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Posted on Techdirt - 23 March 2018 @ 6:29am

Senators Say The FCC's Broadband Maps are a Bad Joke

from the hide-a-problem-so-you-don't-have-to-fix-it dept

We've noted for some time how the broadband industry fights tooth and nail against more accurate broadband availability mapping, since having a better understanding of the broadband industry's competition problem might just result in somebody actually doing something about it. This dysfunction and apathy was most recently illustrated with the FCC's recent release of an "updated" broadband availability map, which all but hallucinates competition, speeds, and overall availability. This map (available here) also omits pricing data at industry behest, resulting in a $300 million pair of rose-colored glasses.

But it's not just the FCC's broadband availability map that's under fire. FCC maps that determine which area get wireless subsidies (more specifically Mobility Fund Phase II (MF II) funding) are also a bad joke for many of the same reasons. As such, a group of Senators from both parties fired off a letter to the FCC last week, politely pointing out how the FCC's new wireless coverage map dramatically overstates the availability of wireless broadband service:

"We write this letter to express our serious concerns that the map released by the Federal Communications Commission last week showing presumptive eligible areas for Mobility Fund Phase II (MF II) support may not be an accurate depiction of areas in need of universal service support. We understand that the map was developed based on a preliminary assessment from a one-time data collection effort that will be verified through a challenge process. However, we are concerned that the map misrepresents the existence of 4G LTE services in many areas. As a result, the Commission’s proposed challenge process may not be robust enough to adequately address the shortcomings in the Commission’s assessment of geographic areas in need of support for this proceeding."

When you're crafting telecom policy, actually understanding the "reality on the ground" is arguably important. But if you can twist, manipulate, and distort the data to indicate the industry doesn't have any real problems, you can justify the kind of head-in-sand approach to leadership that birthed the telecom industry's dysfunction in the first place. In this case, the MF II is intended to provide $4.53 billion in support over 10 years to preserve and expand mobile coverage to rural areas, something that won't actually happen if maps aren't correctly illustrating which areas need help and which areas don't.

The Senators were quick to point this out in their letter to Ajit Pai, who has repeatedly and breathlessly professed his dedication to closing the digital divide, even while the lion's share of his policies work to make these problems inherently worse:

"For too long, millions of rural Americans have been living without consistent and reliable mobile broadband service. Identifying rural areas as not eligible for support will exacerbate the digital divide, denying fundamental economic opportunities to these rural communities. We strongly urge the Commission to accurately and consistently identify areas that do not have unsubsidized 4G LTE service and provide Congress with an update on final eligible areas before auctioning $4.53 billion of MF II support."

Some lawmakers, like New Hampshire Senator Maggie Hassan, have taken to begging for public input on their websites in the hopes of getting a more accurate picture of real-world coverage. Some, like Kansas Senator Jerry Moran say the FCC map's “value is nil," while Mississippi Senator Roger Wicker stated the FCC's map was "utterly worthless of giving us good information." That's not particularly impressive for an FCC that has been crowing about how data driven it is, but it's the price of supporting revolving door regulators who prioritize monopoly revenues over science, competition, innovation or the welfare of the public.

And while the telecom industry will be quick to insist that this is just the inherent dysfunction of government at play, the reality that this is a feature, not a bug. ISPs have routinely fought tooth and nail against every and any attempt to build better maps, fearing that a more accurate picture will only result in efforts to not only (gasp) improve competition, but might result in the subsidizing of smaller competitors that could disrupt the comfortable (but very, very broken) telecom sector status quo.

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Posted on Techdirt - 22 March 2018 @ 6:32am

Facebook Working With Comcast To Scuttle California Broadband Privacy Protections

from the watch-what-we-do,-not-what-we-say dept

Last year you might recall that the GOP and Trump administration rushed to not only kill net neutrality at ISP lobbyist behest, but also some pretty basic but important consumer privacy rules. The protections, which would have taken effect in March of 2017, simply required that ISPs be transparent about what personal data is collected and sold, while mandating that ISPs provide consumers with the ability to opt of said collection. But because informed and empowered consumers damper ad revenues, ISPs moved quickly to have the rules scuttled with the help of cash-compromised lawmakers.

When California lawmakers stepped in to then try and pass their own copy of those rules, ISPs worked in concert with Google and Facebook to scuttle those rules as well. As the EFF documented at the time, Google, Facebook, AT&T, Verizon and Comcast all collectively and repeatedly lied to state lawmakers, claiming the planned rules would harm children, increase internet popups, and somehow "embolden extremism" on the internet. The misleading lobbying effort was successful, and the proposal was quietly scuttled without too much fanfare in the tech press.

Obviously this behavior has some broader implications in the wake of the Cambridge Analytica scandal. Especially given Facebook's insistence this week that it's open to being regulated on privacy, and is "outraged" by "deception" as it tries (poorly) to mount a sensible PR response to the entire kerfuffle:

But last year's joint ISP and Silicon Valley assault on consumer privacy protections wasn't a one off.

California privacy advocates are again pushing a new privacy proposal, this time dubbed the California Consumer Privacy Act of 2018. Much like last year's effort the bill would require that companies be fully transparent about what data is being collected and sold (and to who), as well as mandating mandatory opt-out tools. And this proposal goes further than the FCC's discarded rules, in that it would ban ISPs from trying to charge consumers more for privacy, something that has already been implemented by AT&T (temporarily suspended as it chases merger approval) and considered by Comcast.

But privacy groups note that Facebook and Google are again working with major ISPs to kill the proposal, collectively funneling $1 million into a PAC custom built for that purpose:

Privacy advocates at Californians for Consumer Privacy also wrote a letter to Facebook this week expressing their lack of amusement at the effort in the wake of the Cambridge scandal:

"Something’s not adding up here,” Mactaggart writes. “It is time to be honest with Facebook users and shareholders about what information was collected, sold or breached in the Cambridge Analytica debacle; and to come clean about the true basis for your opposition to the California Consumer Privacy Act of 2018."

As we recently noted, however bad Facebook's mistakes have been on the privacy front, they're just a faint shadow of the anti-consumer behavior we've seen from the telecom sector on this front, suggesting that a disregard for privacy is a cross-industry norm, not an exemption. That said, while Google and Facebook love to portray themselves as the same kind of consumer allies they were a decade ago, their refusal to seriously protect net neutrality -- and their eagerness to work with loathed companies like Comcast to undermine consumer privacy -- consistently paints a decidedly different picture.

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Posted on Techdirt - 21 March 2018 @ 6:20am

If You're Pissed About Facebook's Privacy Abuses, You Should Be Four Times As Angry At The Broadband Industry

from the selective-outrage dept

To be very clear, Facebook is well deserving of the mammoth backlash the company is experiencing in the wake of the Cambridge Analytica revelations. Especially since Facebook's most substantive reaction to date has been to threaten lawsuits against news outlets for telling the truth. And, like most of these stories, it's guaranteed that the core story is only destined to get worse as more and more is revealed about the way such casual handling of private consumer data is pretty much routine not only at Facebook, but everywhere.

Despite the fact that consumer privacy apathy is now bone-grafted to the DNA of global corporate culture (usually only bubbling up after a scandal breaks), the outrage over Facebook's lack of transparency has been monumental.

Verizon-owned Techcrunch, for example, this week went so far as to call Facebook a "cancer," demanding that readers worried about privacy abuses delete their Facebook accounts. The #Deletefacebook hashtag has been trending, and countless news outlets have subsequently provided wall to wall coverage on how to delete your Facebook account (or at least delete older Facebook posts and shore up app-sharing permissions) in order to protect your privacy.

And while this outrage is well-intentioned and certainly justified, a lot of it seems a touch naive. Many of the folks that are busy deleting their Facebook accounts are simultaneously still perfectly happy to use their stock smartphone on a major carrier network, seemingly oblivious to the ugly reality that the telecom sector has been engaged, routinely, in far worse privacy violations for the better part of the last two decades. Behavior that has just as routinely failed to see anywhere near the same level of outrage by consumers, analysts or the tech press.

You'll recall that a decade ago, ISPs were caught routinely hoovering up clickstream data (data on each and every website you visit), then selling it to whoever was willing to pony up the cash. When ISPs were asked to share more detail on this data collection by the few outlets that thought this might not be a good idea, ISP executives would routinely play dumb and mute (they still do). And collectively, the lion's share of the press and public generally seemed OK with that.

From there, we learned that AT&T and Verizon were effectively bone grafted to the nation's intelligence apparatus, and both companies were caught routinely helping Uncle Sam not only spy on Americans without warrants, but providing advice on how best to tap dance around wiretap and privacy laws. When they were caught spying on Americans in violation of the law, these companies' lobbyists simply convinced the government to change the law to make this behavior retroactively legal. Again, I can remember a lot of tech news outlets justifying this apathy for national security reasons.

Once these giant telecom operators were fused to the government's data gathering operations, holding trusted surveillance partners accountable for privacy abuses (or much of anything else) increasingly became an afterthought. Even as technologies like deep packet inspection made it possible to track and sell consumer online behavior down to the millisecond. As the government routinely signaled that privacy abuses wouldn't be seriously policed, large ISPs quickly became more emboldened when it came to even more "creative" privacy abuses.

