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  2. July 2015

July 2015

Akamai on broadband: A few surprises and a new (but useless) metric

[Commentary] Akamai’s most recent “State of the Internet” report is 60 pages of insightful data on broadband around the world. The report contains reiterations of many things we already knew (including that the US is not, in fact, falling behind), but also offers some surprising insights into IPv6 adoption and a completely new -- albeit somewhat useless -- metric. In terms of Internet speeds in different US states, Delaware ranks number one with an average peak (Akamai’s measure of broadband capacity) of 85.6 Mbps. If Delaware were a country, it would rank 3rd overall, behind Singapore and Hong Kong. In the overall global ranking, Singapore retains the lead with an average broadband capacity of 98.5 Mbps.

Because it’s not reasonable to compare small countries to big ones and urban countries with suburban ones, I like to compare the nations in the G7 with each other. While there are few surprises in Akamai’s speed rankings, IPv6 adoption rankings is a different ballgame. Belgium is the world leader in IPv6, followed by Germany and then the US. This is surprising since conventional wisdom says China – who didn’t even make the top 10 – is the biggest adopter. There may be a lot of IPv6 within China, but none of the external sensors see it. I expect the island nation will be the world’s first to break the 100 Mbps barrier. To sum up, global broadband speeds continue to rise at a rapid rate, especially in small, densely populated areas, and IPv6 is catching on, especially in the US and Western Europe. So there you have it folks, this is the State of the Internet.

[Richard Bennett was vice-chair of the Institute of Electrical and Electronics Engineers (IEEE)]

Don’t Delay the Fiber Future

There is no disputing that fiber is the best wireline broadband communications infrastructure. So it is no surprise that communities across the country are trying to attract fiber deployments in their areas and President Barack Obama has created a Broadband Opportunity Council to identify ways of removing barriers to new broadband deployment. That is why it is strange that some parties are asking the Federal Communications Commission to consider rules that, rather than encouraging the move to fiber, would divert investment dollars into the very legacy copper networks that they have already acknowledged cannot provide real competition for cable at the higher speeds.

Make no mistake, rules that force companies to invest in copper networks, even where they are already deploying new fiber networks, would significantly delay the fiber future. Specifically, some parties are asking the FCC to adopt rules to address “de facto copper retirement,” a made-up problem based on the unfounded claim that copper networks are being allowed to deteriorate to the point of not being usable. Despite some cherry-picked anecdotes provided by advocates with a vested interest in having us spend more money on two parallel wireline networks, the objective performance data makes it clear that there simply is not a problem. The FCC and other policy makers rightly recognize that only new fiber deployments can improve the quality and range of services available to consumers, while also accelerating competition at the highest broadband speeds. Creating new rules that would divert investment from fiber to keep redundant copper networks would be a major step backwards for consumers and competition.

July 24, 2015 (Broadband; Ownership; Wireless)

BENTON'S COMMUNICATIONS-RELATED HEADLINES for FRIDAY, JULY 24, 2015

Today's Event: New America Foundation discussion, "How Much Is Too Much? US Government Secrecy and the New Half-Life of Secrets" https://www.benton.org/calendar

INTERNET/BROADBAND
   The Next Generation Network Connectivity Handbook: Top Ten Overall Lessons - research
   Appropriations Bill Blocks ISP Rate Regulations
   Sen Nelson warns network neutrality rider could prevent compromise
   Why your Internet prices are bound to go up
   Five years after Verizon abandoned FiOS build, Alexandria still seeking fiber [links to web]
   Small biz pushes for 'level playing field' online
   Hillary Clinton backs local taxes on Internet sales [links to web]
   Judges Revive Claim that AT&T Overcharged Schools for Internet Service

CONTENT
   Instagram will unblock the #curvy hashtag [links to web]

