Karl Bode’s Techdirt Profile

kbode

About Karl Bode




Posted on Techdirt - 22 August 2017 @ 3:34am

Judge Kills AT&T's Attempt To Thwart Google Fiber Competition In Louisville

from the defenders-of-the-status-quo dept

There's plenty of methods incumbent ISPs use to keep broadband competition at bay, from buying protectionist state laws to a steady supply of revolving door regulators and lobbyists with a vested interest in protecting the status quo. This regulatory capture goes a long way toward explaining why Americans pay more money for slower broadband than most developed nations. Keeping this dysfunction intact despite a growing resentment from America's under-served and over-charged broadband consumers isn't easy, and has required decades of yeoman's work on the part of entrenched duopolies and their lobbyists.

Case in point: Google Fiber recently tried to build new fiber networks in a large number of cities like Nashville and Louisville, but ran face first into an antiquated utility pole attachment process. As it stands, when a new competitor tries to enter a market, it needs to contact each individual ISP to have them move their own utility pole gear. This convoluted and bureaucratic process can take months, and incumbent ISPs (which often own the poles in question) often slow things down even further by intentionally dragging their feet.

So in cities like Nashville and Louisville, Google Fiber and other competitors have pushed for so-called "one touch make ready" utility pole reform. These reforms let a licensed an insured contractor move any ISP's pole-mounted gear if necessary (usually a matter of inches), as long as the ISP is notified in advance and the contractor pays for any damages. Under these regulatory reforms, the pole attachment process can be reduced from six months or more to just a month or so -- dramatically speeding up fiber deployment. ISPs like Verizon (in part because Google Fiber isn't encroaching on their East Coast turf) has supported the changes.

But because this would speed up competitor broadband deployments as well, incumbent ISPs like AT&T and Charter did what they do best: they filed lawsuits against both Nashville and Louisville -- claiming they'd exceeded their legal authority in updating the rules. The companies proclaim they're simply concerned about the potential damage to their lines (ignored is the fact that the contractors doing the work are often the same people employed by ISPs), but the lawsuits are driven by one thing: fear of competition.

In Louisville, things haven't worked out very well for AT&T, with a Judge recently declaring that the ISP's claim that Louisville had somehow exceeded its authority doesn't make any legal sense:

"AT&T claimed that Louisville has no jurisdiction under federal or state law to regulate pole attachments, an argument that the district court judge picked apart. AT&T argued that the rule referred to in-court documents as Ordinance No. 21 "impermissibly regulates the terms and conditions of pole attachments," but in doing so AT&T "narrowly characterize[d] Ordinance No. 21 as one that regulates pole attachments," the judge wrote. In reality, "the ordinance actually prescribes the 'method or manner of encumbering or placing burdens on' public rights-of-way," Hale wrote.

"Kentucky's state Public Service Commission has exclusive jurisdiction over regulation of rates and services of utilities, but cities are allowed to "regulate local utilities in every area except as to rates and service," the judge wrote.

That's good news for Louisville and people looking for beefed up broadband competition, but the damage is still done, and the delay still benefited AT&T (who'll likely appeal) all the same. Google Fiber wound up being forced to consider a pivot to wireless in Louisville after the company's efforts to deploy gigabit-capable fiber in the city took notably longer than expected. Thanks, in large part, to large incumbent ISPs like AT&T, which at one point publicly mocked Google Fiber's struggles while omitting its lawyers were a major reason for the delays in the first place.

Read More | 6 Comments | Leave a Comment..

Posted on Techdirt - 21 August 2017 @ 3:37pm

Tech Journalists Keep Completely Missing The Point Of Cord Cutting

from the buy-ALL-the-things! dept

It has become the laziest "hot take" in technology media. Once a month or so, a writer decides to subscribe to as many streaming video services as possible. They then proudly declare that this whole cord cutting thing (ditching traditional cable TV for streaming video) is a waste of time. Why? For whatever reason, these writers feel compelled to try and use streaming alternatives to perfectly mirror the existing, bloated cable bundle consumers have spent two decades complaining about, only to shockingly wind up disappointed by the cost (gosh, it's almost as if broadcasters dictate the pricing for both services!).

Each time one of these stories pops up (from Gizmodo to USAToday,) we note how these writers are completely missing the point. Cord cutters aren't trying to precisely mirror traditional cable bundle, they're simply looking for greater flexibility. Cord cutting provides just that, in that if you don't like sports -- for example -- you don't have to subscribe to any services that offer it. As such, "cord cutting is really expensive when I subscribe to every streaming service in the known universe" is just an odd narrative that just keeps bubbling up across various media outlets despite not really making much sense.

The latest culprit is the New York Post, which recently penned a missive declaring that "streaming TV is getting as bad as cable." Why? Again, it's apparently because when you sign up for every streaming service imaginable, it starts to get somewhat expensive:

"Home entertainment is really starting to add up. Want to watch “The Crown,” “The Handmaid’s Tale,” “Transparent,” “Game of Thrones” and “Homeland”? Prepare to drop $51 a month — minimum. And that number doesn’t even include your Internet package or basic options such as Food Network, Travel Channel and Syfy.

And just when we thought we’d reached maximum capacity, in September, CBS will resurrect “Star Trek” for a new series called “Discovery.” Fans rejoiced at the announcement — they’d been without a “Trek” series for 12 years — until they made a rude discovery of their own: The new show would only be available on the CBS All Access app. That’s $5.99 a month to basically watch one show. Absolutely nobody is signing up for the “NCIS” reruns. So now we’re at $57 a month.

So, several things. One, $57 a month is still significantly less money that what many people pay for cable. Two, writers like this ignore a number of obvious realities that can lower your costs further, including the fact that countless people share streaming service passwords (something most streaming companies don't care about because they see it as free advertising). You also need to factor in things like over the air antennas (and the rising number of solutions that let you record this content to DVR), which provide additional options for less money -- or free.

Writers like this also hysterically like to avoid so much as mentioning piracy. Too many writers bizarrely act as if you're not allowed to even acknowledge piracy exists because it's naughty. But if you're "analyzing" how much it costs for an ordinary consumer to get TV content and you're not factoring in piracy, you're missing a fairly massive part of the overall picture. It doesn't really matter if you or your publisher don't like it, or don't think people should be doing it. It's happening, it's part of the overall cost-saving picture, and it's something companies have to compete with. Yet it's never even mentioned in these reports.

That said, journalists pushing the "if I buy everything in the store it gets expensive" narrative are missing the most important point: actual consumers repeatedly say cord cutting saves them significant sums of money each and every month. And if any of these writers had actually bothered to, say, talk to actual cord cutters, they would tell them the same thing.

Every time a story like this pops up I enjoy heading over to Reddit where users quickly point out how cord cutting is saving them plenty of money. Why? Because it provides something most traditional cable providers aren't willing to: flexibility and choice. With cord cutting, the end user gets to decide how to best balance their viewing options to build a content package that works for them and their budget. That's in contrast to your cable provider, who'll consistently pay empty lip service to choice and flexibility, right before it raises both your cable bill and set top box rental fee.

Yet somehow the reality that consumers are truly saving money escapes these pearl-clutching authors. Like in this recent story at Wired pushing the same, stale narrative. One user at Reddit put their objection to these reports rather succinctly:

"I don't know why every article like this dives into recreating cable, and then laments that it's not that much cheaper than cable. He's way more concerned with watching channels than watching shows or entertainment."

Look, if you really like paying a significant sum of money for 500 channels to a company with a worse customer service rating than the IRS nobody's stopping you. In fact, if you truly need to access every shred of programming imaginable and have oodles of disposable income, cable remains your best bet. But the idea that cord cutting is somehow "failing" just because it's not good at mirroring the abysmal value presented by the traditional cable bundle makes no coherent sense. At the very least, the next time you proudly declare that cord cutting doesn't save consumers money -- perhaps talk to some actual consumers first?

41 Comments | Leave a Comment..

Posted on Techdirt - 18 August 2017 @ 3:43am

'Smart' Lock Vendor Locks Hundreds Out Of Their Home With Bungled Firmware Update

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

So we've talked repeatedly about how the real "smart" choice in the era of "smart" internet of things devices is often -- dumber technology. Whether it's your smart refrigerator or TV leaking your gmail details or viewing data over unencrypted connections, your smart car opening the door to potentially fatal attack, or your smart doorbell creating new attack vectors into your WiFi network, more often than not you're quite frankly better off with the older, less sophisticated versions of these technologies if you want the smart path toward a more secure life.

The latest case in point: smart door lock vendor Lockstate managed to completely disable the smart door locks of an estimated 500 customers after a botched firmware update left customers unable to access their own properties:

A subset of smart locks made by Lockstate have been bricked after an update. The smart lock vendor is part of Airbnb’s Host Assist program, and integrates with the accommodation rental platform so, for instance, hosts can automatically generate and email one-time codes for their guests to use during check-in....Two models of Lockstate smart lock are apparently affected, one of which currently retails for $469.

Airbnb offers property owners a $50 discount code if they use Lockstate products as part of the Host Assist program — where said products are heralded as “revolutionary” and capable of withstanding “high usage”. Because the botched update made it impossible for these locks to subsequently connect to the internet for a new fix, the vendor is informing owners that their only recourse is to wait anywhere from a week to eighteen days for a physical replacement, inundating them with neither smart nor revolutionary added costs:

In the mass mailer email, which begins “Dear Lockstate customer” and summarizes its contents as an “update” pertaining to LockState 6i/6000i, affected customers are asked to wait as long as 18 days for a full replacement. Or up to a week if they choose to remove and send the back portion of the lock to the company for repair.

