FCC Warns AT&T, Verizon They're Violating Net Neutrality With Zero Rating Schemes

Broadband

from the nice-timing,-hero dept

Last month, we noted how the FCC had finally woken up from a deep slumber to realize that zero rating (an ISP exempting its own or a partner company’s content from usage caps) can be anti-competitive. The FCC’s net neutrality rules don’t specifically ban zero rating, but the agency had said it would act on a “case by case basis” should the practice be used anti-competitively. But a year came and went, and the FCC consistently failed to act as ISPs from Comcast to Verizon began giving their own content an unfair leg up in the market.

That was until last month, when the FCC sent AT&T a letter warning it that exempting its DirecTV Now content from AT&T wireless usage caps raised “serious concerns” about the open internet. Apparently unfazed by AT&T’s defense of its behavior, the FCC last week sent an additional letter to AT&T (pdf) saying it believes that AT&T’s implementation of usage caps hurts competition:

“…Your submission tends to confirm our initial view that the Sponsored Data program strongly favors AT&T’s own video offerings while unreasonably discriminating against unaffiliated edge providers and limiting their ability to offer competing video services to AT&T’s broadband subscribers on a level playing field. We have therefore reached the preliminary conclusion that these practices inhibit competition, harm consumers, and interfere with the “virtuous cycle” needed to assure the continuing benefits of the Open Internet.”

Again, why it took the FCC the better part of a year to realize this isn’t clear, but the agency sent a similar letter to Verizon (pdf). In that letter, the FCC criticizes Verizon’s “Free Bee” sponsored data service that lets competing content companies enjoy the same cap-exempt status Verizon’s own content enjoys — if companies are willing to pay a steep premium:

“Under either option for competing with Verizon’ s Go90 or other affiliated edge services, unaffiliated edge providers appear to confront significant disadvantages when trying to compete with Verizon from the combined impact of Verizon’s FreeBee Data 360 fees and zero-rating of its own Go90 offerings. We are therefore concerned that this combination could present anti-competitive effects.”

That’s great, FCC, we’re so glad you could join the rest of us in realizing the obvious. But while the FCC’s letters urge both AT&T and Verizon to offer up further justifications before December 15, there’s no indication any FCC enforcement or punishment for these violations will survive the Trump administration. We’ve noted how all of Trump’s telecom advisors not only have deep ties to the broadband industry, but have actively stated they want to gut net neutrality rules entirely in addition to hamstringing and defunding the FCC.

In fact Ajit Pai, a current Commissioner in the running for new FCC boss issued a statement (pdf) reminding the FCC that whatever it does can (and likely will) be undone by the new administration:

“Chairman Wheeler launched yet another broadside against free data for consumers, notwithstanding the objections of Republican commissioners. This end-run around Congress?s clear instruction is sad?and pointless. For any unilateral action taken by the Wireless Telecommunications Bureau at the Chairman?s direction in the next 49 days can quickly be undone by that same bureau after January 20, 2017.”

So again, it’s great that the FCC finally realized that using caps to give your own content an unfair market advantage is anti-competitive, but the enforcement (if you can call it that) comes too little too late for consumers, given the incoming administration has made every indication it intends to either refuse to enforce the existing rules, or work to scrap net neutrality protections entirely.

Filed Under: competition, fcc, net neutrality, zero rating
Companies: at&t, verizon

Comcast Loses Just $5.50 Per Month When You Cut The Cord Thanks To Its Growing Broadband Monopoly

Broadband

from the insulated-from-competitive-harm dept

We’ve noted several times that the cable industry is somewhat shielded from the rise of cord cutting because of its growing monopoly over broadband. You see, as AT&T and Verizon give up on unwanted DSL customers they don’t want to upgrade (as part of a pivot into content and ads), there are now huge swaths of the country where users really only have one option for broadband above 25 Mbps: cable. Users fleeing neglected DSL lines sign up for cable, and because TV bundled with broadband is cheaper than broadband alone, users sign up for TV service they may not even want.

As this cable monopoly grows, these cable companies have less incentive than ever to compete on price across more than half of their footprint. And with ISPs literally writing state laws preventing public/private or community broadband, no market forces exist to prevent them from expanding the application of entirely unnecessary usage caps and overage fees. Most analyses overlook this, instead focusing on the scattered rise of Google Fiber and other gigabit deployments in highly-select areas.

