Shocker: ISPs Cut Back 2020 Investment Despite Tax Breaks, Death Of Net Neutrality

from the ill-communication dept

Why it's almost as if you can't take telecom giants (and their lawyers, consultants, and political allies) seriously.

If you recall, the broadband industry and the Trump FCC repeatedly proclaimed that modest consumer protections like net neutrality had dramatically stifled telecom sector investment, and were we to ease regulatory oversight of giants like AT&T and Verizon, it would result in a wave of new sector investment the likes of which we'd never seen before. Ignore the fact that data routinely disproved this claim; this "net neutrality stifled investment" claim was made almost daily by the telecom sector and the wide variety of mouthpieces paid (one way or another) to support them.

Funny thing about that. Despite just having received billions in tax breaks and regulatory favors, AT&T, Comcast, and Charter are all slated to lower their CAPEX and network investment significantly in 2020. Others 2020 CAPEX projections, like Verizon, were entirely flat. This static or reduced investment arrives despite the slow but steady deployment of 5G, the accelerated deployment of which was also a big cornerstone of the net neutrality repeal's justification:

"Comcast and Charter missed 3Q expectations for capex and guided 2019 lower than previously planned," wrote the analysts at Nomura's Instinet in a recent note to investors. "We have lowered our combined 2019 capex forecast for Comcast and Charter from $14.6 billion to $14.2 billion."

And AT&T...surprised Wall Street analysts with a significantly lower-than-expected capex for 2020. The operator said it expects to spend around $20 billion on capex next year, which is way down from the $23 billion it expects to spend this year and the $22 billion that most Wall Street analysts had expected AT&T to spend in 2020."

Fewer jobs, higher prices, and lower investment was not what we were promised. It's the precise opposite of what the endless parade of telecom-linked think tankers, academics, consultants, and other hired mouthpieces claimed would happen. And it's certainly not what Ajit Pai said would happen when he recently told Congress net neutrality had a disastrous impact on sector investment, despite the fact that biggest study of its kind on the subject ever undertaken just last month showed that net neutrality had no meaningful impact on broadband investment levels whatsoever.

It's simply no longer debatable, and it's fairly telling to see which groups and individuals are still trying to push this line of debunked detritus.

Granted this is a con AT&T has been running on the American public for decades now. The company will proclaim that immense broadband deployment and employment gains can be made if the government just lobotomizes itself and does whatever AT&T is demanding at the moment (lower tax rate, fewer regulations, new regulations AT&T supports, merger approval, etc.). When the government inevitably follows through, AT&T's promises then mysteriously disappear. And like Lucy and Charlie Brown football, nobody in the US seems particularly interested in learning from the experience.

Filed Under: broadband, capex, investment
Companies: at&t, comcast, verizon


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  • icon
    Samuel Abram (profile), 5 Nov 2019 @ 6:08am

    *gasp*

    I'm shocked! Shocked!

    …sorry, there was some static electricity I needed to take care of. As I was saying, this was entirely predictable and anyone who couldn't see Ajit Pai as something other than a full-throated tool of the telecom monopolies is blind, corrupt, or both.

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  • icon
    Stephen T. Stone (profile), 5 Nov 2019 @ 6:52am

    [shocked Pikachu face]

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  • icon
    Norahc (profile), 5 Nov 2019 @ 6:52am

    Hard to spend money on investment and improvements when you've spent it all on lobbying for less regulation and oversight.

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  • identicon
    Anonymous Coward, 5 Nov 2019 @ 6:57am

    Starlink

    These same ISPs are going to be shocked when the first high-speed low latency internet becomes available from satellites. When they lose more than ten percent of their subscribers per month, maybe then they will look at all of their mistakes.

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    • identicon
      Anonymous Coward, 5 Nov 2019 @ 7:46am

      Re: Starlink

      I thought the same thing years ago when cable tv was first being deployed.

      I thought, wow man ... can not wait till the satellite tv folks get up and running - oh yeah baby!
      There will be competition when that happens for sure!

      reply to this | link to this | view in chronology ]

    • identicon
      MathFox, 5 Nov 2019 @ 7:48am

      Re: Starlink

      The board will look at their wallets and see that they are well stuffed with bonuses. Why care about customers, employees and investors?

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    • icon
      Scary Devil Monastery (profile), 6 Nov 2019 @ 4:57am

      Re: Starlink

      "These same ISPs are going to be shocked when the first high-speed low latency internet becomes available from satellites."