Like the time Verizon Wireless was caught covertly modifying user data packets to track users around the internet without telling them or letting them opt out. It took two years for security researchers to even realize what Verizon was doing, and another six months for Verizon to integrate an opt out function. But despite a wrist slap by the FCC, the company continues to use a more powerful variant of the same technology across its "Oath" ad empire (the combination of AOL and Yahoo) without so much as a second glance from most news outlets.

Or the time that AT&T, with full regulatory approval, decided it would be cool to charge its broadband customers hundreds of additional dollars per year just to protect their own privacy, something the company had the stones to insist was somehow a "discount." Comcast has since explored doing the same thing in regulatory filings (pdf), indicating that giant telecom monopolies are really keen on making consumer privacy a luxury option. Other companies, like CableOne, have crowed about using credit data to justify providing low income customers even worse support than the awful customer service the industry is known for.

And again, this was considered perfectly ok by government regulators, and (with a few exceptions) most of these efforts barely made a dent in national tech coverage. Certainly nowhere near the backlash we've seen from this Facebook story.

A few years back, the Wheeler run FCC realized that giant broadband providers were most assuredly running off the rails in terms of consumer privacy, so they proposed some pretty basic privacy guidelines for ISPs. While ISPs whined incessantly about the "draconian" nature of the rules, the reality is they were relatively modest: requiring that ISPs simply be transparent about what consumer data was being collected or sold, and provide consumers with working opt out tools.

But the GOP and Trump administration quickly moved (at Comcast, Verizon and AT&T's lobbying behest) to gut those rules via the Congressional Review Act before they could take effect. And when states like California tried to pass some equally modest privacy guidelines for ISPs on the state level to fill the void, telecom duopolies worked hand in hand with Google and Facebook to kill the effort, falsely informing lawmakers that privacy safeguards would harm children, inundate the internet with popups (what?), and somehow aid extremism on the internet. You probably didn't see much tech press coverage of this, either.

So again, it makes perfect sense to be angry with Facebook. But if you're deleting Facebook to protect your privacy but still happily using your stock, bloatware-laden smartphone on one of these networks, you're just trying to towel off in a rainstorm. The reality is that apathy to consumer privacy issues is the norm across industries, not the exception, and however bad Facebook's behavior has been on the privacy front, the telecom industry has been decidedly worse for much, much longer. And whereas you can choose not to use Facebook, a lack of competition means you're stuck with your snoop-happy ISP.

We've collectively decided, repeatedly, that it's OK to sacrifice consumer privacy and control for fatter revenues, a concept perfected by the telecom sector, and the Congressional and regulatory lackeys paid to love and protect them from accountability and competition. So while it's wonderful that we're suddenly interested in having a widespread, intelligent conversation about privacy in the wake of the Facebook revelations, let's do so with the broader awareness that Facebook's casual treatment of consumer privacy is just the outer maw of a mammoth gullet of dysfunction.

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Posted on Techdirt - 20 March 2018 @ 6:19am

The Cable Industry Is Quietly Securing A Massive Monopoly Over American Broadband

from the nobody-is-paying-attention dept

Cable providers like Comcast and Charter continue to quietly secure a growing monopoly over American broadband. A new report by Leichtman Research notes that the nation's biggest cable companies added a whopping 83% of all net broadband subscribers last quarter. All told, the nation's top cable companies (predominately Charter Spectrum and Comcast) added 2.7 million broadband subscribers in 2017, while the nation's telcos (AT&T, Verizon, CenturyLink, Frontier) saw a net loss of 625,000 subscribers last year, slightly worse than the 600,000 subscriber net loss they witness in 2016.

A pretty obvious pattern begins to emerge from Leichtman's data, and it's one of total and absolute cable industry dominance:

"The top broadband providers in the US added nearly 4.8 million net broadband subscribers over the past two years," said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc. "The top cable companies accounted for 130% of the net broadband additions in 2017, following 122% of the net adds in 2016."

Oddly Leichtman can't be bothered to explain why the cable industry has become so dominant: a total refusal by the nation's phone companies to upgrade their networks at any real scale. Verizon years ago decided that residential broadband wasn't profitable enough quickly enough, so it froze its FiOS fiber deployments to instead focus on flinging video advertisements at Millennials.

You'll note from the chart above that the only telcos still adding subscribers are those that are actually tryiing to upgrade to fiber to the home (AT&T, Cincinnati Bell). Even then, while AT&T is upgrading some areas to fiber, actual availability remains spotty as the company largely focuses on developments and college campuses where costs are minimal. There's still millions of customers in AT&T territories stuck on DSL straight out of 2003, and they won't be getting upgraded anytime soon.

Other American telcos, like Frontier, Windstream and Centurylink, have effectively refused to upgrade aging DSL lines at any real scale, meaning they're incapable of even offering the FCC's base definition of broadband (25 Mbps down, 3 Mbps up) across huge swaths of America. Frontier in particular has been a bit of a shitshow if you've followed the often comic corruption and cronyism they've fostered in states like West Virginia. Other telcos (like CenturyLink) now don't see residential broadband as worth their time, so they've shifted much of their focus to enterprise services or the acquisition of transit operators like Level 3.

The result is a massive gap between the broadband haves and the broadband have nots, especially in rural markets and second and third tier cities these companies no longer deem worthy of upgrading (they will, however, back awful protectionist state laws banning towns and cities from serving themselves, even when no incumbent ISP wants to).

This is all wonderful news for natural monopolies like Comcast, who now face less competitive pressure than ever. That means a reduced incentive to lower prices or shore up what's widely considered some of the worst customer service in any industry in America. It also opens the door wider to their dream of inundating American consumers with arbitrary and unnecessary usage caps, which not only drive up the cost of broadband service, but make shifting to streaming cable alternatives more costly and cumbersome.

While many people like to argue that wireless (especially fifth generation, or 5G) will come in and save us all with an additional layer of competition, that ignores the fact that wireless backhaul services remain dominated by just a few monopolies as well, ensuring competition there too remains tepid and often theatrical in nature. And with many cable providers now striking bundling partnerships with wireless carriers, the incentive to actually compete with one another remains notably muted, as nobody in the sector wants an actual price war.

This of course is all occurring while the Trump administration attempts to gut most meaningful oversight of the uncompetitive broadband sector, meaning neither competition nor adult regulatory supervision will be forcing improvement any time soon. With the death of net neutrality and broadband privacy protections opening the door to even more anti-competitive behavior than we've grown accustomed to, what could possibly go wrong?

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Posted on Techdirt - 19 March 2018 @ 1:40pm

Pedestrian Deaths By Car In Phoenix Area Last Week: 11. But One Was By A Self-Driving Uber

from the I-can't-do-that,-Dave dept

Despite worries about the reliability and safety of self-driving vehicles, the millions of test miles driven so far have repeatedly shown self-driving cars to be significantly more safe than their human-piloted counterparts. Yet whenever accidents (or near accidents) occur, they tend to be blown completely out of proportion by those terrified of (or financially disrupted by) an automated future.

So it will be interesting to watch the reaction to news that a self-driving Uber vehicle was, unfortunately, the first to be involved in a fatality over the weekend in Tempe, Arizona:

"A self-driving Uber SUV struck and killed a pedestrian in Tempe, Arizona, Sunday night, according to the Tempe police. The department is investigating the crash. A driver was behind the wheel at the time, the police said.

"The vehicle involved is one of Uber's self-driving vehicles," the Tempe police said in a statement. "It was in autonomous mode at the time of the collision, with a vehicle operator behind the wheel."

Uber, for its part, says it's working with Tempe law enforcement to understand what went wrong in this instance:

Bloomberg also notes that Uber has suspended its self-driving car program nationwide until it can identify what exactly went wrong. The National Transportation Safety Board is also opening an investigation into the death and is sending a small team of investigators to Tempe.

We've noted for years now how despite a lot of breathless hand-wringing, self-driving car technology (even in its beta form) has proven to be remarkably safe. Millions of AI driver miles have been logged already by Google, Volvo, Uber and others with only a few major accidents. When accidents do occur, they most frequently involve human beings getting confused when a robot-driven vehicle actually follows the law. Google has noted repeatedly that the most common accidents it sees are when drivers rear end its AI-vehicles because they actually stopped before turning right on red.

And while there's some caveats for this data (such as the fact that many of these miles are logged with drivers grabbing the wheel when needed), self-driving cars have so far proven to be far safer then even many advocates projected. We've not even gotten close to the well-hyped "trolly problem," and engineers have argued that if we do, somebody has already screwed up in the design and development process.

It's also worth reiterating that early data continues to strongly indicate that self-driving cars will be notably safer than their human-piloted counterparts, who cause 33,000 fatalities annually (usually because they were drunk or distracted by their phone). It's also worth noting that 10 pedestrians have been killed by drivers in the Phoenix area (including Tempe) in the last week alone by human drivers, and Arizona had the highest rate of pedestrian fatalities in the country last year. And it's getting worse, with 197 Arizona pedestrian deaths in 2016 compared to 224 in 2017.

We'll have to see what the investigation reveals, but hopefully the tech press will view Arizona's problem in context before writing up their inevitable hyperventilating hot takes. Ditto for lawmakers eager to justify over-regulating the emerging self-driving car industry at the behest of taxi unions or other disrupted legacy sectors. If we are going to worry about something, those calories might be better spent on shoring up the abysmal security and privacy standards in the auto industry before automating everything under the sun.