One Wall Street analyst this week highlighted just how cushioned a company like Comcast really is when it comes to cord cutting. MoffettNathanson analyst Craig Moffett crunched the numbers and found that once you account for the higher costs you’ll have to pay for buying broadband standalone, Comcast only really loses about $5.50 per month when a user cuts the TV cord:

“When a Comcast customer drops video, the MSO loses about $38 in contribution margin, Moffett estimates. But that customer ends up paying an extra $25 a month more for broadband when their bundling discount goes away. “Now, further suppose that half of those customers opt to upgrade to a higher speed tier at an average premium of $15 per month (implying a probability-weighted $7.50 benefit per cord-cutter).” The difference comes to $5.50.

Moffett’s analysis isn’t perfect and Comcast’s losses are likely higher. He comes to that $5.50 number by assuming the departing customer upgrades to a faster speed, which really isn’t necessary just for streaming Netflix. And it’s not clear he’s included the revenues Comcast makes on households paying rental fees for numerous cable boxes, or the fees Comcast hides below the line (like the broadcast TV fee). Still, the point remains that Comcast is arguably shielded from cord cutting because of the high prices it charges for broadband — only made possible by limited broadband competition.

And Moffett doesn’t even touch on the fact that Comcast can further recoup any cord cutting losses via usage caps and overage fees, something Moffett and other investors have long embraced given it lets an ISP charge significantly more money for the exact same service. Nor does Moffett highlight how Comcast further benefits by counting all competitor streaming traffic against the cap, while it’s own streaming video service remains cap exempt.

All told, cable providers are now adding 99% of the quarterly net additions for new broadband subcribers each quarter, at the same time that the sector is consolidating at an incredible rate. And these companies continue to have almost comical control over state legislatures, often allowing them to literally write wish-list legislation further insulating them from competitive harm. And time and time again the industry, and the policy folks it employs en masse to pollute public discourse, intentionally conflate enabling this protectionist dysfunction as the “deregulation of free markets” (often with no penalty from an unskeptical press).

So yes, if you live in a major, relatively-affluent city or upscale broadband development your broadband options may be improving, if you’re lucky. But across more than half of the country, users are actually seeing less broadband competition than ever before. And with Trump listening to telecom advisors that don’t believe monopolies exist and are keen on gutting net neutrality and all regulatory oversight of said non-existing monopolies, you’re potentially talking about millions of consumers looking at higher prices and worse customer service than ever before.

The solution, again, is fighting for better broadband on the local level. If you want better broadband, you need to get behind the push to eliminate protectionist state laws that restrict towns and cities from making local broadband infrastructure decisions for themselves. These laws, passed in roughly 20 states, not only prohibit towns and cities from building their own networks (even in cases where nobody else will), but they often hinder the kind of public/private partnerships that are becoming necessary to shore up competitive gaps caused by the broadband market failure the industry will tell you doesn’t exist.

Filed Under: broadband, competition, cord cutting, craig moffett, monopoly, tv
Companies: comcast

After Zero Rating Backlash, Facebook Returns With New, Somewhat Murky 'Express WiFi' Initiative

Broadband

from the with-friends-like-these dept

You might recall that earlier this year there was a massive backlash against Facebook for its often clumsy attempts to try and dominate emerging developing nation ad markets through what many saw as bogus altruism. The entire fracas bubbled over in India, where regulators banned Facebook’s attempt to create a sort of zero-rated, net neutrality-violating walled garden of Facebook-curated content under the pretense of helping the nation’s farmers. Facebook didn’t help itself by trying to drum up fake support for its initiatives while labeling those worried about the plan as extremists.

Under the original idea, low-income families got access to a limited crop of Facebook-approved content; sort of a glorified AOL for poor people. However, net neutrality advocates and critics like Mozilla were (justly) concerned with this giving Facebook too much power over content, so they consistently argued that if Facebook was so desperately interested in helping the poor — the company and its Internet.org initiative should focus on providing actual broadband connectivity.

