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Posted on Techdirt - 12 December 2018 @ 1:31pm

The FBI Is Now Looking Into Those Bogus Net Neutrality Comments

from the ill-communication dept

So we already knew numerous reporters, the GAO, and the New York State AG's office are already looking into who was behind the millions of bogus comments that plagued the FCC's net neutrality repeal. And we've already noted how the Ajit Pai FCC has been trying its very best to hinder those inquiries, whether we're talking about the way that it has been blocking and stalling on journalist FOIA requests, or actively ignoring numerous, previous inquiries from law enforcement.

The FCC's efforts to obfuscate the culprit by refusing to share data on this subject may have just become more... complicated. Over the weekend, Daily Beast reporter Kevin Collier noted that two additional AG's offices (Massachusetts and Washington, DC) -- and the FBI -- have also started digging into those fake comments as well:

"The Justice Department is investigating whether crimes were committed when potentially millions of people’s identities were posted to the FCC’s website without their permission, falsely attributing to them opinions about net neutrality rules, BuzzFeed News has learned. Two organizations told BuzzFeed News, each on condition that they not be named, that the FBI delivered subpoenas to them related to the comments."

New York's AG began its investigation last year, but stated in a public letter a year ago that the FCC had actively blocked all efforts by the AG to obtain server, API, and other data that could help identify who was behind the fraudulent comments, some of them mysteriously made by dead people. The AG's office stated Pai's office ignored nine inquiries over a period of five months for more details:

"We made our request for logs and other records at least 9 times over 5 months: in June, July, August, September, October (three times), and November.

We reached out for assistance to multiple top FCC officials, including you, three successive acting FCC General Counsels, and the FCC’s Inspector General. We offered to keep the requested records confidential, as we had done when my office and the FCC shared information and documents as part of past investigative work.

Yet we have received no substantive response to our investigative requests. None."

According to the NY AG's office, about 9.5 million of the more than 22 million comments filed with the FCC during the repeal's open comment period were filed using peoples' names without their consent (including my own and those of two Senators). Last October, the New York AG announced they had expanded their probe, issuing subpoenas to both numerous ISP-linked lobbying and policy organizations (like the industry's dubious Broadband for America policy vessel) as well as a few pro net neutrality consumer groups.

Last week, numerous outlets falsely reported that "Russia" was behind these comments. There's no actual evidence of that (500,000 Russian email addresses were used, but that doesn't mean Russia itself was involved). As we've seen during the similar bogus comments plaguing other US government proceedings in recent years, the usual culprit is almost always the companies that stand to benefit from the regulatory efforts in question, since there's several DC policy shops that apparently sell these kinds of services (read: bogus support for terrible policies) as a value added service.

And while it's pretty clear that the Ajit Pai FCC doesn't want anybody knowing which firm tried to stuff the ballot box and who was funding the initiative, the involvement of the DOJ and several additional AG offices means hiding the truth just got immeasurably more difficult. And depending what investigators find, that could seriously complicate next February's opening arguments in the net neutrality lawsuit against the FCC, which, if the FCC and its ISP allies lose, could end with the restoration of the FCC's 2015 rules, bringing us fill circle.

If it turns out the broadband industry or some proxy organization paid a DC lobbying firm to stuff the ballot box (which has always seemed the most likely explanation given historical precedent), such a self-inflicted wound would be utterly legendary.

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Posted on Techdirt - 12 December 2018 @ 6:24am

If You're Surprised By Verizon's AOL, Yahoo Face Plant, You Don't Know Verizon

from the yet-another-face-plant dept

So for years we've been pointing out that Verizon's attempt to pivot from grumpy old telco to sexy new Millennial ad brand hasn't been going so well. Oddly, mashing together two failing 90s brands in AOL and Yahoo, and renaming the coagulated entity "Oath," didn't really impress many people. The massive Yahoo hack, a controversy surrounding Verizon snoopvertising, and the face plant by the company's well-hyped Go90 streaming service didn't really help.

This week, Verizon was forced to acknowledge that Oath was now effectively worthless, at least in full context of what Verizon paid for it, and the company's past claims that the company would be taking on Facebook and Google in the online advertising wars for a generation to come:

"Verizon announced Tuesday that it would take a $4.6 billion writedown on its the media unit, which includes Yahoo and AOL. Oath's brand value is now worth just $200 million, according to Verizon. That's a stunning decrease in value since it formed in 2017. Verizon said Oath's brand was worth $4.8 billion when it last accounted for the company's goodwill valuation. With virtually no goodwill brand value, Oath's overall value (assets and goodwill) is now worth half of what it was a few years ago.

While some folks reacted with "shock" on Twitter, none of this should really have been a surprise to anybody who has watched Verizon do business over the last decade or two.

Pretty much every time Verizon wanders outside of its core competencies (operating admittedly excellent networks, lobbying to hamstring competition, being misleading about net neutrality), Verizon falls flat on its face. Whether it's the company's failed Go90 platform, failed video joint venture with RedBox, failed news website Sugarstring (which you may recall tried to ban reporters from talking about surveillance or net neutrality), its app store, its "me too" VCAST apps, or any of a dozen other countless efforts to expand into less familiar territory, Verizon failed. Usually semi-spectacularly.

This happens because having spent the better part of a generation engaged in turf protection and lobbying, telcos really can't innovate. We've known this for more than a decade, yet somehow, each time Verizon announces some new pivot, we forget. Telecom executives tend to think they can overcome this character flaw via megamerger, which usually just saddles the company with oodles of additional debt, but doesn't really address any of the sector's core shortcomings, built on the back of being largely government-pampered natural monopolies for the better part of a generation.

A big part of Verizon's attempted pivot to Millennial video ads was courtesy of former CEO Lowell McAdam, who left the company last summer. His predecessor, Ivan Seidenberg, believed that Verizon should remain focused on what it does best (sometimes): building better, faster networks. Seidenberg was a big reason for the company's $24 billion push into pure fiber with "FiOS." McAdam came in, froze most of those deployments, then tried to turn a legacy telco into Google. It didn't work, and anybody who is surprised by that hasn't watched Verizon do business.

All of that said, a company SEC filing effectively blamed McAdam and his team for the failure. As of this writing, that appears to have been enough to satisfy the company's investors, who are clearly eager to ride the hype waves emanating from Verizon's next big unfulfilled promise.

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Posted on Techdirt - 11 December 2018 @ 6:28am

Mobile Location Scandals Keep Making Facebook's Privacy Flubs Look Like Child's Play

from the ill-communication dept

We've noted a few times now that while Facebook gets a lot of justified heat for its privacy scandals, the stuff going on in the cellular data and app market in regards to location data makes many of Facebook's privacy issues seem like a grade-school picnic. That's something that was pretty well highlighted by the recent Securus and LocationSmart scandals, which showcased perfectly how cellular carriers and location data brokers routinely buy and sell your daily travel habits with only a fleeting effort to ensure all of the subsequent buyers and sellers of that data adhere to basic privacy and security standards.

Over the weekend, the New York Times had an interesting read that offers some fresh insight into just how commonly your daily location data is traded and shared without much in the way of meaningful protection or oversight. There's a certain naive shock by both the Times authors and its subjects as they suddenly realize that apps on mobile devices routinely hoover up users' daily movement patterns, often without anything in the way of real consent or transparency, then sell that valuable data to every Tom, Dick, and Harry in a bid to monetize it:

"The app tracked her as she went to a Weight Watchers meeting and to her dermatologist’s office for a minor procedure. It followed her hiking with her dog and staying at her ex-boyfriend’s home, information she found disturbing.

“It’s the thought of people finding out those intimate details that you don’t want people to know,” said Ms. Magrin, who allowed The Times to review her location data.

The Times investigation found that at least 75 companies routinely receive anonymous, precise location data from apps that collect location data but fail to clarify how that data is used. Several of the firms tracked by the Times note they routinely collect data on more than 200 million mobile devices; data that in many instances is so granular it's updated as many as 14,000 times a day. Of course if you've been paying attention, location data has been a gold mine for cellular carriers (and everybody in the chain) for the better part of the last decade as it's sold to everyone from city planners to shopping malls.

And while carriers and those handling this data routinely insist there's no harm because this data is "anonymized," reports have repeatedly shown that this kind of data isn't really anonymous, especially if it can be linked with other private data (obtained by hackers, leaked, or already in the wild). That's something you can feel the Times reporters realizing as the story proceeds:

"Businesses say their interest is in the patterns, not the identities, that the data reveals about consumers. They note that the information apps collect is tied not to someone’s name or phone number but to a unique ID. But those with access to the raw data — including employees or clients — could still identify a person without consent. They could follow someone they knew, by pinpointing a phone that regularly spent time at that person’s home address. Or, working in reverse, they could attach a name to an anonymous dot, by seeing where the device spent nights and using public records to figure out who lived there."

Curiously, the Times doesn't even mention the cellular carriers' role in this problem, insisting that location data sales "began as a way to customize apps and target ads for nearby businesses." In reality, cellular carriers have been tracking and selling your location data before the concept was even a twinkle in many app makers' eye, and as the recent LocationSmart scandal (which exposed the personal data of nearly every mobile customer in North America) made very clear, this data is sold to dozens of third-party location data brokers and their sales partners -- without much, if any, effort to ensure it's being protected down the chain.

In other words, app location data sharing is just a smaller part of a massive problem. A problem that started with telecom operators and our total unwillingness to hold them accountable for similar behavior. Politically powerful cellular carriers who repeatedly insisted we didn't need any meaningful privacy rules of the road because "public shame" would keep the industry honest. That promise has never really worked out that well.