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Posted on Techdirt - 16 March 2018 @ 6:29am

Ex-DOJ Officials Raise Trump, AT&T Merger Interference Concerns

from the do-the-ends-justify-the-means? dept

Last fall, the Department of Justice announced it would be suing to block AT&T's $86 billion acquisition of Time Warner. According to the DOJ, it sued to block the lawsuit to protect consumers, arguing that the deal would likely make it harder for streaming competitors to license the content they need to compete with AT&T (especially HBO programming). Consumer advocates have long argued that AT&T (with its decade of well-documented and often comedic anti-consumer behavior in tow) would simply use its greater leverage and power to hamstring competition and jack up rates for consumers (especially with net neutrality dying).

While some have argued that the DOJ is simply following antitrust protocol, others (including AT&T lawyers) think the lawsuit is driven by other motivations.

That's not a hard case to make given the Trump administration's anti-consumer, anti-innovation, and anti-competition tendencies on other fronts (like net neutrality). Trump's pick to head the DOJ's antitrust division, Makan Delrahim, was also on record, before joining the DOJ, stating he saw no real problems with the deal. Meanwhile Trump's disdain for Time Warner-owned CNN is also well established, and reports have indicated that Trump pal Rupert Murdoch spent much of last year trying to scuttle the deal for competitive reasons (Muroch has also approached AT&T twice about buying CNN).

Adding fuel to this fire was a bipartisan group of ex-DOJ officials (from US Attorney Preet Bharara and Nixon White House counsel John Dean) that, last week, filed an amicus brief with the court urging an inquiry into whether any potential laws were broken. The brief doesn't even mention Murdoch, and instead focuses on the obvious, inherent problems in scuttling a merger just because the President doesn't like one of the media outlets involved:

"While any improper use of government authority to punish critics or reward supporters would pose a grave threat to our constitutional system, that threat is particularly acute in a situation in which the government uses or appears to use its regulatory authority to punish media entities or others who are critical of the government. Such behavior could chill criticism, endangering the kind of free and open speech and debate that our Founders adopted the First Amendment to protect precisely because it is necessary for self-government."

While that's true, Bharara's specific objections here are somewhat rich for him personally, given that during his tenure he seized domain names and refused to return them -- only giving them back once it was abudantly clear he wasn't going to win in court. Bahara's office also issued a gag order over a subpoena to Reason just because a few folks said some mean things about a Judge.

Regardless, hoping to use these concerns to defeat the DOJ lawsuit, AT&T lawyers have been busy trying to get a hold of evidence proving that the Trump administration pressured the DOJ to try and derail the lawsuit. But late last month Judge Richard J. Leon rejected AT&T's request for detailed email and phone logs between the White House and the Justice Department related to the deal, forcing AT&T to scuttle that angle of their legal defense. Needless to say, whichever way this ruling goes could have a profound impact on the media, broadband, and advertising markets for years:

"If the judge sides with AT&T and Time Warner, he would usher in the creation of a new kind of corporate behemoth — one with nationwide reach via wireless and satellite television service that would also have control over a movie studio and channels like HBO, CNN and TNT, which has valuable basketball sports rights. The company would have a leading position to negotiate licensing deals with rival telecom and media firms. It would also be in a stronger position against fast-growing streaming video services like Netflix and Amazon Prime Video."

Questions over the DOJ's actual motivation here have created an interesting conversation over whether the ends justify the means, even if the motivation is cronyism and not consumer welfare. Whether the deal should be blocked has become increasingly relevant in the wake of the Trump FCC's attack on net neutrality, a move that could open the door to all manner of "creative" efforts by a bigger, more powerful AT&T to hamstring competition in the media space, should the deal be allowed to proceed.

All told, we've ironically got the Trump DOJ breathlessly claiming it's trying to protect consumers from a bigger, badder AT&T, while the Trump FCC empowers AT&T to engage in more anti-competitive shenanigans than ever before -- with no sign that anybody in government realizing they're operating at cross purposes if "consumers" really are the driving motivator. The Justice Department’s antitrust lawsuit against AT&T and Time Warner, filed back in November, is scheduled to go to trial on March 19.

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Posted on Techdirt - 15 March 2018 @ 6:28am

California Introduces New, Tougher Net Neutrality Rules; Uses Ajit Pai's Abdication Of Authority Against The FCC

from the reap-what-you-sow dept

Earlier this year, California introduced new net neutrality legislation as part of similar efforts across more than half the states in the nation. At the time, we noted how the EFF wasn't a particular fan of California's proposal, arguing that the wording of the effort left the law open to challenges by the FCC, which has (at AT&T and Comcast behest) promised to block states that actually try to protect consumers in the wake of its unpopular net neutrality repeal. But a new California proposal has no such Achilles heel, goes notably further than the first effort, and now has the EFF's full support.

California state senator Scott Wiener this week introduced SB 822, a much tougher, more comprehensive proposal that would prohibit not only the blocking and throttling of websites and services by ISPs, but would ban "paid prioritization" deals that would allow deep-pocketed content companies (like, say, ESPN) from buying an unfair advantage against smaller competitors and startups. The bill also takes aim at the kind of interconnection shenanigans and double dipping that resulted in Netflix performance issues back in 2014, while leaving the door open to reasonable network management practices.

In some ways the proposal goes a bit further than the FCC's 2015 net neutrality rules, in that it more concretely addresses the problem of "zero rating" ( when ISPs let a partner's content or their own bypass usage caps while still penalizing others). Zero rating in general is allowed, but only if entire classes of content are whitelisted. Individual efforts to whitelist only specific partners (as we saw with T-Moble's controversial "Binge On" efforts), would be forbidden, as would pay to play approaches where content companies are allowed to buy a zero rating advantage over a competitor:

"Wiener’s bill digs into more arcane matters that the Obama-era FCC’s now-abolished 2015 policy included. It tackles the “zero-rating” programs, such as T-Mobile’s Binge On, which exempt some sites, apps, and services from monthly data caps. Obama’s FCC allowed Binge On, since T-Mobile continued welcoming new video services. California’s law seems to require blanket access for all similar apps without a wait for the ISP to add them. “It can be allowed if it is about a certain class [of content], like you could have when you’re doing games,” says Wiener about zero-rating. “If they say we’re going to apply it to a category, not any one product, and all comers, then it’s not automatically illegal."

The bill is also more resilient to any efforts by the Trump and Ajit Pai FCC to hinder state efforts to protect consumers. Whereas many states are just regurgitating the FCC's 2015 rules in their own proposals, that alone isn't enough to protect them from potential FCC preemption, argues Barbara van Schewick, Professor of Law at Stanford Law School, and the Director of Stanford Law School’s Center for Internet and Society. She also argues that the FCC shot its state preemption efforts in the foot by rolling back the classification of ISPs as common carriers under Title II of the Telecommunications Act:

"The bill is on firm legal ground.

While the FCC’s 2017 Order explicitly bans states from adopting their own net neutrality laws, that preemption is invalid. According to case law, an agency that does not have the power to regulate does not have the power to preempt. That means the FCC can only prevent the states from adopting net neutrality protections if the FCC has authority to adopt net neutrality protections itself.

But by re-classifying ISPs as information services under Title I of the Communications Act and re-interpreting Section 706 of the Telecommunications Act as a mission statement rather than an independent grant of authority, the FCC has deliberately removed all of its sources of authority that would allow it to adopt net neutrality protections. The FCC’s Order is explicit on this point. Since the FCC’s 2017 Order removed the agency’s authority to adopt net neutrality protections, it doesn’t have authority to prevent the states from doing so, either."

More simply, the FCC shot itself in the foot, and when it neutered its own authority over ISPs at Comcast, AT&T and Verizon's behest, it managed to also neuter its authority to pre-empt states from filling the void. Of course this could all be moot if the FCC loses its battle in court, but it's amusing all the same, and it's another example of how Ajit Pai and friends didn't really think this whole thing through.

While ISPs have whined incessantly about the headaches of having to adhere to multiple discordant net neutrality rules, that's not quite as big of a problem as they claim (especially since they already adhere to numerous rules governing phone, broadband and TV, which can vary town to town). Most of these new state laws follow the same effective template, and Wiener's office says it will work with numerous states to help them mirror California's efforts. All told, if consistency and stability were really the goal of AT&T, Verizon and Comcast lobbyists, they should have left the popular federal protections alone.

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Posted on Techdirt - 14 March 2018 @ 6:29am

Verizon Forced To Briefly Give A Damn About Its Neglected Broadband Networks

from the almost-accountability dept

Several years back Verizon paused all serious residential fiber deployment to shift its focus to slinging video ads at Millennials, an effort that isn't going all that well. While Verizon was busy attempting to pivot from stodgy protectionist telecom monopoly to sexy new media brand, one of its core legacy businesses (fixed line broadband) was simply allowed to wither and die on the vine. As such, the company has spent the last few years bombarded with complaints up and down the east coast about how it neglected repairs and upgrades across a massive swath of its telecom empire.

One one hand, Verizon's disinterest in residential broadband has resulted in a growing cable broadband monopoly as frustrated users flee to their only option for current-generation speeds. That in turn results in less competitive pressure than ever, resulting in higher prices, worse service, and the slow but steady deployment of arbitrary and punitive usage caps across the board. Meanwhile, customers on aging DSL lines who stick with Verizon face repair delays and higher prices as Verizon literally tries to drive away customers it simply no longer has a genuine interest in serving.

