MPAA Tells The FCC: If We Don't Stop Piracy, The Internet Will Die

from the moral-panic dept

Never let it be said that the folks in Hollywood aren't good at coming up with a totally fictional horror story. I just have a problem when they use it not to entertain, but to create a moral panic to push the government to pass laws in their favor. In discussing the recent 60 Minutes piece that was really nothing more than an MPAA scare tactic, some suggested that it was really just a first step in the process of getting the government to make sure net neutrality rules had a special Hollywood exception. So, it's interesting to note that just before that 60 Minutes episode aired (and just before Halloween), the MPAA sent a "scary" filing to the FCC warning it how the US would always be a broadband laggard if it didn't stomp out piracy. The full filing (warning:pdf) claims, repeatedly, that piracy is sucking up all our bandwidth and getting rid of that would somehow make it cheaper to install faster internet connections.

The Commission has projected that it could cost $350 billion to ubiquitously deploy broadband networks capable of delivering 100 Mbps, which is rapidly becoming the international standard. The Commission, however, should not ignore that illegal content accounts for a vast amount of online traffic. Thus, it could generate substantial savings in this tremendous build-out cost -- to be borne by both government and private sector investment -- by encouraging construction of networks that are designed not on the basis of accommodating capacity-hogging transmissions of unlawful content but rather with the goal of providing consumers a rich broadband experience.

And, of course, it pushes for kicking file sharers off the internet (it hides this by calling it "graduated response," of course, rather than the more common term "three strikes"). The filing also goes on about how the MPAA is just so sure that ISPs can stamp out piracy, and because of that, it thinks the government should force them to get on it.

The MPAA wastes little time mocking those who disagree with its position, and suggesting that the FCC "pay no heed" to consumer concerns:

[The] Commission should pay no heed to assertions by some members of the advocacy community that the problem of content theft can be ignored because some amount of legitimate e-commerce already occurs through vendors such as iTunes.... The same holds true for the preposterous notion that the law should be ignored unless a property owner can demonstrate that a thief, in the absence of stealing, otherwise would have legitimately purchased a stolen product. A shoplifter who steals a DVD from a store in a mall is not immune from security intervention, let alone prosecution, simply because he might not have planned to buy the product that he attempted to steal.

Except, of course, there's a huge difference there. If someone steals a DVD it's no longer there for someone else to buy. If someone who never would have purchased the movie views it online there's no loss. it's difficult to see how the MPAA can simply ignore this while assuming that FCC commissioners are too stupid to grasp this rather simple economic concept.

But where the filing really comes into its own in being laughably funny is where it tries to claim that if the FCC doesn't do this, the internet will effectively die. How does it get there? Well, first, it claims that the reason people use the internet is to view content from Hollywood. And, if file sharing keeps up, there won't be any of that content left, and then why would anyone use the internet? Think that's an exaggeration? How else do you interpret this:

Quite clearly, it is the promise of access to the content flowing over the Internet's network architecture that motivates Americans to adopt broadband. The Internet without content would be nothing more than a collection of hardware; a series of computer links and protocols with great capacity to communicate but nothing to say. Television once was unfairly derided as little more than a toaster with pictures. In the absence of compelling content, the Internet would offer consumers even less value than that proverbial toaster. It is the content that flows over and through the Internet that makes the breakthrough technology so potentially powerful.

Yes, because even though the internet existed for decades before the folks at the movie studios had even heard of it, they had nothing to say, at all, until people could start sharing the latest camcorded blockbuster. Do they really think people are this stupid? Sorry, Hollywood, but it's not "the content" that you're thinking about that makes the internet so powerful. It's the ability to communicate. Sure, the content is a nice-to-have, but the internet grew and grew because it let people talk to each other, not because it was another broadcast medium. This fantasy story by the MPAA also leaves out the fact that more content than ever before is being produced today, even as "piracy" numbers have gone up. And, oh yes, once again, the movie business is hitting record highs at the box office. Funny that the MPAA seems to spend so much time insisting that its industry is dying, while leaving out the record revenue bit. Instead, it just keeps jumping out and yelling that piracy will kill the movie business...

