September 2009

Republicans in Congress and at FCC Move To Block FCC Net Cop Initiative

Some Republican lawmakers moved swiftly Monday to try and block Federal Communications Commission Chairman Julius Genachowski's proposal that the FCC adopt new Network Neutrality rules.

Sen Kay Bailey Hutchison (R-TX) Monday introduced an amendment to an appropriations bill that would prohibit the FCC from spending any funds "to develop and implement new regulatory mandates." The bill is co-sponsored by Sens John Ensign (R-NV), Sam Brownback (R-Kansas), David Vitter (R-LA), Jim DeMint (R-SC) and John Thune (R-SD).

Sen Hutchison said, "Even during a severe downturn, America has experienced robust investment and innovation in network performance and online content and applications. For that innovation to continue, we must tread lightly when it comes to new regulations. Where there have been a handful of questionable actions in the past on the part of a few companies, the Commission and the marketplace have responded swiftly. The case has simply not been made for what amounts to a significant regulatory intervention into a vibrant marketplace. These new regulatory mandates and restrictions could stifle investment incentives."

Public Knowledge President Gigi Sohn responded to the amendment saying, "The FCC has pledged a full, public factual inquiry. The Senate should let that process move ahead."

Republican members of the FCC said they did not get an advance summary of the FCC chairman's major network neutrality proposal, and have some concerns about what they call a "monumental" undertaking that could reverse "decades of precedent" and a Clinton Administration bipartisan policy "to allow a diverse assortment of technical experts, rather than politicians and bureaucrats, working in loosely knit non-governmental organizations to make such engineering decisions."

Industry Groups Question Need For FCC to Expand Internet Openness Principles

Various industry groups and companies were quick to weigh in Monday on FCC Chairman Julius Genachowski's proposal to expand and codify FCC Internet openness principles. National Cable & Telecommunications Association President Kyle McSlarrow applauded the chairman's vision of "preserving an open Internet," but said the cable trade group "may have a different view about the state of competition and choices and benefits that flow to consumers from that competition." Comcast, which was the subject of the FCC's Aug. 20, 2008 finding that the company's broadband-network-management practices violated the FCC's Internet access principles, released a statement saying, in part, "we welcome the dialogue suggested by his comments. The chairman has made it clear that commission decisions must be based on hard facts and data, and we are committed to work with the chairman and the other commissioners in this proceeding. We also appreciate that the chairman recognized that networks need to be managed and that consumer disclosure of those techniques is important." Verizon director of Internet and Technology Policy David Young in a roundtable discussion at the Brookings Institute following the chairman's speech said he was pleased that the chairman said it would be driven by data and facts, but said he also wasn't sure he saw a problem that needed to be addressed with first-time regulations on the Internet. Randolph May of the free market think tank, The Free State Foundation, called it "regulatory hubris and immodesty." "Despite good intentions, the likelihood of error costs from overregulation - in an environment in which Genachowski says we cannot know what tomorrow holds for the Internet - are likely to be exceedingly high," said May. "The presumption that the FCC will know the point at which it has gotten regulation just right demonstrates an immodest approach that likely will dampen the successes that Genachowski acknowledges have taken place without the type of regulation he proposes."

Proposed FCC Web rule change draws wireless ire

Federal Communications Commission Chairman Julius Genachowski said wireless phone operators should not be able to discriminate against any Internet applications or content and would have to make management practices for Web traffic transparent. While he appeared to address operators' network management concerns, the wireless industry criticized the proposal and analysts said it could hurt profits for mobile operators, which had not been targeted by previous Net neutrality requirements. "The risk to the wireless carriers is that they won't be able to stop customers from using free voice and text services like Skype or Google voice," said Bernstein analyst Craig Moffett. "Voice and text are where they make all of their money." The new proposal could result in mobile customers cutting their phone bills by opting for minimum carrier voice plans and doing without text-messaging plans if they use mobile voice and text services from Skype and Google. Piper Jaffray analyst Christopher Larsen downplayed the
risk, saying that if they have to, operators would be sure to find a way to change their fees in order to maintain profits.

Genachowski Praised For Net Neutrality Proposal

Federal Communications Commission Chairman Julius Genachowski's proposed effort to codify and expand network openness principles does not supplant congressional efforts to do the same, said Rep Ed Markey (D-MA). "This is a significant step towards preserving the free and open nature that has enabled the Internet to become a platform for innovation, job-creation and economic growth," said Markey, who recently introduced a bill along with Rep Ann Eshoo (D-Calif.) to codify the FCC's principles. "I hope the full Commission follows Chairman Genachowski's lead in this vital effort." But he also said that the proposal would be a "complement" to the bill that he and Eshoo introduced. The Genachowski proposal drew praise from another one of network neutrality's strongest backers on the Hill, as well as numerous groups long advocating for a stronger government role in what they see as preserving and open and innovative Internet. "I applaud today's announcement by the FCC that they will begin to create rules in support of net neutrality. I will closely follow the process and make sure the FCC moves quickly to approve strong, enforceable non-discrimination protections," said Sen Byron Dorgan (D-ND). "In a landmark move, Chairman Genachowski has put the FCC on course to protect the Internet economy and make sure it promotes consumer-friendly innovation," said the Open Internet Coalition, which includes Google, Skype, Sling Media, Paypal, Amazon and Public Knowledge. "Over the last several years, the uncertainty around the extent and enforceability of non-discrimination rules has cast a shadow over investment and potentially stifled a key element of growth. The bold step by the Chairman will fulfill President Obama's repeated commitment to net neutrality policies."