Multiple ISPs were accused years ago of collecting and selling consumer clickstream data. When they were pressed for details, many simply either denied doing it or refused to respond. Collectively, we decided that was fine. As more sophisticated network gear like deep-packet inspection emerged, ISPs began tracking and selling online browsing habits down to the millisecond, some even charging users extra if they wanted to protect their own privacy. Wireless only made things worse, some carriers even going so far as to modify your very data packets to glean additional insight without your knowledge or consent.

That initial attitude has subsequently infected every other ecosystem on the network as countless industries ran toward the location data cash cow, utterly apathetic to the slow but steady erosion of consumer trust and privacy. There's an endless list of points of failure here by self-interested companies eager to prioritize growth over all things, from the carriers themselves to the app store approval process. As such, the focus specifically on apps--or Facebook--tends to miss the bigger picture: that this sort of behavior is now the norm across all of tech, not some errant anomaly.

That said, the Times piece is still full of some entertaining revelations on app privacy specifically, like the fact that even some of the companies involved don't understand why the hell they even have access to all of this customer location data:

"To evaluate location-sharing practices, The Times tested 20 apps, most of which had been flagged by researchers and industry insiders as potentially sharing the data. Together, 17 of the apps sent exact latitude and longitude to about 70 businesses. Precise location data from one app, WeatherBug on iOS, was received by 40 companies. When contacted by The Times, some of the companies that received that data described it as “unsolicited” or “inappropriate.'

Currently, outside of a week of bad press that's quickly forgotten (see: Equifax), there's really no penalty for even the most mammoth of privacy abuses (aside from the occasional wrist slap for violating kid specific privacy laws like COPPA). This apathy and incompetence was rooted in the cellular and telecom industry, and has since spiraled outward, infecting every app and internet ecosystem as numerous industries ran to feed at the unsupervised trough. The fact that we're still so collectively naive to the scope of the problem a decade or two later is utterly mind boggling in and of itself.

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Posted on Techdirt - 10 December 2018 @ 6:40am

AT&T Finds Yet Another Way To Nickel-And-Dime Its Broadband, TV Customers

from the innovation! dept

While AT&T's marketing wing often likes to pat itself on the back for "innovation," the company's real skill set revolves around finding creative and ways to nickel-and-dime its own customers. Like the multiple times the company was caught aiding drug dealing directory assistance scammers, IP Relay credit card scammers, or crammers because it was getting a cut of the profits. Or the time the company started charging everybody more money for broadband if they wanted to protect their own personal privacy. Or the company's well-documented net neutrality shenanigans.

This week, AT&T's under fire yet again for some new bill changes that will, once again, result in users paying the company significantly more money. More specifically, the company has announced that it will now keep broadband and TV customers' money if you cancel in the middle of a billing cycle:

"AT&T will start charging customers for the full month after they cancel TV or Internet service, ending its customer-friendly practice of providing a prorated credit for the final month. Even if you cancel on the first day of a new billing period, you'll be charged for the full month and service will continue for the rest of the month whether you want it or not. To avoid paying for a month of service you don't want, you'd need to cancel by the last day of the previous billing period. The change will take effect on January 14, 2019 and apply even when a customer is paying on a month-to-month basis and no longer under contract.

Interestingly, the same company that has whined fairly incessantly about the logistical impossibility of adhering to state level privacy or net neutrality rules in the wake of federal repeals (a problem its own lobbyists created), isn't imposing the new rate system on users in states with tougher consumer protection standards:

"The new policy of charging for the full final month does not apply to any accounts in California, Illinois, and New York. The change also doesn't apply to "U-verse TV, AT&T Phone, or AT&T Internet accounts in Michigan," AT&T said.

AT&T is applying different policies in those states in order to comply with local regulations. “A limited number of customers will continue to receive prorated credits, either as a result of local or state regulations or for other specific reasons," AT&T told Ars.

Standing alone this may not be that big a deal, but cumulatively AT&T's nickel-and-diming matters very much to consumers.

You'll recall AT&T just got done jacking up streaming TV prices on the heels of its massive merger with Time Warner, just like deal critics had warned. AT&T then quickly doubled an already bogus "administrative fee" on the company's wireless customers, alone netting AT&T an additional estimated $800 million per year. AT&T's now hinting it will raise streaming prices even higher (AT&T's version of competition). This is of course on top of existing TV and broadband rate hikes, usage caps, hidden fees, and other soaring consumer costs.

Most of this is occurring for two reasons. One, AT&T's desperately trying to bounce back from the utterly massive debt load it incurred from the one-two punch of the DirecTV and Time Warner mergers. As is usually the case, the one paying for our mindless merger mania is usually... you. Two, because AT&T and other telecom and media giants have been on a tear effectively neutering all federal oversight of their efforts, there's nobody really in power interested in doing much about it. The above example makes it pretty clear why AT&T and Ajit Pai have also tried to neuter state consumer protection authority.

Getting ripped off in this fashion is the price tag for the nation's mindless obsession with merger mania, and the entirely false, yet oddly persistent, dogma that blindly deregulating the telecom sector somehow creates a free market connectivity Utopia. After several decades of this approach clearly not working in telecom you'd think more people would be keyed into the fact that letting natural monopolies dictate policy only really benefits investors and executives. But our collective, almost willful ignorance on this subject is nothing if not stubbornly persistent.

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Posted on Techdirt - 7 December 2018 @ 10:42am

Contrary To Media Claims, There's No Evidence Russia Was Behind Fake Net Neutrality Comments

from the a-game-of-telephone dept

Earlier this week we noted how the Ajit Pai FCC again shot down journalist FOIA attempts to find out who was behind the millions of bogus comments that plagued the agency's net neutrality repeal. The move prompted one of the agency's commissioners, Jessica Rosenworcel, to accuse her own agency of a coverup--since Pai refuses to work with either journalists or law enforcement investigations trying to uncover the truth of who was behind the comment fraud.

In an uncharacteristically snarky statement (pdf) issued the same day, Pai attempted to dismiss the criticisms as purely partisan attacks. But he also acknowledged something we already knew...that 500,000 or so of the email addresses used in the FCC's comment form came from users purportedly on Russian ISPs. From his statement:

"...one finds the now-standard overheated rhetoric about “net neutrality” (omitting, as usual, the fact that the half-million comments submitted from Russian e-mail addresses and the nearly eight million comments filed by e-mail addresses from e-mail domains associated with FakeMailGenerator.com supported her position on the issue!)."

So this is nothing new. Media reports had noted previously how 444,938 of the millions of bogus comments happened to have Russian email addresses. The New York Times' FOIA-focused lawsuit against the FCC also specifically highlights these addresses (many of which actually supported retaining net neutrality), likely in the hopes this would lend a little extra gravitas to court consideration.

Yet in the modern news media cycle, which can often resemble a game of telephone, numerous media outlets somehow rushed to the conclusion that Pai had "confirmed" that Russia must have been behind the efforts to stuff the ballot box at the FCC. Just a smattering of examples from this week:

That's fairly remarkable, given that's not what Pai said, nor is there any proof that "Russia" itself interfered with the net neutrality public comment period.

While many of these stories were more nuanced than the headlines (which writers often don't get to pick), the reality is the headlines are all a pretty large majority of people read. The Daily Dot report in particular was a huge hit on Reddit, upvoted more than 66,000 times and circulated far and wide. Not too surprisingly, the media's collective headline errors quickly drove many on Twitter to accuse Pai of being a Russian agent himself in dire need of prosecution:

Even Tim Wu, the Columbia law professor who coined the term net neutrality, circulated one of the headlines claiming Russia itself had been "linked" to the comment fraud:

Here's the problem: while these 500,000 email addresses used in the FCC's form appear to be Russian, that may not mean all that much.

Whoever stuffed the FCC comment section with farmed support (and in some cases opposition) for the repeal used all kinds of tricks to generate the bogus identities, including a bot that pulled names alphabetically from a hacked database of some kind. Many of the names used were dead people. Anybody could have plugged Russian email addresses into some of these form-generated responses, without actually representing the Russian government or even Russian people, thanks largely to an FCC website that didn't even remotely try to ferret out spam or bullshit.

Putin's adoration of hacking and disinformation is a legitimate problem, even if many may disagree on the breadth of the impact the Russian leader's digital dick waving has had on the real world and elections. And while it's certainly possible that Russia's attempts to pour gasoline on our already napalm-esque levels of dysfunction extended to the net neutrality fight, there's simply no evidence actually supporting that claim right now. Nor did Pai state that there was.

In similar cases, the evidence that inevitably appears usually points to a more obvious culprit: industry. These kinds of fake comments have been plaguing multiple US government agencies and proceedings in the states over the last few years, from proceedings at the Labor Department trying to rein in financial fraud, to efforts at the Consumer Financial Protection Bureau aimed at thwarting payday loan fraud.

More often than not it's the companies that benefit from the shenanigans that are found to be behind gamesmanship like this, since more than a few DC policy shops now offer this kind of greasy bullshit as an added value service for clients hoping to shape or influence public perception and government policy. The goal is usually to not just to create bogus support for bad policy, but to help undermine trust in the public comment process--often the only chance many Americans have to voice their thoughts on these decisions. Using Russian email addresses in bulk certainly would go a long way toward achieving that goal.