And then it gets into rewriting history, by insisting that every new technology is only successful if the big media companies support it:

Throughout history, whenever transformative communications technologies have captured the imagination of consumers, compelling content has been the vehicle for forward progress.

Apparently, the MPAA is unfamiliar with the telephone. Hopefully, the FCC is a bit more familiar with that particular technology.

The filing goes on and on like this, designed to "scare" the folks at the FCC with a bit of a moral panic, but only inducing laughter (good show, Hollywood) from anyone with any actual understanding of technology, history and copyright. Another favorite tidbit is the MPAA's demand that the FCC not pay attention to how incredibly screwed up every single attempt at using technological measures to stop piracy has been in the past:

MPAA does not want the Commission's consideration of the important overarching issue of unlawful online conduct to be derailed by backward-looking debates about the pros and cons of any given technology, particularly those that already have been surpassed by new innovations. MPAA firmly believes that future developments will yield an entirely new generation of ever-more-sophisticated online protection technologies.

In other words, please ignore how badly we've screwed up in the past. Don't worry about things like rootkits and security vulnerabilities we've created. Also, ignore the fact that DRM doesn't work and only punishes our legitimate customers while driving more people to piracy. That would be a waste of time. Really.

And finally, I leave you with the most stunning statement of all, along those lines. One that I'm amazed the MPAA lawyers let go through in this filing, because it absolutely has to come back to haunt the MPAA in the future. In responding to concerns from lots of different people, including consumer advocates and consumer electronics firms that the various technological protection measures the MPAA wants to force on ISPs will harm, the MPAA states:

That a tool intended to stop unlawful conduct could be put to ill use, however, is not an argument for prohibiting the use of the tool....

Wait... isn't that exactly the argument that the MPAA has used for years against every new file sharing technology out there? Wasn't it the crux of the Grokster lawsuits? That because the tool could be put to ill use, it needed to be prohibited? Yet, now, suddenly it doesn't want its own technologies prohibited just because they can be put to "ill use." Double standard, much?

This is nothing but a typical moral panic from Hollywood. They are storytellers out there, and they know how to craft a horror story. Hopefully, though, the FCC reviewers of this particular fantasy will give it the thumbs down for simply being totally unbelievable.

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Connected Nation Bails On Its Home State Of Kentucky

from the oddity-of-oddities dept

The bizarre story of Connected Nation continues. While the telco-backed broadband mapping organization that politicians all seem gaga over has been able to sweep politicians in Minnesota and Florida off their feet, despite dubious qualifications and/or reviews, Connected Nation has apparently decided to bail out on bidding for the broadband mapping opportunity in Kentucky. This is significant, because Connected Nation is from Kentucky. It was originally Connect Kentucky, and it was the group's supposed "success" in mapping broadband deployments in Kentucky that led to the formation of Connected Nation. In other words, not only does Connected Nation actually have experience in Kentucky (unlike those other states), it should already have the maps. And yet it's suddenly claiming that it can't meet the deadlines laid out in the proposal? Art Brodsky questions the claim:

Is the deadline issue what chased Connected Nation out of Kentucky? Perhaps. There may be other factors at play, including that the Commonwealth wanted the vendor to work with all providers, and two of those significant sectors -- cable and municipals -- are not happy with the telephone-dominated nature of Connected Nation. It's also worth noting that the Kentucky state government, aware of the criticism of Connect Kentucky's efforts, was planning a very strict follow-up procedure for the stimulus mapping program. The Request for Proposals mentioned there would be a third-party verification of "any and all data at any location." That condition would seem to conflict with the general Connect philosophy of controlling access to the information. But we digress.

Given all this, it's worth asking: does the state of Kentucky have the broadband mapping data that Connect Kentucky did for it earlier? Can it give that data to other providers? Or must those providers start from scratch as Connect Kentucky takes its data and goes home?