      Assuming starlink can scale, or even works at all. Neither of which has been shown to date. Sat to sat transmission still has to abide by the laws of physics meaning that either bandwidth will be incredibly low or each satellite will have to be able to consistently pinpoint laser pulse transmissions from a thousand clicks away while moving unpredictably.

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      • identicon
        Anonymous Coward, 6 Nov 2019 @ 6:58am

        Re: Re: Starlink

        I cant remember where, but I have seen the statement, but it said that Starlink could serve about 10% of the urban population, but that is not its intended audience. It should serve rural and remote areas well, and those are the areas which have the most need for broadband. The other potential audience are truckers and others who spend long periods on the road, and have a vehicle on which to mount the antenna' The antenna is described as pizza box size, so it will not replace mobile phones for most road warriors.

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      • identicon
        ryuugami, 6 Nov 2019 @ 8:50am

        Re: Re: Starlink

        satellite ... moving unpredictably

        Small things in orbit around big things are, generally, some of the most predictable objects in the universe.

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      • icon
        R.H. (profile), 6 Nov 2019 @ 5:05pm

        Re: Re: Starlink

        The first public test of Starlink happened on October 22nd when Elon Musk sent this tweet over its network. As the full network hasn't been deployed, we certainly don't know if it will scale yet but, it quite clearly works.

        Secondly, the laws of physics state that nothing travels faster than light in a vacuum and that's how the inter-satellite links are designed, they're literally communication lasers traveling between the satellites so, as long as each satellite has enough computing power to handle the routing, there won't be any bandwidth issues there.

        Thirdly, as Ryuugami points out, orbital mechanics is a nearly solved bit of physics, if it wasn't, GPS wouldn't work at all. As long as each satellite knows where its neighbors in orbit are, those and the ground stations are the only things that they need to communicate with. We've gotten quite good at that type of communication. (Also to this point, the communications to and from the ground are using radio frequency not laser communications. You have a point there, pointing a laser at a specific point on Earth while traveling at thousands of miles an hour over the surface is quite difficult. It's not impossible but, the cost per satellite would be far greater.)

        Lastly, these satellites are being designed with a ~5-year lifespan so that, as new technology becomes available, the replacement satellites will be able to take advantage of it without having any unexpected replacement costs creeping in.

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  • identicon
    Anonymous Coward, 5 Nov 2019 @ 7:08am

    You mean Richard Bennett lied? That's an M. Night Shyamalan twist right there...

    reply to this | link to this | view in chronology ]

    • identicon
      Rocky, 5 Nov 2019 @ 11:06am

      Re:

      You mean Richard Bennett lied? That's an M. Night Shyamalan twist right there...

      No, the shocking twist would be that he actually told the truth...

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  • identicon
    Pixelation, 5 Nov 2019 @ 7:52am

    Well

    If we take a page from Pai's book, this means that net neutrality was good for investment and he was totally wrong.

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  • identicon
    Anonymous Coward, 5 Nov 2019 @ 7:58am

    Just shows the greed and short-sightedness of the telecom execs. If they wanted to seal the deal of the whole "Net Neutrality reduced our CAPEX" line, they should have intentionally upped their expenditures this year. Then they could run around and proclaim "see! NN is gone and we're increasing CAPEX! We told you this was a good thing!"

    But no. Business won't change much for the next couple of years while the lawsuits work through the system, and then the bills will start going up while the service doesn't change or gets worse.

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    • identicon
      Anonymous Coward, 5 Nov 2019 @ 8:46am

      Re:

      They don't have to prove anything, false or otherwise. What they actually do, the facts, don't matter. It's not about reality. It's only about how much it costs to buy off politicians and nothing more. The facts aren't even an inconvenience any more.

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  • identicon
    Anonymous Coward, 5 Nov 2019 @ 8:38am

    i bet everyone is completely gobsmacked by this news! everyone, that is, except the idiots who agreed the tax breaks and to back the demolishing of Net Neutrality! and yes, that's the same friggin' idiots in government positions who have done whatever they could to aid whatever industries would give them 'campaign contributions' in return! as usual, the only losers are the public with even more pathetic services, even less options and even higher prices! why in hell dont these politicians get voted out, replaced by some who are at least marginally less corrupt? baffling, totally baffling!!

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    • identicon
      Anonymous Coward, 5 Nov 2019 @ 8:43am

      Re:

      why in hell dont these politicians get voted out,

      Because most people vote for the party that they and their family have always supported, and of those who think before they vote, most have been convinced that to vote for other than a major party is to waste their vote. That is tribalism and vote for the lessor of two evils keeps the two party system and their corrupted politicians in power.