Fast forward to this week, and Facebook appears to have dusted off its trousers and is preparing to try again. The company’s Internet.org website this week announced that it would be bringing something called “Express WiFi” to India. The website is almost hysterically short on details, only offering explanations like this:

“With Express Wifi, we?re working with carriers, internet service providers, and local entrepreneurs to help expand connectivity to underserved locations around the world. We?re currently live in India, and are expanding to other regions soon.”

Facebook not only isn’t really explaining what Express WiFi is, they’re not saying how much it costs, where it’s available, or giving even the slightest technical explanation of how the system and software works. It could actually be a good thing. Or it might be terrible. No one can actually say based on the little info provided. The end result has been oodles of articles with promotional photos like this one highlighting Facebook’s incredible altruism and showcasing Zuck as a man of the people. But not a single one could be bothered to explain how this new initiative differs from Facebook’s last, arguably bungled Free Basics effort.

It took a little digging, but the company provided this still relatively ambiguous statement on Express WiFi:

Currently we are working with ISP and operator partners to test Express Wi-Fi with public Wi-Fi deployments in multiple pilot sites. This solution empowers ISPs, operators, and local entrepreneur retailers to offer quality internet access to their village, town or region.

Express Wi-Fi customers can purchase fast, reliable and affordable data packs via digital vouchers to access the Internet on the Express Wi-Fi network.

We focus on building a sustainable economic model for all stakeholders involved, so that local retailer entrepreneurs, ISPs, operators, and Facebook can continue to invest in and operate lasting connectivity.

We believe a sustainable economic model is the one which can scale to bring all of India online.

That’s still kind of murky, and Facebook’s refusal to explain precisely how this system will work (and just what its software at the heart of the initiative does, collects or delivers) raises a few warning flags, since you’d think Facebook would want to clearly ease the minds of net neutrality activists in India. Still, at least on the surface, it appears that Facebook may have actually listened to its critics that pointed out the best way to bring the internet to the poor — is to actually bring the internet to the poor. Quite a novel idea.

Filed Under: express wifi, internet basics, zero rating
Companies: facebook

Trump Appoints Third Anti-Net Neutrality Advisor To Telecom Transition Team

Broadband

from the burn-the-house-down dept

President-elect Donald Trump’s promise to “drain the DC swamp” has become a bit of a running gag as his administration plugs a wide variety of lobbyists and cronies into key cabinet positions. Telecom is certainly no exception, with Trump appointing a number of telecom sector lobbyists and allies to guide telecom policy and help select a new FCC boss. One of these picks doesn’t believe telecom monopolies exist. None of them can actually admit the broadband market isn’t competitive. And all of them have made it abundantly clear that they intend to roll back net neutrality and effectively gut the FCC from the inside out.

Trump completed a telecom sector trifecta of anti-net neutrality advisors this week, with the selection of American Enterprise Institute think tanker Roslyn Layton. Layton joins Jeffrey Eisenach (a long-standing Verizon consultant) and Mark Jamison (a former Sprint lobbyist) to form a perfect circle of industry allies — all of whom are on record opposing not only net neutrality, but nearly every FCC effort to make the broadband sector more competitive. All three have been visiting fellows over at the American Enterprise Institute, which takes money from large telecom providers in exchange for muddying the discourse waters.

Over at the AEI blog, Layton has consistently made her disdain for net neutrality very clear. Like so many broadband industry allies, Layton insists that net neutrality protections for consumers aren’t necessary, and that the concept is all some kind of secretive cabal on the part of Netflix to ride incumbent ISP pipes for free:

“Using their own definitions, however, companies such as Netflix hijack the language of net neutrality to lobby for regulatory favors. They want the government to mandate that transit costs they pay for today become free. In the offline world, such a deal would mean that retailers could not negotiate agreements with their suppliers or even where products could be placed on shelves.

This idea that net neutrality is a phantom problem and mostly about somehow secretly giving Netflix free bandwidth is a ridiculous idea we’ve debunked time and time again. Current FCC Commissioner Ajit Pai, among the finalists to lead the next FCC, has tried to claim net neutrality is some kind of unholy Netflix cabal for years. Why the disdain and bizarre focus on Netflix? Incumbent cable companies loathe Netflix for its support of net neutrality, opposition to usage caps, and the erosion of their legacy TV subscriber base, so they work pretty tirelessly to smear the company as often as possible via proxy policy voices.