In the case of net neutrality, whoever was behind the fake comments was obviously keen on trying to downplay and discredit the millions of bipartisan Americans pissed off by the FCC's blatant handout to giant ISPs like AT&T, Verizon, Comcast, and Charter (Spectrum). Numerous investigations (at the GAO and NY AG, for example) and next February's net neutrality court battle are likely to, sooner or later, shed light on who carried out this operation, who funded it, and why Pai's FCC is trying so hard to keep most of these investigations from getting to the truth.

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Posted on Techdirt - 7 December 2018 @ 6:33am

FCC Tries to Bury Report Showing Many Broadband Users Still Don't Get The Speeds They Pay For

from the hiding-it-won't-make-it-go-away dept

So every year like clockwork since 2011 the FCC has released a report naming and shaming ISPs that fail to deliver advertised broadband speeds. The Measuring American Broadband program, which the FCC runs in conjunction with UK firm SamKnows, uses custom-firmware embedded routers in subscriber homes to collect data on real-world speeds (an improvement from years past when the FCC would just take ISPs' at their word).

In the years since, the program has been an effective way to name and shame ISPs that fail to deliver speeds promised to consumers. For example, in the first report, the FCC announced that some ISPs, like New York's Cablevision, had delivered just 50% of advertised speeds during peak hours. By the next report Cablevision had moved to fix its under-provisioning issues, and the FCC found that the company was now offering more bandwidth than advertised at peak hours. In the absence of more competition, simply using real data was a useful way to motivate apathetic regional monopolies to try a little harder.

Of course last year that all changed under Ajit Pai, when the FCC boss refused to release the report at all. After being pressured by telecom beat reporters to explain why, the FCC this week finally released some of the data... buried in the appendix of a much larger report (pdf) few will actually read. The data again showcases how many broadband providers -- mostly telcos selling aging, slow and pricey DSL -- routinely fail to deliver speeds consumers are paying for:

In the years since the program launched, many cable providers have been successfully nudged toward over-provisioning their lines to remain on the FCC's good side (though it should be noted that one cable provider, Charter Spectrum, was busted by the NY AG contemplating ways to game the system). This wasn't particularly hard; DOCSIS 3.1 cable upgrades are relatively inexpensive anyway, and have helped the cable sector deliver gigabit speeds (at least downstream).

The problem is that cable is slowly but surely securing a monopoly over these next-gen speeds because the nation's phone companies no longer really want to be in the fixed-line broadband business. AT&T and Verizon have shifted their focus to wireless, video, and ads, and providers like CenturyLink have shifted their focus to enterprise. As a result, millions of customers are stuck on aging, expensive, (and often unnecessarily usage capped) DSL lines nobody really wants to upgrade because the return on investment is too slow for Wall Street's liking.

The result: less competition, higher prices, slower speeds, and worse customer service as cable secures a monopoly over high speeds. And no, 5G wireless is not going to magically fix these problems, as we've explored previously.

Of course because the Measuring American Broadband program highlighted these issues via a very clear stand alone report, it seems fairly likely that broadband providers didn't much like this. Like so much Pai does (like killing net neutrality rules), burying the report was framed by the FCC head as a noble effort to simply improve agency efficiency. But in a statement to Ars Technica's Jon Brodkin, Pai's fellow Commissioner Jessica Rosenworcel seemed unsold on that explanation:

"We're all frustrated when our broadband speed doesn't live up to what was promised," FCC Commissioner Jessica Rosenworcel, the FCC's only Democrat, said in a statement to Ars today. "So it's downright unacceptable that the FCC—which has been collecting data on broadband speeds nationwide—is slow to make this information public and, when it does so, buries it in the appendices to a larger report. This is essential data for every consumer in the digital age. The public deserves better."

The attempt to bury belated data in a study appendix nobody will read is just another example of Pai's largely blind fealty to the industry he's supposed to be holding accountable. From the attacks on net neutrality and FCC oversight to his efforts to literally weaken the very definition of competition, Pai continues to be the very best friend any lumbering telecom monopoly could ask for. After all, if you can manipulate or obscure data showing just how broken the US broadband industry is, it's far easier to justify your complete and total apathy toward actually doing anything about it.

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Posted on Techdirt - 6 December 2018 @ 10:44am

The TV Sector's Latest Bad Idea: Ads That Play When You Press Pause

from the more-and-more-ads dept

The TV industry is certainly skilled when it comes to ignoring the will of the customer. You'll recall that as the cord cutting and ratings free fall began, the sector's very first impulse was to double down on a lot of bad ideas, from mindlessly raising rates, to editing down programs or speeding them up to shove more ads into each viewing hour. And as new innovations like ad skipping DVR technology emerged, the industry's very first impulse was to first sue companies in a bid to ban the tech, then "innovate" by charging users more if they did want to skip ads.

This week, both AT&T and Hulu (which AT&T now owns a chunk of via its Time Warner merger) unveiled their latest "innovation" in delivering ads that users don't want: ads that run when you press pause and leave the room. According to AT&T, the tech should emerge sometime next year for its DirecTV and IPTV (formerly branded U-Verse) TV customers:

"AT&T also has hopes to use the pause to lend new momentum to TV advertising. The company, which owns DirecTV and U-verse, expects to launch technology next year that puts a full-motion video on a screen when a user decides to take a respite. “We know you’re going to capture 100% viewability when they pause and unpause,” says Matt Van Houten, vice president of product at Xandr Media, AT&T’s advertising division. “There’s a lot of value in that experience."

Said "value" will certainly be in the eye of the beholder. Consumers that have made it clear they don't want to pay an arm and a leg for traditional TV and watch ads aren't going to be particularly thrilled to engage in another, entirely new layer of ads. And the "value" of layering more ads when users press pause and (usually) leave the room certainly isn't going to be any kind of panacea for the problems that plague the sector (high prices, too many ads, terrible customer service, bloated & inflexible pay TV lineups, and sagging ratings).

For its part, AT&T makes the case that you'll need some additional advertising in streaming because low subscription prices aren't enough to pay for content development in the streaming era:

"At a September conference held for advertisers, AT&T executives made the case that even new forms of video entertainment – including streaming – require ad support. “If we are to continue this pace of developing content of this quality in these volumes, then we need advertising to pay for some of the content,”said Brian Lesser, chief executive of the company’s Xandr unit, while speaking to reporters at the event. “I don’t believe – nor does anybody on the team believe – that subscription video on demand services could possibly pay for all the content being developed” without relying on money from advertising."

While that might be true, it's worth noting that AT&T's not trialing this technology on its streaming platforms (like DirecTV Now), it's implementing it on its traditional IPTV and satellite TV services, which usually cost consumers (on average) upwards of $100+ per month. Forcing additional advertising on customers already annoyed by high prices isn't the path to winning back frustrated customers. Meanwhile, AT&T has no problem raising subscription rates on streaming anyway; the company just got done implementing a streaming price hike before the ink on its last merger was even dry, and is already hinting at another round of hikes.

When you face real competition (something that's a little alien to AT&T), you don't get to choose when you compete on price and features. That's why some wings of the cable and broadcast sector have finally started actually lowering the ad load in a bid to keep people from switching to streaming alternatives to heading to piracy. And while it's true the sector needs to innovate around advertising, hitting already frustrated users with even more ads (when they're probably not even in the room) doesn't seem like the best path forward.

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Posted on Net Neutrality Special Edition - 6 December 2018 @ 6:14am

Telecom's Top Lobbying Arm Oddly Keeps Undermining The Industry's Own Claims About Net Neutrality

from the ill-communication dept

The telecom industry (and by proxy Ajit Pai's) primary justification for killing net neutrality -- and FCC authority over ISPs in general -- was that sector oversight was stunting network investment. Of course repeated analysis of the data shows that simply isn't true, but that hasn't stopped telecom lobbyists and the lawmakers who love them from repeating those claims in the hopes that repetition forges reality.

And while telecom lobbying organizations like US Telecom continue to cling tight to this false narrative, the "science" they've been shoveling out in recent months to try and "prove" these claims leaves a little something to be desired. Last October, for example, US Telecom released a study it claimed somehow proved that the Ajit Pai's attacks on net neutrality had boosted broadband investment:

"Broadband investment rebounded in 2017, as a series of positive consumer and innovation policies and a pro-growth regulatory approach helped reverse the industry’s previous spending pullback, according to new research released today by USTelecom."

The problem: net neutrality wasn't actually repealed until June of 2018.

This week, US Telecom released another study crowing about what's some fairly modest recent broadband deployment growth. As part of the report, the industry highlights how US fiber deployment jumped from 21 to 29% of US homes between 2015 to 2017, a period when the FCC's classification of ISPs as Title II common carriers (purportedly an investment killer) was in effect:

"In just a year and a half, from the end of 2015 to mid-2017, U.S. fiber deployment grew from 21 percent to 29 percent of homes and competitive availability of wired broadband at 25 megabits per second (mbps) download and 3 mbps upload increased from 31 percent to 55 percent. At lower speed tiers, and if fixed wireless is included, competitive availability is even greater: 77 percent at 10 mbps download and 1 mbps upload; and 91 percent at any speed. By mid-2017, broadband at 100 mbps download was available to 89 percent of Americans, compared to 10 percent in 2010. Moreover, fiber deployment and competitive availability of broadband at higher speeds continue to grow rapidly today, driven by competitive upgrades."