Despite the fact that many of these lines were taxpayers subsidized, occasionally Verizon's behavior results in something vaguely resembling a wrist slap. Case in point: after highlighting the massive state of disrepair of Verizon's network in New York, the Communications Workers of America this week managed (with the help of the NY Public Service Commission) to force Verizon to upgrade a notable chunk of its neglected networks across the state. An announcement by the CWA notes that Verizon not only has to repair neglected infrastructure, but expand real, fiber broadband in New York City:

"In a big victory for New York consumers, the Communications Workers of America has reached a settlement with Verizon that will require the company to repair 54 central offices across the state, replace bad cable, defective equipment, faulty back-up batteries, and to take down 64,000 double telephone poles. The agreement also includes increased broadband buildout to major apartment buildings in New York City and more than 30,000 homes across the state."

That last bit is of particular note, given that New York recently sued Verizon for taking taxpayer subsidies for fiber deployments only partially completed, something that's also an undeniable trend for the telecom giant. As they did in Pennsylvania, the union simply had to share photos showcasing the abysmal disrepair across Verizon's network, part of a three-year effort to hold the company accountable:

"The settlement is the result of a CWA campaign to pressure the New York Public Service Commission (PSC) to require Verizon to upgrade and repair the legacy telephone network and to expand consumer access to broadband. In 2015, CWA, 20 allied organizations, and 70 legislators filed a request for an investigation, providing substantial documentation of Verizon’s failure to maintain its copper network. In April 2016, the PSC opened a formal proceeding with extensive discovery and evidence collection. CWA and Verizon agreed to a settlement, which has been endorsed by the PSC staff. The PSC must approve the final settlement."

Granted in most states, Verizon has so much political power that complaints about failing infrastructure or subsidized-yet-unfinished deployments have been largely ignored. Verizon's response has generally been to make fun of these users, or promise them that wireless broadband will somehow make all of these concerns moot-- ignoring that the company's wireless network is more expensive, frequently unavailable, and often less robust than the fixed, taxpayer-subsidized infrastructure it's supposed to be replacing.

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Posted on Techdirt - 13 March 2018 @ 6:20am

Ten Years Later, Cable Industry Finally Realizes More Ads Is Not The Solution To Cord Cutting

from the who-knew? dept

For years we've noted how the traditional cable TV industry is slowly-but-surely bleeding customers tired of paying an arm and a leg for bloated bundles of often terrible programming. And for just as long we've documented how far too many cable and broadcast executives are hell bent on doubling down on all of the bad behaviors that cause these defections in the first place. That has ranged from knee jerk price hikes in the face of growing streaming competition, to efforts to stuff more ads into every viewing hour, whether by editing down programs or speeding them up to ensure maximum commercial load.

The ugly truth most cable and broadcasting executives can't face is that the era of the sacred cable TV cash cow is over. Television simply isn't going to be as profitable in the wake of real competition and the more flexible, cheaper pay TV alternatives that competition is providing. And while countless industry executives still somehow think this is a fad they can wait out, there's growing evidence that at least a few industry executives are finally getting the message.

Fox executives, for example, last week signaled that they intend to dramatically lower the ad load to two minutes an hour across their networks by 2020 (it's currently 13 minutes for broadcast networks and 16 minutes for cable):

"The two minutes per hour is a real target for Fox, and also our challenge for the industry,” said Ed Davis, chief product officer for ad sales at Fox Networks Group, in an email. “Creating a sustainable model for ad-supported storytelling will require us all to move."

By "move," Davis means "actually compete and adapt," which should be a no brainer after watching ESPN lose ten million audience members in just the last few years. The old model of hammering customers with as many ads as they can stomach (and then some) while also charging massive subscription fees is finished. That's something even Comcast NBC Universal execs seem to realize as they also aim to cut ad load during prime time shows by 10% and the number of ads during commercial breaks by 20%:

"The industry knows that television is already the most effective advertising medium there is, but we need to make the experience better for viewers,” said Linda Yaccarino, chairman of advertising and client partnerships at NBCUniversal, in the statement. “We’re reimagining the advertising experience for consumers, marketers, and the entire industry."

It can't be understated how hard it was for the industry to come to the realization that perhaps it needed to annoy its paying customers less and compete a little more. Many of these same executives have spent the better part of the last decade either ignoring or downplaying the cord cutting threat, many arguing it was just a fad that would end once Millennials began procreating more (that didn't happen). Combined with the rise of more streamlined and expensive alternatives (Dish, Sling TV, AT&T's DirecTV Now, etc.), there's some real signs of evolutionary traction in the stubborn sector.

That said, there's still plenty of opportunities for these companies to double down on bad behavior on other fronts. As TV becomes less of a money maker, many companies have just started jacking up the price of broadband (via either usage caps and overage fees or obnoxious hidden fees), given there's no competitive repercussion. And with the looming death of net neutrality, the use of anti-competitive tactics to jack up your TV/Phone/broadband bill in other "creative" ways is going to grow as these companies seek out their pound of flesh elsewhere.

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Posted on Techdirt - 12 March 2018 @ 6:21am

Telecom Lobbyists Whine About State Net Neutrality Efforts They Helped Create

from the this-is-on-you dept

In the wake of the FCC's extremely-unpopular repeal of net neutrality, more than half the states in the country are now pursuing their own net neutrality rules. Some of these efforts are taking the form of actual legislation that closely mirrors the discarded FCC rules (as seen in Oregon and Washington), while others involve the creation of executive orders adjusting state policies to ban states from doing business with ISPs that engage in anti-competitive net neutrality violations. In most instances these rules carve out vast exemptions for "reasonable network management," only outlawing anti-competitive behavior.

ISPs have of course been quick to whine about the unfairness of having to adhere to 50 different rules governing net neutrality, even though most implementations closely mirror the FCC rules these same lobbyists just successfully killed. US Telecom, a lobbying organization primarily managed by AT&T, lamented the unfairness of this scenario in a conversation with the Washington Post:

"As we have cautioned repeatedly, we simply cannot have 50 different regulations governing [broadband],” said USTelecom, a major trade association for Internet providers. “It’s time for Congress to step up and enact legislation to make permanent and sustainable rules governing net neutrality."

So one, most of the state-level rules closely mirror the same rules the FCC is trying to eliminate, so most of them are fairly uniform. It's also worth pointing out that these companies already have to navigate a vast array of regulations governing phone, cable and broadband service -- rules that can often vary town by town. In other words, these net neutrality efforts aren't as uncommon, discordant and fractured as the telecom industry might have you believe.

Granted having disparate state-level protections may in some ways be cumbersome, but that's again something ISPs like AT&T, Verizon and Comcast should have thought a little harder about before killing extremely popular and modest (by international standards) federal protections. Large ISP lobbyists created this mess and, unsurprisingly, they're simply refusing to own it.

US Telecom is also being disingenuous in claiming to want "permanent and sustainable rules" via new legislation. As we've noted several times, what they really want is a net neutrality law they know they'll write. One that prohibits ISPs from doing things they never intended to do (like blocking websites entirely), while carving out vast loopholes allowing anti-competitive behavior on numerous other fronts (zero rating, interconnection). The real goal: pass flimsy legislation that pre-empts tougher state rules, or future efforts by the FCC or Congress to implement meaningful protections.

ISPs like Comcast and Verizon successfully lobbied the FCC to include language in its net neutrality repeal banning states from protecting consumers ("states rights" and all that). But the FCC's legal authority on this front is untested, setting up some interesting legal showdowns in the weeks and months to come. And while this too is going to generate ridiculous costs predominately in the form of billable hours, blame for this needs to be placed where it belongs: in the laps of ISP lobbyists and revolving door regulators that thought ignoring the facts and the public interest would be a wonderful idea.

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Posted on Net Neutrality Special Edition - 9 March 2018 @ 6:28am

Terrified Of Losing In Court, ISPs (With Senator John Kennedy's Help) Push Hard For A Fake Net Neutrality Law

from the pretending-to-help dept

ISPs are worried that the FCC's assault on net neutrality won't hold up in the face of court challenge. And they should be.

By law, the FCC has to prove that the broadband market changed substantially enough in just a few years to warrant such a severe reversal of popular policy. And the numerous lawsuits headed the FCC's direction (including one by nearly half the states in the union) will also take aim at all of the shady and bizarre behaviors by the FCC during its ham-fisted repeal, from making up a DDOS attack to try and downplay the John Oliver effect, to blocking a law enforcement investigation into the rampant fraud and identity theft that occurred during the public comment period.

With the FCC repeal on unsteady legal ground, ISPs have a back up plan for in case the FCC and its mega-ISP BFFs lose in court: bogus net neutrality legislation.

Last fall, AT&T-favorite Masha Blackburn introduced one such bill in the House dubbed the "Open Internet Preservation Act." While the bill's stated purpose was to reach "compromise" and "put the net neutrality debate to bed," the bill's real intent is notably more nefarious. While the bill would ban behaviors ISPs had no real interest in (like the outright blocking of websites), it contained numerous loopholes that allowed anti-competitive behavior across a wide variety of fronts, from zero rating tactics that exempt an ISPs own content from usage caps, to interconnection shenanigans or anti-competitive paid prioritization.