Feel smarter yet? Of course this isn't the first problem of this type. Internet of things brand darling Nest has, at several different points, botched their own firmware updates for supposedly smart thermostats, resulting in users either being cooked or chilled until they were able to remedy the problem. This is the kind of stuff internet of things evangelists still don't spend much time talking about when they're busy hyping and pitching the latest and greatest internet-connected widgets, built by a rotating crop of companies with a fleeting interest in actual security, functionality and privacy.

Granted bungled firmware updates are only one risk. A recent report took a look at sixteen different brands of Bluetooth-enabled smart locks, and found that at least twelve of the brands were notably susceptible to remote attacks. The flaws are fairly standard at this point, ranging from user data and passwords being transmitted in plain text, or a bungled use of encryption to transmit user data when encryption was used at all. Short version of the lesson: if you're trying to build a smart home either do your homework and consult a hacker to find the best quality devices available, or save both time and money and revert to the best available dumb alternative.

37 Comments | Leave a Comment..

Posted on Techdirt - 17 August 2017 @ 10:46am

Former FCC Commissioner Tries To Claim Net Neutrality Has Aided The Rise Of White Supremacy

from the dumb-argument-hall-of-fame dept

When last we checked in with former FCC Commissioner Harold Furchtgott-Roth, he was rather grotesquely using the Manchester bombing to try and launch a completely bizarre attack on net neutrality over at the Forbes op-ed pages. Furchtgott-Roth, who served as an FCC Commissioner from 1997 through 2001, now works at the Hudson Institute, which not-coincidentally takes money from large incumbent broadband providers. The Hill, Forbes and other similar outlets then publish not-so-objective "analysis" from such individuals without really disclosing the money or motives driving the rhetoric.

In his missive for hire last May just days after the Manchester attack, Furchtgott-Roth tried to argue that protecting net neutrality somehow aids and abets terrorism and murder:

"A sensible question is why civilized governments do not seek to deprive terrorists of unfettered access to the Internet...Sadly, here in America, limiting access to the Internet would be illegal under the euphemistic term “network neutrality,” the two-year-old experiment in federal regulation of the Internet...To its supporters, network neutrality is a bulwark of civilization. But network neutrality is also a shield for terrorists who seek to destroy civilization."

As we noted then, Furchtgott-Roth doesn't appear to have even the remotest understanding of how the internet or net neutrality works, and conflated the issue of net neutrality with his own deep-rooted desire to see greater government censorship of the internet. That lust for censorship runs so deep, Furchtgott-Roth envisioned a future where ISPs could compete with one another (as if that's a thing) by how heavily they censor internet content:

"Under network neutrality, broadband companies--such as AT&T, Charter, Comcast, Sprint, T-Mobile, and Verizon—are prohibited from discriminating against any lawful websites or content. There is no clear distinction between lawful and unlawful websites and content. The net result is a broadband company could and likely would be sued for blocking websites housing information about recruitment and organization for ISIS, Al Qaeda, the Ku Klux Klan, or other terrorist groups. It is also illegal to block content that instructs viewers on how to manufacture explosives such as nail bombs."

Again, that has nothing to do with net neutrality. Net neutrality encourages the internet as a level playing field free of the anti-competitive or editorial meddling of giant telecom conglomerates comfortable in uncompetitive markets. And while ISPs are banned from blocking legal websites under the rules, few ISPs have interest in outright blocking of content in the first place due to political and PR backlash. In other words, eliminating net neutrality would do nothing to expedite Furchtgott-Roth's vision of a filtered internet anyway. ISPs simply aren't interested, and individuals have every right to avoid or filter websites as they see fit.

The former FCC Commissioner turned think tank "expert" simply conflated two completely unrelated issues (either intentionally for effect or unintentionally out of confusion) to try to demonize popular net neutrality protections. Apparently undaunted by his previous run in with extreme myopia and insensitivity, Furchtgott-Roth has since published a second, horribly ill-timed screed against net neutrality over at Forbes, this time blaming net neutrality for the resurgence of neo-nazis and white supremacy:

"In many countries around the world, national governments block much content and decide which websites its citizens can access. In the United States, we should allow individuals, not the government, to make those decisions. Broadband companies, including those currently regulated by network neutrality rules, should be allowed to offer various filtered services and filtering technologies to allow individuals to avoid content that they would rather not see, or have their families see. Families that want to block Daily Stormer and its ilk from the Internet should be allowed to purchase such a service directly from any business, and not have the FCC tell them that such a service is unlawful in the name of network neutrality."

That's an even deeper layer of bullshit than Furchtgott-Roth's original treatise. There's absolutely nothing in the net neutrality rules preventing individuals from using any filtering technology they'd like at any time under something known as personal responsibility. At no point has the FCC ever indicated that families can't purchase any filtering or parental control service they want. This is a completely made up and bizarre claim, made with total insensitivity to the recent attacks in Charlottesville, all to try to demonize some basic, popular consumer protections for the open internet.

At this point it feels like Furchtgott-Roth is just sitting around waiting for tragedies so he can blame them on the pure evil that is net neutrality. It would be lovely if he would fucking stop that.

40 Comments | Leave a Comment..

Posted on Techdirt - 17 August 2017 @ 9:42am

Crowdfunded Billboards Shame Politicians For Selling You Out On Net Neutrality

from the something-resembling-accountability dept

Earlier this year you might recall that lawmakers voted along party lines to kill consumer broadband privacy protections. The rules, which large ISPs whined incessantly about, were relatively basic; simply ensuring that ISPs couldn't collect or sell your personal data without being transparent about it and providing working opt out tools. The rules were only proposed after ISPs repeatedly showed they weren't able to self regulate on this front in the face of limited competition, from AT&T's plan to charge more for privacy, to Verizon getting busted for covertly modifying wireless packets to track users without consent.

After a massive lobbying push, the usual loyal ISP allies like Tennessee Rep. Marsha Blackburn rushed to help free these incumbent duopolists from the terror of accountability. In response, many of these lawmakers faced a naming and shaming campaign by consumer advocacy group Fight for the Future, which crowdsourced the funding of billboards erected in their home districts clearly highlighting how they took ISP campaign contributions in exchange for selling consumer privacy down river:

Of course many of those same lawmakers have, as instructed, now shifted their gaze toward supporting the FCC's plan to ignore the public and dismantle net neutrality protections. As a plan B, most of them are being prodded by ISPs to help craft a new net neutrality law. One that pretends to solve the problem, but will be written by industry lawyers to intentionally include so many loopholes as to be arguably useless. This cacophony of self-serving dysfunction again highlights how AT&T, Verizon, Comcast and Charter campaign contributions trump the public interest on a routinely grotesque scale.

Hoping to piggyback on its privacy campaign, Fight for the Future has now similarly-crowdfunded new billboards shaming lawmakers that have breathlessly supported killing popular net neutrality protections. Which politicians are shamed is being determined by a congressional scorecard, which tracks just how cozy politicians are with incumbent telecom duopolies. Needless to say, Marsha Blackburn again took top honors and is being featured again in the group's latest effort:

The group is hoping that this naming and shaming campaign will help shake these lawmakers' constituents out of their apparent slumber:

"Politicians need to learn that they can’t attack free speech on the Internet and expect to get away with it,” said Evan Greer, campaign director of Fight for the Future (pronouns: she/hers), “Voters from across the political spectrum all agree that they don’t want companies like Comcast and Verizon dictating what they can see and do online. No one is fooled by corrupt lawmakers’ attempts to push for bad legislation while they strip Internet users of protections at the FCC. Hundreds of people donated to make these billboards possible. When you come for the Internet, the Internet comes for you.”

The problem, as always, is that folks like Marsha Blackburn have been selling out their constituents for years and are consistently re-elected anyway. Blackburn was a major supporter of SOPA, and is the cornerstone of an AT&T stranglehold over Tennessee's state legislature that's so severe, AT&T lawyers are quite literally allowed to write protectionist state laws protecting the company from anything that even smells like competition. Tennessee is, not at all coincidentally, one of the least connected states in the union for just this reason.

Of course there's any number of reasons for why folks like Blackburn are immune to accountability efforts. Gerrymandering and voter suppression certainly plays a role. But so too does concerted disinformation campaigns that frame kissing Comcast's ass as a heroic quest for freedom, and important technology issues of interest to all (like oh, the internet fucking working) as somehow partisan. Still, you'd like to think that with enough elbow grease and repetition, even folks like Blackburn can't be permanently immune from something at least vaguely resembling accountability.

14 Comments | Leave a Comment..

Posted on Techdirt - 16 August 2017 @ 6:59pm

As A Streaming Future Looms, ESPN Is Damned If It Does, Damned If It Doesn't

from the rock-and-a-hard-place dept

So for years we've examined how executives at ESPN completely whiffed at seeing the cord cutting revolution coming, and personified the industry's denial that a massive market (r)evolution was taking place. As viewers were beginning to drift away from traditional cable and erode revenues, ESPN executives were busy doubling down on bloated sports contracts and expensive Sportscenter set redesigns. Only once ESPN lost 10 million viewers in just a few years did executives finally acknowledge that cord cutting was a problem, though they subsequently have tried to downplay the threat at every opportunity.

The question now is how to fix that problem. ESPN's first step was to try and save costs by firing oodles of on-air talent, but not the executives that failed to navigate this sea change. That has since been followed by ESPN-owner Disney recently proclaiming it would be offering two direct to consumer streaming platforms -- one stocked with Disney and Pixar fare, and the other being a direct to consumer ESPN product. During a recent earnings call, Disney CEO Bob Iger verbalized the company's slow epiphany in the face of cord cutting:

"We’ve got this unbelievably passionate base of Disney consumers worldwide that we’ve never had the opportunity to connect with directly other than through the parks,” Iger said. “It’s high time we got into the business to accomplish that.”

Iger acknowledged that the decision to act was spurred by the disruption in the traditional TV eco-system that has been rocking ESPN for the past few years. But Disney’s blue-chip brands give them a leg up in taking a radical new approach to reaching consumers.