Blaming everything on Netflix helps incumbent broadband ISPs (and their allied think tankers, consultants, and lobbyists) avoid two glaring truths: one, that net neutrality is a symptom of the disease that is limited broadband competition, but if you admit the broadband market isn’t competitive, then you have to actually do something about it; and two, that net neutrality has broad, bi-partisan support among the public. Pretending net neutrality is solely about giving Netflix “free stuff” is a handy narrative that obfuscates both truths.

Layton, like Eisenach and Jamison, also opposed the FCC’s basic new privacy protections. Those rules, which only require that ISPs are transparent about what’s being collected and provide working opt-out tools, were passed only after Verizon was busted modifying user data packets to track users around the internet — without informing them or providing working opt out tools. The FCC also acted after AT&T began trying to charge broadband customers a premium just to protect their own privacy, and Cable ONE hinted at offering worse customer service to users with bad credit scores.

Like net neutrality, these violations are just another symptom of the lack of broadband competition, and the bad behavior on the part of incumbent ISPs has been fully apparent to anybody paying attention. But according to Layton, these privacy rules were just “partisan” gamesmanship, and utterly unnecessary because ISPs weren’t doing anything wrong:

“Chairman Wheeler?s three years at the FCC have broken records in partisanship, with more votes along party lines for rulemaking than previous commissions combined. Consider the recent online privacy rulemaking, which came about only because the FCC?s Open Internet rules reclassified Internet broadband under Title II, giving FCC new authority to regulate Internet privacy. Simply stated, the FCC rulemaking was not born out of any concluded necessity.”

Yes, the FCC has long split along partisan lines, quite often on issues (like net neutrality) that shouldn’t be partisan. Under Wheeler, that was largely thanks to Commissioners Ajit Pai and Mike O’Rielly, who voted down nearly every consumer-benefiting policy the FCC tried to enact. That includes the duo voting down every single attempt to hold AT&T accountable for outright fraud, whether that involved AT&T ripping off programs for low income families, turning a blind eye to abuse of IP Relay systems intended for the hearing imparied, or intentionally helping crammers rip off AT&T customers by making fraudulent charges on bills harder to detect.

Under the guidance of Layton, Eisenach and Jamison, you can expect every effort to hold incumbent ISPs accountable for bad behavior to evaporate. Gone will be the FCC’s net neutrality rules. Gone will be the agency’s new privacy protections. Gone will be efforts to shore up broadband competition. In addition to selecting an FCC boss that will be sure to avoid admitting any substantive faults on the part of incumbent ISPs, you can expect a rewrite of the Communications Act in 2017 with a full focus on hamstringing the FCC’s ability to protect consumers while dramatically slashing its funding.

This tends to get lost among farmed think tank pie charts and misleading arguments from dollar-per-holler economists and fauxcademics, but boiled down to their purest essence, these positions are about one thing and one thing only: protecting giant incumbent ISP revenues. This isn’t really about deregulation — given that these same folks are generally ok with awful regulation, just as long as it’s AT&T, Verizon and Comcast writing the law. And the ultimate irony remains that this gutting of all popular, bipartisan consumer protections will be conducted under the false banner of “populist reform.”

Filed Under: donald trump, drain the swamp, fcc, jeffrey eisenach, lobbyists, mark jamison, net neutrality, roslyn layton

AT&T Just Showed Us What The Death Of Net Neutrality Is Going To Look Like

Broadband

from the not-with-a-bang-but-with-a-whimper dept

For some time now we’ve warned how the FCC’s decision to not ban zero rating (exempting some content from usage caps) was going to come back and bite net neutrality on the posterior. Unlike India, Japan, The Netherlands, Norway, Chile, and other countries, the FCC crafted net neutrality rules that completely avoided tackling the issue of usage caps and zero rating. Then, despite ongoing promises that the agency was looking into the issue, the FCC did nothing as AT&T, Verizon and Comcast all began exempting their own content from usage caps while still penalizing competitors.

Fast forward to this week, and AT&T has delivered what may very well be the killing blow to net neutrality thanks predominantly to the FCC’s failure to see the writing on the wall.