Basically, it's a net neutrality law in name only, ghost written by the broadband industry. And its real purpose is three fold. One, it would pre-empt the 25 (and counting) state efforts to impose real net neutrality rules in the wake of federal apathy. It would also prevent any future FCC or Congress from passing real, tough federal rules should the FCC repeal succeed in court. And finally it would even pre-empt the FCC's 2015 net neutrality rules from being restored should ISPs and the FCC lose in the major court battle to come.

This week the broadband industry pushed its plan a little harder, prompting Louisiana Senator John Kennedy to unveil a companion version of the bill in the Senate. The bill is a mirror copy of Blackburn's HR 4682 in the House, and again, suffers from massive loopholes that allow all manner of anti-competitive behavior. That includes letting companies engage in paid prioritization deals, allowing companies like ESPN to buy a distinct competitive advantage over smaller content creators, startups and non-profits (most Techdirt readers should understand how that's a really, really bad idea).

Having covered this sector for the better part of my adult life, I can assure you the bill Blackburn and Kennedy are pushing was ghost written by AT&T, Verizon, and Comcast lawyers and lobbyists. So it's amusing to see Kennedy try to pretend in his press release for the bill that he's somehow courageously standing up to telecom monopolies:

"Some cable companies and content providers aren’t going to be happy with this bill because it prohibits them from blocking and throttling web content. They won’t be able to micromanage your web surfing or punish you for downloading 50 movies each month. This bill strikes a compromise that benefits the consumer,” said Sen. Kennedy."

Except it does nothing of the sort. The bill still allows ISPs to abuse a lack of competition by imposing arbitrary and unnecessary usage caps and overage fees. A system that not only makes broadband (and streaming video) more expensive, but allows ISPs to give their own content a leg up via zero rating. Calling a ghost-written industry bill a "compromise" is like calling a punch to the nose "healthy negotiations."

As has traditionally been the case with ISP allies pushing garbage legislation, Kennedy then tries to insist that anybody that refuses to support his industry-favored bill isn't "serious" about protecting net neutrality:

"If the Democrats are serious about this issue and finding a permanent solution, then they should come to the table and work with me and Rep. Blackburn on these bills. Does this bill resolve every issue in the net neutrality debate? No, it doesn’t. It's not a silver bullet. But it's a good start."

But it's not a good start, either. It's always worth repeating that net neutrality isn't a "partisan" problem, it's just framed that way by ISP lobbyists to sow division and stall progress on meaningful rules. It's disingenuous to pretend this is an above-board effort to compromise when the bill's real purpose is to prevent real rules from taking root. This is an AT&T and Comcast-backed policy play, and neither they nor their Congressional marionettes will allow changes to this legislation that could possibly prevent these companies from abusing the lack of broadband competition for further anti-competitive financial gain (the only thing this has ever been about).

Fortunately most net neutrality advocates in Congress seem to see these bills for what they are, and have steered clear. But as the telecom industry's worries over losing in court grow, you're going to see a growing drumbeat of farmed support for a "legislative compromise" that will be anything but. The best chance for restoring net neutrality rests with the courts. Failing that, it rests with voting out ISP lackeys in the midterms and thereafter, replacing them with lawmakers that actually respect the will of the public and the bipartisan quest for a healthy, competitive internet.

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Posted on Techdirt - 8 March 2018 @ 6:24am

Cable's Top Lobbyist Again Calls For Hyper Regulation Of Silicon Valley

from the Google-is-the-real-villain dept

For years telecom monopolies have downplayed the lack of competition in the broadband sector, and the chain reaction of problems this creates for everybody (from privacy infractions to net neutrality violations). At the same time, large ISP lobbyists (and the regulators, politicians and policy flacks paid to love them) have insisted that it's Silicon Valley companies the public really need to worry about. As a result, ISPs like Comcast and AT&T routinely insist that we need new regulations governing companies like Google and Facebook, but entrenched natural monopolies should be allowed to do pretty much whatever they'd like.

This of course requires you ignore a few things. One, that the lack of competition in broadband makes the two sectors an apples to oranges comparison. Customers frustrated by Facebook's bad behavior can vote with their wallets, something most Comcast customers can't do. You're also supposed to ignore the fact that large ISPs are simply trying to saddle Google and Facebook with additional regulation because they're increasingly trying to challenge them for advertising revenue in the video and media space.

This underlying narrative is constant, whether it's FCC boss Ajit Pai weirdly demonizing Netflix, to telecom-industry funded smear campaigns that try to suggest Google is a nasty freeloader that doesn't pay for bandwidth. Speaking at a sector trade show in Ireland this week, former FCC boss turned top cable lobbyist Michael Powell dusted off this rhetoric and turned up the volume. He began by insisting the quest for a healthy and open internet was "irrelevant" because the real villains are Silicon Valley companies hungrily gobbling up "mindshare":

"Michael Powell, president of NCTA-The Internet & Television Association, told the crowd at a Cable Congress Dublin event in Ireland Tuesday (March 6) that the network neutrality debate sucks up money, resources and "mindshare," but is increasingly an irrelevant discussion.

What isn't irrelevant, he suggested, is for governments in the U.S. and abroad to start looking at tech companies/edge providers like Facebook, their size and power, and the harm they can do to mental health by keeping consumers chasing the dopamine rush of "likes" and "streaks" as a way to glue them to devices.

Right. So again, notice how some of the most despised and least competitive companies in America aren't a problem and should be free from regulation, but Facebook and Google (which again, consumers can choose not to use) require vast expansions in regulatory oversight. Powell, whose tenure at the FCC consisted of comically denying any competition issues whatsoever, repeatedly called out Apple, Facebook and Google as the worst sort of villains; villainy that somehow, magically, makes the whole net neutrality conversation moot:

"They have the size, power and influence of a nation state. Antitrust policy has barely begun to address how to check this power to protect consumers and healthy competition."...He called the net neutrality debate "mindless trench warfare" and said that, as in the First World War, Democratic and activist cries that the battle for an open internet was a war to end all wars would prove wrong.

"Net neutrality policy does not remotely address the issues companies and consumers are facing today and likely will face in the future," Powell said. "Put simply, net neutrality is deeply rooted in engineering, consumer expectations, corporate business models and the norms of internet activity. It is firmly entrenched, and I don’t believe the open internet experience will change, whatever the outcome of the current debate."

So one, Comcast owns NBC and is considering a $31 billion acquisition of European satellite TV provider Sky, so it's not clear Powell's the guy to turn to when talking about media consolidation worries. Two, the idea that the "open internet experience" won't change if ISPs are successful in their current bid to gut FTC, FCC and state authority over natural monopolies is simply comical. History is filled with endless examples of how a lack of competition or reasonable regulatory oversight of natural monopolies results in higher prices and worse service. In telecom this lack of competition is already profound, routinely exemplified by everything from privacy violations to net neutrality infractions.

That's not to say that companies like Facebook and Google don't have their own universe of issues. Both were totally absent from the latest net neutrality fight as they slowly but surely shift from innovation and disruption to turf protection. And there's countless conversations to be had regarding their privacy practices and the country's ugly little disinformation problem.

But despised monopolists like Comcast calling for hyper-regulation of companies they're trying to compete with is pretty damn hard to take seriously. When Powell wasn't busy trying to insist that companies like Facebook were to blame for the nation's mental health issues, he was was hypocritically giving the audience lessons on anti-competitive behavior and a respect for consumer privacy:

"Our governmental authorities need to get a handle on what kind of market power and harm flow from companies that have an unassailable hold on large pools of big data, which serve as barriers to entry, allowing them to dominate industries throughout the economy," he said. "For years, big tech companies have been extinguishing competitive threats by buying or crushing promising new technologies just as they were emerging," he said. "They dominate their core business, and rarely have to foreclose competition by buying their peers. "Competition policy must scrutinize more rigorously deals that allow dominant platforms to kill competitive technologies in the cradle," he added.

If you've watched the companies Powell represents do business, that's pretty funny. As is Powell's claim that Silicon Valley giants have too much influence over government, a claim made just a few months after revolving door regulators sold out the public on net neutrality:

"We have reached a point where governments can no longer coddle and cater to tech companies," he said. "They have become too large, too influential and too indispensable to live above regulatory scrutiny. As a start, we need to reject the 'do no evil' fairytale." These companies must be brought back down to earth and regulators must recognize them for what they are: profit-maximizing corporations that have a strong incentive and ability to pursue their own self-interest over the interests of society and consumers."

Oh no! You mean just like Comcast, and Charter Spectrum? In the heads of many telecom executives, the quest for net neutrality (despite having massive support from the public) was all one mean cabal by Google designed to ruin their good time. But despite this breathless concern for consumer and market welfare, this hysteria serves only one real purpose: to saddle companies Comcast wants to challenge for advertising "mindshare" with numerous additional regulations, while leaving entrenched telecom monopolies free to run amok.

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Posted on Net Neutrality Special Edition - 7 March 2018 @ 3:28pm

Middle Schoolers Cheer As Oregon Passes A Net Neutrality Law

from the the-people-are-kind-of-pissed dept

More than half of all states are now pushing their own net neutrality rules in the wake of the federal repeal. Some states are pushing for new net neutrality laws that closely mirror the discarded FCC rules, while others are signing executive orders that prohibit states from doing business with ISPs that behave anti-competitively. And while these discordant laws may make doing business from state to state harder on incumbent ISPs, that's probably something they should have thought about before dismantling arguably modest (and hugely popular) federal protections.

