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April 2016

April 6, 2016 (Why we should care about the FCC’s broadband privacy rules)

BENTON'S COMMUNICATIONS-RELATED HEADLINES for WEDNESDAY, APRIL 6, 2016


INTERNET/TELECOM
   Results of FCC’s 2016 Urban Rate Survey for Fixed Voice and Broadband Services - public notice
   Members of Congress unleashed last-minute lobbying to change Lifeline deal
   Commissioner Pai’s Plan and the FCC Lifeline “Compromise” That Wasn’t - analysis
   Department of Commerce Seeks Comment on Potential Policy Issues Related to Internet of Things - press release
   The Special Problem of Special Access: Consumer Overcharges and Telephone Company Excess Profits - CFA research
   Netflix, self-interest and network neutrality - op-ed
   What Would a World Without Internet Look Like? [links to Atlantic, The]
   Trends in Telecommunication Reform 2016 - ITU research [links to Benton summary]

WIRELESS/SPECTRUM
   The little-known auction that could change the course of technology, explained (video) [links to Washington Post]
   FCC's Wheeler: Spectrum Auction Could Extend Into FY 2017 [links to Broadcasting&Cable]

PRIVACY/SECURITY
   Why privacy pros should care about the FCC’s broadband privacy rules - op-ed
   How Surveillance Stifles Dissent on the Internet [links to Atlantic, The]
   FBI Lawyer Won’t Say if Data From Unlocked iPhone Is Useful [links to New York Times]
   Facebook’s WhatsApp Launches ‘End-to-End’ Encryption [links to Wall Street Journal]

HEALTH
   FTC Releases New Guidance For Developers of Mobile Health Apps [links to Federal Trade Commission]
   Developing a health app? Book an appointment with two new compliance resources [links to FTC blog]

OWNERSHIP
   Senators Grill Wheeler on Joint Sales Agreements [links to Broadcasting&Cable]

ELECTIONS AND MEDIA
   Sen Cruz Bets On Data To Find Enough Voters To Match Trump's Loyal Base [links to Fast Company]

JOURNALISM
   In Chicago, new media startups rise from ashes of old media [links to Crain’s Chicago Business]

GOVERNMENT & COMMUNICATIONS
   RTDNA urges court to keep police videos public [links to Radio Television Digital News Association]
   Police Use Social Media as Front-Line Tool in Fighting Crime [links to Government Technology]

GOVERNMENT PERFORMANCE
   Idea to retire: Government lags in adopting technology [links to Brookings]

STORIES FROM ABROAD
   Trends in Telecommunication Reform 2016 - ITU research [links to Benton summary]

MORE ONLINE
   Silicon Valley’s sunny outlook on technology and opportunity ignores systematic inequalities [links to Atlantic, The]
   A History of Technology, via the Consumer Price Index [links to Atlantic, The]
   Dodgers fans miss out on watching opener because of continued TV fiasco [links to Los Angeles Times]

