not longer needed.

But engineer Richard Bennett argued that DPI and network management techniques were getting a bad name and are simply the logical extension of the tools used in the early days of the internet.

Hoping to convince the subcommittee not to write legislation, AT&T’s chief privacy officer Dorothy Atwood said that the committee’s previous hearings and investigations have led to “robust self-regulation,” code-words for “no laws needed.” There’s some truth in that statement, since last summer, the subcommittee single-handedly ended ISPs dreams of letting outside companies spy on their subscribers in exchange for a little more revenue.

If the privacy is the problem, it needs to be the focus of the bill, not one of many techniques that may be used to compromise it, of course.

What I Did This Morning

While California was sleeping, I enjoyed a bit of broadband politics in the heart of the beast, testifying at the House Subcommittee on Communications, Technology, and the Internet on Communications Networks and Consumer Privacy: Recent Developments

The Subcommittee on Communications, Technology, and the Internet held a hearing titled, “Communications Networks and Consumer Privacy: Recent Developments” on Thursday, April 23, 2009, in 2322 Rayburn House Office Building. The hearing focused on technologies that network operators utilize to monitor consumer usage and how those technologies intersect with consumer privacy. The hearing explored three ways to monitor consumer usage on broadband and wireless networks: deep packet inspection (DPI); new uses for digital set-top boxes; and wireless Global Positioning System (GPS) tracking.

Witness List

* Ben Scott, Policy Director, Free Press
* Leslie Harris, President and CEO, Center for Democracy and Technology
* Kyle McSlarrow, President and CEO, National Cable and Telecommunications Association
* Dorothy Attwood, Chief Privacy Officer and Senior Vice President, Public Policy, AT&T Services, Inc.
* Brian R. Knapp, Chief Operating Officer, Loopt, Inc.
* Marc Rotenberg, Executive Director, The Electronic Privacy Information Center
* Richard Bennett, Publisher, BroadbandPolitics.com

It went pretty well, all in all; it’s really good to be last on a panel, and the Reps aren’t as snarky as California legislators. I’ll have more on this later.

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Google’s Sweet Book Deal

If you read books, you’ll want to know what Robert Darnton has to say about the pending Google book deal, in Google & the Future of Books – The New York Review of Books. Here’s a teaser:

As an unintended consequence, Google will enjoy what can only be called a monopoly—a monopoly of a new kind, not of railroads or steel but of access to information. Google has no serious competitors. Microsoft dropped its major program to digitize books several months ago, and other enterprises like the Open Knowledge Commons (formerly the Open Content Alliance) and the Internet Archive are minute and ineffective in comparison with Google. Google alone has the wealth to digitize on a massive scale. And having settled with the authors and publishers, it can exploit its financial power from within a protective legal barrier; for the class action suit covers the entire class of authors and publishers. No new entrepreneurs will be able to digitize books within that fenced-off territory, even if they could afford it, because they would have to fight the copyright battles all over again. If the settlement is upheld by the court, only Google will be protected from copyright liability.

A policy change of this magnitude should not be negotiated behind closed doors to the detriment of all purveyors of information but Google.

At long last, Genachowski

The long-awaited nomination of Julius Genachowski to the FCC chair finally came to pass yesterday, raising questions about the delay. If everybody with an interest in telecom and Internet regulation knew he was the choice months ago, why did the official announcement take so long? I have no inside information, so I’ll leave it to those who do to enlighten us on that question. Perhaps the Administration was just being extra-cautious after the debacles around a Commerce Secretary and others.

Neutralists are excited about the choice, naturally, as they view Genachowski as one of their own. And indeed, if network neutrality were actually a coherent policy and not just a rag-tag collection of Christmas wishes, they would have cause to be exhilarated. But given the range of restrictions that the movement seeks, it’s less than clear that any particular raft of regulations would satisfy them and leave broadband networks the ability to function, so we’ll see how this pans out. We’re already hearing runblings from Boucher that there may not be any Congressional action on network neutrality this year in any case.

Genachowski brings an interesting (and potentially very dangerous) set of qualifications to the job. A college buddy of the President, he’s an inner circle member with the power to wield enormous influence. As a former FCC staffer, he’s imbued with the Agency’s culture, and as a former venture capitalist funding fluffy applications software, he’s something of a tech buff. But he resembles Kevin Martin in most of the important respects: he’s a Harvard lawyer who’s worked inside the regulatory system for most of his life, and he has strong alliances to an industry that seeks to exercise control over the nation’s network infrastructure for its own purposes. Whether those purposes resemble the public interest remains to be seen.

The largest problem with the FCC and similar agencies is the knowledge gap between regulators and the modern broadband networks that are the subject of their regulatory power. Martin didn’t have the training to appreciate the effect that his orders would have on the infrastructure, and neither does Genachowski. So the new Chairman is just as likely as the old chairman to make things worse while trying to make them better.