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Kentucky Cable Companies Point Out That Connected Nation Isn't All That

from the well,-look-at-that dept

It's seemed like a foregone conclusion that the US gov't was going to hand over lots and lots of cash to Connected Nation -- a group favored by the telcos -- to handle all of the "broadband mapping" needed for a better national broadband plan. There have been plenty of concerns about Connected Nation's close relationship with the telcos, as well as its proposal which wouldn't give a very fair or accurate picture of actual broadband offerings around the US. But a funny thing just happened. Connected Nation is really based on Connect Kentucky, where this experiment was first run, and the cable companies there have suddenly stood up to oppose Connect Kentucky, questioning its ability to accurately map broadband in the state. Looks like maybe the telcos should have cut the cablecos in on the deal before backing Connected Nation.

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FCC Apparently Not Very Concerned About Consumer Views On Broadband

from the keep-quiet-and-take-what-we-give-you dept

We recently expressed our concerns with the state of the government's attempts to increase broadband in the US. Karl Bode, over at Broadband Reports has now hit quite a homerun with his analysis of 5 signs of why the broadband plan is in trouble. The whole thing is worth reading, but I wanted to highlight number 5 on the list, because it's a big problem:

The FCC continues to hold "workshops" to discuss the direction and scope of the national broadband plan. They're also recording presentations by all of the FCC's "constituents," and offering consumers instantaneous access to all of the documents being presented at the workshop at the Broadband.gov website. All of this is absolutely great. What's not so great?

There are 51 panelists attending the latest 8 workshops. Out of those 51, there are just five people not directly associated with a company: Dave Burstein, Craig Moffett, George Ford, Victor Frost and Henning Schulzrinne. Moffett is a stock jock who's positions (such as upgrades are unnecessary and consumers should be paying more money) are clearly not going to serve anyone but investors. Ford works at the Phoenix Center, an AT&T-funded "think tank," who's job is to parrot AT&T policy positions.

Of the remaining three, only Burstein, a long-time telecom beat reporter, will likely ask any hard questions -- and then again his job is to get scoops, not to represent the public interest. Zero of the originally scheduled attendees acted as public interest witnesses. After complaints by consumer groups, Dr. Mark Cooper from the Consumer Federation Of America was added at the last second, but the fact that this was an afterthought raises questions about how "transparent and inclusive" this process really is.

This definitely seems like politics as usual. And it's a problem, not just for the FCC, but for the very businesses involved in these discussions. Ignoring consumer will these days is increasingly a suicide pact. The businesses leading this discussion would be well-served to look at what's happening in other industries (music, newspapers) where business execs have been trying to ignore consumers' rights and interests, in the belief that they have some sort of monopoly control over their market. Those things can disappear quickly, and when stripped of such artificial protections, it's amazing how fast the consumers you mistreated will move elsewhere.

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Broadband Stimulus Plan Keeps Looking Worse And Worse

from the that's-not-stimulus dept

From the beginning, we've questioned the broadband stimulus plan, which was designed not to actually stimulate broadband so much as it was designed to stimulate jobs by getting people to install broadband in places where people weren't that interested in getting broadband. It had little to do with actually increasing broadband in a meaningful way. For that... all we kept hearing about was about how we'd also get some magical broadband mapping solution with hundreds of millions of dollars given to Connected Nation -- an organization favored by incumbents, because it lets them retain control over the mapping process. And, indeed, it looks like the broadband stimulus remains something of a boondoggle. As Stacey Higginbotham notes, there's "no map for success," and the plan itself has been watered down. The mapping plan has been cut back to appease telcos, and the focus of stimulus money will go to those not served by broadband, rather than those underserved by broadband. Installing broadband in far off places where there's no current access may sound good, but those are sparsely populated areas where broadband doesn't do all that much. Meanwhile, folks in densely populated regions have only one or two very slow options. Focusing on boosting broadband competition and speeds in those areas would seem to have a lot more bang for the buck... but doesn't seem to be in the current plans.