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    • identicon
      Anonymous Coward, 5 Nov 2019 @ 8:49am

      Re:

      The "marginally less corrupt" politicians are so few and far between that they'll never overcome the voting onslaught of the corrupt ones. There just aren't enough at least semi-honest politicians to tip the scales. It's very doom-and-gloomy but we're pretty much fucked for life now. There's no coming back from this without draining the entire swamp, every last one of them, and starting over.

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  • icon
    JoeCool (profile), 5 Nov 2019 @ 9:28am

    Not a good analogy

    And like Lucy and Charlie Brown football, nobody in the US seems interested in learning from the experience.

    That never quite fit. It's more like every time Charlie Brown misses the football because of Lucy, she makes a million dollars while Charlie Brown goes to the hospital, and the taxpayers foot his bill, and yet we are not allowed to do anything about Lucy.

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  • icon
    tom (profile), 5 Nov 2019 @ 11:02am

    I doubt NN had anything to do with it. Well before the NN vote, back when Google was still doing major fiber rollouts, both AT&T and Cox were heavily advertising their new Gig speed services in OKC. The moment Google said OKC was off their list, the roll outs stopped. The "coming in days" signs vanished almost overnight in my neighborhood. Cox did slowly roll out gig service over cable but I think that was more a side effect of improving the TV service infrastructure. Months before I moved, AT&T finally came through and finished deploying fiber and speeds went from 6mbs via copper DSL to 50mbs over fiber. But again, I think that was more motivated by AT&T wanting to rip out the copper network then really wanting to improve ISP speeds.

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    • identicon
      Anonymous Coward, 5 Nov 2019 @ 11:16am

      Re:

      I doubt NN had anything to do with it.

      NN never had anything to do with it. It was pointed out many times that while the telecom companies were crying about how NN reduced CAPEX, CAPEX was actually going up. There's even the AT&T (I think it was them) earnings call where the CEO flat-out stated NN didn't affect operations.

      It's always been about increasing profits and reducing competition.

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  • icon
    ECA (profile), 5 Nov 2019 @ 11:40am

    Some odd reason.

    its a strange thing in the USA.
    When things happen and Fines have to be given esp to LARGE companies..
    Its a FIXED/limited amount.

    When something bad happens inside a corp that affects the regular Citizens/consumers..its a minor Slap to fine them, it dont even affect their Stock prices or Scare many away from Investing.

    More people Listen to the Mouth piece and what they say and do, then to any corruption involved.
    We dont even demand that the Owners and Managers Control their own companies.
    There is a Corp License, called LLC.. and it was for Smaller companies to protect them. but for Some odd reason, the larger corps have gotten hold of this. Its that the Corp is responsible, NOT the people managing it.. you cant Sue the people. They can take every penny out of the corp and run, and not be held responsible.
    I really wonder how other nations Control the corps.. I dont know if the EU does any better, as Many of our corps are Marching across the world. AND we still dont tax them what they are worth. I dont think the other nations get much either. As the corps would just march off and not do business in them.

    Might as well be Communism with the corps in charge..Shadowrun here we come(book series)

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  • icon
    Richard Bennett (profile), 6 Nov 2019 @ 12:16pm

    OK boomer

    Comcast has completed the upgrade of its footprint to DOCSIS 3.1 with gigabit offers to all of its customers. What sort of capex makes sense for them to take on today?

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    • identicon
      Anonymous Coward, 6 Nov 2019 @ 2:41pm

      Re:

      So you admit that NN had absolutely zero impact on broadband investment. What took you so long?

      Try again Richard.

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      • icon
        Richard Bennett (profile), 6 Nov 2019 @ 2:54pm

        Re: Re:

        Odd comment. I can only surmise that Coward is high.

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        • identicon
          Anonymous Coward, 6 Nov 2019 @ 3:13pm

          Re: Re: Re:

          Well, I mean, considering that the majority of people in favor NN back in 2015 were saying this exact same thing, and then again when Pai rolled back NN, I can only surmise that you have finally seen the light and now agree with us.

          Either that or you are HORRIBLY dishonest and are now trying to twist the facts to try and save face now that we've been proven right and you were proven wrong.

          Care to try again Richard?

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          • icon
            Richard Bennett (profile), 6 Nov 2019 @ 3:20pm

            Re: Re: Re: Re:

            Yes, definitely high.

            Broadband investment follows a ten year cycle where R & D is followed by spending followed by recouping invest; rinse and repeat.