“It’s not just a defensive movie, it’s an offensive move,” Iger said.

Granted it's not really playing offense when you only react after worries about cord cutting and ratings slides causes a $22 billion valuation hit in just a few days, something Disney experienced last year. Still, it's good to see Disney pull its head out of the sand and embrace the idea of giving consumers what they want, even if the move is painfully belated and under-cooked. The problem for ESPN specifically, as many have been quick to point out, is that the company is still stuck between a rock and a hard place in terms of navigating the transition to streaming -- even if it does everything right (which it won't).

There's plenty of reasons for that, the biggest being that streaming simply can't be as profitable as the long-standing practice of forcing cable TV customers on to bloated bundles filled with channels (like ESPN) that they may not want. ESPN currently makes $7.21 for each cable TV subscriber, many of which pay for ESPN begrudgingly. One survey found that 56% of ESPN viewers would ditch the channel if it meant saving that money off of their monthly bill. Fear of losing those customers was one of the reason ESPN sued Verizon when the company tried to take ESPN out of its core TV bundle.

And while ESPN may now be technically doing the right thing in finally offering a direct-to-consumer streaming product, such an offering will only aid to expedite viewer defections, while ESPN's sports licensing costs remain the same:

"A streaming service, while it might attract sports fans who have cut the cord, won’t solve ESPN’s profit problems. Instead it will exacerbate them. Why? Because ESPN will continue to lose the millions upon millions of cable subscribers who pay for it but never watch it. Losing $7.21 from each non-watcher is going to be a revenue killer. There is no possible way the universe of sports fans who want ESPN can make up that revenue, even if they’re charged more for a streaming service."

Traditionally, many cable and broadcast companies have tried to give the impression of adaptation by launching a streaming service, then saddling it with all manner of caveats to prevent existing, traditional cable TV customers from downgrading to the cheaper, more flexible streaming option. This really never works, but it looks like the path Iger and Disney are going to follow when it comes to ESPN's latest streaming venture:

"To make matters worse, Disney appears to be planning a streaming service that even the most rabid sports fan will be reluctant to pay for. All the good stuff — big-time college football, professional basketball, the Monday night National Football League game — will remain exclusively on ESPN’s cable channels. The streaming service will get, well, other things. It’s pretty clear that Iger is still trying to protect Disney’s legacy cable business, and that his move to the internet is not exactly a wholehearted embrace."

In other words, ESPN's epiphany and transition isn't quite as profound as many are suggesting, and ESPN still somehow believes it can control the rate of evolution; a fool's errand. Many industry insiders also have told me over the years that ESPN's contracts with many cable providers state that should ESPN offer its own streaming services, cable providers will no longer be bound by restrictions forcing them to include ESPN in their core lineups, which will only accelerate the number of skinny bundle options without ESPN.

It's a damned if you do and damned if you don't scenario for ESPN, and even if ESPN does all the right things here and offers a truly compelling streaming platform customers really enjoy -- there's simply no getting around the fact that this transition is still going to really hurt.

35 Comments | Leave a Comment..

Posted on Techdirt - 16 August 2017 @ 11:55am

Wall Street Merger Mania Is Driving Us Toward One Single, Horrible ISP - Probably Named Comcast

from the merge-ALL-the-things dept

Many consumers are still reeling from a Charter, Bright House Networks and Time Warner Cable merger that left users with slower speeds, worse service, and higher prices. Other broadband consumers are still struggling with a bungled Frontier acquisition of Verizon assets that left users with prolonged outages and even worse customer service than the shitshow they already enjoyed. As we've seen for decades, this kind of mindless consolidation traditionally only benefits the companies involved, particularly in a market where real competition is in short supply.

This growth for growth's sake is one of the major reasons Comcast -- and its horrible customer service (which didn't scale with the company's expansion because that would have cost money) -- exists. And Wall Street's relentless thirst for growth at all costs is a major reason these companies can't simply focus on being the best "dumb pipes" possible, instead focusing their attentions on expanding into markets they have little expertise in (see Verizon's ingenious plan to hoover up failed 90s brands and pander to Millennials). When they can't succeed because they're out of their depth, they try to tilt the playing field (killing net neutrality).

There's oodles of history lessons here, and there's every indication we intend to learn nothing from them. With the ink barely dry on Charter's troubled deal, and the Trump administration signaling that no merger is too big or too absurd, Wall Street analysts have been positively giddy this year pondering megamergers in telecom that had previously been unthinkable on anti-competitive or antitrust grounds. That has included heavy pushes for a Sprint acquisition of T-Mobile or a Verizon bid to buy Comcast -- the massive, obvious anti-competitive impact of both deals be damned.

This week, the merger mania du jour apparently involves a plan that would involve Comcast and French-owned Altice working in concert to buy Charter Communications, whose $180 billion asking price has proven too steep for any one company to contemplate alone (Verizon made a $100 billion offer and was rejected). Citigroup has floated the idea that after acquisition, Comcast could integrate the Time Warner Cable customers they were blocked by regulators from acquiring for anti-competitive reasons, leaving us with one giant cable company to rule us all:

"Charter is pretty much an equal rival in size and scope to Comcast at this point, at least with regards to subscriber numbers. Each company has somewhere in the neighborhood of 25 million customers. For the two to merge outright would leave one dominant cable company in the country, with about half of the entire nation’s subscribers — from coast to coast, and in many of the states in between — under a single umbrella."

Granted there's no guarantee such a deal will happen. Wall Street stock jocks often like to float rumors then profit off of the herk and jerk of stock prices caused by the half-truths they themselves create. But should Comcast be able to swing such a deal, we could be looking at a supernova of anti-competitive dysfunction, the likes of which made Comcast's well documented issues seem charming.

Consider that cable's monopoly was already blossoming thanks to the countless telcos which have effectively stopped trying to compete -- in large part because Wall Street thinks spending money to upgrade your networks is a fool's errand. Then ponder the fact that the current FCC is busy gutting any and all meaningful oversight of these companies, allowing them to inevitably engage in all manner of anti-competitive shenanigans, from arbitrary and punitive usage caps, to net neutrality and privacy violations.

This all may sound like hyperbole, but it's a future that's very much under construction. And the folks giddily contemplating the "looming synergies" of such monumental coagulation are building it with absolutely zero concern for the impact on consumers, startups, small businesses or the health of the internet. Telecom sector executives and the folks paid to cheer their every decision have every intention of taking the already dismal Comcast experience, injecting it with steroids, and setting it loose on a market with no organic competitive or regulatory checks and balances. And by the time most notice the negative repercussions, these same folks will already be hyping the next wave of mindless consolidation.

26 Comments | Leave a Comment..

Posted on Techdirt - 16 August 2017 @ 9:29am

Stories Claiming DNC Hack Was 'Inside Job' Rely Heavily On A Stupid Conversion Error No 'Forensic Expert' Would Make

from the don't-trust-anonymous-sources-unless-you-agree-with-them dept

While we wait for the Mueller investigation to clearly illustrate if and how Russia meddled in the last election, there's no shortage of opinions regarding how deep this particular rabbit hole goes. While it's pretty obvious that Putin used social media and media propaganda to pour some napalm on our existing bonfires of dysfunction, just how much of an impact these efforts had on the election won't be clear until a full postmortem is done. Similarly, while Russian hackers certainly had fun probing our voting systems and may have hacked both political parties, clearly proving state involvement is something else entirely.

Quite fairly, many folks have pushed for caution in terms of waiting for hard evidence to emerge, highlighting the danger in trusting leaks from an intelligence sector with a dismal track record of integrity and honesty. There's also the obvious concern of ramping up tension escalation between two nuclear powers. But last week, many of those same individuals were quick to highlight several new stories that claimed to "completely debunk" Russia's involvement in hacking the DNC ahead of last year's election. The problem? These reports were about as flimsy -- if not flimsier -- than the Russian hacking theories they supposedly supplanted.

In fact, these reports took things one step further by claiming that the hack of the DNC was something committed solely by someone within the DNC itself. This particularly overlong, meandering piece by The Nation, for example, claimed to cite numerous anonymous intelligence sources who have supposedly grown increasingly skeptical over the "Russian hacking narrative." Quite correctly, the report starts out by noting that while there's oodles and oodles of smoke regarding Putin's involvement in the election hacks, the fire (hard evidence) has been hard to come by so far:

"Lost in a year that often appeared to veer into our peculiarly American kind of hysteria is the absence of any credible evidence of what happened last year and who was responsible for it. It is tiresome to note, but none has been made available. Instead, we are urged to accept the word of institutions and senior officials with long records of deception. These officials profess “high confidence” in their “assessment” as to what happened in the spring and summer of last year—this standing as their authoritative judgment.

But it's then that's where things get a little weird. The report repeatedly proclaims that a laundry list of anonymous "forensic investigators, intelligence analysts, system designers, program architects, and computer scientists of long experience and strongly credentialed" have been hard at work "producing evidence disproving the official version of key events last year." But one of the key conclusions by these experts -- and a key cornerstone for of all of these stories -- makes absolutely no sense.

The reports lean heavily on anonymous cybersecurity experts calling themselves "Forensicator" and "Adam Carter," who purportedly took a closer look at the metadata attached to the stolen files. Said metadata, we're breathlessly informed, indisputably proves that the data had to have been transferred from inside of the DNC network and not over the internet, since the internet isn't supposedly capable of such transfer speeds:

"Forensicator’s first decisive findings, made public in the paper dated July 9, concerned the volume of the supposedly hacked material and what is called the transfer rate—the time a remote hack would require. The metadata established several facts in this regard with granular precision: On the evening of July 5, 2016, 1,976 megabytes of data were downloaded from the DNC’s server. The operation took 87 seconds. This yields a transfer rate of 22.7 megabytes per second.