OWNERSHIP
   Statement Of FCC Commissioner O'Rielly On The AT&T/DirecTV Merger Application - press release
   Nikkei buys the Financial Times [links to web]
   The Financial Times Sale to Nikkei Means Bloomberg Can Finally Focus on Buying the New York Times - analysis [links to web]
   Technicolor Buying Cisco’s Set-Top Box Biz for $600 Million [links to web]

PRIVACY/SECURITY
   FBI Director Sees Increasing Terrorist Interest in Cyberattacks Against US [links to web]
   Here’s what your stolen identity goes for on the Internet’s black market [links to web]
   Why cracking down on hackers would be bad for innovation - WaPo op-ed [links to web]

TELECOM
   FCC Fines GPSPS $9.065 Million For Illegally Billing Customers And Switching Their Phone Companies - press release

WIRELESS/SPECTRUM
   FCC Said Poised to Deny T-Mobile Help to Get More Airwaves [links to web]
   Analysts: Verizon could run out of network capacity in 2-3 years [links to web]
   Getting the future of spectrum right - The Hill op-ed [links to web]
   Your smartphone may be killing your data plan with invisible ads [links to web]
   Cellphone Ordinance Puts Berkeley at Forefront of Radiation Debate [links to web]

EMERGENCY COMMUNICATIONS
   FirstNet developing base stations for police cars, but deployment still several years away [links to web]

GOVERNMENT & COMMUNICATIONS
   Criminal Inquiry Is Sought in Clinton E-mail Account
   NIST on the Search for Innovative Mobile Apps [links to web]

JOURNALISM
   What’s at risk with digital town halls? - CJR analysis [links to web]

ACCESSIBILITY
   This small change could make a big difference for accessible technology [links to web]

COMPANY NEWS
   Why AT&T Chief Randall Stephenson Needs a Slam Dunk [links to web]
   Comcast has finally become an Internet-first company [links to web]
   This Wall Street Veteran Is Whipping Google Into Shape [links to web]

STORIES FROM THE GREAT WHITE NORTH
   Canada orders large ISPs to make fiber available to competitors [links to web]