This week Oregon became the latest state to sign net neutrality protections into law with what was largely bipartisan support. House Bill 4155 largely mirrors the FCC ban on things like paid-prioritization and anti-competitive blocking and throttling, though (also like the discarded FCC rules) it wouldn't address usage caps and overage fees or zero rating, one of the key areas where anti-competitive behavior often takes root. The bill also carves out numerous exemptions for legitimate instances of prioritization (medical care, prioritized VoIP services).

The bill also mandates that state and local governments contract only with companies that abide by the principles of net neutrality. Again highlighting the popularity of these efforts, three middle school kids testified before the State Senate in support of the new law:

"Leading up to the bill's passage, three students from Mt. Tabor Middle School testified in support of net neutrality in Salem. "It isn't common that kids get very involved in this, and it shows just how important this issue is to us," Luca Larsen-Utsumi, who spoke in front of the House Committee on Rules said."

While these state laws are an organic reaction to the federal government selling out consumers and the health of the internet, they'll only be as good as the people willing to actually enforce them. Many of the laws carve out exceptions for "reasonable network management," language ISP lobbyists have routinely and successfully abused to effectively allow pretty much anything -- at least in states where lawmakers and regulator ethics are malleable via campaign contribution (read: most of them). In other words, passing these rules is only part of the equation.

Granted this is the same state that just got done giving Comcast an inadvertent $15 million annual tax break for doing absolutely nothing, so you have to hope they crossed their t's and dotted their i's on this particular legislation, and remain alert to post-passage lobbying efforts to subvert it.

States like Oregon also have to contend with likely legal challenges by incumbent ISPs and their BFFs at the FCC.

After it was lobbied to do so by Verizon and Comcast, the FCC included language in its net neutrality repeal that attempts to "pre-empt" (read: ban) states from protecting consumers on issues of privacy and net neutrality. But this authority is untested, which could result in some significant and interesting legal battles in the months to come. Again though: this expensive, confusing battle could all have been avoided if the FCC had actually bothered to listen to data, the experts, and the will of the public and kept the FCC rules intact.

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Posted on Techdirt - 7 March 2018 @ 12:06pm

Nobody (Even His Industry BFFs) Likes Ajit Pai's Latest Attack On Low Income Broadband Programs

from the death-by-a-thousand-cuts dept

So we've noted a few times how Trump FCC boss Ajit Pai enjoys wandering the country informing everyone he's a massive champion of closing the digital divide. But those claims have been repeatedly and consistently undermined by Pai's own actions, whether that involves rolling back net neutrality (a move that will make life harder and more expensive for countless consumers, non-profits, minority communities and startups alike), or his slow but steady dismantling of programs intended to make life a little bit easier for the poor.

One of Pai's biggest targets has been the FCC's Lifeline program. It's an arguably modest program that was started by Reagan and expanded by Bush, and it long enjoyed bipartisan support until the post-truth era rolled into town. Lifeline doles out a measly $9.25 per month subsidy that low-income homes can use to help pay a tiny fraction of their wireless, phone, or broadband bills (enrolled participants have to chose one). The FCC under former FCC boss Tom Wheeler had voted to expand the service to cover broadband connections, something Pai (ever a champion to the poor) voted down.

Now Pai is back with a new proposal that would prevent anybody but the nation's biggest carriers from helping provide service to the poor via the Lifeline program. According to Pai's new proposal, only "facilities-based broadband" providers (companies that own and operate their own networks) could participate in the program, forcing millions of the nations' poor off of existing MVNOs and other resellers, and forcing them onto the networks of incumbent wireless carriers.

If you've followed Pai's ideological rhetoric, it's pretty clear he sees government as a pesky impediment to the miracles of the broadband free market, which, in Pai's head, will always do the right thing if left in an accountability vacuum. But if you've also followed the broadband industry, you'll know it's not a free market. It's a mish-mash of regional monopolies that enjoy regulatory capture on the state and federal level, resulting in limited competition, high prices, and awful service. In telecom, history shows us that mindlessly gutting regulatory oversight instead of reforming it doesn't magically fix this problem, it makes it worse.

Still, it's clear that Pai believes that slowly dismantling the FCC as both an agent of altruism (empathy is painfully unfashionable) and oversight is the path to nirvana. And he's justifying his latest efforts to scale back Lifeline by insisting that booting resellers off the program somehow will magically boost broadband deployment:

"[W]e believe Lifeline support will best promote access to advanced communications services if it is focused to encourage investment in broadband-capable networks...We believe this proposal would do more than the current reimbursement structure to encourage access to quality, affordable broadband service for low-income Americans. In particular, Lifeline support can serve to increase the ability to pay for services of low-income households. Such an increase can thereby improve the business case for deploying facilities to serve low-income households."

Consumer advocates argue in their own filings with the FCC (pdf) that the effort is a pointless attempt to help drive additional revenue to incumbent carriers. And former FCC staffer Gigi Sohn recently noted in Wired how this is part of a broader effort that will make life more difficult for low-income Americans to actually get broadband:

"One of Pai’s first acts as chair was to chill competition and innovation in the Lifeline program. Pai reversed a decision made by former FCC chair Tom Wheeler that allowed nine new Lifeline providers into the program. In the process Pai got rid of new competitors who could drive down prices and improve services.

Now, Pai proposes to limit Lifeline even further. Eliminating a Wheeler-era designation that welcomed new broadband providers into the program, the FCC said in December, will “better reflect the structure, operation, and goals of the Lifeline program.” But if the goal of the program is to ensure that low-income Americans have affordable access to broadband, reducing competition in the program will do the exact opposite.

The problem is only compounded by Pai's failure to do anything about a lack of competition in general in the telecom market. And while incumbent ISPs (like Pai's former employer Verizon) routinely applaud Pai's efforts on these fronts, even they doubt the effectiveness of Pai's proposal. For example Verizon was quick to point out in its own filing (pdf) that Pai's plan wouldn't do what he claims and would actually be harmful:

"The proposed exclusion of resellers from the Lifeline program would be highly disruptive to existing Lifeline beneficiaries and is at odds with the Commission's goal of supporting affordable voice telephony and high-speed broadband for low-income households."

Even all of the dollar per hollar think tankers, academics, and others the industry uses to parrot anti-consumer policies aren't impressed by Pai's proposal. US Telecom, a lobbying group spearheaded by AT&T, also panned Pai's plan for Lifeline, saying it wouldn't accomplish what Pai says it would (pdf):

"[T]he proposed elimination of resellers from the Lifeline program would not materially further the deployment of broadband infrastructure, because revenue from resellers already contributes to facilities-based carriers' deployment of broadband facilities."

Again, you've got industry and consumer advocates agreeing here that Pai is wrong and his plan will actually harm the poor.

But as his attack on net neutrality made pretty clear, Pai's blinded by an ideological vision of the telecom market that may or may not be supported by actual reality. And whereas a good leader would listen to opposition to his plans and reconsider positions that run in contrast to the will of the public, the insight of experts, and the facts -- Pai's default tendency is almost always to double down on bad ideas. And it this case Pai's bad idea is pretty clear: dismantling telecom programs that help the poor via death by a thousand cuts, no matter how counterproductive it is.

There's still time for Pai to back off his plan, given the FCC isn't expected to vote on the proposal until sometime after the public comment period ends on March 23. Still, when your definition of "helping the poor" includes ensuring cable boxes stay expensive and closed, allowing duopolies to abuse net neutrality and drive up service costs, protecting prison monopoly telcos that have price-gouged families for years, and preventing smaller ISPs from actually helping the poor you profess to love -- you have to wonder what it looks like when Pai actively wants to harm something.

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Posted on Techdirt - 7 March 2018 @ 8:31am

Rhode Island Law Would Mandate Porn Filters, Charge You $20 Per Device To Bypass Them

from the good-luck-with-that dept

Rhode Island lawmakers are proposing a new law (pdf) that would force ISPs to filter pornography and other "patently offensive material." It would then force state residents interested in viewing porn to pony up a one-time $20 "digital access fee" to whitelist the internet's naughty bits for each internet-connected device in the home, the money purportedly going toward helping combat human trafficking. ISPs would be required to build entire new support systems (on their dime) to help combat porn, and would face fines of $500 for each instance of offensive content that ISPs failed to censor.

The bill is worded vaguely enough to suggest that hardware vendors could also be held liable if they failed to help censor said "patently offensive" material:

"If a person who manufacturers, sells, offers for sale, leases, or distributes a product that makes content accessible on the Internet is unresponsive to a report of sexual content or patently offensive material that has breached the filter required by this section, the attorney general or a consumer may file a civil suit. The attorney general or a consumer may seek damages of up to five hundred dollars ($500) for each piece of content that was reported but not subsequently blocked. The prevailing party in the civil action may seek attorneys' fees."

Upon initial inspection, this awful proposal would just appear to be garden-variety vanilla stupid. It's technically impossible, annoyingly expensive, unlikely to ever pass, and (like most filter programs) would likely only cause collateral damage to the access of legitimate content. But the proposal is actually just one of more than a dozen similar proposals winding their way through numerous state legislatures. All of these bills follow the same, absurd playbook, and all falsely try to use child trafficking as a bogus straw man to justify censorship.