These statistics are matters of record and essential to disproving the hack theory. No Internet service provider, such as a hacker would have had to use in mid-2016, was capable of downloading data at this speed. Compounding this contradiction, Guccifer claimed to have run his hack from Romania, which, for numerous reasons technically called delivery overheads, would slow down the speed of a hack even further from maximum achievable speeds."

That reads like a semi-cogent paragraph, but it's largely nonsense. 22.7 megabytes per second (MB/s) sounds impossibly fast if you don't know any better. But if you do the simple conversion from megabytes per second to megabits per second necessary to determine the actual speed of the connection used, you get a fairly reasonable 180 megabits per second (Mbps). While the report proclaims that "no internet service provider" can provide such speeds, ISPs around the world routinely offer speeds far, far faster -- from 500 Mbps to even 1 Gbps.

And despite the report oddly pooh pooh'ing Romanian broadband's "delivery overheads," many Romanian cities actually have faster internet connectivity than either Russia or in the States (check out Akamai's global broadband rankings). Bernie Sanders learned this last year when he unintentionally pissed off many Romanians when trying to highlight the dismal state of U.S. connectivity. Even then, the hacker in question could have used any number of tricks to hide his or her location and real identity from a high-bandwidth vantage point, so the claim that the hacker couldn't achieve 180 Mbps through a VPN is simply nonsense.

Obviously this raises some questions about what kind of cyber-sleuths we're talking about when they can't do basic conversions or look at some fairly obvious broadband speed availability charts. And it also raises some questions about why reporters thought flimsy anonymous experts were the perfect remedy to the other flimsy anonymous leaks they hoped to debunk. While The Nation couldn't even be bothered to do the simple calculation to determine the speed of the connection used by the hacker was relatively ordinary, in a story titled "Why Some U.S. Ex-Spies Don't Buy the Russia Story," Bloomberg actually did the conversion to get the 180 Mbps speed, and still somehow told readers that such speeds were impossible:

"The VIPS theory relies on forensic findings by independent researchers who go by the pseudonyms "Forensicator" and "Adam Carter." The former found that 1,976 MB of Guccifer's files were copied from a DNC server on July 5 in just 87 seconds, implying a transfer rate of 22.6 megabytes per second -- or, converted to a measure most people use, about 180 megabits per second, a speed not commonly available from U.S. internet providers. Downloading such files this quickly over the internet, especially over a VPN (most hackers would use one), would have been all but impossible because the network infrastructure through which the traffic would have to pass would further slow the traffic."

Yes, all but impossible! Provided you ignore that DOCSIS 3.1 cable upgrades and fiber connections deliver speeds consistently faster than that all around the world every day -- including Romania. False claims and sloppy math aside, after the Bloomberg column ran, several actual, identifiable intelligence experts also came forward doubting the legitimacy of the supposed intelligence sources for these stories altogether:

Surrounded by raised eyebrows, The Nation is now apparently reviewing its story for accuracy after numerous people highlighted that a major cornerstone of the report was little more than fluff and nonsense. Bloomberg has so far failed to follow suit.

So again, there's certainly every reason to not escalate hostility between the United States and Russia with many details still obfuscated and investigations incomplete. And there's also every reason to view reports leaning heavily on anonymous intelligence insiders skeptically after generations of distortions and falsehoods from those same agencies. That said, if you want to debunk the anonymous claims of a growing number of intelligence insiders who claim Russia played pinball with our electoral process, perhaps running into the arms of even more unreliable, anonymous intelligence sources -- without checking your math -- isn't your best path toward the truth.

62 Comments | Leave a Comment..

Posted on Techdirt - 16 August 2017 @ 6:27am

FCC Begins Weakening The Definition Of Quality Broadband Deployment To Aid Lazy, Uncompetitive ISPs

from the It's-not-a-problem-if-we-say-so dept

You may be shocked to learn this, but like most U.S. regulatory agencies, the FCC's top Commissioner spots are occassionally staffed by individuals that spend a bit too much time focused on protecting the interests of giant, incumbent, legacy companies (usually before they move on to think tanks, consultant gigs, or law firm policy work financed and steered by those same companies). In the telecom market these folks usually share some fairly consistent, telltale characteristics. One, they're usually comically incapable of admitting that there's a lack of competition in the broadband market.

Two, they go to great, sophisticated lengths -- usually via the help of economists hired for this precise purpose -- to obfuscate, modify, and twist data until it shows that broadband competition is everywhere and the market is functioning perfectly. After all, if the data shows that there's no longer a problem -- you can justify your complete and total apathy toward doing anything about it.

We've seen this cycle play out time and time again, and it's a major reason most of us have shitty broadband. Under former FCC boss Michael Powell (now shockingly the head lobbyist for the entire cable industry), the FCC repeatedly proclaimed that the broadband industry was so competitive, we didn't need rules, regulations, or consumer protections governing their behavior. And when anyone provided evidence that existing providers like Comcast were little more than walking shitshows, Powell would consistently insist that these complaints were utterly hallucinated.

This sort of behavior continued for a while under Obama-era FCC boss Julius Genachowski. But his successor, Tom Wheeler shocked a few people by actually acknowledging the industry wasn't competitive. Wheeler went so far as to raise the base definition of broadband to a more modern 25 Mbps, a decision the industry whined incessantly over. Why? By raising the bar, Wheeler was able to highlight how two-thirds of the country only have the choice of one broadband provider at current generation speeds.

But with Ajit Pai now in charge at the FCC, we've once again returned to the regulatory policy of burying your head firmly in the sand to the express benefit of Comcast, AT&T and Verizon. In addition to Pai's frontal assault on net neutrality, erosion of broadband programs for the poor, protection of prison phone monopolies, derailing of consumer broadband privacy standards and his protection of the cable industry's set top box monopoly , Pai has begun taking steps to lower the bar when it comes to determining whether or not the country is being adequately connected.

Under the Telecommunications Act, the FCC is required by law to track broadband deployment and competition and -- if things aren't up to snuff -- the agency is mandated to "take immediate action to accelerate deployment of such capability by removing barriers to infrastructure investment and by promoting competition in the telecommunications market." But if you fiddle with how precisely broadband penetration and competition is measured, you can avoid having to do, you know, work to improve things. Enter Ajit Pai, whose agency this week quietly began fiddling with these determinations to the benefit of industry:

"But with Republican Ajit Pai now in charge, the FCC seems poised to change that policy by declaring that mobile broadband with speeds of 10Mbps downstream and 1Mbps upstream is all one needs. In doing so, the FCC could conclude that broadband is already being deployed to all Americans in a reasonable and timely fashion, and thus the commission could take fewer steps to promote deployment and competition.

Of course determining that an area has healthy and competitive broadband if a wireless provider can offer 10 Mbps is a major gift to incumbent ISPs. AT&T and Verizon have been working tirelessly to gut rules requiring they continue to provide cheaper, more reliable fixed-line broadband to rural areas and many less affluent cities, while also wiggling out of fiber upgrade obligations in countless markets. But wireless connections are significantly more expensive and less reliable, and in many smaller and more rural cities won't be a suitable fixed line replacement for a decade or more.

And while AT&T and Verizon's own data will insist that they provide 10 Mbps wireless to pretty much everywhere already, if you've ever driven across the nation with work to do you can probably attest to the fact this uniform coverage isn't real. And because the FCC is more concerned about pleasing incumbent broadband providers than actually beefing up competition for consumers, they're not going to be running out anytime soon to do field tests and fact check wireless carrier data proclaiming 10 Mbps is sprouting up everywhere like weeds.

No, the FCC's goal here is to technically lower the standard definition of quality broadband from 25 Mbps down, 4 Mbps to, to 10 Mbps down, 1 Mbps up. By doing this, Pai and friends can simply declare the broadband industry ultra-competitive, justifying their failure to actually do anything about the obvious fact that's simply not true. Of course it's not being explained that way in the agency's related notice of inquiry (pdf), the proposal couched under the pretense that we're simply modernizing the way the FCC operates -- or imposing new baseline wireless standards.

If you haven't carefully watched these ISPs and revolving regulators work tirelessly at protecting their uncompetitive empire for two decades, you might be inclined to believe that line of bullshit. But what the FCC's actually doing here is really quite simple: they're fucking with the math and lowering the bar to ankle height as a gift to the nation's lumbering, uncompetitive duopolies -- who'd like it very much if we left the existing, embarrassing status quo well enough alone.

53 Comments | Leave a Comment..

Posted on Techdirt - 15 August 2017 @ 6:47am

Broadband ISP Cox Will Now Charge You $50 More To Avoid Usage Caps, Overage Fees

from the thanks,-competition dept

We've noted repeatedly how large ISPs for years have happily abused the lack of competition in the broadband market by imposing arbitrary, unnecessary and confusing usage caps and overage fees. While ISPs had tried for a while to suggest these caps were "only fair," or necessary due to congestion, repeated debunking of those excuses forced the ISPs a few years back to finally stop pretending there's any good reason for these limits.

These days, ISPs don't even give coherent reasons for the limits, because they know caps are about one thing: abusing a lack of competition to raise rates and protect TV revenues from streaming video competition. More importantly, they know that thanks to this limited competition, there's nothing you can do about it either way.

Cox Communications is one of several cable providers that have taken full advantage of the reduction in competition by telcos to drive up rates via usage caps and overage fees. Back in June, Cox announced it would be imposing usage caps of one terabyte, then charging users $10 for each additional 50 GB of data consumed. And this week, the company unveiled the other arm of the company's ingenious plan -- charging its users $50 more per month if users want to avoid usage caps entirely:

"A memo being circulated among employees on the changes downplays the impact of these restrictions on consumers, repeatedly trying to argue that confusing and unnecessary usage limits aren't a big deal because the majority of Cox customers won't run afoul of them...today.