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INTERNET/BROADBAND

THE NEXT GENERATION NETWORK CONNECTIVITY HANDBOOK: TOP TEN OVERALL LESSONS
[SOURCE: Benton Foundation, AUTHOR: Blair Levin, Denise Linn]
[Commentary] On July 21, 2015, Gig. U and the Benton Foundation published a comprehensive guide for communities who want better broadband for their residents and businesses. The Next Generation Connectivity Handbook: a Guide for Community Leaders Seeking Affordable Abundant Bandwidth is an indispensable tool in lowering the initial, daunting information barrier for cities just beginning to navigate critical Internet infrastructure issues. Today, we share the Handbook’s Top Ten Overall Lessons drawing on the experiences of 25 Gig.U communities who have worked on this issue for many years.
Lesson 1: Organizing community resources and stakeholders is essential for making gigabit projects economically viable.
Lesson 2: Start with a clear understanding of how your city’s rules and assets affect deployment costs.
Lesson 3: Because it takes a long time to plan and deploy a network -- and it always takes longer than you think -- the right time to start thinking about how to improve the economics is today.
Lesson 4: Incumbents only respond to a potential change in the status quo. Inaction by a city leads to inertia in the market.
Lesson 5: Cities who act will have to choose between the quick, short-term win and the harder, longer-term win.
Lesson 6: While success depends upon broad support, it also depends on nimble decision-making.
Lesson 7: There is no one-size-fits-all solution. There are multiple solutions to multiple community needs with multiple trade-offs. But all efforts improve the situation relative to the status quo.
Lesson 8: Experiments don’t always work the first time. That’s why they are called experiments. Make sure the community leadership understands this and that there is a path for “lessons learned” to improve performance in successive iterations.
Lesson 9: Scale matters.
Lesson 10: Above all, local leadership is the single most important ingredient for success. If there are local leaders who put this at the top of their agenda, it can happen. If not, it won’t.
benton.org/headlines/next-generation-network-connectivity-handbook-top-ten-overall-lessons | Benton Foundation
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APPROPRIATIONS BILL BLOCKS ISP RATE REGULATIONS
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
A Federal Communications Commission budget bill approved out of the Senate Appropriations Subcommittee would prevent the FCC from regulating rates under its new Title II-based network neutrality rules, but would not block the rules until the end of litigation, as a House Republican appropriations rider would. FCC Chairman Tom Wheeler has insisted that the FCC is not planning to use reclassification to regulate rates, but cable operators are worried nonetheless, including about whether a future Chairman will concur. The FY2016 Financial Services Appropriations Bill also would grandfather all joint sales agreements (JSAs) in place before the FCC's March 2014 decision to make most of them attributable as ownership interests. There are already stand-alone versions of legislation in the House and Senate that would do the same thing. The Financial Services Appropriations Bill also cuts the FCC's budget by $20 million and would fund the FCC's planned move to new leased space -- its current lease is expiring -- only if it reduces the amount of space it plans to lease in the new digs.benton.org/headlines/appropriations-bill-blocks-isp-rate-regulations | Broadcasting&Cable
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SEN NELSON WARNS NETWORK NEUTRALITY RIDER COULD PREVENT COMPROMISE
[SOURCE: The Hill, AUTHOR: Mario Trujillo]
Senate Commerce Committee Ranking Member Bill Nelson (D-FL) warned that a network neutrality rider included in a financial services appropriations bill could scuttle any hope of a compromise on the issue. The Senator’s office made the announcement ahead of a markup of the spending bill slated for the morning of July 23. Ranking Member Nelson and Senate Commerce Committee Chairman John Thune (R-SD) have made “real progress” on a deal, his office said. “Sens. Thune and Nelson have been making real progress on bipartisan net-neutrality legislation, but that effort could be undermined if lawmakers try to fiddle with the FCC in a funding bill,” Ranking Member Nelson spokesman Dan McLaughlin said. The Senate rider would block the FCC from using the new net neutrality rules to regulate the rates that Internet service providers like Comcast or AT&T can charge customers. While Ranking Member Nelson said he has made headway on a compromise with the GOP, little public progress has been announced since the legislation was floated at the beginning of 2015. Many other Democrats have been satisfied to let the FCC’s rules stand on their own. They have also raised major concerns about limiting the FCC’s authority with the GOP bill.
benton.org/headlines/sen-nelson-warns-network-neutrality-rider-could-prevent-compromise | Hill, The
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WHY YOUR INTERNET PRICES ARE BOUND TO GO UP
[SOURCE: Washington Post, AUTHOR: Brian Fung]