            Following RIF, Comcast invested in providing universal gigabit. They've now moved into the R & D phase for 10 gigabit.

            You have to explain every little thing to the Techdirt kids.

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            • identicon
              Anonymous Coward, 6 Nov 2019 @ 3:31pm

              Re: Re: Re: Re: Re:

              And I guess we're going with dishonest, in addition to poor reading comprehension. Considering that in my previous comment I stated that those in favor of NN said THE EXACT SAME THING (that investment goes in cycles) in 2015 and again when Pai rolled back NN.

              But I guess I shouldn't have expected anything more, it seems impossible for you to tell the truth.

              Try again Richard.

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            • identicon
              Anonymous Coward, 6 Nov 2019 @ 5:31pm

              Re: Re: Re: Re: Re:

              You know, it helps to wipe your mouth before you start repeating the Pai points. It's called proper grooming.

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            • icon
              nasch (profile), 12 Nov 2019 @ 7:20am

              Re: Re: Re: Re: Re:

              Broadband investment follows a ten year cycle

              So you admit that net neutrality has no impact on investment? We all know it's true, just wondering if you're going to say it.

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              • icon
                Richard Bennett (profile), 12 Nov 2019 @ 10:36am

                Re: Re: Re: Re: Re: Re:

                That would be silly. Regulation has a lot to do with investment, but so does technology, user demand, and a few other things.

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                • icon
                  nasch (profile), 12 Nov 2019 @ 11:10am

                  Re: Re: Re: Re: Re: Re: Re:

                  I'm not entirely clear - you are still claiming that net neutrality hampers broadband sector investment?

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                  • icon
                    Richard Bennett (profile), 12 Nov 2019 @ 11:46am

                    Re: Re: Re: Re: Re: Re: Re: Re:

                    Title II hampered investment. I'm not confident defining net neutrality as it appears to mean whatever you want it to mean.

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                    • icon
                      nasch (profile), 12 Nov 2019 @ 12:33pm

                      Re: Re: Re: Re: Re: Re: Re: Re: Re:

                      I'm not confident defining net neutrality

                      Well you don't have to define it since the FCC already did so.

                      https://apps.fcc.gov/edocs_public/attachmatch/FCC-15-24A1.pdf

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                      • icon
                        Richard Bennett (profile), 12 Nov 2019 @ 12:55pm

                        Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                        Kindly tell me which paragraphs of that rather long document define net neutrality if you please.

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                        • icon
                          nasch (profile), 12 Nov 2019 @ 2:10pm

                          Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                          Section IIA is a summary of the NN rules and I think IIIC spells them out in more detail. I thought you were in the industry, haven't you seen this before?

                          reply to this | link to this | view in chronology ]

                          • icon
                            Richard Bennett (profile), 12 Nov 2019 @ 3:11pm

                            Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                            Section II does not mention net neutrality.

                            reply to this | link to this | view in chronology ]

                            • icon
                              Richard Bennett (profile), 12 Nov 2019 @ 3:16pm

                              Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                              The order in question deals with something called the "open Internet," which presumably contrasts with a previous "closed Internet." There's really nothing in this order about a "neutral Internet" as it allows all sorts of shenanigans in the name of "Non-BIAS Data Services."

                              Try reading it some time, it's now a historical document without any force of law but the logic is pretty hilarious.

                              reply to this | link to this | view in chronology ]

                              • identicon
                                Anonymous Coward, 14 Nov 2019 @ 7:20am

                                Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                                The order in question deals with something called the "open Internet,"

                                Yes, and in order to have an open internet, you have to have net neutrality, which is then laid out in the order. But I do love how you are basically calling yourself stupid because you are pretending you don't know what either NN or the open internet is in the context presented.

                                which presumably contrasts with a previous "closed Internet."

                                If you want to lie about what it actually says, sure. If you're honest though you'll note it talks about protecting the open internet. Meaning that is what we have today and nobody wants to see it turn into a "closed internet".

                                There's really nothing in this order about a "neutral Internet"

                                Well, I mean, we've already established your reading comprehension skills are so bad that you are borderline illiterate, so I'm not surprised you didn't understand a word of what you read in that document or that it is all about a neutral internet.

                                as it allows all sorts of shenanigans in the name of "Non-BIAS Data Services."