"An overwhelming majority of data is consumed by a very small percentage of internet users," the memo reads. "The new choices are great options for the small percentage of heavy users who routinely use 1TB+ per month and prefer a flat monthly rate, rather than purchasing additional data blocks.".

If it's truly only a "very small percentage" of users causing problems with "excessive" usage, Cox could have simply pushed these users to business-class tiers. Instead, they made the conscious decision to impose confusing new rate hikes on all users, feebly trying to insist that this can't possibly impact their consumption. And while it might be true it won't impact consumption today that's not really the point. Once caps are imposed, ISPs can tighten the noose at their discretion. And in a few years, when 4K video streaming and other new high-bandwidth applications emerge, ISPs have a wonderful new way to raise rates on a consistent basis.

But consumers realize they're being screwed, which goes a long way toward the cable industry's utterly abysmal customer satisfaction ratings. In just a few months, Cox imposed pricey and confusing new surcharges knowing a lack of competition would let them get away with it. They then offered users the "option" to pay $50 more just to enjoy the kind of unlimited connections they had last year -- for notably less money.

It's a wonderful racket, and one regulators at the FCC and elsewhere (regardless of political party) have pretty consistently made abundantly clear they couldn't give two shits about. And while many people reading these reports get bogged down over whether one terabyte limits are fair, that misses the entire point. There's no technical reason to impose these limits in the first place. They're glorified rate hikes, poorly justified, shoveled on the backs of captive users who already pay more for bandwidth than users in most developed nations. All thanks to a broken market very few people seem all that interested in fixing.

37 Comments | Leave a Comment..

Posted on Techdirt - 14 August 2017 @ 6:26am

New FCC Broadband 'Advisory Panel' Stocked With Telecom Consultants, Allies & Cronies

from the parade-of-yes-men dept

On the one hand, FCC boss Ajit Pai proclaims to be a man dedicated to hard data, transparency, and closing the digital divide. But we've repeatedly highlighted how his public rhetoric is miles from his actual policies, which by and large focus on making life easier than ever for the nation's entrenched, uncompetitive broadband mono/duopolies. From gutting broadband privacy and net neutrality protections, to protecting the cable industry's monopoly over the cable box, Pai's actions consistently reveal anti-competitive intent, while his words gracefully try to imply another, artificial artifice.

This stage play has apparently extended to Pai's creation of a new Broadband Deployment Advisory Committee (BDAC), which at an event earlier this year the FCC insisted would provide the agency with well-rounded input on how to improve broadband deployment:

"The BDAC's mission will be to make recommendations for the Commission on how to accelerate the deployment of high-speed Internet access, or "broadband," by reducing and/or removing regulatory barriers to infrastructure investment. This Committee is intended to provide an effective means for stakeholders with interests in this area to exchange ideas and develop recommendations for the Commission, which will in turn enhance the Commission's ability to carry out its statutory responsibility to encourage broadband deployment to all Americans."

Laying the blame for the broadband industry's issues exclusively on "regulatory barriers" is already a telltale bit of over-simplification. While there certainly are some regulations that could be streamlined to improve broadband deployment (like utility pole attachment rules), the real problems in the industry have a notably larger origin: namely entrenched duopolists that relentlessly lobby government to help keep real, vibrant competition at bay. These lobbying tendrils run deep, with ISPs using hired academics, economists, PR reps and consultants all with one goal: protect the profitable, but often anti-consumer and dysfunctional status quo.

In a speech (pdf) given earlier this year, Pai proclaimed that his new advisory panel would be "forward-looking and fair, balancing the legitimate interests of municipalities with the ever-growing demands of the American public for better, faster, and cheaper broadband." Odd, then, that the Daily Beast recently dug through the panel and found that 28 of the 30 panel members have direct financial ties to telecom operators:

"Instead the FCC loaded the 30-member panel with corporate executives, trade groups and free-market scholars. More than three out of four seats on the BDAC are filled by business-friendly representatives from the biggest wireless and cable companies such as AT&T Inc., Comcast Corp., Sprint Corp., and TDS Telecom. Crown Castle International Corp., the nation’s largest wireless infrastructure company, and Southern Co., the nation’s second-largest utility firm, have representatives on the panel. Also appointed to the panel were broadband experts from conservative think tanks who have been critical of FCC regulations such as the International Center for Law and Economics and the Mercatus Center at George Mason University."

In other words, not so much a "balanced" group of diverse stakeholders as much as an echo chamber filled with industry allies who'll all happily stay on message, working in polite unison at reducing oversight and accountability for one of the most regulatory captured, least competitive markets in America. And while it's important to have companies on the panel that have expertise building large networks, so too is it important to have an equal weight given to consumer activists, objective external experts, and folks that operate outside of the box when it comes to improving American connectivity.

Like Gary Carter, who runs one of the oldest municipal broadband networks in America (in Santa Monica, California). Carter says he was one of several representatives of municipal broadband providers hoping to be chosen for the panel, since they have a unique perspective on connecting communities incumbent ISPs have long refused to. But Carter says when he called the FCC to check up on the panel member selection process, he was literally laughed at:

“When I called [the FCC] to check on the status of the BDAC selection process [earlier this year] and identified myself as an employee from the City of Santa Monica, the gentleman on the phone laughed hysterically,” Carter said. “At first I didn’t get the joke. When I saw the appointees for the municipal working group—only three out of 24 positions were from local government—I got the joke.”

You'll of course recall that incumbent ISPs have worked tirelessly to pass protectionist state laws in more than twenty states hamstringing local communities' ability to build their own networks or work with private partners. Why? They don't want to serve many of these areas -- but they don't want anybody else to either -- lest it ultimately blossom into something that resembles competition and challenges their regional monopolies. As such, including municipal broadband builders on the panel might just raise questions Pai and friends aren't particularly interested in answering.

So again, while Pai's rhetoric consistently focuses on his supposed dedication to the digital divide, in practice he's simply engaging in wave after wave of anti-innovation, anti-competitive, and anti-consumer policies, then surrounding himself with industry allies who'll do little more than pat him on the back for his remarkable "leadership." Pai's going to promise this all ends with miraculous innovation and broadband expansion, but the history lessons we like to ignore suggest it's more likely the net result will simply be more apathetic companies like Comcast, with zero competitive or regulatory incentive to improve.

22 Comments | Leave a Comment..

Posted on Net Neutrality Special Edition - 11 August 2017 @ 11:59am

Mozilla Study: Zero Rating Isn't The Miracle Broadband Duopolies And Facebook Pretend It Is

from the on-ramp-to-nowhere dept

For years now we've explored how large ISPs have (ab)used the lack of competition in the broadband market by imposing completely arbitrary and unnecessary usage caps and overage fees. But in addition to these glorified price hikes, ISPs have also long taken to exempting their own content from usage caps, while penalizing competitors -- allowing them to use this lack of broadband competition to tilt the content playing field in their favor. Incumbent ISPs have long tried to twist and distort this narrative, claiming that zero rating is the bits and bytes equivalent of a 1-800 data or free shipping.

Of course that's simply not the case, and zero rating simply shifts costs around to the benefit of entrenched mono/duopolists. Since caps and overage fees are arbitrary implementations not tied to any sound, real-world economics, the consumer isn't technically really saving anything (especially in the States, where we already pay more for data than most developed nations). And because content companies are often penalized while ISPs exempt themselves, this reduction in overall competition has very real negative cost impact on the end user.

This gross distortion of the market doesn't just benefit ISPs. Overseas, companies like Facebook have partnered with mobile carriers to cook up their own, poorly-received zero rating efforts, providing an AOL-esque portal to the internet stocked with Facebook-chosen content. Facebook tried to convince folks in India that it wasn't just trying to corner the international ad market, it was simply worried about the plight of the impoverished farmers.

When Facebook's plan was being debated last year, Mozilla quite-correctly pointed out that if Facebook was so worried about the poor getting access to the internet, it could... you know... actually help fund connections to the actual internet. Mozilla's now back with a new study that further deflates some of the common, bunk narratives surrounding zero rating, particularly the Facebook and ISP claim that zero rating is a wonderful "on ramp to the internet" that showers immeasurable benefits upon the backs of the poor.

More specifically, Mozilla and its international research partners found that zero rating isn't really an on ramp to anywhere useful:

"In all countries surveyed — excluding India where zero rating has been banned by the regulator — focus groups revealed that users are not coming online through zero rated services. While more research is needed, if zero rating is not actually serving as an on-ramp to bring people online, the benefits seem low, while the resulting risk of these offerings creating an anti-competitive environment is extremely high."

The study also gets to the real reason companies like Facebook are so breathlessly in love with zero rating -- it tends to keep users focused on just a handful of websites (and obviously the advertising companies like Facebook want seen). It should probably go without saying that users who are stuck with only a limited window to the internet, aren't getting the full benefits the internet has to offer. But one of Mozilla's research partners (pdf) also noted that many users of these walled garden, zero rated services wind up conflating "Facebook" with "the internet," which is one of Facebook's primary goals:

"In discussing promotions and Internet-use more broadly, respondents focus on Facebook. Some respondents from rural focus groups use Facebook and the Internet interchangeably, as, for example Internet search for them means searching within Facebook...Our findings raise concern of Facebook’s influence within Myanmar, as these zerorated promotions may serve to perpetuate its dominance and undermine widespread understanding of the distinction between its services and the ‘open Internet’.

Of course the decision to drive users to a handful of websites instead of the entire internet has a dramatic, negative impact on overall content competition. That's why India banned Facebook from engaging in this behavior, hoping to encourage efforts that help bring the real internet to the poor, not bizarre walled gardens where Facebook, Google or your ISP has the final say when it comes to the content and services you're seeing. Here in the States, where we're facing both a gutting of net neutrality rules and a looming reduction in competition thanks to mindless merger mania, we're about to get a crash course in how the "help" provided by zero rating is no real help at all.