So one, it should be noted that this growth is solid but not spectacular by any means; it would likely be significantly higher if one of US Telecom's top missions wasn't to try and stifle meaningful sector competition at every conceivable opportunity. Still, this period -- from 2015 (when the FCC created its latest net neutrality rules) to 2017 -- was the exact period in which the industry keeps telling us it suffered from "unprecedented" and "heavy handed regulation" like net neutrality that stifled industry investment. And yet here US Telecom is insisting that the exact period exhibited "rapid" growth "driven by competitive upgrades." Why it's almost as if the telecom sector's top lobbyists aren't ideologically or ethically consistent.

Of course the firm then proceeds to proclaim that if we want this growth (that wasn't supposed to exist) to continue, we need to double down on policies that embrace an "investment-friendly environment" that will allow this growth to continue. Oh, and more subsidies for US Telecom's client companies who've already received billions, of course:

"Therefore, it will remain imperative for policymakers to maintain an investment-friendly environment for broadband deployment, including providing additional financial support in areas that need it. Governments should target support to specific areas where the economics do not support deployment or upgrades, and funding must be dedicated and direct, using a mechanism like the Connect America Fund."

As we've been noting, said "investment-friendly environment" includes effectively neutering the FCC's ability to police bad behavior in telecom, then shoveling all remaining responsibility to an FTC that lacks the authority, willpower, or desire to actually police giant ISPs like AT&T, Verizon, and Comcast (the entire point). Said "investment-friendly environment" also currently involves trying to ban states from protecting broadband consumers from false advertising and fraud.

Granted, nobody actually reads reports by groups like US Telecom outside of a few execs, consumer groups, and beat reporters, but the "science" they shovel forth does often tend to cement itself into the base layers of more policy conversations than you'd prefer. Still, after the last few months of exceptionally flawed efforts at "science," perhaps US Telecom should spend less time accidentally emailing us their talking points, and more time pursuing something vaguely resembling intellectual consistency.

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Posted on Techdirt - 5 December 2018 @ 11:54am

Verizon Dinged Again For Privacy Violations, This Time For Slinging Personalized Ads To Kids

from the what-privacy-law? dept

Oh Verizon. For years we've noted how the company's consumer privacy practices are utterly abysmal. Like that time in 2016 when Verizon was fined a relative pittance by the FCC for modifying user wireless packets so it could covertly track users around the internet (beyond cookie, clickstream, or even deep packet inspection data). This being Verizon, it didn't bother to tell anybody that this was happening. As a result, it took two years for security researchers to even notice what the company was up to, and another six months of media yelling before the company was willing to even let consumers opt out of the data collection.

Fast forward to this week, and Verizon has been busted once again on the privacy front, this time for slinging behavioral advertisements at kids in violation of the Children’s Online Privacy Protection Act (COPPA). According to an announcement by acting New York Attorney General Barbara Underwood, Verizon's Oath operations (the mash up of its Yahoo and AOL acquisitions) routinely auctioned off ad space and placed ads on websites the company knew targeted kids -- without parental consent. As a result, Verizon's being hit with the biggest fine in the history of COPPA:

"The Attorney General’s Office found that AOL conducted billions of auctions for ad space on hundreds of websites the company knew were directed to children under the age of 13. Through these auctions, AOL collected, used, and disclosed personal information from the websites’ users in violation of COPPA, enabling advertisers to track and serve targeted ads to young children. The company has agreed to adopt comprehensive reforms to protect children from improper tracking and pay a record $4.95 million in penalties, the largest penalty ever in a COPPA enforcement matter in U.S. history."

But much like the company's fine for its earlier scandal, the fine itself is likely a small fraction of the money made during the time AOL spent intentionally turning a blind eye as behavior ads were aimed at kids and kid-frequented websites. The AG's report notes that until late last year (presumably as a result of realizing the AG inquiry existed), AOL's systems ignored any information that it received from an ad exchange indicating that the ad space was subject to COPPA, so the website routinely ignored the law in general. It's worth noting that the full settlement has not yet been released.

There's no indication from the NY AG (I've reached out for more detail) how long this was going on, but it's fairly obvious the income AOL made from ignoring COPPA (there were 1.3 billion auctions of display ad space) outweighs any penalty it's facing, however historic. COPPA is one of the few privacy regulations currently in place, and even then, Verizon/AOL/Oath's decision to just ignore the law speaks pretty broadly as to how even the privacy laws we do have are inconsistently enforced. Especially when we're talking about deep-pocketed telecom giants, who have openly flirted with the idea of charging users even more money for privacy without regulators so much as batting an eye.

As we sit down and begin the long, difficult conversation about what a real internet-era privacy law should look like, the lion's share of the focus remains (quite justly given the Cambridge Analytica scandal) on Facebook. But it can't be understated how the telecom industry has historically been even worse -- especially given they're effectively bone-grafted to the nation's intelligence surveillance apparatus. That these are the companies that will have the biggest impact on the crafting of privacy laws should terrify anyone interested in getting meaningful privacy legislation right.

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Posted on Techdirt - 5 December 2018 @ 6:21am

FCC Commissioner Accuses Her Own Agency Of A Net Neutrality Cover Up

from the ill-communication dept

We've long discussed how the Pai FCC's net neutrality repeal was plagued with millions of fraudulent comments, many of which were submitted by a bot pulling names from a hacked database of some kind. Millions of ordinary folks (like myself) had their identities used to support Pai's unpopular plan, as did several Senators. Numerous journalists have submitted FOIA requests for more data (server logs, IP addresses, API data, anything) that might indicate who was behind the fraudulent comments, who may have bankrolled them, and what the Pai FCC knew about it.

But the Pai FCC has repeatedly tried to tap dance around FOIA requests, leading to several journalists (including those at the New York Times and Buzzfeed) suing the FCC. Despite the Times' lawyers best efforts to work with the FCC to tailor the nature of their requests over a period of months, the agency continues to hide behind FOIA exemptions that don't really apply here: namely FOIA exemption 6 (related to protecting privacy) and 7E (related to protecting agency security and law enforcement activity).

And while the Times and Buzzfeed had appealed the FCC's ruling, the FCC this week released a memorandum and order formally denying those requests. In it, the FCC doubles down on the claims that it's simply blocking the release of this data because it's super worried about the privacy of FCC commenters (though again, if you actually read the Times lawsuit, you'll note the FCC was utterly inflexible in terms of narrowing down the scope of requests).

FCC lawyers also try to make the amusing claim that the press really doesn't need this data because there's other investigations (including one at the GAO) trying to get to the bottom of the scandal:

"Confessore proffers a putative public interest in understanding the integrity of the Commission’s comment process. This question, however, is being or has already been examined by other press outlets,51 Commission staff, and the Government Accountability Office, among others. Confessore has not provided us with any reason to believe that his review of this data would significantly advance any public interest beyond the investigations that are already underway."

Of course this is the same FCC that has also actively blocked law enforcement efforts to get to the bottom of the scandal, refusing nine inquiries from the NY AG over a period of five months for additional data. So while the Pai FCC breathlessly claims it's all about transparency and integrity, their actions on this subject (and that whole fake DDOS attack they concocted in a weird bid to downplay public backlash) tend to undermine these claims.

Meanwhile, Pai's fellow Commissioner, Jessica Rosenworcel, has certainly taken off the gloves in recent weeks. She hit Twitter and issued a statement that effectively accused her own agency of engaging in a cover up of fraudulent activity:

Her full statement (pdf) is also worth a read, and doesn't pull any punches:

"Instead of providing news organizations with the information requested, in this decision the FCC decides to hide behind Freedom of Information Act exemptions and thwart investigative journalism. In doing so, the agency asserts an overbroad claim about the security of its public commenting system that sounds no more credible than its earlier and disproven claim that the system was the subject of distributed denial of service attack. It appears this agency is trying to prevent anyone from looking too closely at the mess it made of net neutrality. It is hiding what it knows about the fraud in our record and it is preventing an honest account of its many problems from seeing the light of day.

Pai's justification for the FOIA blockade tries very heavily to insist this is all just unfair partisan gamesmanship. But at this juncture his FCC's record when it comes to transparency, blatant telecom sector cronyism, and bizarre scandals has pretty much been established. This is an agency that not only used bullshit telecom lobbyist data to undermine policies that had broad, bipartisan public support, it has been rocked by scandal after scandal, fought tooth and nail against real transparency on numerous fronts, and has refused to give any real weight to the will of the tech-savvy public.

Pai comes off as an unwavering ideologue who truly seems to believe he's doing an incredible job of "unleashing innovation" despite every shred of evidence to the contrary (not unlike the man who appointed him to the position). Unfortunately for Pai, whose post-FCC political ambitions couldn't be any more obvious, his legacy will likely be the giant middle finger he's given to tech-savvy Millennials. As for the fake comments specifically, they're likely to play a starring role in next February's net neutrality lawsuits, which will look to prove the agency violated the Administrative Procedure Act by ignoring the will of the public as it rushed to give AT&T, Verizon, and Comcast a sloppy kiss for the ages.

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Posted on Techdirt Wireless - 4 December 2018 @ 12:03pm

Wireless Carriers Won't Comment On 5G's Most Important Question: How Much Will It Cost?

from the meet-the-new-boss dept

We've noted a few times that while fifth-generation wireless (5G) will certainly improve the speed, reliability, and latency of existing networks, it's being pretty painfully overhyped by hardware vendors and cellular carriers. Telecom industry marketing folks spend countless hours insisting that the smart cities and smart cars of tomorrow are only possible with 5G, the sort of claims countless online outlets will repeat utterly unquestioningly. More often than not these claims are based on nothing close to reality (like this one claiming 5G will somehow result in four day work weeks).