                                Which are explicitly laid out and limited to things like emergency services and critical health care services. You know, kind of similar to how the government can take over your TV, radio, etc... with emergency alert services. So, nothing new there and that is a valid exemption that even net neutrality proponents are fine with. Your attempt to frame it as something else is pathetic. It's also no different from the extremely narrow and limited exceptions to the First Amendment. Are you going to argue that we don't have freedom of speech because there are some exceptions?

                                Try reading it some time

                                I have. You obviously have not, or are lying about what it says. Take your pick.

                                it's now a historical document without any force of law

                                Sadly.

                                but the logic is pretty hilarious.

                                The courts said otherwise since they upheld the order prior to Pai becoming chairman.

                                Try again Richard.

                                reply to this | link to this | view in chronology ]

                            • icon
                              nasch (profile), 12 Nov 2019 @ 6:41pm

                              Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                              Since you seem to be having trouble, here it is in full. And "open internet" is the phrase the FCC chose to use to describe net neutrality. But I'm sure you already knew that and are just playing dumb to try to obfuscate the issue. So is it your position that these orders hampered investment in the broadband sector?

                              A. Strong Rules That Protect Consumers from Past and Future Tactics that Threaten
                              the Open Internet

                              1. Clear, Bright-Line Rules
                              2. Because the record overwhelmingly supports adopting rules and demonstrates that three
                                specific practices invariably harm the open Internet—Blocking, Throttling, and Paid Prioritization—this
                                Order bans each of them, applying the same rules to both fixed and mobile broadband Internet access
                                service.
                              3. No Blocking. Consumers who subscribe to a retail broadband Internet access service
                                must get what they have paid for—access to all (lawful) destinations on the Internet. This essential and
                                well-accepted principle has long been a tenet of Commission policy, stretching back to its landmark
                                decision in Carterfone, which protected a customer’s right to connect a telephone to the monopoly
                                telephone network.
                                16
                                Thus, this Order adopts a straightforward ban:
                                A person engaged in the provision of broadband Internet access service, insofar as such
                                person is so engaged, shall not block lawful content, applications, services, or nonharmful devices, subject to reasonable network management.
                              4. No Throttling. The 2010 open Internet rule against blocking contained an ancillary
                                prohibition against the degradation of lawful content, applications, services, and devices, on the ground
                                that such degradation would be tantamount to blocking. This Order creates a separate rule to guard
                                against degradation targeted at specific uses of a customer’s broadband connection:
                                A person engaged in the provision of broadband Internet access service, insofar as such person is
                                so engaged, shall not impair or degrade lawful Internet traffic on the basis of Internet content,
                                application, or service, or use of a non-harmful device, subject to reasonable network
                                management.
                              5. The ban on throttling is necessary both to fulfill the reasonable expectations of a
                                customer who signs up for a broadband service that promises access to all of the lawful Internet, and to
                                avoid gamesmanship designed to avoid the no-blocking rule by, for example, rendering an application
                                effectively, but not technically, unusable. It prohibits the degrading of Internet traffic based on source,
                                destination, or content.17 It also specifically prohibits conduct that singles out content competing with a
                                broadband provider’s business model.
                              6. No Paid Prioritization. Paid prioritization occurs when a broadband provider accepts
                                payment (monetary or otherwise) to manage its network in a way that benefits particular content,
                                applications, services, or devices. To protect against “fast lanes,” this Order adopts a rule that establishes
                                that:
                                A person engaged in the provision of broadband Internet access service, insofar as such
                                person is so engaged, shall not engage in paid prioritization.

                              “Paid prioritization” refers to the management of a broadband provider’s network to
                              directly or indirectly favor some traffic over other traffic, including through use of
                              techniques such as traffic shaping, prioritization, resource reservation, or other forms of
                              preferential traffic management, either (a) in exchange for consideration (monetary or
                              otherwise) from a third party, or (b) to benefit an affiliated entity.18

                              1. The record demonstrates the need for strong action. The Verizon court itself noted that
                                broadband networks have “powerful incentives to accept fees from edge providers, either in return for
                                excluding their competitors or for granting them prioritized access to end users.”19
                                Mozilla, among many
                                such commenters, explained that “[p]rioritization . . . inherently creates fast and slow lanes.”20
                                Although
                                there are arguments that some forms of paid prioritization could be beneficial, the practical difficulty is
                                this: the threat of harm is overwhelming,21 case-by-case enforcement can be cumbersome for individual
                                consumers or edge providers, and there is no practical means to measure the extent to which edge
                                innovation and investment would be chilled. And, given the dangers, there is no room for a blanket
                                exception for instances where consumer permission is buried in a service plan—the threats of consumer
                                deception and confusion are simply too great. 22
                              2. No Unreasonable Interference or Unreasonable Disadvantage to Consumers
                                or Edge Providers
                              3. The key insight of the virtuous cycle is that broadband providers have both the incentive
                                and the ability to act as gatekeepers standing between edge providers and consumers. As gatekeepers,
                                they can block access altogether; they can target competitors, including competitors to their own video
                                services; and they can extract unfair tolls. Such conduct would, as the Commission concluded in 2010,
                                “reduce the rate of innovation at the edge and, in turn, the likely rate of improvements to network
                                infrastructure.”23
                                In other words, when a broadband provider acts as a gatekeeper, it actually chokes
                                consumer demand for the very broadband product it can supply.