Many Americans have just one or two choices of Internet provider at home. Critics say this system leads to sky-high, even "ridiculous," prices for Internet. But if you were hoping things will improve, you could be waiting a long time, according to one industry analyst. In fact, conditions are only going to worsen for consumers despite new entrants into the market such as Google Fiber, said Craig Moffett, an analyst at MoffettNathanson, during a House hearing July 22. "Market forces," said Moffett, "are unlikely to yield a competitive broadband market." In plain English, nothing may be able to stop an inevitable spike in Internet prices. Here's why. Rising pressure on cable and Internet providers to shift away from the TV bundle -- a big source of traditional income -- could force cable companies to raise the price of their other products, namely broadband. "It's a simple matter of removing a leg from the stool," said Moffett in an interview after the hearing. "If you remove a leg from the stool, you have to do something to keep it balanced. And that'll end up raising prices for broadband." As consumers, we're increasingly abandoning our traditional television packages in favor of online streaming apps, which let us customize the channels we get. This offers more flexibility, but it costs Internet providers, many of which use television programming to help shore up their broadband businesses. "The video business and the broadband business are opposite sides of the same coin," Moffett said.
benton.org/headlines/why-your-internet-prices-are-bound-go | Washington Post
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SMALL BIZ PUSHES FOR 'LEVEL PLAYING FIELD' ONLINE
[SOURCE: The Hill, AUTHOR: Kate Hardiman]
Small-business owners hailed emerging mobile app technology before a hearing on July 23 and pressed lawmakers to do more to give them a "level playing field" in the online economy. At a hearing of the House Small Business Subcommittee on Health and Technology, business owners called for the expansion of broadband connectivity and cellphone service in rural areas and urged lawmakers to hold the line against Internet sales taxes. Entrepreneur Cassie Gray, who sells handcrafted jewelry through the Etsy retail app from her home in Massachusetts, told lawmakers that the lack of reliable cell service in rural areas inhibits her business. Business owners also singled out the Remote Transactions Parity Act, a bill from House Oversight Committee Chairman Jason Chaffetz (R-UT) that would allow states to tax businesses even if they don't have a physical presence in their state. Gray said the proposal would disproportionately harm businesses that sell most of their goods online. “In order to tap into entrepreneurship and technology, we need to keep a level playing field for everyone involved,” she said. Lawmakers also touted the jobs created by mobile apps. “Since 2007, the United States has seen more than 750,000 app economy jobs created,” said Small Business Subcommittee Member Aumua Amata Coleman Radewagen (R-American Samoa). “Findings predict that the app economy will reach $151 billion by 2017,” she continued. Ranking Member Seth Moulton (D-MA) said that although “entrepreneurship in our modern economy is declining, technology like mobile apps can help lead the way.”
benton.org/headlines/small-biz-pushes-level-playing-field-online | Hill, The
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JUDGES REVIVE CLAIM THAT AT&T OVERCHARGED SCHOOLS FOR INTERNET SERVICE
[SOURCE: Pro Publica, AUTHOR: Jeff Gerth]
For seven years, a Wisconsin telecommunications consultant has waged an unsuccessful legal fight against AT&T, alleging that the company long defrauded a federal program by overcharging the nation’s schools and libraries for Internet and telephone services. Now an appeals court in the District of Columbia has given new life to his case. The little-noticed June 23 ruling concluded that the complaint by Todd Heath was properly filed under the US False Claims Act -- a decision that could lead to the disclosure of AT&T’s internal records about the federal program known as E-Rate. At issue in the court case is a rule established at E-rate’s inception that requires providers to set rates for schools and libraries at the lowest prices offered to comparable customers. The theory was that bargain rates would help schools in less-wealthy areas provide their students with access to the Web. An investigation in 2012 by ProPublica found that the preferential pricing rule had been widely neglected by AT&T and the Federal Communications Commission, which oversees the program. The result was that many schools were paying more than the program’s framers envisioned, draining the federal fund and limiting the reach of the subsidies. AT&T said then, and reaffirmed recently, that it complies with the requirement that it charge such customers what is known as the “lowest corresponding price.” In 2014 a DC district court judge granted the company’s request to toss out the national suit, on grounds that Heath’s Wisconsin action meant the follow-on case shouldn’t qualify for whistleblower status. But on June 23, the DC Court of Appeals reversed that decision. Heath said he was “pleased that the case is going to move forward and I’m looking towards to the discovery phase,” where he seeks access to AT&T documents.
benton.org/headlines/judges-revive-claim-att-overcharged-schools-internet-service | Pro Publica
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OWNERSHIP