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Exploring The Connected Nation Boondoggle

from the sneaky,-sneaky dept

Last year, we discussed whether or not Connected Nation broadband mapping group, was really just a big telco boondoggle designed to get gov't money and allow telcos to avoid really providing broadband data. For some reason, politicians are absolutely in love with Connected Nation, though. When I was in Washington DC recently, they talked about it like it was the solution to our country's broadband needs. That seems quite bizarre no matter how you look at it. First, it's just a "mapping" organization and it's run by the telcos themselves, allowing them to continue to fudge the data to make markets look a lot more competitive than they really are. And, yet, thanks to all the political love that goes out to Connected Nation, it looks like they're about to get hundreds of millions of dollars in broadband stimulus money.

Broadband Reports points us to Art Brodsky's "final warning" about Connected Nation, before we hand over tons of tax money to it, and it's not pretty. He notes the ridiculousness of politicians complaining that the gov't agency in charge of getting accurate maps has failed (solely because the telcos refuse to give them the data) and deciding the best "response" to this is to simply hand the whole project (and lots of money) over to the telcos who refused to give the data up in the first place:

The fruit is not the product of the state agency, however. Faison used his announcement to criticize e-NC: "Until now, we have not had a map showing street address availability of broadband. e-NC has generated maps based on information disclosed by the providers which are based on the average number of customers with broadband access in a wire center. Unfortunately, information provided in this fashion does not allow you to see where broadband is and where it is not, it does not allow you to see the holes in the Swiss cheese, and depending on the area the hole may be larger than the cheese."

Note the circular logic here. Faison and other members of his committee are criticizing e-NC for their maps, which were based on information supplied, or not, as it were, by the telecom industry. The state agency has been hampered by AT&T's unwillingness to supply broadband data and its insistence on a very restrictive non-disclosure agreement for information the company did supply.

Instead of pushing the industry to stop stonewalling e-NC, Faison and the others trashed e-NC's work and commended the work of – AT&T, the very company that hamstrung e-NC. Here is Faison’s praise for the industry: "In the face of legislation recommended by the Committee which would have required the providers to disclose precise information to the Legislature for our staff to generate a detailed map of availability, the providers have come together and collectively decided to provide the information through Connected Nation, to not only provide the "street address" map but also to make the map both accessible and interactive through the internet. Special recognition should be given to AT&T, Embarq, Sprint, Time Warner Cable, The Cable Association, the Telephone Co-op association, and Alltel for their work on this matter."

Brodsky goes on to show a Connected Nation map, and note how useless it is in actually giving granular data, and then compares it to another group's map, with much greater detail. I certainly agree that better data is important, but I have to admit I'm still somewhat confused as to what real problem we end up solving with mapping alone? Yes, it will give us more data to figure out just what the current situation is when it comes to broadband deployment, but that's got little to do with actually improving our broadband infrastructure.

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Telcos Resisting Broadband Stimulus Because They're Worried It Might Force Them To Compete

from the if-they're-all-upset,-that's-a-sign dept

We've had a lot of concerns about the broadband stimulus package, since it was shaping up to look like little more than a handout to incumbent operators who have a long history of grabbing public money, then not living up to the promises they made to get it. The real problem underlying most issues having to do with broadband in the US is a lack of competition, so any stimulus needs to address that, instead of just throwing money blindly at broadband providers. Mobile operators have already complained about anything that might force them to compete interfering with the government broadband giveaway; now BusinessWeek reports that several incumbent telcos are holding back from the stimulus, because they're afraid the government will attach strings to it to try and increase competition. Most of all, they're worried they may have to allow line-sharing, which, of course, they worked very hard to get tossed out in 2005. The rules are still under discussion, but we're optimistic that the opportunity to effect some positive change on the broadband market won't get left behind in the rush to throw money at it.