FCC Fires Back at Comcast in Net Neutrality Legal Battle

The Federal Communications Commission filed a brief with the US Court of Appeals for the District of Columbia Circuit defending the Commission's right to censure Comcast for blocking P2P files on its cable network. The FCC claims it has general jurisdiction over all interstate communications by radio and wire — including the company's cable modem service. The claim came in response to Comcast's appeal last month regarding the FCC's August 2008 decision that ordered the cable provider to stop blocking P2P files and to amend its network management techniques. Comcast argued that the FCC had no jurisdiction to enforce the principles of net neutrality.

It's Official: NTIA Throwing States Under The BTOP Bus

[Commentary] The San Francisco Business Times report, "California technology officials are scrambling to rank 178 applications for broadband stimulus money that have been submitted to the federal government by businesses, nonprofits and government agencies statewide." Daily understands why the National Telecommunications & Information Administration has shared the applications with states: the NTIA set deadlines for getting feedback from the states and it wants to give the states as much time as possible to review the applications and make recommendations. But if NTIA truly didn't conduct any initial filtering before passing the applications through then they've created a lot more work for the states by forcing them to review everything, which means they'll be wasting time considering those applications that have no chance of making it to the next round of consideration. And if NTIA wanted states to be able to make the best possible recommendations, then why not wait until they're able to see the scores from the initial round of reviews?

Short-Staffed Local Governments Struggle with Stimulus Grants

The American Recovery and Reinvestment Act (ARRA) may offer billions of dollars in stimulus funds, but short-handed local governments are having a tough time getting their hands on the money. For cities and counties wracked by hiring freezes and staff layoffs, it's hard enough to cope with existing workloads, let alone the new demands of securing stimulus grants. Finding stimulus-related grants takes time and effort, and then the eligibility requirements must be studied and the application processes completed. Adding to the burden is the fact that some local officials are struggling to understand the process for chasing down stimulus dollars. And others complain the stipulations on grants funded by the stimulus are so restrictive that applying for them isn't practical. Many stimulus grants come with stipulations that make the money nearly impossible to integrate with other stimulus-funded projects. Agency-specific broadband grants often restrict applications that can be run on the network.

House Democrats Push High-Speed For Anchor Institutions

House Democrats have made it clear to the Federal Communications Commission, and now the National Telecommunications & Information Administration, that they want the national broadband plan to include getting high-speed broadband service to libraries and other anchor institutions. In a letter to NTIA, which is handing out billions in government grant money for broadband deployment, adoption and education, House Communications Subcommittee members Doris Matsui (D-CA) and Ann Eshoo (D-CA) and former Subcommittee Chairman Ed Markey (D-MA) urged the administration to put a priority on "anchor institutions, including libraries, schools and health facilities." They said that a number of those institutions did not apply for that money because they did not fit the categories established by BTOP, and those that did apply found the process "confusing, complicated and discouraging." The legislators suggested that the anchor institutions needed 100 megabits to 1 gigabit connections to provide distance learning and healthcare services.

Who's Running the Show -- the FCC or Hollywood Execs?

[Commentary] Although panelists at Federal Communications Commission National Broadband Plan workshops are given five minutes to make presentations, last week Paramount Pictures CEO Frederick Huntsberry was given ten minutes on "The Role of Content in the Broadband Ecosystem." And, oddly enough, even though the presentation was made at a public forum to inform public policymaking, Paramount is claiming ownership of the presentation and not allowing public access via the FCC's website.

President Obama Lays Out Strategy for American Innovation

At the Hudson Valley Community College, president Barack Obama deliver remarks on his commitment to fostering new jobs, new businesses, and new industries by laying the groundwork and the ground rules to best tap our innovative potential.

The President's innovation strategy has three parts:

1) Investing in the Building Blocks of American Innovation -- from research and development to the human, physical, and technological capital needed to perform that research and transfer those innovations.

2) Promoting Competitive Markets that Spur Productive Entrepreneurship -- creating a national environment ripe for entrepreneurship and risk taking that allows US companies to be internationally competitive in a global exchange of ideas and innovation.

3) Catalyzing Breakthroughs for National Priorities -- in sectors of exceptional national importance -- alternative energy sources, reducing costs and improving lives with health IT, and manufacturing advanced vehicles -- government can be part of the solution.

Benton

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