And they're all being spearheaded by a man named Chris Sevier, whose checkered history suggests he shouldn't be writing love notes on cocktail napkins, much less helping craft state-level legislation:

"Chris Sevier, 40, who sometimes goes by Mark Sevier in court and Chris Severe in communications with state legislators, has a contentious and often intentionally provocative relationship with the American court system that is news to at least some of the bill’s co-sponsors. He once famously tried to legally marry his computer to protest same-sex marriage, and was charged with stalking and harassing both country star John Rich and a 17-year-old girl."

Lovely. Sevier's war on porn, and his effort to obfuscate his real agenda by professing to be combating human trafficking, isn't new. Sevier has also filed suit against Apple in the past for the company's failure to implement more robust porn filters. Said lawsuit was jam-packed with spelling and other errors, and he claimed that Apple's failure to police porn resulted him in seeing "pornographic images that appealed to his biological sensibilities as a male and lead to an unwanted addiction with adverse consequences."

Somehow, Sevier has had some notable success convincing lawmakers to push their own versions of the same draft legislation. We've covered previous iterations of these efforts, which all use human trafficking as a bogeyman to justify ham-fisted and technologically unworkable censorship efforts. South Carolina Senator Bill Chumley pushed one-such incarnation of this effort in late 2016. We've also covered similar efforts in Virginia. Time and time again, the lawmakers backing these proposals fail utterly in explaining how their legislation actually harms human trafficking in any material way.

The Electronic Frontier Foundation last week did a good job highlighting the scope of this absurdity, noting that more than fifteen states are now pushing some flavor of the “Human Trafficking Prevention Act” (HTPA). Again, none of the bills actually do anything to stop human trafficking, but do appear to enjoy using the subject to obfuscate the problems inherent in hysterical puritanical hyperventilation and censorship. And as the EFF notes, the fact that these proposals are logistically unworkable doesn't appear to bother their backers in the slightest:

"The bill would force the companies we rely upon for open access to the Internet to create a massive, easily abused censorship apparatus. Tech companies would be required to operate call centers or online reporting centers to monitor complaints about which sites should or should not be filtered. The technical requirements for this kind of aggressive platform censorship at scale are simply unworkable. If the attempts of social media sites to censor pornographic images are any indication, we cannot count on algorithms to distinguish, for example, nude art from medical information from pornography. Facing risk of legal liability, companies would likely over-censor and sweep up legal content in their censorship net.

Numerous states (like New Mexico) have backed off their own proposals after the EFF raised the alarm, but it remains stunning just how much traction these efforts have seen despite being technologically impossible, hugely expensive, utterly disingenuous, and the intellectual and legislative equivalent of some random internet troll's epic brain fart.

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Posted on Techdirt - 6 March 2018 @ 6:18am

Oregon Winds Up Giving Comcast A Huge Tax Break For Doing Nothing Differently

from the great-work-everybody dept

A well-intentioned effort in Oregon to drive more competition to the broadband market has instead netted Comcast a $15 million annual tax break for effectively doing nothing differently.

Back in 2014 the Oregon State Supreme Court issued a hugely-controversial ruling that allowed companies to be taxed based on "intangible" assets such as the value of their brands. Lobbied by Google, the state in 2015 signed a new law rolling back those assessments to try and incentivize competitors looking to deploy faster broadband networks. But in 2015, Google was quick to point out that the sloppily-worded bill actually exempted it from gleaning any tax breaks for deploying gigabit broadband:

"SB611 offers an exemption from the state's tax methodology to companies with the capacity to offer Internet service of "at least one gigabit." Google Fiber offers speeds "up to a gigabit" per second - that's 1,000 megabits per second, 25 times faster than the current broadband standard. So the law, as written, would make Google Fiber ineligible for the tax exemption."

In other words, a well-intentioned bill intended to incentivize deployment of next-generation broadband actually exempted the one company actually promising to do so.

Oddly, this was only the start of the problem. Google Fiber had spent several years promising Portland locals that gigabit fiber would be deployed to the city. This promise was at the heart of the entire state-level legislative tax adjustments in the first place. But by late 2016, Google Fiber had indicated that it was getting bored by the whole broadband disruption thing, and had decided to put its fiber expansion plans on hold. Needless to say Portland, one of several cities that had been strung along as potential launch markets, wasn't impressed.

But wait: it gets better. Comcast, which had already been planning to deploy gigabit broadband service via relatively inexpensive DOCSIS 3.1 upgrades, was quick to take full advantage of a law intended to bring more competition to bear on the incumbent giant. Its lawyers quickly got to work successfully arguing that its modest and already-planned cable-based upgrades qualified it for $15 million in annual tax breaks. But because Comcast's gigabit service costs $300 per month and came with a $1000 installation fee (plus usage caps), lawmakers were quick to argue that this massive Comcast gift wasn't what they had intended:

"Comcast argues it qualifies, too, by virtue of its obscure new service. Oregon cities are crying foul, but the staff of the Oregon Public Utility Commission says Comcast meets the letter of the broadly written law - even if hardly anyone signs up for a service critics say would cost subscribers $4,600 in the first year alone."

Since Comcast technically adhered to the letter of the law (even if the service it was deploying was already planned and priced uncompetitively), it was able to begin enjoying the huge tax break. So was Frontier Communications, a company under fire in other states for being almost as large of an anti-competitive shitshow as Comcast. And while Oregon lawmakers tried to reboot the whole mess and repeal the law last week, procedural missteps and Comcast's lobbying influence over state leaders made sure that wasn't successful:

"Count Comcast among the big winners in this year's legislative session in Salem.

Efforts to repeal a tax break worth millions of dollars a year to big internet companies faltered at the last minute Thursday during the Oregon Legislature's short session.

"I'm really disappointed we weren't able to get that one over the finish line," said Senate Majority Leader Ginny Burdick, D-Portland, who chairs the rules committee where House Bill 4027 died. She said the measure didn't clear the House early enough to avoid a potential Republican slowdown, and with the Legislature set to adjourn Saturday or Sunday she said the clock ran out on the bill.

Just so we're clear: a well-intentioned bill designed to improve competition in the state simply wound up giving Comcast $15 million annually in taxpayer funds for doing nothing differently. Funds that could have otherwise gone to local schools and other essential services. All, ironically, while Comcast faced heat in numerous communities for all manner of billing hijinks and anti-competitive behavior across the state. And this was a state where lawmakers really were trying to do the right thing. In countless other states, where those good intentions don't exist (like West Virginia), things are often even more ridiculous.

This state level corruption, dysfunction and absurdism, as they say, really is why we can't have nice things.

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Posted on Techdirt - 5 March 2018 @ 1:35pm

After Chat With Ethics Lawyers, FCC Boss Declines NRA Gun Award For Killing Net Neutrality

from the good-call,-hoss dept

Last month you might recall that the NRA gave FCC boss Ajit Pai the Charleton Heston Award for Courage for his decision to dismantle popular net neutrality rules. The tone-deaf celebration was a pretty hollow attention seeking move, but was also an ouroboros of blistering idiocy. One, the NRA appears oblivious to the fact that net neutrality rules would have helped it as well, since the entire point is to ensure the internet is a level playing field for all competitors and voices. Net neutrality protects free speech (even speech you don't agree with), something you'd think the folks at the NRA would be able to appreciate.

Two, there's simply nothing courageous about teaming up with Comcast to screw over the public and the nation's small businesses and startups. Pai's decision is widely derided as the dumbest decision in the history of modern tech policy. And while ISPs like to frame net neutrality as partisan to sow division and prevent meaningful rules, surveys repeatedly indicate the rules had broad bipartisan support.

It didn't take long for ethics experts to point out that the award and the NRA's gift to Pai (a Kentucky long rifle) was over $200 and therefore violated ethics rules and lobbying restrictions:

After a chat with FCC ethics lawyers, Pai appears to have finally realized that accepting the award probably wouldn't be a particularly bright idea. As such, Pai wrote a letter to the NRA declining the gun while insisting this whole thing simply caught him by surprise:

"As you know, once my staff became aware of what was happening, they asked backstage that the musket not be presented to me to ensure that this could be first discussed with and vetted by career ethics attorneys in the FCC’s Office of General Counsel," Pai wrote, according to an FCC source who relayed the text of the letters.

“Therefore, upon their counsel, I must respectfully decline the award,” he wrote. “I have also been advised by the FCC’s career ethics attorneys that I would not be able to accept the award upon my departure from government service."

Of course Pai and his staff could have rejected the award at any point (the award occurred on February 23), but then they wouldn't have been able to enjoy all the yucks at the expense of startups, consumers, and the health of the internet. From stem to stern this was just a PR disaster, and you couldn't have paid a fiction author to craft a dumber, more absurd narrative. And while those behind the effort likely believe they were being clever trolls, Millennial voters likely got a decidedly different impression from the tone-deaf gala.

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Posted on Techdirt - 5 March 2018 @ 6:24am

Wireless Carriers, Hardware Companies Use Flimsy IOT Security To Justify Attacks On Right To Repair Laws

from the lobbyists-within-lobbyists dept

A few years ago, anger at John Deere's draconian tractor DRM birthed a grassroots tech movement. The company's lockdown on "unauthorized repairs" turned countless ordinary citizens into technology policy activists, after DRM and the company's EULA prohibited the lion-share of repair or modification of tractors customers thought they owned. These restrictions only worked to drive up costs for owners, who faced either paying significantly more money for "authorized" repair, or toying around with pirated firmware just to ensure the products they owned actually worked.