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INTERNET/TELECOM

VOICE AND BROADBAND URBAN RATE SURVEY
[SOURCE: Federal Communications Commission, AUTHOR: Public Notice]
The Federal Communications Commission’s Wireline Competition Bureau (Bureau) announced:
the 2016 rate floor for incumbent eligible telecommunications carriers (ETCs) and reasonable comparability benchmarks for fixed voice and broadband services;
the posting of the fixed voice and broadband services data collected in the most recent urban rate survey, and explanatory notes regarding the data; and
the required minimum usage allowance for 2016 for ETCs subject to broadband public interest obligations.
benton.org/headlines/results-fccs-2016-urban-rate-survey-fixed-voice-and-broadband-services | Federal Communications Commission
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LAST-MINUTE LIFELINE LOBBYING
[SOURCE: The Hill, AUTHOR: Mario Trujillo]
Congressional Democrats heavily lobbied Federal Communications Commissioner Mignon Clyburn in the hours before a vote March 31, helping to prevent a firm budget cap on a new program offering subsidies for Internet service to low-income Americans. The last-minute lobbying of Commissioner Clyburn left Republicans on the FCC crying foul. In the hours before the vote, Sen. Cory Booker (D-NJ) personally told Commissioner Clyburn the deal could hurt his constituents. Rep. G.K. Butterfield (D-NC), the chairman of the Congressional Black Caucus and eight other members sent a letter to the FCC echoing his concerns. House Democratic Leader Nancy Pelosi (D-CA) had her staff reach out to Clyburn’s office for information. Staff for Rep. Anna Eshoo (D-CA) did the same. A half a dozen other offices reached out to explicitly express concern to Clyburn about imposing the $2 billion cap on spending. Similar calls came from Democratic staff on the House Commerce Committee and the Senate Judiciary Committee. In all the outreach, only Sen. Claire McCaskill (D-MO) “encouraged the commissioner to reach a compromise.” Commissioner Clyburn, the daughter of Rep. James Clyburn (D-SC), said FCC Chairman Tom Wheeler consistently told her that he would follow her lead, adding that Chairman Wheeler “did not pressure me.” Chairman Wheeler gave a one-word response to charges that he bullied his fellow commissioner: “Balderdash.”
benton.org/headlines/members-congress-unleashed-last-minute-lobbying-change-lifeline-deal | Hill, The
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THE LIFELINE COMPROMISE THAT WASN’T
[SOURCE: Public Knowledge, AUTHOR: Phillip Berenbroick, Meredith Filak Rose]
[Commentary] Much has been made of the political theatre that surrounded the Federal Communications Commission’s recent vote to modernize the decades-old Lifeline program. A minority on the Commission is pushing a narrative with all the appeal of a particularly wonky House of Cards episode (without the sex and murder): frantic negotiation, last-minute compromises, staff all-nighters, strong-armed negotiation tactics, improper outside influence, and interference from Capitol Hill, the works. All the while they bemoaned the loss of a bipartisan compromise that, they claim, would have brought meaningful reform to the Lifeline program. The problem is, that the proposed “reforms” Commissioners Ajit Pai and Mike O’Rielly supported would have actually crippled, and ultimately sunk, the Lifeline program. If their was goal to advance a serious plan to update Lifeline for the 21st century, acknowledging that broadband is a necessity and not a luxury, proposing a punitive budget number picked out of a hat and a minimum service standard that Commissioner Pai has called “arbitrary” and unwanted by most Americans and Commissioner O’Rielly has called “artificially high” and “untenable” was counterproductive. The Pai plan 1) guarantees the Lifeline program will be ineffective at helping poor families in urban and suburban areas (where services meeting his minimum standards are most likely to be deployed) because they’ll be priced out Lifeline-eligible services, and 2) reduces the types of services that certain consumers can access -- paternally dictating that poor families shouldn’t have the same choices in the broadband marketplace that wealthier subscribers have.
benton.org/headlines/commissioner-pais-plan-and-fcc-lifeline-compromise-wasnt | Public Knowledge
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POLICY ISSUES RELATED TO INTERNET OF THINGS
[SOURCE: Department of Commerce, AUTHOR: Press release]
The US Department of Commerce announced that as part of the Department’s Digital Economy Agenda, the National Telecommunications and Information Administration (NTIA) issued a Request for Comment (RFC) on questions posed by the growth of the Internet of Things (IOT). This Request is an important step in the Department’s continued effort to promote the Internet of Things, the broad category of devices, appliances, and objects that can be connected via the Internet. The Department will use the input it receives to build on its broader agenda promoting economic growth and opportunity to help develop an approach that will foster IoT innovation. After it receives the comments, the Department will draft a “green paper” identifying key issues affecting deployment of these technologies, highlighting potential benefits and challenges, and outlining possible roles for the federal government in fostering the advancement of IoT technologies in partnership with the private sector. The deadline for filing comments is 45 days after the RFC is published in the Federal Register. Comments should be submitted in searchable format to NTIA’s Office of Policy Analysis and Development at iotrfc2016 AT ntia DOT doc DOT gov.
benton.org/headlines/department-commerce-seeks-comment-potential-policy-issues-related-internet-things | Department of Commerce
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SPECIAL PROBLEM OF SPECIAL ACCESS
[SOURCE: Consumer Federation of America, AUTHOR: Press release]
Taking on one of the most pressing issues facing the current Federal Communications Commission, the Consumer Federation of America released a study that estimates that large incumbent telephone companies have engaged in abusive pricing practices for high-speed broadband “special access” services, with overcharges totaling about $75 billion over just the past five years. As a result, CFA estimates that the indirect macroeconomic loss to American consumers doubles that damage to a total in excess of $150 billion since 2010. The analysis explores the critical – and often unappreciated – role special access plays in the U.S. telecommunications and broadband marketplace and the impact concentrated market power has on American consumers and the American economy as a whole. Special access services are critical inputs to a wide range of businesses, including mobile broadband services, anchor institutions like hospitals, schools and libraries, public safety offices, ATM networks, and essentially any enterprise that needs access to secure, dedicated high-speed, high-capacity connections to the wireline communications network.
benton.org/headlines/special-problem-special-access-consumer-overcharges-and-telephone-company-excess-profits | Consumer Federation of America
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NETFLIX, SELF-INTEREST AND NETWORK NEUTRALITY
[SOURCE: The Hill, AUTHOR: Patrick Maines]
[Commentary] The recent announcement by Netflix that it has been reducing the video quality of its programs on mobile networks for years — something the new network neutrality rules prohibit Internet service providers (ISPs) from doing — has sparked a firestorm by opponents of net neutrality regulations. It's easy to understand why net neutrality opponents would be angered by Netflix's untimely revelation about its video throttling, and one hopes it will be investigated by Congress and the Federal Trade Commission. But even if, after some scrutiny, Netflix's belated admission is found to be offensive to the spirit, if not the letter of the law, this is not the greatest offense in the whole sorry history of the FCC's net neutrality campaign. After all, we are quite familiar these days with the venal aspects of crony capitalism, whereby companies get policymakers to do their bidding, whatever the costs to others or to the country as a whole. It might be helpful in that regard to ponder this one stunning datum: The two companies that generate more than half of all downloads in North America are Netflix and Google. And it was those two companies, and their amen chorus in what is laughingly referred to as the tech media, that led the way to what became the net neutrality rule. From its inception until February of last year, the Internet grew and prospered, unfettered by the kinds of regulation that have been imposed on cable and broadcasting. But that is over now, and only history will tell us how much mischief this dreadful regulation will do to the Internet, and to us all. [Maines is president of the Media Institute]
benton.org/headlines/netflix-self-interest-and-network-neutrality | Hill, The
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PRIVACY/SECURITY