14 Comments | Leave a Comment..

Posted on Net Neutrality Special Edition - 11 August 2017 @ 6:28am

One Man's War Against Verizon's Long History Of Lies, Anti-Competitive Behavior, And Nonsense

from the we-don't-have-to-care,-we're-the-phone-company dept

In the telecom market the trifecta of holy bullshit has long been AT&T, Verizon and Comcast. And while all three companies are painfully unethical, anti-competitive, and viciously anti-consumer, Verizon has long utilized a particular finesse as it works tirelessly to prevent its regional mono/duopoly from anything closely resembling actual competition. Many of these efforts have historically teetered on the comical, and you've likely forgotten most of them.

Remember when Verizon tried to ban Bluetooth, tethering, or competing GPS apps to force you to use their inferior and expensive services? Or when it launched a shitty tech news blog, but banned reporters from talking about surveillance or net neutrality? Or that time Verizon blocked all competing mobile payment services on its phones to prop up its poorly-named and executed ISIS mobile payment service? Or when it was busted covertly modifying user packets to track users without their permission? And who could ignore its frontal assault on net neutrality, and recent comical video denying it was doing anything of the sort?

Yeah, good times.

Impressively, one man has done some yeoman's work for the rest of us and complied these and countless more examples of Verizon's anti-competitive behavior into what's the only real formal net neutrality complaint filed so far. It should be noted that there are tens of thousands of informal consumer net neutrality complaints (which the agency refuses to disclose because it might highlight how this is a real problem). But to file a formal complaint you need to pay $225, submit an ocean of paperwork, and kick off a long-train of procedural and legal fisticuffs most consumers simply don't have time for.

But after doing a painstaking amount of homework, a man named Alex Nguyen did just that:

"Nguyen is a recent college graduate living in Santa Clara, California. And for much of 2015, he spent his time digging through years of Verizon's public statements and actions, assembling more than 300 citations into a 112-page document that could well have been his master's thesis. (In fact, he studied computer science.) The document catalogs a dozen questionable actions Verizon has taken since 2012, assembling a body of evidence in an attempt to prove that the carrier has violated a number of open internet protections."

Not only that, Nguyen took the time to actually navigate the myriad of bullshit counter arguments Verizon put forth in trying to deny the fact that it is a well-documented anti-competitive ass. Some of them being, well, pretty comical:

"The complaint kicked off a back-and-forth process of objections, evidence discovery, and failed mediation to reach a resolution. Along the way, there have been some hilariously petty digressions, which Nguyen, untrained in the law, has handled patiently. At one point, Verizon objected to his definition of “Verizon” and proposed its own definition. Nguyen then objected to Verizon’s objection, saying that Verizon “copied my definition almost verbatim,” which, in fact, it had."

"With Verizon it's always, 'We're blocking these features as a fraud prevention tactic,' or 'It didn't pass our certification requirement that we're not gonna talk about,' or 'It didn't pass these requirements that were never specified,'" he told The Verge. "There's always this pattern of deception with Verizon."

After countless arguments and counter arguments taking nearly a year, Nguyen's complaint now sits in the lap of the FCC's Enforcement Bureau, which needs to either rule on the complaint, or refuse and explain why. With the current FCC boss busy bumbling toward killing the rules entirely and clumsily trying to downplay the massive backlash to his proposal, it seems unlikely that Ajit Pai and pals would want to sanction his former employer publicly or in any meaningful way. So for now the name of the game at the FCC appears to be to ignore the complaint and hope nobody notices, something that just became more difficult courtesy of this week's news coverage.

16 Comments | Leave a Comment..

Posted on Techdirt - 10 August 2017 @ 2:49am

The Nation's Telcos Are Hemorrhaging Customers Because They Refuse To Upgrade Their Networks

from the don't-build-it-and-they-won't-come dept

So we've noted for a while how despite all the hype surrounding next-gen wireless and gigabit fiber builds like Google Fiber, vast swaths of this country are actually facing less broadband competition than ever before. That's in large part thanks to the nation's phone companies, which have effectively given up on upgrading their lagging DSL networks at any real scale. One net result is millions of customers paying an arm and a leg for sub 6 Mbps DSL service that doesn't even technically meet the FCC's new standard 25 Mbps definition of broadband.

And it's not changing anytime soon. Verizon has all but frozen next-gen upgrades as it shifts its focus to gobbling up failed 90s internet brands to help it sling video advertisements at Millennials (poorly, we might add). But smaller telcos like Frontier, CenturyLink and Windstream have similarly been losing broadband customers hand over foot as they flee to faster cable competitors. Even Wall Street, which has historically and myopically disliked putting any money back into broadband networks, has started to take notice, resulting in the nation's telco stocks taking a precipitous dive in recent months:

"Shares in the wireline ILEC/RLEC space (CenturyLink, Frontier, Windstream) have endured the worst three consecutive quarters in industry history, with shares plummeting an average of -20% in 4Q16, -21% in 1Q17, and -24% in 2Q17 (we note another -5% in 3Q17 thus far), mostly from Frontier and Windstream as CenturyLink shares are being supported by the Level 3 acquisition,” Cowen said in a research note."

It has gotten to the point where some Wall Street analysts have even gone so far as to *gasp* recommend that some of these companies actually upgrade their networks if they want to remain relevant. Ironic, since it was Wall Street's relentless focus on short-term gains and avoiding these necessary network upgrades that help put these companies in this position to begin with:

"Jennifer Fritzsche, senior analyst for telecommunications services at Wells Fargo, doesn't think Frontier can actually right said ship without offering consumers a better broadband product.

"It is hard to fix a problem just by cutting costs when your competition (cable) is only pressing its foot heavier on the capex and fiber pedal," Fritzsche said.

But instead of upgrading the networks they already have, many telcos are trying to please Wall Street by focusing on growth for growth's sake. Frontier recently gobbled up Verizon's unwanted DSL customers in California, Texas and Florida in the belief that bigger automatically means better. But Frontier not only saddled itself with massive additional debt and outdated copper landlines Verizon had neglected for years, but it bungled the acquisition so badly it actually forced many of these subscribers to flee to cable even faster. Focusing on growth for growth's sake now has Frontier teetering on the verge of bankruptcy.

But the more problematic impact of all this is that across countless markets, consumers looking for current-generation broadband often only have one option: cable providers. These cable providers are on the cusp of enjoying a greater broadband monopoly than ever before, resulting in less incentive than ever to shore up their historically awful customer service, and only encouraging their slow but steady deployment of arbitrary and unnecessary usage caps. Combine that with the Trump administration's intense focus on eliminating all consumer protections in the telecom space, and it shouldn't take a tea leaf reader to see how this could potentially end very badly for consumers and competitors alike.

38 Comments | Leave a Comment..

Posted on Techdirt - 9 August 2017 @ 11:55am

Disney Pulls Content From Netflix As Users Face An Annoying, Confusing Rise In Streaming Exclusivity Silos

from the drowning-in-monthly-fees dept

On one hand, the increasing number of independent streaming services is certainly a good thing. This increase in competition is finally starting to apply pressure on incumbent cable TV providers to offer greater programming flexibility and to compete on price, even though many cable and broadcast execs falsely believe they can ignore the threat and do the exact opposite. But as everybody and their mother jumps into the streaming game, we're facing a new threat: the rise of fractured exclusivity silos that make consumers hunt and peck to obtain their favorite programs.

Case in point: if you're a fan of a particular program in the modern streaming video age, you first need to check to see if that program or film is available on any of the half-dozen services you may subscribe to, be it Hulu, Netflix, Amazon, CBS All Access, YouTube TV, or any of a myriad of other options. That in and of itself can prove fatiguing on your patience -- and wallet if you're trying to save money over traditional cable. You've then got to see if that content is still actually available, since content licensing results in titles being added and removed in what are often illogical availability windows, adding another layer of confusion.

Now, things are poised to become even more complicated in that regard. Wanting to cut out the middleman, many broadcasters (like CBS, FX or AMC) are busy pursuing their own streaming services, pulling their content from existing available services and forcing users to sign up for yet another monthly subscription. For example, if you want to watch CBS's upcoming new Star Trek: Discovery TV show, your only option will be to sign up for CBS's $7 per month All Access service. Don't want or can't afford another service? Your option is to either go without -- or to pirate the program. Guess which option many choose?

A more recent case in point: Disney announced this week that the company would be pulling its content from Netflix in order to launch its own streaming video service:

CEO Bob Iger told CNBC's Julia Boorstin Disney had a "good relationship" with Netflix, but decided to exercise an option to move its content off the platform. Movies to be removed include Disney as well as Pixar's titles, according to Iger. Netflix said Disney movies will be available through the end of 2018 on its platform. Marvel TV shows will remain. The new platform will be the home for all Disney movies going forward, starting with the 2019 theatrical slate which includes "Toy Story 4," "Frozen 2," and the upcoming live-action "The Lion King." It will also be making a "significant investment" in exclusive movies and television series for the new platform.

On one hand, if you really like Disney content, this may not be a horrible thing for you. On the other hand, if you're only interested in a few Disney titles but already feel you pay for too many streaming services, you could find yourself annoyed. Users are, it goes without saying, cutting the TV cord because they're tired of the poor value proposition traditional cable TV represents. It's not entirely clear you can call it real pricing evolution if you replace one bloated, giant cable bill with an ocean of smaller charges that ultimately cost you the same if not more than your old cable TV subscription.

And while it's not entirely clear how many monthly fees and subscriptions users are willing to tolerate, it is abundantly clear that broadcasters and cable companies intend to push their luck and figure out the answer. Not many seem to realize that should they push too hard and cordon off content into an ocean of annoying exclusivity silos, the end result will drive users back to the simplicity of piracy. And that's a particular shame given all the work it took to wean consumers off of file trading services like BitTorrent and on to "legitimate" monthly streaming subscriptions in the first place.