While 5G will result in faster, more resilient networks, it doesn't magically somehow unleash additional innovation for tech that already largely works on existing 4G networks (smart cars, smarter cities). And while carriers have begun testing and hyping various incarnations of 5G, broad phone availability on broadly-deployed 5G networks remains years away as companies hammer out battery life issues (Apple isn't releasing a 5G iPhone until 2020, or potentially later) and push 5G upgrades to rural and less affluent cities these companies routinely don't care much about. .

While most media articles on 5G are little more than blind stenography of wireless marketing claims, Sean Hollister at The Verge did a good job last week breaking down 5G's promises, laying down the real-world impact and deployment schedules. More importantly, he narrows in on what's probably the most important question for 5G carriers don't want to answer: how much will 5G cost?

"Consider me a wee bit concerned that on the eve of AT&T’s launch, neither AT&T nor Verizon was willing to talk about how much, how often, how fast, nor answer what’s probably the most burning question: whether we should expect to pay more, less, or the same for 5G connectivity. (Because 5G’s inevitable, right? You’ll be paying for it sooner or later.)

For that matter, neither carrier would even tell me whether today’s data caps might get larger to account for the tremendous amount of data we’ll supposedly be using on 5G. I figured that would be a softball question, but they deflected anyhow.

That question, in turn, is being very directly shaped by the attack on net neutrality:

"I do wonder how the death of net neutrality will embolden the carriers to do things that would have been unthinkable before. One of the reasons carriers argued for the end of net neutrality was to open up “innovative” business models, and it’s possible they’ll look at bundling their own services, or those of partners, with free or discounted 5G connectivity."

Since most of these services aren't launching until next year, it's not surprising they're not able to comment on pricing yet. That said, if the history of telecom is anything to go by, you can be sure of two things related to 5G pricing: it won't be cheap, and (like we're seeing with "unlimited" packages) will be saddled with all manner of caveats designed to nickel-and-dime you just for using it. As such, any evolutionary gains made in network advancement could easily be hamstrung by bad tech policy dictated by mobile carriers.

The problem for carriers: they're not really sure how much nickel-and-diming they can actually get away with, since a lot of that depends on whether the FCC and its ISP BFFs win next February's looming net neutrality lawsuit against the FCC. If the plaintiffs (23 State AGs, Mozilla, and consumer groups) win that case, the FCC's 2015 net neutrality rules should be restored, dramatically impacting 5G pricing and plans. Should they win, there's not much (outside of a future FCC or Congress passing new rules) preventing the wireless industry from upping the ante in terms of nickel-and-diming consumers in a wide variety of ways.

That means a lot more of the kind of dubious stuff we're already seeing on 4G networks, such as throttling all video then charging consumers a premium to get around restrictions that shouldn't exist in the first place. So while 5G will be a step forward in many ways, the death of net neutrality will have a lot to say about how much value consumers (both consumer and enterprise) see from 5G. And of course this is before you factor in in the looming Sprint, T-Mobile merger, which will reduce the overall number of competitors, and any real incentive to compete on price.

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Posted on Techdirt - 4 December 2018 @ 6:20am

UK ISPs Demand Ad Watchdog Crack Down On 'Fake Fiber' Broadband

from the ill-communication dept

A few years back, we noted how a growing number of US broadband providers (particularly telcos) were trying to obscure their network upgrade failures. How? By only partially upgrading their networks then over-stating their customers actual access to real fiber broadband. AT&T, for example, likes to upgrade only a few developments in a city then breathlessly declare the entire city served with fiber. AT&T and other telcos often only upgrade part of the path to the users' home (fiber to the local node, aka FTTN) instead of running fiber to the home.

It's well in line with the problem we've seen in both the UK and US with ISP's advertising "up to" broadband speeds (usually an indicator you won't get the actual speed advertised. Needless to say, this collectively creates a lot of confusion among customers who often don't know if fiber is actually available, or if they're being sold either empty promises, or some inferior version of marginally upgraded DSL that isn't fiber (usually made most obvious by pathetic upstream speeds).

In the United States regulators couldn't care less about this. Both parties have long turned a blind eye to such creative marketing, in much the same way we've turned a blind eye to the fact our terrible broadband maps routinely over-state broadband availability over all. Apathy to this kind of creative marketing is also common in the UK, where the Advertising Standards Authority recently declared it was no big deal if a broadband provider wants to sell inferior broadband service (with speeds much slower than real fiber) as "fiber" broadband.

Three of the UK's actual fiber providers have joined forces in a bid to try and force the ASA to retreat from the decision:

Three of the UK’s most pioneering providers’ of ultrafast “full fibre” (FTTP/H) broadband – Gigaclear, Cityfibre and Hyperoptic – have today called on the Advertising Standards Authority to stop rivals from using the term “fibre” to advertise services delivered over slower copper wires...“Consumers are increasingly being provided with a choice; to rely on traditional broadband services delivered over outdated copper wires and cables, or to connect to a new generation of full fibre networks offering the vastly improved speeds and reliability essential to a modern-day home or business."

This seems like semantics, but when you're trying to upgrade a country to actual broadband... it matters. DSL lines remain highly distance constrained, and (again) tend to offer paltry upstream speeds. So when you're trying to determine whether a city has been upgraded to real broadband -- or substandard broadband -- it's kind of an important difference. Granted ISPs in both the UK and US that don't want to meaningfully upgrade their networks (or let anybody else do so either) would prefer it if they could continue calling a Honda Civic a Bugatti for what should be obvious reasons.

It should be noted that the FCC's 2015 net neutrality rules had some transparency requirements insisting that ISPs be entirely clear about what kind of connection they're buying. Requirements that, with the rest of the rules, were stripped away by the FCC's Ajit Pai in his quest for "internet freedom" (or whatever he's calling it these days).

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Posted on Techdirt - 30 November 2018 @ 6:26am

Senators Continue To Point Out Our Broadband Maps Suck

from the do-not-pass-go,-do-not-collect-$200 dept

For a country that likes to talk about "being number one" a lot, that's sure not reflected in the United States' broadband networks, or the broadband maps we use to determine which areas lack adequate broadband or commpetition (resulting in high prices and poor service). Our terrible broadband maps are of course a feature not a bug; ISPs have routinely lobbied to kill any efforts to improve data collection and analysis, lest somebody actually realize the telecom market is a broken mono/duopoly whose dysfunction reaches into every aspect of tech.

If you want to see our terrible broadband maps at work, you need only go visit the FCC's $300+ million broadband availability map, which is based on the Form 477 data collected from ISPs. If you plug in your address, you'll find that not only does the FCC not include prices (at industry behest), the map hallucinates speed and ISP availability at most U.S. addresses. Part of the problem is that the FCC declares an entire region "served" with broadband if just one home in a census tract has service. Again, ISPs fight efforts to reform this in a bid to protect the status quo.

Only when states are jockeying for broadband subsidies is this problem even brought up in DC, so as states vie for $4.7 million in wireless broadband subsidies via the FCC's Mobility Fund Phase II, the problem has been seeing renewed attention.

Back in August, Montana Senator Jon Tester took these criticisms to a new level, bluntly insisting the FCC's maps "stink" and that we really have "got to kick somebody's ass" to get the problem fixed. Like Tester, West Virginia Senator Joe Manchin also isn't impressed and has been trying to challenge the FCC's historically terrible coverage maps. This week Manchin again pointed out that our US broadband maps are terrible, while noting he was the only member of Congress to actually formally challenge them:

"Manchin argued the map does not accurately show broadband coverage in West Virginia, leaving some out of receiving reliable and affordable broadband. Rural areas were getting screwed, and all of West Virginia was getting screwed because these big-time carriers were showing, ‘Oh, this is our area. We’ve got it taken care of, don’t worry. They’re only going to go into areas where they know that they’re going to have a return on an investment. It’s no different than electricity back in the 1930s."

Therein lies the problem. Incumbent ISPs see no reason to deploy broadband into countless areas (rural and urban) country wide because they either don't see a good return on the investment, or the unyielding need for quarterly improvements mean they don't see a return quickly enough for Wall Street's liking. And while that's certainly understandable, at the same time incumbent ISPs do everything in their power to prevent cities from wiring themselves either, most notably via the 21 protectionist laws ISPs have quite literally written and purchased that ban towns and cities from exploring more creative solutions.

That's particularly true in Manchin's West Virginia, which we've long noted is the poster child for US broadband corruption and dysfunction, thanks in large part to regional incumbent telco Frontier Communications.

Last year, the ISP fired a seven year employee because, at his part-time job as West Virginia senate leader (note how nobody in the state thought that was a conflict of interest), he voted for a new law that would actually help improve broadband penetration and competition in the state. Frontier has also been under fire for the better part of the last decade over allegations that the ISP routinely rips off taxpayers and has wasted millions in past subsidies by intentionally misrepresenting how that money was spent.

So while it's great that Manchin is the only Senator that actually cares about the country's broadband maps, terrible broadband maps are just a symptom of a much broader problem Manchin tap dances around: corruption and cronyism. Even the most well-intentioned US lawmakers routinely let some of the least popular, monopolistic companies in America dictate both federal and state telecom policy, then stand around with an idiotic look on their faces as they wonder what could have possibly gone wrong.