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

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Researcher Claims His Study Is Being Misused To Pitch Broadband Stimulus

from the won't-create-jobs dept

We're certainly on the record as being quite skeptical of the proposed broadband stimulus, which seems like it's mistargeted and a bit of a gift to incumbents, rather than stimulating much needed competition in the space. Of course, the Obama administration has made it clear that the short-term focus of the plan is less about dealing with the big broadband issues, and more about creating jobs.

Turns out there's a problem there too: the guy whose research the administration is using to claim that the broadband stimulus will create 300,000 jobs is now claiming that his research has been taken out of context. Shocking. It turns out that the study in question was talking about adding broadband to non-rural areas in 2005, helping to create a ton of new jobs. However, since then, plenty of broadband services have been deployed, meaning that the job creation impact is greatly diminished. And, even worse, much of the focus of the stimulus plan is on those rural communities that were excluded from the report, and which would have a much lower impact on job creation.

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More People Realizing Broadband Stimulus Is Targeting The Wrong Problem

from the competition,-competition,-competition dept

We've been worried about the details of the broadband stimulus bill, since it has looked mostly like a way to give money to incumbent telcos, rather than to actually stimulate any broadband. Obama advisor Blair Levin insisted this was just part I, and was more about creating jobs than tackling the broadband problem, but it looks like more folks are getting worried, as well. Scott Bradner points out the obvious at Network World: the broadband stimulus package seems focused on getting broadband to people who aren't that interested in broadband, more than it's about improving broadband for those who do want it.

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State Of The Net: Blair Levin Tells Us To Not Freak Out Yet On Obama's Broadband Plan

from the benefit-of-the-doubt? dept

While we certainly think that having a better broadband policy in the US is an important step, there's a difference between just saying that you have a broadband policy, and actually implementing a plan that helps improve broadband. The devil's in the details, as they say. And... so far, the details that have come out have suggested that the key elements under discussion look something like a boondoggle for incumbent providers, rather than a truly comprehensive plan to stimulate actual competition in the broadband space.

On Wednesday, I got to attend the Congressional Internet Caucus' State of the Net 2009 conference, where the opening (surprise) speaker, was Blair Levin, one of President Elect Obama's tech transition team. In his remarks, he clearly tried to respond to these criticisms raised by us and others by suggesting (1) that the team is still tossing up a variety of ideas and nothing has been concluded and (2) there are two elements that need to be considered: (a) a short-term "stimulus" plan to get the economy churning and create new jobs and (b) a more comprehensive broadband policy. From this, he suggested that the first part -- the "stimulus" part -- would have to involve "existing structures" (i.e., the incumbents), but that was only a piece and "not the whole puzzle" or "just an inning, not the whole ballgame."

While it's a relief that the tech team recognizes there is a larger issue, I think it's important to keep hammering home the point, because this has all the warning signs of a "best laid plans..." situation. The initial "bailout" (and the ISP representatives keep making sure to say "it's a buildout, not a bailout") as an initial stimulus just seems ripe for abuse. The incumbent players have almost no record of either playing fair on these issues or delivering what they promise to deliver. And, why should they? There's been no downside to simply accepting the subsidies and not delivering. And, of course, after that happens, there may be the next crisis to deal with. Do we ever get that really comprehensive broadband plan? Remember, President Bush also had big plans to provide a massive broadband policy... and that went nowhere.

While I understand the point that Levin is making for separating out the short term action and the long term action, it's still not clear that the short term strategy makes sense and will do what it's supposed to do. And then there are questions about whether or not the long term strategy will ever actually show up. Combined... you have to wonder if we're just hearing a lot of hype about nothing. I'm sure Levin and the rest of the team are earnest in what they want to do. From what I've seen from the folks working on the transition, there are an awful lot of really smart, dedicated and sincere folks involved. So that's (at least) a good first step. But going from there to actually implementing something real that's useful? That's a big step, and we've heard enough vague promises over the years not to take such a promise at face value. Hopefully, we'll be surprised, and both the short and long term plans will make sense -- but considering how many times the "best laid plans" of government officials have gone off the road and into a ditch, it's hard to provide the benefit of the doubt without at least a little more info on what's really happening.