BROADBAND PRIVACY RULES
[SOURCE: International Association of Privacy Professionals, AUTHOR: Jim Halpert]
[Commentary] Under Travis LeBlanc’s leadership, the Federal Communications Commission’s Enforcement Bureau has been very aggressive in bringing enforcement actions involving privacy and data security and obtaining settlements in the tens of millions of dollars. The new privacy Notice of Proposed Rulemaking would significantly expand the scope of FCC enforcement authority so that it reached a wide range of Internet service provider customer data as well as Internet advertising involving customer data obtained directly by ISPs. Although the FCC would likely bring enforcement actions against the ISP only, in response to this heightened risk, ISPs would likely impose strict privacy and security requirements on vendors who have access to Internet access provider customer data. The requirements would likely include indemnification obligations for violations attributable to the vendor and proof of sufficient insurance coverage from vendors to hold the ISP harmless for those violations. The proposal would place heavy importance on providing rapid notice of any form of unauthorized or excessive access to routine customer information that is not sensitive. Use of ISP customer data would be a complex and risky activity. These data would need to be coded and treated very differently to ensure compliance and audit logging would need to be put in place for all these data, regardless of their sensitivity. The proposal would likely create consumer confusion and significantly lengthen and complicate privacy notices. Consumers are unlikely to understand if asked to consent to ISP uses of information that the consumer choices apply only to the ISP and would have no bearing on use of consumer data elsewhere in the Internet ecosystem. The proposal would further complicate the stove-piped landscape of U.S. privacy regulation and add a fourth, highly specific layer of regulation to ISP customer data over and above the FTC privacy framework, ECPA, COPPA, state ISP and online privacy laws, and the privacy provisions of the cable and satellite portions of the Communications Act already regulate. By significantly expanding privacy, breach notice and security regulation in this area, the proposal would set a precedent that would likely be invoked at the state and federal level to call for more extensive breach notice, information security and privacy requirements, creating further uncertainty and potential regulatory complexity. And there is some risk that complex privacy and security requirements, coupled with significant potential enforcement risk may discourage broadband investment in less profitable areas.
[Halpert is a partner in the Communications, Electronic Commerce & Privacy Practice of DLA Piper U.S. LLP]
benton.org/headlines/why-privacy-pros-should-care-about-fccs-broadband-privacy-rules | International Association of Privacy Professionals
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Results of FCC’s 2016 Urban Rate Survey for Fixed Voice and Broadband Services

The Federal Communications Commission’s Wireline Competition Bureau (Bureau) announced:

  • the 2016 rate floor for incumbent eligible telecommunications carriers (ETCs) and reasonable comparability benchmarks for fixed voice and broadband services;
  • the posting of the fixed voice and broadband services data collected in the most recent urban rate survey, and explanatory notes regarding the data; and
  • the required minimum usage allowance for 2016 for ETCs subject to broadband public interest obligations.