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Posted on Techdirt - 29 November 2018 @ 4:56am

ESPN Has Lost 14 Million Viewers In 7 Years Thanks To Cord Cutting

from the swimming-against-the-tide dept

ESPN has long personified the cable and broadcast industry's tone deafness to cord cutting and TV market evolution. Executives not only spent years downplaying the trend as something only poor people do, it sued companies that attempted to offer consumers greater flexibility in how video content was consumed. ESPN execs clearly believed cord cutting was little more than a fad that would simply stop once Millennials started procreating, and ignored surveys showing how 56% of consumers would ditch ESPN in a heartbeat if it meant saving the $8 per month subscribers pay for the channel.

The penalty for ESPN's failure to adapt has been severe. Disney's recent earnings revealed that ESPN lost another 2 million regular viewers this year. And while ESPN still has 86 million regular viewers, that's a 14 million regular viewer dip from the 100 million regular viewers it enjoyed in 2011. Those 14 million lost users generated around $1.44 billion per year for the "worldwide leader in sports," which is still saddled with the severe costs of set redesigns and sports licensing contracts the company struck while it was busy not seeing the massive locomotive of market change bearing down upon it.

While some of these wounds are inevitable due to shifting markets, many were self-inflicted. ESPN execs often tried to shoot the messengers instead of listening to the message. And once the damage was done, ESPN decided to fire hundreds of longstanding sports journalists and support personnel, but not the executives like John Skipper (since resigned for other reasons) whose myopia made ESPN's problems that much worse in the first place.

Ultimately, ESPN and Disney figured out that streaming was the future. In response, it launched a new direct-to consumer app dubbed ESPN+ that sort of provided users what they wanted, but not really. The $5 per month service basically took much of the fare available on ESPN's lesser-watched channels and offered it over the internet. But there were caveats; such as the service didn't really offer users what they really wanted (just a streaming version of ESPN's core channel) unless you subscribe to traditional cable, part of the "TV Everywhere" mindset cable execs can't seem to move past.

While ESPN's losses are the most notable, other Disney properties continue to see sharp viewership declines in the cord cutting era:

"Disney Channel has also seen its subscribers ebb to 89 million, down from 92 million in fiscal 2017. Freeform fell by 2 million to the 90 million mark. Disney Junior (69 million) and Disney XD (71 million) both lost 3 million subs. The numbers, attributed to Nielsen Media Research estimates, indicate that the growth of virtual MVPDs such as YouTube Live and Hulu’s package, are still not enough to offset a net decline in the subscribers from the traditional pay-TV world."

Again, many cable and broadcast industry executives are under the mistaken impression they get to choose when to adapt to the markets shifting around them. In reality they only have two choices. One, get out ahead of the shift toward streaming video by giving consumers what they actually want, even if that means losing some money in the short term. Or, refuse to adapt, double down on the belief that traditional cable TV is a cash cow that will never die, and watch as smaller, more flexible outfits continue to steal your massive subscriber base out from beneath your feet.

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Posted on Techdirt - 28 November 2018 @ 3:37pm

Activists Make One Last Push To Restore Net Neutrality Via Congressional Review Act

from the one-more-time-around dept

Efforts to reverse the FCC's historically unpopular attack on net neutrality using the Congressional Review Act (CRA) have been stuck in neutral for several months, but activists are backing one last push in a bid to get the uphill effort over the hump.

The CRA lets Congress reverse a regulatory action with a simple majority vote in the Senate and the House (which is how the GOP successfully killed broadband consumer privacy protections last year). And while the Senate voted 52 to 47 back in May to reverse the FCC's attack on net neutrality, companion efforts to set up a similar vote in the House haven't gained much traction as the clock continues to tick. A discharge petition needs 218 votes to even see floor time, and another 218 votes to pass the measure.

But the needed votes have lingered at around 172 for months, split (quite stupidly, given broad public support) along strict partisan lines.

Hoping to push the effort over the line and drum up the needed votes ahead of the December 10 CRA deadline, net neutrality activist groups like Fight for the Future are holding one last online protest on Thursday, November 29. This time around they've drummed up the support of numerous musicians and celebrities in the hope of getting the attention of a public that's clearly weary of the entire debate:

"The effort is backed by musicians and celebrities like Hollywood star Evangeline Lilly (Ant-Man and the Wasp, The Hobbit, Lost), Rage Against the Machine guitarist Tom Morello, and EDM star Bassnectar, along with startups and major web companies like online selling platform Etsy, delivery service Postmates, publishing platform Tumblr, Private Internet Access VPN, popular blog BoingBoing, domain registrar Namecheap, search engine StartPage, and speaker company Sonos."

The problem, of course, is that all the public screaming in the world has yet to shift the thinking of well-lobbied net neutrality opponents in Congress, and adding Tom Morello or Sonos to the proceedings, while appreciated and notable, isn't likely to move the needle much. Even if the vote succeeds, it still would have to avoid a veto by Trump. And while activists I've spoken to have argued that a House vote could appeal to Trump's "populist" side and pressure him to let the restoration ride through, that's simply not very likely.

That said, it was worth trying as a hail Mary pass anyway, and there's absolute value in both naming and shaming corrupt lawmakers, something Fight For the Future has toyed with via crowdfunded billboards. There's also value in keeping the issue in the public headspace ahead of next year's Congressional battles. Still, users looking to this effort to actually restore the FCC's rules should probably temper their enthusiasm. Our existing Congress has made its disdain for the public interest abundantly clear, and the real fight for net neutrality is next year.

The best chance at saving net neutrality rests with next year's net neutrality court battle, the opening arguments for which begin next February. It's there that a handful of companies like Mozilla, and 23 state attorneys general, will make their case that the FCC ignored the public and violated the Administrative Procedure Act in aggressively dismantling popular consumer protections, while basing their entire justification for the repeal on telecom industry lobbying bullshit.

Should the FCC lose that lawsuit, the agency's 2015 rules would be restored -- though Ajit Pai's FCC isn't likely to enforce them during his tenure (however long it lasts). Should the FCC and its ISP BFFs win that case, they still need to find a way to prevent a future FCC or Congress from passing net neutrality rules (or laws) with real teeth. That's why companies like AT&T have been pushing loyal foot soldiers like Marsha Blackburn to table loophole-filled, fake net neutrality legislation with only one real purpose: preempting tougher state or federal rules.

But with a shifting Congressional makeup, and net neutrality supporters in Congress not eager to anger activists by signing garbage legislation, that gambit isn't likely to succeed. The net result: like privacy, we're going to need to have a real conversation about what a realnet neutrality law might look like. And it's going to require a Sisyphean effort to prevent countless industries and their loyal political foot soldiers (with a vested interest in uneven playing fields and turf protection) from polluting the entire process.

While many are fatigued by the entire net neutrality fight, it's worth remembering that net neutrality doesn't just live or die based on the passage or restoration of rules or laws. It's a never-ending fight that will continue for however long the broadband industry maintains a stranglehold on meaningful competition. Given telco upgrade apathy, 5G's overhype as a competitive panacea, a growing cable monopoly over next-gen speeds, and Pai-era regulatory apathy, that's a problem that's not going away anytime soon.

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Posted on Techdirt - 28 November 2018 @ 6:12am

From $1.50 To $10 Per Month: How Comcast's Bogus Fees Are False Advertising

from the fees-and-surcharges-may-apply dept

For several years now cable and broadband providers have been using hidden fees to covertly jack up their advertised rates. These fees, which utilize a rotating crop of bullshit names, help these companies falsely advertise one rate, then sock the consumer with a significantly higher-rate post sale (often when locked into a long-term contract). The practice also allows the company to falsely claim they're not raising rates on consumers. They omit that they're talking about the above the line rate being charged, implying that anything below the line (where real fees like taxes are levied) is outside of their control.

Back in 2014, Comcast introduced a new $1.50 per month surcharge it called its "Broadcast TV Fee." Said fee was really just a portion of the cost of doing business for Comcast (programming), busted out of the full bill and hidden below the line -- again to help the company falsely advertise a lower price. Over the last four years Comcast has quietly but quickly pushed this fee skyward, this week informing customers that -- alongside numerous other rate hikes like its "Regional Sports Network" fees -- the company's Broadcast TV fee would now be $10 per month for the company's cable TV customers:

"Comcast is raising its controversial "Broadcast TV" and "Regional Sports Network" fees again on January 1, with the typical total price going from $14.50 to $18.25 a month. The newly raised broadcast TV fee will be $10 a month, and the sports fee will be $8.25 a month, Cord Cutters News reported last week. The new fee sizes are confirmed in a Comcast price list for the Atlanta market. About a year ago, Comcast raised the broadcast TV fee from $6.50 to $8 and the sports fee from $4.50 to $6.50."

Not to be outdone, Comcast's also socking millions of its customers with a bevy of additional fees in the new year. Including a wide variety of modem and cable box rental fees, the latter of which arrive after Comcast worked overtime to kill FCC plans to improve cable box competition. Comcast users still routinely pay an arm and a leg in rental fees for hardware that actually costs very little for Comcast to buy wholesale:

"Equipment rental fees are rising, too. Comcast last year raised its modem rental fee from $10 to $11 a month. The new price list for January 1 lists an "Internet/Voice Equipment Rental" fee as $13. Comcast confirmed to Ars that the modem rental fee is rising $2 a month. Customers can avoid that fee by purchasing their own modem."