AT&T this week is launching its new “DirecTV Now” streaming video service. According to the full AT&T announcement, the service offers various packages of streamed TV content ranging from $35 to $70 per month. Thanks to AT&T’s looming $100 billion acquisition of Time Warner, AT&T’s even throwing in HBO for an additional $5 per month, the lowest price point in the industry. Though a bit hamstrung to upsell you to traditional DirecTV (two stream limit, no 4K content, no NFL Sunday Ticket, no DVR functionality), all told it’s a fairly compelling package for cord cutters.

But somewhat buried in AT&T’s announcement is the long-expected confirmation that this new service won’t count against usage caps if you’re an AT&T wireless subscriber:

“And, if you?re an AT&T Mobility customer, DIRECTV will pick up the tab for data to help you achieve all your binge-worthy goals. Data Free TV means you won?t use your AT&T mobile data for watching DIRECTV NOW or FreeVIEW in the App. Fullscreen will also cover your data for streaming in the Fullscreen App on the AT&T mobile network.”

For consumers who have no idea what zero rating or net neutrality even is (read: most of them), this sounds like a great idea. Most don’t know that usage caps are an entirely-arbitrary construct completely untethered from network or financial necessity. As such, they believe they’re getting something for free. This collective illusion means fewer annoyed users, which means less political pressure on the FCC, which is why the FCC failed to act. The problem, as we’ve noted time and time again, is that AT&T is violently distorting the open market and giving its own content a distinct and decidedly unfair market advantage.

Because most consumers either aren’t bright or informed enough to understand this doesn’t mean it’s not happening all the same.

In addition to existing offerings by Dish (Sling TV) and Sony (Playstation Vue), the “over the top” market is about to get flooded with an absolute torrent of live TV streaming competitors including Apple, YouTube, Hulu, and Amazon. Ideally, these services would all compete with DirecTV Now based on quality and pricing. But under AT&T’s new zero rating umbrella, all of those services will count against AT&T’s usage caps, while DirecTV Now won’t. Owning the pipe and the content will protect AT&T from the full brunt of increased competition in the space.

This is precisely the sort of “new normal” AT&T has spent the last decade trying to build, and exactly the sort of future net neutrality rules were supposed to help us avoid. And while the current Wheeler-led FCC recently finally acknowledged that it now understands this sort of behavior is anti-competitive, it’s too little, too late. There’s every indication that Trump’s new FCC intends to not only gut net neutrality, but the FCC entirely. Trump’s telecom transition team is filled to the brim with telecom-sector cronies who can’t even admit telecom monopolies are real. Large ISP executives and investors are thrilled.

With no (or unenforced) net neutrality rules and a toothless FCC, you can expect all of the incumbent broadband ISPs to follow AT&T’s lead, while folks like Trump telecom advisor Jeffrey Eisenach regurgitate telecom sector think tank pieces trying to claim that zero rating is a huge boon to consumers. These are men and economists for hire who’ll breathlessly inform you they adore “free markets” and open competition, while simultaneously working to thwart competition at every turn — whether it’s dismantling the level streaming playing field with zero rating, or letting telecom giants literally write abysmal telecom law.

Those who have actually paid attention to net neutrality realize this may very well be the beginning of the end for the idea — or at best a very long, dark and unfortunate detour off of the path — with the ultimate irony being that because zero rating is seen as little more than “free stuff” by many misinformed consumers, net neutrality’s death knell will arrive to thunderous public applause.

Filed Under: discrimination, fcc, net neutrality, open internet, streaming tv, zero rating
Companies: at&t, directv

Trump, GOP Prepare To Gut FCC Boss Tom Wheeler's Populist Reforms…Under The False Banner Of Populist Reform

Broadband

from the autopilot-to-oblivion dept

So we’ve noted a few times over the years how current FCC boss Tom Wheeler was a bit of a surprise for many of us covering the telecom sector. As a former wireless and cable lobbyist with some unclear policy positions, alarm bells were raised when his appointment to the chairman spot was first announced. But as Wheeler’s tenure rolled on, he wound up being arguably one of the most consumer and startup-friendly FCC leaders in the history of the agency (which, given the agency’s history as a rubber stamp for large broadband providers, admittedly wasn’t a particularly high water mark).