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Connected Nation: National Broadband Policy Or Big Telco Front?

from the questions-questions dept

For years, we've pointed out that, unlike most every other nation these days, the US lacks any sort of comprehensive broadband policy. Whether or not you think that's a good thing may depend on your perspective -- even among free market supporters. If you believe that broadband is a national infrastructure question involving a natural monopoly (a la the highway system) then it's a shame that there's no national broadband system that allows competition at the service level. If, instead, you think that broadband is not a natural monopoly then perhaps competition at the infrastructure level makes sense, even if it decreases competition at the service level. However, there's definitely been a lot of clamoring from folks that the US needs a national broadband policy. For years, the big telcos have resisted this push, often with incredibly misleading statements about how the government needs to keep its "hands off" their network. That's misleading because they leave out how much of that infrastructure was subsidized by the government -- whether through direct subsidies, grants of rights of way or tax breaks.

Either way, it appears that the telcos have recognized that they need to get behind a "national broadband policy" before one is handed to them -- so they've created their own, called Connected Nation. We discussed this back in February, when there was some question about whether Connected Nation really was a reasonable policy or just a front for the telcos. One of the biggest problems? The more you look at Connected Nation, the more difficult it is to figure out what it actually does. Broadband Reports is taking a look at the problems with Connected Nation, noting that the big telcos are all claiming that it represents a good national broadband policy, but that's hardly supported by the details.

For example, Connected Nation's broadband plan doesn't seem to involve anything resembling consumer advocates, or any objective look at ways to get broadband to those not served by it. But what does Connected Nation actually do? Basically tells the rest of the government that everything is groovy and not to do anything. Officially it takes taxpayer money to create its own questionable maps about broadband penetration, most of which come back showing that there's plenty of broadband penetration (nothing to see here, move along now). Then it sends out marketing material to local leaders about the importance of broadband -- effectively advertising incumbent telco broadband offerings with taxpayer money. Whether or not you support a national broadband policy, this seems pretty questionable all around. It seems to just divert taxpayer money to broadband advertising, without doing much to actually improve broadband.

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When Will We Have a Comprehensive National Sneaker Strategy?

from the parallel-processing dept

My fellow Arsian Nate Anderson blasts the Bush administration for its laissez faire attitude toward the development of broadband infrastructure. He laments the fact that the administration lacks a "vision" or "national target" for broadband deployment. DSL Reports chimes in, noting that Japan claims to have deployed 100 Mbps fiber to eighty five percent of its homes. But Matt Sherman points out that while "we," meaning the government, may not have a single, unified broadband strategy, "we" the broader marketplace have several broadband strategies being developed in parallel. As he says, Verizon's strategy is fiber-to-the-home, AT&T's strategy is fiber-to-the-node, Sprint's strategy is WiMax, etc. Which of these will prove the most effective? I have no idea. But it's also not clear to me how greater federal government involvement in these deployments would speed them up. Matt also notes the peculiarity of using advertised broadband speeds as a measure of broadband quality. He's got a graph showing that, by at least some measures, North America leads the world in the deployed speed of actual measured broadband connections. Comparing advertised speeds can be problematic, especially since some countries have low usage caps that make the high advertised speeds and low advertised prices extremely misleading. There are certainly plenty of problems with the broadband marketplace, not least the limited amount of competition in many markets. But calling for a "comprehensive national broadband strategy" doesn't make a lot of sense. We need to find ways to increase competition and remove obstacles to the deployment of more capacity, but we don't need a national strategy for the broadband industry any more than we need a national strategy for the production of tennis shoes.

Timothy Lee is an expert at the Insight Community. To get insight and analysis from Timothy Lee and other experts on challenges your company faces, click here.

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