There's nothing healthy about a scenario where customers don't know how much they'll pay for service until the bill actually arrives, and face a rotating bevy of covert fees while purportedly under contract. In a country with functional regulators or healthy competition (or hey, both) Comcast wouldn't be allowed to completely make up a bogus fee specifically to help it advertise a lower price. But despite some occasional noise on this front, neither party has given much of a damn about such "creative" pricing. It sends a pretty clear message: ripping off consumers is fine if you're semi-creative about it.

As such, regulatory promises to mandate some transparency on this front come and go without meaningful change, and bills attempting to stop the practice routinely get crushed by lobbyist cash in Congress. The FCC's net neutrality rules included some meager provisions requiring that ISPs being transparent about hidden surcharges, but even those requirements were killed during the agency's net neutrality repeal (at direct Comcast lobbyist behest).

And while Comcast is occasionally singled out for the practice via lawsuits and consumer groups, it routinely tries to insist that socking customers with bullshit fees is just Comcast's way of being "transparent."

Obviously it's not just the cable industry that engages in such nonsense; telecom companies learned the tactic from the banking, airline, and other industries, who similarly get to confuse customers with surprise surcharges with zero meaningful market or regulatory repercussions. From hotel "resort fees" to family-separating airline assigned seating fees, the United States has repeatedly made it clear across industries that lying to consumers about how much they'll pay is now a great American pastime akin to baseball.

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Posted on Techdirt - 27 November 2018 @ 6:15am

Consumer Groups Say FCC Weakening Oversight Of Cell Carriers Under Pretense Of Battling Text Message Spam

from the ill-communication dept

Consumer groups say that the Ajit Pai FCC is once again being misleading as he continues his ongoing quest to eliminate most meaningful oversight of cell carriers and broadband providers.

Last week, the FCC announced several major initiatives the agency claimed were intended to help fight text message spam. One of them involves the creation of a reassigned number database, which would help marketers market more efficiently by ensuring that a target of marketing calls and text messages are receiving the messages they either opted in to, or opted out of. But another effort, only vaguely hinted at in the announcement, would further weaken the FCC's consumer protection authority over wireless cell providers, already greatly eroded after the assault on net neutrality.

So some background: a little more than a decade ago, Verizon decided to ban a pro-choice group named NARAL Pro-Choice America from sending text messages to Verizon Wireless customers that had opted in to receiving them. Verizon justified the ban by declaring the text messages "controversial or unsavory"; a curious move for an industry that often cuddles up to marketing spammers and crammers when it's profitable. Ever since then consumer groups, worried that cellular carriers would use their power as gatekeepers to stifle certain voices, have been urging the FCC to declare text messages a “telecommunications service," making it illegal for carriers to ban such select SMS services.

Last week, the Ajit Pai FCC unsurprisingly rejected the request. An accompanying Ajit Pai blog post tries to claim that the FCC's refusal of he request (lobbied for by cellular carriers) was somehow necessary to "protect successful consumer protections," the sort of up is down and cold is hot rhetoric that has come to be one of the trademarks of Pai's legacy:

"In 2015, a mass-texting company named Twilio petitioned the FCC, arguing that wireless messaging should be classified as a “telecommunications service.” This may not seem like a big deal, but such a classification would dramatically curb the ability of wireless providers to use robotext-blocking, anti-spoofing, and other anti-spam features. So I’m circulating a Declaratory Ruling that would instead classify wireless messaging as an “information service.” Aside from being a more legally sound approach, this decision would keep the floodgates to a torrent of spam texts closed, remove regulatory uncertainty, and empower providers to continue finding innovative ways to protect consumers from unwanted text messages.

But consumer groups were quick to point out that there's nothing about the request that would prevent wireless cellular carriers from policing text message spam, and that Pai was (again) being misleading about what his latest policy order actually does:

"It wouldn’t be the holiday season without Chairman Pai giving a great big gift basket to corporate special interests at the expense of American consumers. Chairman Pai proposes to grant the wireless industry’s request to classify text messages as Title I ‘information services,’ stripping away vital consumer protections. Worse, Chairman Pai’s action would give carriers unlimited freedom to censor any speech they consider ‘controversial,’ as Verizon did in 2007 when it blocked NARAL and prompted the Public Knowledge 2007 Petition."

By now Ajit Pai has developed a fairly impressive skill: take something that cellular carriers lobbied for, and justify it by insisting it's essential for overall efficiency and effective consumer protection. Public Knowledge notes that happened again here:

"Chairman Pai supports this outrageous action by claiming the Title II ‘telecommunications service’ classification undermines spam filtering. As the FCC made clear in 2016 (over then-Commissioner Pai’s dissent), text messages and robocalls are both ‘calls’ under the anti-robocall statute, and this Title II designation does not prevent filtering or other technological means to block unwanted robocalls or spam texts. Indeed, Chairman Pai undermines his own argument by pointing out that email, which has always been an information service, has a 50 percent spam rate whereas text messaging, which the FCC treats as a ‘phone call,’ has a 2.5 percent spam rate."

The net neutrality repeal dramatically weakened the FCC's authority over ISPs by rolling back the classification of ISPs from "telecommunications providers" to "information services" under the telecom act. The goal of the giant telecom companies that lobbied for the rollback was fairly obvious: with a weakened FCC, most telecom oversight gets passed to an FTC that generally lacks the authority or resources to do much of anything about bad ISP behavior. As a result, ISPs will be clear to abuse a lack of competition in broadband to harm consumers and nickel-and-dime consumers -- provided they're somewhat subtle about it.

The same logic applies here. With text messages now declared "information services" free from FCC oversight, cellular carriers are free to not only block any SMS services they deem "controversial," but it opens the door to "creative" restrictions that protect a cellular carriers' own services. Fellow FCC Commissioner Jessica Rosenworcel went so far as to call the policy decision "bogus doublespeak," but most media outlets appeared to buy into the Pai FCC's claims that mindlessly doing whatever the biggest cellular companies want is somehow a massive boon to consumer protection.

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Posted on Techdirt - 26 November 2018 @ 6:40am

Dystopia Now: Insurance Company Secretly Spying On Sleep Apnea Patients

from the tomorrow's-dystopia,-today dept

So for years digital rights activists have worried about insurance companies getting their hands on everything from your smart car data to your pacemaker information and using that to deny you coverage, charge you more money, or make an extra buck selling said data to the highest bidder. That's especially a problem in an era where consumer privacy rights are under constant siege, alongside the right to repair and open access these devices (and any data they might store about you).

If you thought this rather dystopian future was activist hyperbole or still a decade or so out, you may be disappointed.

Propublica recently released a rather interesting story about a CPAP (continuous positive airway pressure, used to treat sleep apnea) user who found that their insurance company had been accessing sleep data generated by the device, and using it to deny coverage:

"Last March, Tony Schmidt discovered something unsettling about the machine that helps him breathe at night. Without his knowledge, it was spying on him. From his bedside, the device was tracking when he was using it and sending the information not just to his doctor, but to the maker of the machine, to the medical supply company that provided it and to his health insurer."

CPAP machines are essential to sleep apnea patients, whose health and quality of life is dramatically and negatively impacted by the fits and starts of interrupted sleep. But like so many health care sectors, these users already face all manner of hostile restrictions from their insurance companies, who often won't cover the machines if users don't rent them from specific companies at a steep premium. The insurance companies simply say they're trying to ensure that consumers actively use the machines as intended; critics say say insurance industry is simply trying to shift the cost of such services to unsuspecting patients.

"But the companies’ practices have spawned lawsuits and concerns by some doctors who say that policies that restrict access to the machines could have serious, or even deadly, consequences for patients with severe conditions. And privacy experts worry that data collected by insurers could be used to discriminate against patients or raise their costs."

“The doctors and providers are not in control of medicine anymore,” said Harry Lawrence, owner of Advanced Oxy-Med Services, a New York company that provides CPAP supplies. “It’s strictly the insurance companies. They call the shots."

In Schmidt's case, he quickly found that the device's manufacturer, ResMed, had access to his usage data. As did his supply company, Medigy. As did his health insurer, Blue Cross Blue Shield. Of course because US privacy laws remain stuck in the era of the wild west this is all perfectly legal, resulting in Schmidt running into a brick wall when he began to complain about the privacy implications of being monitored and having his medical information shared with a bevy of companies. The Better Business Bureau wouldn't help. Neither would the federal government.

Again, insurance companies say they're simply monitoring usage and denying coverage to avoid paying for CPAP machines that aren't being used (which does happen, since adjusting to sleeping with a mask and tubes is often a challenge). But as the story makes clear, a lot of the system is structured (surely entirely coincidentally!) to ensure that health care patients are paying out far, far more money than the $500 hardware actually costs. Usually courtesy of deductible structures and mandated rental requirements that can making actually having insurance more expensive than going without:

"The rental fees can surpass the retail cost of the machine, patients and doctors say. Alan Levy, an attorney who lives in Rahway, New Jersey, bought an individual insurance plan through the now-defunct Health Republic Insurance of New Jersey in 2015. When his doctor prescribed a CPAP, the company that supplied his device, At Home Medical, told him he needed to rent the device for $104 a month for 15 months. The company told him the cost of the CPAP was $2,400.

Levy said he wouldn’t have worried about the cost if his insurance had paid it. But Levy’s plan required him to reach a $5,000 deductible before his insurance plan paid a dime. So Levy looked online and discovered the machine actually cost about $500."

Levy said he called At Home Medical to ask if he could avoid the rental fee and pay $500 up front for the machine, and a company representative said no. “I’m being overcharged simply because I have insurance,” Levy recalled protesting.