                              4. The bright-line bans on blocking, throttling, and paid prioritization will go a long way to
                                preserve the virtuous cycle. But not all the way. Gatekeeper power can be exercised through a variety of
                                technical and economic means, and without a catch-all standard, it would be that, as Benjamin Franklin
                                said, “a little neglect may breed great mischief.”24
                                Thus, the Order adopts the following standard:
                                Any person engaged in the provision of broadband Internet access service, insofar as
                                such person is so engaged, shall not unreasonably interfere with or unreasonably
                                disadvantage (i) end users’ ability to select, access, and use broadband Internet access
                                service or the lawful Internet content, applications, services, or devices of their choice, or
                                (ii) edge providers’ ability to make lawful content, applications, services, or devices
                                available to end users. Reasonable network management shall not be considered a
                                violation of this rule.
                              5. This “no unreasonable interference/disadvantage” standard protects free expression, thus
                                fulfilling the congressional policy that “the Internet offer[s] a forum for a true diversity of political
                                discourse, unique opportunities for cultural development, and myriad avenues for intellectual activity.”25

                              And the standard will permit considerations of asserted benefits of innovation as well as threatened harm
                              to end users and edge providers.

                              1. Enhanced Transparency
                              2. The Commission’s 2010 transparency rule, upheld by the Verizon court, remains in full
                                effect:
                                A person engaged in the provision of broadband Internet access service shall publicly
                                disclose accurate information regarding the network management practices,
                                performance, and commercial terms of its broadband Internet access services sufficient
                                for consumers to make informed choices regarding use of such services and for content,
                                application, service, and device providers to develop, market, and maintain Internet
                                offerings.26
                              3. Today’s Order reaffirms the importance of ensuring transparency, so that consumers are
                                fully informed about the Internet access they are purchasing and so that edge providers have the
                                information they need to understand whether their services will work as advertised. To do that, the Order
                                builds on the strong foundation established in 2010 and enhances the transparency rule for both end users
                                and edge providers, including by adopting a requirement that broadband providers always must disclose
                                promotional rates, all fees and/or surcharges, and all data caps or data allowances; adding packet loss as a
                                measure of network performance that must be disclosed; and requiring specific notification to consumers
                                that a “network practice” is likely to significantly affect their use of the service. Out of an abundance of
                                caution and in response to a request by the American Cable Association, we also adopt a temporary
                                exemption from these enhancements for small providers (defined for the purposes of the temporary
                                exception as providers with 100,000 or fewer subscribers), and we direct our Consumer & Governmental
                                Affairs Bureau to adopt an Order by December 15, 2015 concerning whether to make the exception
                                permanent and, if so, the appropriate definition of “small.” Lastly, we create for all providers a “safe
                                harbor” process for the format and nature of the required disclosure to consumers, which we believe will
                                result in more effective presentation of consumer-focused information by broadband providers.
                              4. Scope of the Rules
                              5. The open Internet rules described above apply to both fixed and mobile broadband
                                Internet access service. Consistent with the 2010 Order, today’s Order applies its rules to the consumer-
                                facing service that broadband networks provide, which is known as “broadband Internet access service”27
                                (BIAS) and is defined to be:
                                A mass-market retail service by wire or radio that provides the capability to transmit
                                data to and receive data from all or substantially all Internet endpoints, including any
                                capabilities that are incidental to and enable the operation of the communications
                                service, but excluding dial-up Internet access service. This term also encompasses any
                                service that the Commission finds to be providing a functional equivalent of the service
                                described in the previous sentence, or that is used to evade the protections set forth in
                                this Part.
                              6. As in 2010, BIAS does not include enterprise services, virtual private network services,
                                hosting, or data storage services. Further, we decline to apply the open Internet rules to premises
                                operators to the extent they may be offering broadband Internet access service as we define it today.
                              7. In defining this service we make clear that we are responding to the Verizon court’s
                                conclusion that broadband providers “furnish a service to edge providers” (and that this service was being
                                treated as common carriage per se). As discussed further below, we make clear that broadband Internet
                                access service encompasses this service to edge providers. Broadband providers sell retail customers the
                                ability to go anywhere (lawful) on the Internet. Their representation that they will transport and deliver
                                traffic to and from all or substantially all Internet endpoints includes the promise to transmit traffic to and
                                from those Internet endpoints back to the user.
                              8. Interconnection. BIAS involves the exchange of traffic between a broadband Internet