Under Wheeler, the FCC raised the definition of broadband to 25 Mbps (to highlight competition gaps for next-gen speeds), passed and successfully defended net neutrality rules, imposed some relatively basic broadband privacy protections for consumers, fought for an open and more competitive cable box market, fought (albeit unsuccessfully) to stop incumbent ISPs from writing protectionist state laws, and did something few of his predecessors (of either political alignment) could bother to do: admit the U.S. broadband market was uncompetitive. I was so shocked by Wheeler that I issued a mea culpa.

But that was then, and this is now.

With a Trump victory in the books, Wheeler is now headed for the door. While his tenure technically extends until 2018, it’s generally customary for the current FCC boss to step down as chairman. While Wheeler could legally stick around as a regular commissioner, it’s not clear Wheeler wants to spend his retirement years playing Sisyphus. Fearing Wheeler might continue, well, trying to help consumers in the months before his departure, the chairs of the House Energy & Commerce Committee and Communications Subcommittee this week officially asked Wheeler to avoid trying to implement any “controversial” or “partisan” efforts in his final months in office:

“I strongly urge the FCC to avoid directing its attention and resources in the coming months to complex, partisan, or otherwise controversial items that the new Congress and new Administration will have an interest in reviewing,? Senator John Thune wrote Tuesday in a letter to Wheeler…Any action taken by the FCC following November 8, 2016, will receive particular scrutiny,? the GOP lawmaker proclaimed.”

At this point we should probably remind you that the GOP has hounded Wheeler for several years now with an endless series of pointless “accountability” hearings with one core function: shame Wheeler for standing up to AT&T, Verizon and Comcast. Absolutely everything Wheeler has done has been deemed “controversial” by the GOP, which was particularly incensed over net neutrality and the reclassification of ISPs as common carriers (necessary to legally defend the rules). In each hearing, Wheeler was cool under pressure despite being repeatedly shamed for simply doing his job.

People should also probably be reminded that much of what the GOP tries to insist are “partisan” issues in telecom in fact have broad bipartisan support. Net neutrality, for example, is framed as “divisive” and “partisan” by the GOP, yet has broad support from members of both political parties. Similarly, municipal broadband (communities building their own networks or striking public/private partnerships to address private market failure) is often tagged as “partisan” by the GOP, despite the fact that the idea has broad bipartisan support, and most community broadband networks are built in Conservative areas.

The public’s disdain for companies like Comcast and their lobbyist stranglehold of government is damn near universal, and indisputibly bipartisan.

Much like former FCC boss Kevin Martin did when Democrats made a similar request in 2008, Wheeler was quick to bow to GOP pressure and wipe the FCC calendar clean. With that decision the FCC is effectively now on autopilot, and most of the remaining items on Wheeler’s agenda (especially attempts to bring competition to the cable box) can be considered dead. Needless to say, consumer advocacy groups like Public Knowledge weren’t all that impressed with the FCC’s decision to give up on a number of items (like legacy business data services pricing) the agency had been working on for years:

“…the agenda items address real and pressing problems in the broadband marketplace. These problems do not simply go away due to an administration change. When Republicans take over, they will need to address the same competitive problems, or explain to the American people why they plan to perpetuate our broadband duopoly.”

A number of the things the FCC put on hold at GOP request were simply normal operational efforts the GOP would have needed to address anyway — including efforts to create a new roaming standard and to classify Voice over LTE (a higher quality audio standard). Senator Ron Wyden also issued a statement pointing out that the freeze also impacts efforts to try and expand funding for wireless broadband in more rural markets — markets that Trump repeatedly paid ample lip service to throughout his campaign:

“I regularly hear from Oregonians in rural counties that it is clear high costs are preventing private sector broadband investment in parts of rural Oregon. The FCC must fulfill its responsibility to provide a lifeline to rural communities and a connection to the global economy. Wireless cell service and broadband internet spur economic opportunity, improve public safety and increase educational outcomes for rural Americans. Any delay causes these rural communities to wait even longer for help,” said Wyden.”