STATEMENT OF FCC COMMISSIONER O'RIELLY ON THE AT&T/DIRECTV MERGER APPLICATION
[SOURCE: Federal Communications Commission, AUTHOR: Press release]
After reading the Order as prepared by Federal Communications Commission staff, reviewing the voluminous record in the proceeding, and listening to interested parties, I voted the item this afternoon. To be clear, this process shouldn’t have taken this long, and we shouldn’t have been so cavalier with the Commission’s merger review “shot clock,” but at least we have arrived at this final stage. I will release a substantive statement at the conclusion of my colleagues’ review and final consideration of the item.
benton.org/headlines/statement-fcc-commissioner-orielly-attdirectv-merger-application | Federal Communications Commission
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TELECOM

FCC FINES GPSPS $9.065 MILLION FOR ILLEGALLY BILLING CUSTOMERS AND SWITCHING THEIR PHONE COMPANIES
[SOURCE: Federal Communications Commission, AUTHOR: Press release]
The Federal Communications Commission has fined GPSPS, Inc., an Atlanta (GA) telephone company, $9,065,000 for switching consumers’ long distance carriers without their authorization (“slamming”), billing consumers for unauthorized charges (“cramming”), and submitting falsified evidence to government regulatory officials as “proof” that consumers had authorized the company to switch their long distance providers. The Enforcement Bureau reviewed more than 150 complaints against GPSPS that consumers filed with the Commission, the Federal Trade Commission, the Public Utility Commission of Texas, and the Better Business Bureau. Consumers complained that GPSPS switched their long distance service provider without their authorization even though they had never heard of or spoken to the company before discovering GPSPS’s charges on their telephone bills. In many cases, GPSPS refused to refund all of the unauthorized fees it charged consumers. Instead, the company misrepresented to consumers that they or someone in their household had authorized GPSPS’s service, and that GPSPS possessed an audio recording evidencing the
authorization. The audio “verification” recordings GPSPS mentioned to consumers were fake. GPSPS submitted these fabricated recordings to the Commission and state regulatory authorities as “proof” that the consumers authorized its service.
benton.org/headlines/fcc-fines-gpsps-9065-million-illegally-billing-customers-and-switching-their-phone | Federal Communications Commission | FCC Forfeiture Order | Commissioner Pai Statement
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GOVERNMENT & COMMUNICATIONS

CLINTON’S E-MAIL
[SOURCE: New York Times, AUTHOR: Michael Schmidt, Matt Apuzzo]
Two inspectors general have asked the Justice Department to open a criminal investigation into whether sensitive government information was mishandled in connection with the personal e-mail account Hillary Rodham Clinton used as secretary of state. The request follows an assessment in a June 29 memo by the inspectors general for the State Department and the intelligence agencies that Clinton’s private account contained “hundreds of potentially classified emails.” The memo was written to Patrick F. Kennedy, the undersecretary of state for management. It is not clear if any of the information in the emails was marked as classified by the State Department when Sec Clinton sent or received them. But since her use of a private email account for official State Department business was revealed in March, she has repeatedly said that she had no classified information on the account. The Justice Department has not decided if it will open an investigation, senior officials said.
benton.org/headlines/criminal-inquiry-sought-clinton-e-mail-account | New York Times
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Criminal Inquiry Is Sought in Clinton E-mail Account

Two inspectors general have asked the Justice Department to open a criminal investigation into whether sensitive government information was mishandled in connection with the personal e-mail account Hillary Rodham Clinton used as secretary of state.

The request follows an assessment in a June 29 memo by the inspectors general for the State Department and the intelligence agencies that Clinton’s private account contained “hundreds of potentially classified emails.” The memo was written to Patrick F. Kennedy, the undersecretary of state for management. It is not clear if any of the information in the emails was marked as classified by the State Department when Sec Clinton sent or received them. But since her use of a private email account for official State Department business was revealed in March, she has repeatedly said that she had no classified information on the account. The Justice Department has not decided if it will open an investigation, senior officials said.

Your smartphone may be killing your data plan with invisible ads

According to a new study by ad fraud detection form Forensiq, close to 15 percent of all mobile apps are loading ads while you use them that you might not even see.

The invisible images and videos can gobble up your data plan, while reporting back to advertisers that you’ve viewed an image, consequently earning the app developer some cash in the process. The apps in question typically ask for permissions on your phone that they might not necessarily need to operate. For instance, they might request access to your phone’s sleeping function, to prevent an app running in the background from being automatically shut down. Despite the vetting process for apps places like Apple’s App Store and Google Play, offending apps can still slip through the cracks. If you accidentally grant access, that means that an app could be running and serving ads, and consequently adding to your mobile data bill, while your phone is sitting on your nightstand.