Of course as the internet of broken things, wireless, and other sectors make clear, once your data is collected and sold, you're part of a system where you have little control, since using this data to make an extra buck takes absolute priority over security, privacy, or consumer welfare. And as more and more sectors begin to gobble up your daily data (from driving habits to how many times you opened your smart refrigerator), there's an ocean of problems just over the horizon that current privacy laws and regulatory agencies are utterly ill-equipped (and usually unwilling) to address.

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Posted on Techdirt - 21 November 2018 @ 7:39pm

US Has Some Of The Most Expensive Mobile Data Prices In The Developed World

from the pay-more,-get-less dept

While the U.S. wireless industry likes to talk a lot about how ultra-competitive it is, that's generally not the case. While there's more competition in wireless than in the fixed-line broadband sector (where there's virtually no competition at faster speeds due to upgrade-phobic telcos and cable's growing broadband monopoly), much of the competition in wireless tends to be theatrical in nature. Most of the major four carriers still usually outright refuse to compete on price, something you don't get to have a choice about in a truly competitive market.

While T-Mobile's disruption of the market (which has its limits) has certainly helped improve some of the worst aspects of US wireless (like long term contracts and international roaming price gouging), Americans have long paid more money for mobile data than most of the developed world. A new report out of Finland by Rewheel has once again driven that point home. According to the firm's latest data, U.S consumers pay the fifth-highest rate on average per gigabyte for smartphone plans across OECD and European countries, and the highest prices on average for mobile data services provided via things like mobile hotspots.

All told, U.S. smartphone plans are more than four times higher than in most EU countries, and up to sixteen times higher across much of Europe:

The study comes on the heels of another important study showing that streaming video quality over U.S. networks is some of the worst quality in the developed world -- in large part because carriers have begun erecting artificial barriers consumers then have to pay even more to overcome. For example, Verizon now throttles all video by default on its unlimited data plans to 480p (or around 1.5 Mbps), requiring you jump to a more expensive tier if you want streaming to actually work like the originator intended.

The new Rewheel study was quick to point out that whereas the US market should see more serious price competition due to having four major carriers, that's not the case. US pricing tends to more directly compare to countries where there's just three major wireless competitors and real price competition is somewhat suppressed. And while the study doesn't explain why, we've noted repeatedly how much of this is thanks to the monopoly companies like AT&T, Verizon, and CenturyLink enjoy over the business data services (BDS) market that feeds everything from ATMs to cell towers.

In other words, even if you're a scrappy competitor like T-Mobile that somehow manages to beat back the giants at spectrum auction and in DC lobbying, you'll still need to pay them significant sums just to connect your towers to core networks, tightening your margins and driving up your costs. The FCC's own data has indicated that roughly 79% of the BDS market is dominated by just one company, usually AT&T, Verizon, or CenturyLink.

Meanwhile, having regulators like Ajit Pai who are now no more than giant rubber stamps for industry interests means none of these underlying problems are going to be fixed any time soon. In fact, Ajit Pai's "solution" to this problem was to literally redefine the word competition at the FCC to try and hide that the problem exists at all. With that kind of leadership, it shouldn't be too surprising why US consumer mobile bills are so high compared to their European counterparts.

And researchers at Rewheel were quick to hint that it's going to get worse with the looming merger between T-Mobile and Sprint, which actually will reduce the sector to three competitors, proportionally reducing any genuine incentive to actually compete on price. The firm was quick to pour a little cold water on the idea that merger mania and fifth generation (5G) upgrades will somehow fix the sector's deep-rooted issues:

"Judging from the excessive gigabyte prices, US operators are charging today for 4G mobile broadband (see Verizon’s striking $710 100 gigabyte hotspot plan--in Europe 100 gigabyte mobile broadband typically costs between €10 and €20) merger promises concerning affordable 5G home broadband should be critically reviewed and if verified must be made binding."

And this is all before you get to the real cost impact of killing things like the FCC's broadband privacy rules, net neutrality, and other consumer protections, which were some of the only things standing between US carriers and even more aggressive, creative nickel-and-diming of American consumers. Should ISPs and the FCC win the court challenge to the net neutrality repeal next Spring, you can expect a hell of a lot more "creative" efforts to jack up US consumer bills even higher.

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Posted on Techdirt - 21 November 2018 @ 12:07pm

FCC Accused Of Burying Data Highlighting Sorry State Of US Broadband

from the transparency! dept

Back in 2011 the FCC launched something called the Measuring American Broadband program. It was revolutionary in the fact that for the first time, the FCC refused to simply take ISPs at their word in terms of the speed and connection quality of their broadband offerings. Instead, the FCC hired UK firm Samknows to embed custom-firmware modified routers in the homes of thousands of real world broadband volunteers, providing insight into the real state of US broadband network performance, not the rosy picture of US broadband telecom industry lobbyists like to paint.

Not surprisingly, actually using real world data to inform policy paid dividends. The FCC's first report (pdf) in 2011 showed that some ISPs, like New York's Cablevision, were delivering just 50% of the bandwidth they advertised during peak usage hours. Cablevision didn't much like being called out in this way, and by the next report (pdf) in 2012 was shown to have fixed its problems, now offering actually more bandwidth than they had previously advertised (120%). It was, in the absence of more competition, a novel way to nudge ISPs toward doing the right thing.

Each year like clockwork these reports were released to the public. Until last year, that is, when then new FCC boss Ajit Pai simply refused to release the report at all, despite the fact that taxpayer dollars were still funding it and volunteers were still participating.

On Monday of this week, Jon Brodkin at Ars Technica wrote an excellent piece noting how Pai's office not only didn't release the report at all last year, but had refused to answer months of press inquiries as to why, and whether the FCC would release its data this year. He also noted how the Pai FCC had been tap-dancing around numerous FOIA requests for more detail for months (the FCC's facing numerous lawsuits for ignoring FOIA requests on a litany of subjects):

"Because of Pai's office's silence, we filed a Freedom of Information Act (FoIA) request on August 13 for internal emails about the Measuring Broadband America program and for broadband speed measurement data since January 2017. By law, the FCC and other federal agencies have 20 business days to respond to public records requests.

The FCC responded to us but denied our request for "expedited processing." We had argued that expedited processing was warranted because the broadband measuring data is out of date, depriving American consumers of crucial information when they purchase broadband access. The FCC disagreed, telling Ars, "we are not persuaded that the records you request are so urgent that our normal process will not provide them in a timely manner."

Despite ignoring reporters for months, the day after Ars Technica wrote its story, Ajit Pai penned this blog post stating the FCC would eventually release the data, saying that going forward it would be buried within an appendix within other reports mandated by Congress. Pai made no reference to the Ars piece, and insisted this was being done because issuing separate reports was too much of a hassle:

"The FCC has long been required by law to submit a variety of reports to Congress. Each of these reports used to be issued as separate documents and at different times, making it hard for elected officials and the public to track everything down. To streamline these reports into a single document providing a comprehensive evaluation of the state of the communications marketplace in the United States, Congress, in the RAY BAUM’S Act of 2018, required the FCC to craft every two years what we are calling our Communications Marketplace Report. The draft report I’m circulating for my colleagues’ consideration consolidates many of the reports that the Commission had been previously required to produce. For the first time, the Report places essential information about mobile wireless, video, audio, wireline broadband, voice telephony, satellite, broadband deployment, and international broadband all in one place."

In short, Pai is effectively trying to blame Congress for the disappearing of reports naming and shaming under-performing ISPs. But there's nothing in the Ray Baum's act that prohibits the FCC from releasing data from the Measuring American Broadband in standalone fashion. In fact, releasing a standalone report that specifically publicized under-performing ISPs was the entire point. Given the Pai FCC's allergy to factual data, skepticism seemed justified.

While Pai's FCC wouldn't talk to Brodkin (or myself) about what was going on, someone at the FCC did tell CNET (whose coverage of the telcom industry tends to be... gentler) that the report would indeed be released... in the appendix of a much larger report... the day before Thanksgiving (when you can be sure few would actually read it or any news stories covering it):

"When asked by CNET about the criticisms, an agency spokesman said only that the data collected on broadband speed would be part of a report released Wednesday."

Of course the day before Thanksgiving would be the best time to release a report you don't want anybody to actually see. But oddly, CNET then subsequently scrapped that entire story without issuing any corrections, replacing it with this story at the same URL now claiming the data should be released in December. Maybe (the web archive has the old version of the article here).

Brodkin, for one, was flummoxed by the months he spent trying to get the FCC to explain, only to have it provide (apparently) incorrect information to CNET:

And when he circled back around to SamKnows, Brodkin was told that no, the data likely wouldn't be released in this report, but might actually show up in December:

Of course "approved" doesn't mean actually released. Insiders at at least one major cable operator tell me ISPs were given an embargoed copy of this report weeks ago, and it does actually include data from the Measuring American Broadband program. But whether the public will receive access to this data isn't clear. And even if it does, by the time this report is released buried in a larger report, most people will be in a tryptophan-induced holiday coma.

If you've been playing along at home, the reason the Pai FCC didn't want to talk about the program (or release data that might shame its BFFs in the broadband industry) shouldn't be too hard to ferret out. After all, that data might just contradict the longstanding (and quite obviously false) Pai claim that demolishing most oversight of historically-predatory telecom monopolies magically results in better, faster, cheaper broadband. While Pai's office can insist they were just engaged in "improved efficiencies," it should be interesting to see if the emails requested via FOIA (if they're ever actually released) have a different story to tell.

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