The John Deere fiasco resulted in the push for a new "right to repair" law in Nebraska. This push then quickly spread to multiple other states, driven in part by consumer repair monopolization efforts by other companies including Apple, Sony and Microsoft. Lobbyists for these companies quickly got to work trying to claim that by allowing consumers to repair products they own (or take them to third-party repair shops) they were endangering public safety. Apple went so far as to argue that if Nebraska passed such a law, it would become a dangerous "mecca for hackers" and other ne'er do wells.

Wary of public backlash, many of these companies refuse to speak on the record regarding their attacks on consumer rights and repair competition. But they continue to lobby intensely behind the scenes all the same. The latest example comes courtesy of the "The Security Innovation Center," a new lobbying and policy vehicle backed by hardware vendors and wireless carriers. The group issued a new "study" this week that tries to use the understandable concerns over flimsy IOT security to fuel their attacks on right to repair laws.

The study starts out innocuously enough, noting how they hired Zogby to run a poll of 1015 users on consumer privacy and security concerns in the internet of broken things era:

"Almost two-in-three American consumers said that the explosive growth of Internet-connected products makes them more concerned about their privacy and security, the survey of 1,015 Americans found. And only 1 in 3 Americans expressed confidence that people they know would not be affected if one of their devices was hacked."

Which is understandable. Especially in an era where countless IOT companies value gee whizzery over privacy or security. But it doesn't take long for the real purpose of this study to reveal itself--demonizing efforts to break the monopoly over repair:

"These concerns have placed a focus on security when getting Internet-enabled products fixed: 84 percent value the security of their data over convenience/speed of service....More than 80 percent expect repair professionals to both provide a warranty for their repairs and demonstrate that they are trained or certified to fix their specific product. Further, 75 percent value warranty protections over convenience and 70 percent feel most comfortable having their products fixed by a manufacturer or authorized repair shop. Yet, only 18 percent can determine if an electronics repair shop is protecting their security and privacy."

In other words, the not so subtle message being sent by hardware vendors and wireless carriers is this: don't allow third-party or user self repair because you'll wind up hacked, or worse. That matches the same message being sent by Verizon, Apple, Microsoft and others as they try to convince the public that being able to access less expensive third-party repair vendors (or repair your own devices yourself) will result in reduced security and privacy, dogs and cats living together and the world being ripped off its axis.

Again, the "Security Innovation Center" isn't much of a center at all. It's basically just a lobbying and policy vessel created by a New York PR firm (Vrge), backed by other, existing lobbying and policy vessels (CTIA, CompTIA, NetChoice). It's such a thin veneer, the Center's press release lists its "executive director" as Josh Zecher, the guy who founded the PR outfit running the campaign. It's basically just the Russian nesting doll equivalent of lobbying and policy, all to obfuscate Apple's, Verizon's and other companies' blatant disdain for repair competition and consumer rights.

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Posted on Net Neutrality Special Edition - 2 March 2018 @ 6:28am

Washington State Laughs In The Face Of FCC Attempts To Ban States From Protecting Net Neutrality

from the unicorns-at-the-fcc dept

In the wake of the FCC's net neutrality repeal, nearly half the states in the union are now in the process of passing new net neutrality rules. Some states are pushing for legislation that mirrors the discarded FCC rules, while others (including Montana) have signed executive orders banning states from doing business with ISPs that engage in anti-competitive net neutrality violations.

Of course incumbent ISPs saw this coming, which is why both Verizon and Comcast successfully lobbied the FCC to include language in its repeal that tries to "preempt" state authority over ISPs entirely. But this effort to ban states from protecting consumers (not just from net neutrality violations) rests on untested legal ground, which is why some ISPs are also pushing for fake net neutrality laws they hope will preempt these state efforts.

So far, states aren't taking the FCC's threats very seriously.

Washington State for example became the first state in the union this week to pass net neutrality legislation (though Oregon is neck and neck). Washington's new law largely mirrors the discarded FCC rules by prohibiting the anti-competitive throttling and blocking of competitors, as well as "paid prioritization" deals that prevent ISPs from letting deep-pocketed content companies buy an unfair advantage over smaller companies and startups. Also like the FCC's rules, it carves out notable exemptions for "reasonable network management" -- as well as for the prioritization of legitimate services that may need it (medical, VoIP services).

Amusingly, the bill's sponsor doesn't appear particularly flummoxed by FCC restrictions on what states can and can't do:

"Just because the FCC claims it has the power to preempt state laws doesn’t mean that it actually does,” says (Drew) Hansen. “I can claim that I have the power to manifest unicorns on the Washington State Capitol lawn. But if you look outside right now, there are no unicorns."

ISPs have already started complaining that complying with an ocean of discordant state-level rules is hard on them, though that's something they might have wanted to give a little more thought to before lobbying to dismantle what were arguably (by international standards) pretty modest federal-level rules.

Note that's not to say state-level protections will be perfect. Many politicians are just trying to score political brownie points, and in many instances the rules will only be as good as those willing to actually enforce them. Several of them also are a little shaky on how they define "reasonable" network management, a term ISP lobbyists have a long, proud history of trying to redefine to include pretty much anything. Still, these are all problems that could easily been avoided by actually listening to the public, the experts, and the data and leaving the federal rules alone.

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Posted on Techdirt - 1 March 2018 @ 10:48am

Telecom Sector Can't Stop Falsely Claiming That Net Neutrality Will Harm The Sick, Derail Smart Cars

from the just-can't-help-themslves dept

If you've paid attention to the net neutrality debate, you'll recall that large ISPs routinely threaten to hold back on network investment if governments pass rules protecting an open, healthy internet. They also routinely try to claim that the passage of such protections cause a massive slowdown in overall sector investment, something that simply isn't supported by actual facts (remember them?). Such rhetoric is fear mongering designed to scare regulators away from imposing "job killing regulations," even if those regulations make sense for a telecom market where limited competition fails to keep bad actors in check.

This hollow fear mongering has played a starring role as carriers worldwide begin to deploy faster fifth-generation wireless (5G) networks. You'll recall that both American and European telcos have routinely tried to claim that the deployment of these faster, more efficient wireless networks will be derailed by net neutrality.

Usually, this rhetoric is accompanied by claims that 5G will be the centerpiece of the smart cities of tomorrow, and that net neutrality rules will prevent ISPs from using these networks to provide prioritized connectivity for health and other related services. Ignored is the fact that this has never been a problem, since any well-crafted net neutrality rules carve out massive loopholes for all manner of essential services, especially on the medical front. Of course that doesn't stop ISPs from routinely claiming that net neutrality hurts sick people all the same.

With the Mobile World Congress trade show underway this week in Barcelona, all of this debunked rhetoric is being regurgitated like a bad hairball. Speaking at the trade show, Ericsson CEO Börje Ekholm tried to inform attendees that Europe's net neutrality rules must be weakened lest they derail Europe's efforts to build 5G Networks:

"The principle of net neutrality is not to discriminate [against], throttle or degrade based on content but not all traffic is created equally and we don't believe this will work in the 5G future," he told reporters and analysts. "There will be a need for a regulatory regime that allows service providers to create services that are differentiated based on user experience."

But that's not the principle of net neutrality. The principle of net neutrality is to not discriminate against traffic for anti-competitive reasons. Guys like Ekholm certainly realize they're being disingenuous here, they just hope their audience doesn't. As is industry tradition, Ekholm then tried to suggest that with net neutrality in place, carriers won't be able to provide access to essential, prioritized medical services:

"In relation to the hot topic of net neutrality, Ekholm said that while Ericsson believes in non-discriminatory access to information and data, he added that "not all traffic is created equal". Once remote surgery is being performed over 5G, for instance, it should be given priority over other traffic, he said."

Again, this is something carriers in both the United States and Europe like to parrot repeatedly despite not being true. Europe's rules, like the ones we're about to discard in the States, provided ample leeway for such services. But the idea that "government regulation" will harm the sick is apparently too enticing of a siren song for those looking to demonize protection of a healthy and competitive internet.

Not to be outdone, FCC boss Ajit Pai also parroted industry claims in a speech that net neutrality is a threat to the smart cities of tomorrow (pdf):

"We believe that our decision will give the private sector greater incentives to invest in the 5G networks of the future and bring greater digital opportunity to the American people. And we also believe that our decision is critical for another reason as well. To realize the promise of 5G, we will need smart networks, not dumb pipes. Dumb pipes won’t deliver smart cities. Dumb pipes won’t enable millions of connected, self-driving cars to navigate the roads safely at the same time. In short, dumb pipes won’t give us the networks needed to enable the 5G applications of the future."

Again, any idea that "net neutrality hurts the sick" or stops innovation (smart car or otherwise) dead in its tracks is aggressively misleading. Net neutrality rules almost always carve out ample exceptions to legitimate services, often to a fault. The only thing net neutrality rules traditionally harm is the entrenched telecom monopoly's ability to abuse the lack of industry competition for further anti-competitive gain -- the only thing this debate has ever truly been about. Net neutrality is only a "regulatory burden" if you're doing something anti-competitive. Since entrenched telecom operators can't candidly acknowledge this in the quest for fatter revenues, we're subject to a rotating crop of flimsy straw men instead.

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