Why AT&T Chief Randall Stephenson Needs a Slam Dunk

After an eight-year drought, AT&T Chief Executive Randall Stephenson finally has the kind of big deal for which the nation’s largest telecommunications company is known.

The company got a nod from federal regulators to complete its $49 billion takeover of satellite-TV provider DirecTV, handing Stephenson a legacy-making transaction that could rival those of his predecessor. The DirecTV deal isn’t a slam-dunk. It gives AT&T an additional 20 million US pay-TV customers, a national footprint to expand video delivery, and another $33 billion in annual revenue. But it also pairs the carrier with a business that is past its prime as Americans increasingly disconnect from pay TV. DirecTV has endured years of sluggish subscriber growth in its core satellite business and lacks any broadband infrastructure needed for streaming television. The need for an acquisition was on display when AT&T—the country’s largest telecommunications company by revenue and second-largest wireless company by subscribers—reported second-quarter results. Revenue increased 1.4%, while the number of new mainstream wireless subscribers fell 60%.

Cellphone Ordinance Puts Berkeley at Forefront of Radiation Debate

Berkeley passed a measure — not actually backed by science — requiring cellphone stores to warn customers that the products could be hazardous to their health, presumably by emitting dangerous levels of cancer-causing radiation.

Under the so-called Right to Know ordinance, passed unanimously in May by the Berkeley City Council, retailers are supposed to notify customers, starting in August, that “you may exceed the federal guidelines for exposure” to radio frequency radiation by carrying a cellphone in a pants or shirt pocket or tucked into a bra. “The potential risk,” the warning continues, “is greater for children.” Even supporters of the ordinance acknowledge that there is no definitive scientific link between cellphones and cancer, although they argue that it may take years for cancers to develop.

Statement Of FCC Commissioner O'Rielly On The AT&T/DirecTV Merger Application

After reading the Order as prepared by Federal Communications Commission staff, reviewing the voluminous record in the proceeding, and listening to interested parties, I voted the item this afternoon. To be clear, this process shouldn’t have taken this long, and we shouldn’t have been so cavalier with the Commission’s merger review “shot clock,” but at least we have arrived at this final stage. I will release a substantive statement at the conclusion of my colleagues’ review and final consideration of the item.

Hillary Clinton backs local taxes on Internet sales

Democratic Presidential candidate Hillary Clinton said she supported allowing cities and states to tax online purchases, but she would not mandate it. Clinton, who took questions from mayors at an event in South Carolina, said she thought it was worth experimenting with Internet sales taxes and that she would not stand in the way of jurisdictions that wanted to try it.

What’s at risk with digital town halls?

[Commentary] Hillary Clinton’s question-and-answer session on Facebook received ample press, both positive (she’s communicating directly with voters!) and negative (this is about show, not substance). The coverage echoes sentiments that have circulated since digital town halls started becoming an expected part of political campaigns. But because Clinton has kept her distance from reporters -- who’ve been gnawing at the bit to ask her, well, anything -- her participation in this event has been given the tone of a watershed moment. Are digital town halls valuable new tools for journalists who can’t otherwise reach politicians? The short answer? No.

Digital town halls are advertised as casual chats with constituents, but in reality they more closely resemble press releases. The Huffington Post’s Alexander Howard, who also received an answer from Clinton, says that’s a concern for reporters. Largely lost on the digital campaign trail is room for the politician to break from the constructed message, he says. So what’s the takeaway? Journalists can’t avoid these brief, manufactured online interactions, but they also shouldn’t settle for them. There’s no replacement for regular press access, and until politicians agree to communicate with the press on even ground, they aren’t saying nearly enough.

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