                                access provider and connecting networks. The representation to retail customers that they will be able to
                                reach “all or substantially all Internet endpoints” necessarily includes the promise to make the
                                interconnection arrangements necessary to allow that access.
                              9. As discussed below, we find that broadband Internet access service is a
                                “telecommunications service” and subject to sections 201, 202, and 208 (along with key enforcement
                                provisions). As a result, commercial arrangements for the exchange of traffic with a broadband Internet
                                access provider are within the scope of Title II, and the Commission will be available to hear disputes
                                raised under sections 201 and 202 on a case-by-case basis: an appropriate vehicle for enforcement where
                                disputes are primarily over commercial terms and that involve some very large corporations, including
                                companies like transit providers and Content Delivery Networks (CDNs), that act on behalf of smaller
                                edge providers.
                              10. But this Order does not apply the open Internet rules to interconnection. Three factors
                                are critical in informing this approach to interconnection. First, the nature of Internet traffic, driven by
                                massive consumption of video, has challenged traditional arrangements—placing more emphasis on the
                                use of CDNs or even direct connections between content providers (like Netflix or Google) and last-mile
                                broadband providers. Second, it is clear that consumers have been subject to degradation resulting from
                                commercial disagreements,
                                28 perhaps most notably in a series of disputes between Netflix and large last-
                                mile broadband providers. But, third, the causes of past disruption and—just as importantly—the
                                potential for future degradation through interconnection disputes—are reflected in very different
                                narratives in the record.
                              11. While we have more than a decade’s worth of experience with last-mile practices, we
                                lack a similar depth of background in the Internet traffic exchange context. Thus, we find that the best
                                approach is to watch, learn, and act as required, but not intervene now, especially not with prescriptive
                                rules. This Order—for the first time—provides authority to consider claims involving interconnection, a
                                process that is sure to bring greater understanding to the Commission.
                              12. Reasonable Network Management. As with the 2010 rules, this Order contains an
                                exception for reasonable network management, which applies to all but the paid prioritization rule (which,
                                by definition, is not a means of managing a network):
                                A network management practice is a practice that has a primarily technical network
                                management justification, but does not include other business practices. A network
                                management practice is reasonable if it is primarily used for and tailored to achieving a
                                legitimate network management purpose, taking into account the particular network
                                architecture and technology of the broadband Internet access service.
                              13. Recently, significant concern has arisen when mobile providers’ have attempted to justify
                                certain practices as reasonable network management practices, such as applying speed reductions to
                                customers using “unlimited data plans” in ways that effectively force them to switch to price plans with
                                less generous data allowances. For example, in the summer of 2014, Verizon announced a change to its
                                “unlimited” data plan for LTE customers, which would have limited the speeds of LTE customers using
                                grandfathered “unlimited” plans once they reached a certain level of usage each month. Verizon briefly
                                described this change as within the scope of “reasonable network management,” before changing course
                                and withdrawing the change.
                              14. With mobile broadband service now subject to the same rules as fixed broadband service,
                                the Order expressly recognizes that evaluation of network management practices will take into account
                                the additional challenges involved in the management of mobile networks, including the dynamic
                                conditions under which they operate. It also recognizes the specific network management needs of other
                                technologies, such as unlicensed Wi-Fi networks.
                              15. Non-Broadband Internet Access Service Data Services. The 2010 rules included an
                                exception for “specialized services.” This Order likewise recognizes that some data services—like
                                facilities-based VoIP offerings, heart monitors, or energy consumption sensors—may be offered by a
                                broadband provider but do not provide access to the Internet generally. The term “specialized services”
                                can be confusing because the critical point is not whether the services are “specialized;” it is that they are
                                not broadband Internet access service. IP-services that do not travel over broadband Internet access
                                service, like the facilities-based VoIP services used by many cable customers, are not within the scope of
                                the open Internet rules, which protect access or use of broadband Internet access service. Nonetheless,
                                these other non-broadband Internet access service data services could be provided in a manner that
                                undermines the purpose of the open Internet rules and that will not be permitted. The Commission
                                expressly reserves the authority to take action if a service is, in fact, providing the functional equivalent of
                                broadband Internet access service or is being used to evade the open Internet rules. The Commission will
                                vigilantly watch for such abuse, and its actions will be aided by the existing transparency requirement that
                                non-broadband Internet access service data services be disclosed.