There's a fine line here as we shift from traditional cable to over the top streaming, and it's precisely the kind of line the traditional cable and broadcast industry loves to trip face-first over.

186 Comments | Leave a Comment..

Posted on Net Neutrality Special Edition - 9 August 2017 @ 8:57am

AT&T Lies Again, Insists Net Neutrality Rules Will Hurt First Responders

from the chicken-little-fast-lanes dept

So one of AT&T, Comcast and Verizon's favorite bogus claims about net neutrality rules is that such consumer protections will somehow prevent the sick or disabled from getting the essential internet connectivity they need. For example, Verizon once tried to claim that the deaf and disabled would be harmed if large ISPs weren't allowed to create fast or slow lanes, or prioritize emergency traffic over say -- Netflix streams. Comcast recently tried to argue something similar, again implying that the hearing-impaired could be harmed unless ISPs are allowed to prioritize or deprioritize select classes of traffic.

But this claim that net neutrality rules somehow prevent ISPs from prioritizing essential medical technologies or other priority traffic has always been bullshit.

The FCC's 2015 open internet rules (pdf) are embedded with numerous, significant caveats when it comes to creating fast and slow lanes, and only really single out the creation of fast or slow lanes when it comes to hindering competitors. In fact, the existing rules go to great lengths to differentiate "Broadband Internet Access Service (BIAS),” (your e-mail, Netflix streams and other more ordinary traffic) from “Non-BIAS data services,” which can include everything from priority VoIP traffic to your heart monitor and other Telemedicine systems.

The fact that this talking point is complete and utter bullshit (much like the one about how net neutrality kills network investment) doesn't stop it from being circulated repeatedly by the army of politicians, think tankers, consultants, fauxcademics, and lobbyists paid to pee in the net neutrality discourse pool.

One of the core perpetrators of this myth is AT&T, which just scored a massive, lucrative $6.5 billion contract to build the nation's first, unified emergency first responder network: aka FirstNet. Speaking about the project at a recent investor event this week, AT&T's John Stephens once again trotted out this bogeyman for proud display, implying that net neutrality rules would somehow threaten first responder network traffic:

"During an appearance this morning at an investor event, AT&T’s CFO pointed out that FirstNet’s pre-emption requirements for public safety users present “a challenge with the net neutrality process because you are giving prioritized service to police, firefighters.”

“But quite frankly I think everyone would agree that that’s probably a good thing,” explained John Stephens, AT&T’s SVP and CFO. “It’s just one of the uniquenesses of some of the other arguments that we have to deal with.”

Of course if you didn't know the net neutrality rules were carefully crafted to exempt precisely this sort of traffic from them, you might become outraged, which was Stephens' intent. The executive proceeded to double down on his falsehood:

"We have the ability today to give [FirstNet public-safety users] preferential treatment. What we’ll have by the end of the year is what we call ‘relentless pre-emption,’ such that if there’s capacity for 10 calls and 10 calls are being used, and a firefighter gets on, one of the 10 people gets booted off and the firefighter gets in,” he said. “Quite frankly, I don’t think they thought about it [when crafting net neutrality guidelines]. The FirstNet process has been around since 9/11. It came out of the 9/11 events, and so that had been out there for a long time, and so I don’t even think it was even considered.”

Right, "not even considered." Except for the fact that it was painstakingly considered, and AT&T knows it. It's a little grotesque to use the specter of 9/11 to attack popular net neutrality protections, but that's well in line with AT&T's behavior on this subject (including its recent use of the net neutrality protests to con its own customers into opposing net neutrality. In reality AT&T isn't worried about net neutrality rules harming medical services, since they've long-been exempted. AT&T's worried about one thing: any rules stopping it from abusing a lack of broadband competition to drive up prices and engage in anti-competitive behavior.

29 Comments | Leave a Comment..

Posted on Net Neutrality Special Edition - 8 August 2017 @ 10:44am

Congress Gives The FCC An Earful On Its Despised Plan To Kill Net Neutrality

from the Comcastic dept

At this point, more than sixteen million comments have been filed in response to the FCC's myopic plan to kill net neutrality protections, the majority of them in fierce opposition to the idea. We've also noted how more than 900 startups, countless engineers, and a wave of large companies and websites have similarly urged Ajit Pai to stop, pause, and actually listen to what the majority of the country is saying. And what they're saying is that they want Title II and net neutrality protections to remain in place to protect them from giant telecom duopolies with long histories of fiercely-anti-competitive behavior.

Unfortunately. there's no indication that the Ajit-Pai lead FCC much cares. Pai's FCC has made every effort to comically try to downplay this massive wave of opposition, and dress up the agency's blatant giant gift to Comcast, AT&T and Verizon as an ingenious attempt to somehow restore "freedom" to the internet (yeah, big fucking citation needed).

Hoping to perhaps pressure Pai further, 11 Representatives and 21 Senators last week sent a formal comment to the FCC (pdf) insisting that the agency's plan to gut net neutrality protections not only ignores the public interest, but the law as well:

We, as members of Congress who also sit on the House Energy and Commerce Committee, submit these comments out of deep concern that the FCC’s proposal to undo its net neutrality rules fundamentally and profoundly runs counter to the law. As participants either in the passage of the Telecommunications Act of 1996 or in decisions on whether to update the Act, we write to provide our unique insight into the meaning and intent of the law.

The cornerstone of Pai's plan is to reverse the agency's 2015 decision to classify broadband providers as common carriers under the Telecommunications Act. That, in turn, is part of a long-standing AT&T, Comcast and Verizon effort to gut meaningful regulatory oversight of broadband providers and replace it with the policy equivalent of fluff and nonsense. And in a competitive market that wouldn't necessarily be a bad thing, since you could trust market competition to keep ISPs on their best behavior in terms of pricing, net neutrality, privacy, and everything else.

But as you might have noticed if you've looked at your Comcast bill lately, or paid any attention to the rotating crop of sleazy behavior by companies like AT&T, the broadband market isn't competitive. In fact, decades of turning a blind eye to a lack of competition has left it downright hostile to any new disruptive entrants. As such, reducing what limited protections consumers and competitors currently enjoy would have dramatic, negative repercussions on consumer wallets and the health of the internet.

And while the FCC does have the authority to interpret the Telecom Act as it sees fit (much like Wheeler did in 2015), the Senators and Representatives are quick to point out in their letter that Pai and friends are twisting Congressional intent to flimsily justify their decision to reclassify ISPs as an “information service" rather than a "telecommunications service" (you can check out our primer on this entire debate -- and why this distinction matters -- here):

"While the technology has changed, the policies to which we agreed have remained firm the law still directs the FCC to look at the network infrastructure carrying data as distinct from the services that create the data. Using today’s technology that means the law directs the FCC to look at ISP services as distinct from those services that ride over the networks.

The Commission’s proposal performs a historical sleight of hand that impermissibly conflates this fundamental distinction. The FCC proposes to treat network infrastructure as information services because the infrastructure gives access to the services running over their networks. The FCC contends that ISPs are therefore “offering the capability” to use the services that create the content. However this suggestion obliterates the distinction that Congress set in to law-we meant for the FCC to consider services that carry data separately from those that create data. The FCC’s proposal would therefore read this fundamental choice that we made out of the law. Under the proposal’s suggestion, no service could be a telecommunications service going forward.

The lawmakers are also quick to lambast the FCC for ignoring the massive groundswell of public opposition to reversal of the rules, as well as the agency's relentless focus on using network investment as the sole cornerstone for determining whether the rules are useful:

"Americans overwhelming support stronger and clearer privacy rules. Yet the Commission—without comment—proposes to eliminate before-the-fact protections at the FCC in favor of an enforcement-only approach. The FCC should not degrade people’s privacy rights without thorough consideration. Instead of considering these critical national priorities, the proposal single-mindedly concentrates on one issue to the exclusion of all others: the raw dollars spent on network deployment. This narrow focus is clearly contrary to the public interest—if we had intended network investment to be the sole measure by which the FCC determines policy, we would have specifically written that into the law.

The problem, of course, is that ISP lobbyists have successfully managed to submerge this debate under the idiot-din of partisan politics, despite the health of the internet and broadband competition being of benefit to everyone. Polls repeatedly find that net neutrality protections have broad, bipartisan support among consumers of all political ideologies, but by framing this as a partisan debate, ISPs and their loyal, paid allies have successfully bogged the conversation down in inane partisan fisticuffs, sadly convincing an all-too-broad segment of the public that net neutrality is "a government takeover of the internet."

As such, the fact that this particular letter was written largely by Democratic lawmakers only makes it fodder to be ignored by partisans, and it it shouldn't be. Net neutrality is about preventing massive, incumbent ISPs from abusing a lack of broadband competition in a rotating crop of obnoxious, creative ways. Were either party actually interested in shaking off ISP campaign contributions and improving said competition we might be having a different conversation, but until then net neutrality is the only thing standing between a healthy, competitive internet and the predatory whims of regional telecom duopolies.

Read More | 48 Comments | Leave a Comment..

Posted on Techdirt - 8 August 2017 @ 6:32am

Cable's New Brilliant Idea: Charging You More Money To Skip Ads

from the same-shit,-more-money dept

We've noted for years how cable executives facing market (r)evolution just can't stop making bone-headed decisions. As cord cutting accelerates and ratings take a dive, many cable and broadcast executives have decided the solution is to stuff more ads than ever into every viewing hour, in some instances actually editing down or speeding up programs so the additional ad load will fit. That's of course when they're not busy trying to prevent users from using modern technologies like DVR ad skipping, relentlessly raising cable rates and perpetuating some of the worst customer service in America.