In a perfect world, the commissioners would be able to rely on the expert judgment of the Chief Technologist to stay out of trouble, but the current occupant of that job, Jon Peha, has a penchant for playing politics that renders him ineffective. The bizarre, quixotic inquiry the FCC made recently into the quality of service variations between Comcast’s voice service and over-the-top VoIP is an example. This isn’t a serious line of inquiry for a serious Commission, and Peha never should have let it happen. But it did, and that fact should remind us that the FCC is more a creature of politics than of technology.

DTV Transition Starts, World Doesn’t End

Contrary to the expectations of Congress and the FCC, the first phase of the DTV transition took place without major incident. Some 23% of American TV stations stopped sending out analog signals Tuesday at midnight, and only 28,000 calls came into the centers the FCC and the cable and satellite providers have established for transition help. The biggest category of call, close to half of all calls, was from people unable to pick up the digital broadcasts at all, or picking them up with very poor quality. A significant number didn’t know how to setup their converter boxes, or didn’t realize that the converter boxes have to scan for channels.

These numbers support a suspicion I’ve had for a while now, that the emphasis on converter boxes is misplaced. The problem that most people are going to have is a complete inability to receive digital broadcasts at all, because they don’t have the right kind of antenna, the antenna isn’t oriented properly, or because they live in the wrong place. Many stations are moving transmitter locations to alter service areas, and won’t be serving some traditional customers any more. Others are reducing power, sometimes quite substantially. Digital broadcasts are more robust, so some reduction in power is quite sensible. But I suspect that over-the-air delivery of TV is such a small percentage of the overall market – well below 20%, and in some areas less than 10% – that it doesn’t make financial sense for stations to invest heavily in high power transmitters.

The timing of the transition was very bad for this reason. A substantial number of OTA TV viewers are doing to need upgrades to roof-mounted antennas, and in many cases they’re going to need multiple antennas pointing in different directions. Getting up on a roof in February is not a pleasant experience in much of America, so a May or June transition date would have been much more sensible. In any event, it’s a good time to buy stock in antenna companies.

I’ve been doing some experiments with roof-mounted antennas that I’ll be reporting on shortly. So far, I can only get 5 stations where I live, and four broadcast in Spanish. Perhaps the FCC needs a budget for bilingual education as well as for converter boxes and antennas.

Court protects the right to bluff

In a rare move, the DC Circuit has upheld an FCC decision

The cable industry has won a big legal victory in the fiercely competitive phone services market. An appeals court has supported the Federal Communications Commission in its ruling that phone carriers—in this case Verizon—can’t try to lure back customers after they’ve initiated a service switch but before their number has been transferred.

The FCC rarely prevails in court, of course, so this may be a sign that we’re living in the End Times. But we can take some comfort from the fact that it wasn’t totally unpredictable, given that Kevin Martin was on the losing side.

The case involved Verizon’s efforts to win back customers when notified by the new carrier that they had to release the phone number. Verizon took this as an occasion to offer sweeter deals, which the court ruled an unlawful violation of the customer’s privacy, despite the fact that Google’s entire business is based on this kind of snooping.

It’s a win for consumers because it preserves the right to bluff. In today’s economy, consumers can frequently get better deals on subscription services merely by threatening to cancel, whether we’re serious or not. As it happens, I got lower prices from Sports Illustrated and Illy Coffee by calling up to cancel my subscriptions, and in both cases they were substantial. DirecTV refused to offer me a sweetner last year when I was tired of their crappy DVR, so they lost my TV business to Comcast. It’s not entirely clear to the business whether any of these threats are serious, of course, so it’s in their interest to err on the side of caution and offer the customer a better deal when they have the chance. Efforts to win back a customer who’s already made a switch have to be harder to pull off.

But the Verizon deal stacked the cards a little too far in the company’s favor, because it allowed them to play hardball until it was absolutely clear that the customer wasn’t bluffing. They only get a switchover for phone service when you’ve made a deal and scheduled a hookup date.

No deal, we all have the right to bluff and the company is going to have to guess just like any other poker player. That’s a good deal for the consumer.

Internet Myths

Among my missions in this life is the chore of explaining networking in general and the Internet in particular to policy makers and other citizens who don’t build network technology for a living. This is enjoyable because it combines so many of the things that make me feel good: gadgetry, technology, public policy, writing, talking, and education. It’s not easy, of course, because there are a lot of things to know and many ways to frame the issues. But it’s possible to simplify the subject matter in a way that doesn’t do too much violence to the truth.

As I see it, the Internet is different from the other networks that we’re accustomed to in a couple of important ways: for one, it allows a machine to connect simultaneously to a number of other machines. This is useful for web surfing, because it makes it possible to build a web page that draws information from other sources. So a blog can reference pictures, video streams, and even text from around the Internet and put it in one place where it can be updated in more-or-less real time. It enables aggregation, in other words. Another thing that’s unique about the Internet is that the underlying transport system can deliver information at very high speed for short periods of time. The connection between a machine and the Internet’s infrastructure is idle most of the time, but when it’s active it can get its information transferred very, very quickly. This is a big contrast to the telephone network, where information is constrained by call setup delays and a very narrow pipe.
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