                              16. Enforcement
                              17. The Commission may enforce the open Internet rules through investigation and the
                                processing of complaints (both formal and informal). In addition, the Commission may provide guidance
                                through the use of enforcement advisories and advisory opinions, and it will appoint an ombudsperson.
                                In order to provide the Commission with additional understanding, particularly of technical issues, the
                                Order delegates to the Enforcement Bureau the authority to request a written opinion from an outside
                                technical organization or otherwise to obtain objective advice from industry standard-setting bodies or
                                similar organizations.

                              reply to this | link to this | view in chronology ]

                              • icon
                                Richard Bennett (profile), 12 Nov 2019 @ 6:58pm

                                Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                                No, "open Internet" is not shorthand for "net neutrality", that was explained in the chairman's statement attached to the 2010 open Internet order.

                                reply to this | link to this | view in chronology ]

                                • identicon
                                  Anonymous Coward, 14 Nov 2019 @ 7:27am

                                  Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                                  No, "open Internet" is not shorthand for "net neutrality"

                                  Well actually, people do use the two interchangeably. However, even if you don't, net neutrality is required in order to have an open internet so you're really wrong either way.

                                  that was explained in the chairman's statement attached to the 2010 open Internet order.

                                  That might mean something, if we were talking about the 2010 rules, but we're talking about the 2015 rules. Take your bait and switch tactics elsewhere.

                                  Try again Richard.

                                  reply to this | link to this | view in chronology ]

                                  • icon
                                    nasch (profile), 14 Nov 2019 @ 7:47am

                                    Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                                    Try again Richard.

                                    Or don't, and just go away.

                                    reply to this | link to this | view in chronology ]

                                    • identicon
                                      Anonymous Coward, 14 Nov 2019 @ 8:26am

                                      Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                                      But he's so much fun to watch his reaction when you point out his blatant and obvious lies! :P

                                      reply to this | link to this | view in chronology ]

                            • identicon
                              Anonymous Coward, 14 Nov 2019 @ 7:07am

                              Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:

                              That doesn't mean it isn't about net neutrality. Remember when I said net neutrality is fairly clearly defined? Yeah, the 2015 rules encompass the majority of net neutrality. Which you knew (because everyone has been calling it the net neutrality rules), you just can't admit it because you'd then have to admit you were wrong.

                              Try again Richard.

                              reply to this | link to this | view in chronology ]

                    • identicon
                      Anonymous Coward, 14 Nov 2019 @ 7:05am

                      Re: Re: Re: Re: Re: Re: Re: Re: Re:

                      Title II hampered investment.

                      No, it didn't. ISPs even came out and said it didn't. Liar. But we already knew that.

                      I'm not confident defining net neutrality as it appears to mean whatever you want it to mean.

                      Well, net neutrality is pretty clearly defined and everyone except you seems to know what it is. If you were actually honest instead of a dishonest industry shill, you would know that.

                      Try again Richard.

                      reply to this | link to this | view in chronology ]

                • identicon
                  Anonymous Coward, 14 Nov 2019 @ 6:59am

                  Re: Re: Re: Re: Re: Re: Re:

                  He didn't say it was the ONLY thing that affected it, just that it did affect it. Way to twist words.

                  Try again Richard.

                  reply to this | link to this | view in chronology ]

        • icon
          Toom1275 (profile), 7 Nov 2019 @ 8:06am

          Re: Re: Re:

          It's always projection from you.

          reply to this | link to this | view in chronology ]

    • identicon
      Elizabeth Pierce, 6 Nov 2019 @ 5:46pm

      Re: OK boomer

      Help me, Richard! You're my only hope! I don't like it in here, they keep telling me ghastly things, like satisfied customers and giving people what they paid for. It's horrifying! Help me, Richard!

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 7 Nov 2019 @ 4:55am

        Re: Re: OK boomer

        Don't worry, I'm sure Dick's got his special rimjob lipstick on. Pai's Reese piece generator isn't going to clean itself you know.

        reply to this | link to this | view in chronology ]


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