What happens next isn’t entirely clear, but early signs aren’t promising if you prefer your regulators independent and with a dash of backbone. Trump’s telecom transition team is being led by Jeffrey Eisenach, a think tanker with direct ties to telecom (yet not technically a “lobbyist”) who has vehemently opposed nearly every pro-consumer policy the agency has ever implemented. Also on Trump’s advisory team is Rep. Marsha Blackburn, whose faithful support of AT&T and protectionist state laws has played a starring role in ensuring that her state of Tennessee remains a broadband backwater.

Trump has said he opposes net neutrality (even if it’s not clear he actually understands what it is), suggesting those rules will either be scrapped — or simply not enforced. Eisenach has similarly made it abundantly clear he sees the FCC’s future as one in which its influence over broadband is negligible to non-existent, and net neutrality is no longer the law of the land. In an editorial written over at The Hill in 2010, Eisenach blasted net neutrality as a “radical scheme” crafted (ironically) by bogus populists:

“Boiled down to the basics, in other words, net neutrality is a massive scheme for what Richard Posner termed ?taxation by regulation? ? the transfer of wealth from one group to another by means of government regulation….The populist rhetoric of (net neutrality supporting groups) often strikes a radical pose, but the real radicalism of net neutrality lies in the naked use of Federal regulatory power to redistribute wealth.

Eisenach, like so many incumbent ISP allies at the time, intentionally ignored the fact that net neutrality is something the public wanted by an overwhelming, bipartisan degree. And there’s nothing “radical” about preventing Comcast, AT&T or Verizon from using their last mile monopolies or arbitrary usage caps to give their own content an unfair market advantage (something they’re already happily doing with zero rating). What would be “radical” would be ignoring the will of the public and gutting net neutrality, a decision that will make the SOPA uprisings look like a small summer picnic.

While Eisenach picks a new FCC boss who shares his antiquated views, the GOP will be working on crafting entirely new broadband-industry-friendly laws. The GOP has long promised to rewrite the Communications Act with a strict focus on defunding and defanging the FCC, keeping the agency far away from the “amazing innovation” they believe magically blossoms when you refuse to protect consumers or regulate broken, uncompetitive markets. Efforts to try and do this previously have hit brick walls thanks, in large part, to the popularity of net neutrality — a popularity the GOP seems intent on ignoring.

By now, most Comcast or AT&T customers should realize the GOP’s antiquated claims that broadband is a healthy “free market” made better by gutless regulators is dated rhetoric from a bygone era of hot garbage. And while you’ll be hearing a lot of “let’s wait and see” in the months leading up to inauguration, there’s every indication the FCC will soon be reverting to its role as a rubber stamp for sector giants. Despite some potentially empty Trump campaign promises to fight the AT&T Time Warner Merger, Trump, the GOP and his transition team have made it brutally clear (in both commentary and transition hiring) that their plan for the FCC involves something in between a solid hamstringing and a frontal lobotomy.

To make it very clear: we’re gutting the FCC right at the point the agency was starting to actually listen to consumers for arguably the first time in its history — ironically, idiotically or insultingly (pick two) under the banner of “populist reform.” But overreach on net neutrality, and Trump will find himself not only on a collision course with net neutrality activists, but also with Trump supporters who signed on believing the Manhattan billionaire was leading a populist revolt.

Wheeler’s tenure floundered a bit at the tail end thanks to the agency’s refusal to seriously address zero rating, sneaky industry fees, or usage caps and unreliable meters. Even then, most consumers will remember Wheeler fondly as the first FCC Commissioner in the broadband era from either party that was at least willing to actually listen to the will of the public — a public that’s sick to death of uncompetitive broadband markets caused by letting AT&T, Verizon, and Comcast quite literally write protectionist laws that only serve to ensure market dysfunction continues.

While the future is uncertain, one thing seems likely: Wheeler’s shortcomings on subjects like zero rating are going to seem downright charming compared to the regulatory landscape currently being constructed by the next administration. Tom Wheeler, the man who went from dingo to net neutrality hero, was the closest thing to a true populist the modern FCC has ever had. Completely gutting net neutrality and his other efforts isn’t “populist reform,” it’s the political and intellectual equivalent of a roundhouse kick directly to the face of the American citizenry.

Filed Under: donald trump, fcc, jeffrey eisenach, lobbying, net neutrality, populism, rural broadband, tom wheeler