Quite often, cable executives try to obscure the sector's dysfunction by pretending to be innovative, and hoping nobody can tell the difference. The latest case in point: FX Networks has struck a new deal with Comcast that lets viewers avoid ads on some FX programs -- if they're willing to pay another $6 per month:

"For an extra $5.99 a month, Comcast Xfinity customers will be able to receive the FX+ video-on-demand platform with up-to-date episodes of FX’s original programming, including “American Horror Story,” “Fargo,” “The Americans,” FXX’s “It’s Always Sunny in Philadelphia” and older FX titles such as “The Shield” and “Nip/Tuck.”

“This initiative represents the first of its kind for an ad-supported cable network, and begins to put us on equal footing with premium networks and streaming services,” John Landgraf, chief executive of FX Networks, said in a statement.

There's several problems with this "premium," Comcast-exclusive effort. One, users are incredibly fed up with paying too much money for bloated bundles of channels they don't want, and raising prices in any fashion at this juncture is simply a bad idea. Two, these Comcast customers can already skip advertisements on FX programming by using a DVR, making paying an additional fee to do the same thing uninspiring. There's also a notable caveat with this effort: the ad-skipping only works on some FX programs, namely the ones the channel hasn't already licensed out to other streaming competitors like Amazon, Hulu and Netflix.

AMC Networks offered a similar initiative last month, also letting Comcast customers pay even more money to do something they can already do. In some instances these are broadcaster efforts to set the stage for their own more fully-functional streaming services in line with Netflix or Amazon. But every channel from FX to AMC having their own streaming service presents its own problem: namely one of fractured exclusivity. Or, a world where you have to subscribe to a litany of multiple, costly services just to get access to your favorite programs.

On the surface these efforts are designed to give the impression that the cable and broadcast industry are rolling with the punches and adapting to the streaming video era. But the act of charging more money to do something users can already do, combined with raising rates at time when cord cutting is accelerating only really accomplishes one thing: drive users back to piracy where avoiding ever-growing ad loads can be avoided entirely, for free.

39 Comments | Leave a Comment..

Posted on Techdirt - 7 August 2017 @ 3:35pm

US Senators Unveil Their Attempt To Secure The Internet Of Very Broken Things

from the good-luck-with-that dept

Over the last few years we've documented in painstaking detail how the lack of any real security and privacy standards in "internet of things" devices is leading us down a path to some serious trouble. That shouldn't be particularly surprising if you've paid attention to how your refrigerator can now leak your Gmail credentials, your "smart" thermostat is now vulnerable to ransomeware attacks, your smart car could be hacked in order to kill you, your power outlets can be hacked and used to launch DDOS attacks, or how your vibrator is now busy collecting data on your daily behavior.

There's one root cause: companies that prioritized making a quick buck over implementing anything resembling sane security or privacy standards.

And despite this dysfunction now being the butt of endless jokes, things really haven't changed all that much, since actually giving a damn about the problem would erode profit margins for WiFi-enabled widget makers. The end result is the daily introduction of millions of new attack vectors for both homes and businesses on a global scale. As such, there's more than a few security experts that, no hyperbole intended, believe it's inevitable that this problem will impact core infrastructure leading to significant human casualties.

Given this is a global problem, and many of these companies are Chinese, legislating the problem away via U.S. law is likely going to be a steep uphill climb. That apparently doesn't seem to concern Congress, which this week introduced a new bill they hope will help secure the internet of very broken things:

"The new bill would require vendors that provide internet-connected equipment to the U.S. government to ensure their products are patchable and conform to industry security standards. It would also prohibit vendors from supplying devices that have unchangeable passwords or possess known security vulnerabilities. Republicans Cory Gardner and Steve Daines and Democrats Mark Warner and Ron Wyden are sponsoring the legislation, which was drafted with input from technology experts at the Atlantic Council and Harvard University. A Senate aide who helped write the bill said that companion legislation in the House was expected soon."

While IOT legislation may be well-intentioned, many of these devices (like the security cameras and DVRs that contributed to the historically massive DDOS attack on Dyn last year) are made in China, where manufacturers will laugh off foreign legislative band aids. And while there's very legitimate concerns that legislation crafted by a Luddite Congress could stifle innovation and experimentation in the space, this particular proposal does at least apply some standards to the IOT devices purchased and used by the federal government, injecting at least a layer of sanity and reflection to the rapid expansion of poorly-secured IOT devices.

Security researcher Brian Krebs highlights another good part of the bill, namely the portion that expands legal protections for cyber researchers working in "good faith" to hack equipment to find vulnerabilities so manufacturers can patch previously unknown flaws:

"Those advocates were no doubt involved in shaping other aspects of this legislation, including one that exempts cybersecurity researchers engaging in good-faith research from liability under the Computer Fraud and Abuse Act (CFAA), a dated anti-cybercrime law that many critics say has been abused by government prosecutors and companies to intimidate and silence security researchers. Perhaps the most infamous example of prosecutorial overreach under the CFAA comes in Aaron Swartz, a Harvard research fellow who committed suicide after being hounded by multiple CFAA fraud charges by state and federal prosecutors for downloading a large number of academic journals.

All of that said, the legislation isn't going to do enough to prevent major, looming problems. Between 20 billion and 30 billion "IOT" devices are expected to be connected to the internet by 2020 worldwide. And as Bruce Schneier has noted on occasion, the origins of this market failure begin with an apathetic cycle of dysfunction between both hardware vendors and consumers, something that the market alone has shown it's not capable of -- or seriously interested in -- fixing:

"The market can't fix this because neither the buyer nor the seller cares. The owners of the webcams and DVRs used in the denial-of-service attacks don't care. Their devices were cheap to buy, they still work, and they don't know any of the victims of the attacks. The sellers of those devices don't care: They're now selling newer and better models, and the original buyers only cared about price and features. There is no market solution, because the insecurity is what economists call an externality: It's an effect of the purchasing decision that affects other people. Think of it kind of like invisible pollution."

So while this law may be a start, it's going to take a lot more than U.S.-specific legislation to fix this particular market failure, assuming such laws don't actually manage to make the problem worse. Smart networks, smarter engineers, better routers, better code, and better communications between companies, governments, activists, and other stakeholders are all essential to get ahead of this particular threat. Fixing the internet of broken things requires a massive, over-arching, holistic effort, one that doesn't exist yet, and unfortunately isn't likely to gain serious momentum until after the internet of broken things check comes due.

35 Comments | Leave a Comment..

Posted on Techdirt - 7 August 2017 @ 6:29am

Comcast Tries, Fails To Kill Lawsuit Over Its Hidden, Bogus Fees

from the I-see-what-you-did-there dept

Cable TV and broadband providers have created an art form out of advertising one price, then charging you something else entirely when your bill actually arrives. They accomplish this via the addition of sneaky below the line fees, which allow them to covertly raise rates while proudly crowing that they've keep their base rates the same. Some of these fess are downright obnoxious in how fraudulent they are, like CenturyLink's "internet cost recovery fee." Others, like the increasingly common "broadcast TV fee," simply take a part of the cost of doing business (in this case programming), then bury it below the line to jack up the advertised price.

Comcast, an expert at this particular behavior, was sued for the practice late last year. The lawsuit specifically focused on Comcast's use of the broadcast TV fee, which has quickly ballooned for Comcast customers from $1.50 per month to $6.50 since introduction, and the "Regional Sports Fee" that has quickly jumped from $1 to $4.50 since 2015. The lawsuit was also was quick to point out that when people call Comcast to complain, the company's support reps often lie and insist that the fees are somehow government mandated to dodge accountability.

Amusingly, the company responded to the suit by trying to claim that covertly jacking up their advertised rate was just their way of being "transparent" (nothing quite says "transparency" like not knowing what your bill is going to be until after you've signed up for service). Comcast subsequently filed a motion to dismiss, arguing that the company's order submission process doesn't technically create a binding contract with its customers, and that customers agreed to pay the fees by agreeing to the Comcast "Subscriber Agreement" and "Minimum Term Agreement."

But US District Court Judge Vince Chhabria recently shot down this argument in a ruling that will keep the suit alive, for now:

"The motion to dismiss the breach of contract claim is denied. The plaintiffs have alleged the existence of a valid contract, which was created when [Comcast customers Dan] Adkins and [Christopher] Robertson submitted their order for Comcast services through Comcast's website. It is plausible to infer from the complaint that, by clicking "Submit Your Order," Adkins and Robertson agreed to pay Comcast's advertised price, plus taxes and government-related fees, in exchange for the services Comcast offered them. It is also plausible to infer from the complaint that Comcast breached its agreements with the plaintiffs when it sent them bills charging them Broadcast TV and/or Regional Sports Fees (alleged to be neither taxes nor government-related fees) in excess of the agreed-upon price, and when it subsequently sought to raise the amount of the fees."

Judge Chhabria also disputed Comcast's claim that users technically agree to pay these fees by agreeing to the Comcast subscriber agreement, which only references "permitted fees and cost recovery charges," and not these additional surcharges Comcast appears to have hallucinated out of whole cloth:

"As to the Minimum Term Agreement, the plaintiffs plausibly allege that they never saw this agreement at the time they submitted their order for services and have never consented to it," the judge wrote. "Whether the plaintiffs had access to this agreement at the time they submitted their orders for services, or whether they subsequently consented to it, are disputed factual questions more appropriate for summary judgment."

Comcast's being additionally disingenuous here in part because as the owner of NBC, it very often is the broadcaster, and often owns the regional sports networks in question. Granted Comcast's use of covert fees to covertly jack up the cost of service is something that has plagued the broadband and TV sectors in particular for years, though regulators and lawmakers have consistently turned a blind eye to the practice. Similar suits have been filed against Charter Communications, at which point the nation's other extremely-disliked cable provider tried to claim it was simply providing an amazing consumer benefit.

25 Comments | Leave a Comment..

More posts from Karl Bode >>