Members of Congress unleashed last-minute lobbying to change Lifeline deal

Congressional Democrats heavily lobbied Federal Communications Commissioner Mignon Clyburn in the hours before a vote March 31, helping to prevent a firm budget cap on a new program offering subsidies for Internet service to low-income Americans.

The last-minute lobbying of Commissioner Clyburn left Republicans on the FCC crying foul. In the hours before the vote, Sen. Cory Booker (D-NJ) personally told Commissioner Clyburn the deal could hurt his constituents. Rep. G.K. Butterfield (D-NC), the chairman of the Congressional Black Caucus and eight other members sent a letter to the FCC echoing his concerns. House Democratic Leader Nancy Pelosi (D-CA) had her staff reach out to Clyburn’s office for information. Staff for Rep. Anna Eshoo (D-CA) did the same. A half a dozen other offices reached out to explicitly express concern to Clyburn about imposing the $2 billion cap on spending. Similar calls came from Democratic staff on the House Commerce Committee and the Senate Judiciary Committee. In all the outreach, only Sen. Claire McCaskill (D-MO) “encouraged the commissioner to reach a compromise.”

Commissioner Clyburn, the daughter of Rep. James Clyburn (D-SC), said FCC Chairman Tom Wheeler consistently told her that he would follow her lead, adding that Chairman Wheeler “did not pressure me.” Chairman Wheeler gave a one-word response to charges that he bullied his fellow commissioner: “Balderdash.”

Commissioner Pai’s Plan and the FCC Lifeline “Compromise” That Wasn’t

[Commentary] Much has been made of the political theatre that surrounded the Federal Communications Commission’s recent vote to modernize the decades-old Lifeline program. A minority on the Commission is pushing a narrative with all the appeal of a particularly wonky House of Cards episode (without the sex and murder): frantic negotiation, last-minute compromises, staff all-nighters, strong-armed negotiation tactics, improper outside influence, and interference from Capitol Hill, the works. All the while they bemoaned the loss of a bipartisan compromise that, they claim, would have brought meaningful reform to the Lifeline program. The problem is, that the proposed “reforms” Commissioners Ajit Pai and Mike O’Rielly supported would have actually crippled, and ultimately sunk, the Lifeline program.

If their was goal to advance a serious plan to update Lifeline for the 21st century, acknowledging that broadband is a necessity and not a luxury, proposing a punitive budget number picked out of a hat and a minimum service standard that Commissioner Pai has called “arbitrary” and unwanted by most Americans and Commissioner O’Rielly has called “artificially high” and “untenable” was counterproductive. The Pai plan 1) guarantees the Lifeline program will be ineffective at helping poor families in urban and suburban areas (where services meeting his minimum standards are most likely to be deployed) because they’ll be priced out Lifeline-eligible services, and 2) reduces the types of services that certain consumers can access -- paternally dictating that poor families shouldn’t have the same choices in the broadband marketplace that wealthier subscribers have.

Department of Commerce Seeks Comment on Potential Policy Issues Related to Internet of Things

The US Department of Commerce announced that as part of the Department’s Digital Economy Agenda, the National Telecommunications and Information Administration (NTIA) issued a Request for Comment (RFC) on questions posed by the growth of the Internet of Things (IOT).

This Request is an important step in the Department’s continued effort to promote the Internet of Things, the broad category of devices, appliances, and objects that can be connected via the Internet. The Department will use the input it receives to build on its broader agenda promoting economic growth and opportunity to help develop an approach that will foster IoT innovation. After it receives the comments, the Department will draft a “green paper” identifying key issues affecting deployment of these technologies, highlighting potential benefits and challenges, and outlining possible roles for the federal government in fostering the advancement of IoT technologies in partnership with the private sector.

The deadline for filing comments is 45 days after the RFC is published in the Federal Register. Comments should be submitted in searchable format to NTIA’s Office of Policy Analysis and Development at iotrfc2016 AT ntia DOT doc DOT gov.

The Special Problem of Special Access: Consumer Overcharges and Telephone Company Excess Profits

Taking on one of the most pressing issues facing the current Federal Communications Commission, the Consumer Federation of America released a study that estimates that large incumbent telephone companies have engaged in abusive pricing practices for high-speed broadband “special access” services, with overcharges totaling about $75 billion over just the past five years.

As a result, CFA estimates that the indirect macroeconomic loss to American consumers doubles that damage to a total in excess of $150 billion since 2010. The analysis explores the critical – and often unappreciated – role special access plays in the U.S. telecommunications and broadband marketplace and the impact concentrated market power has on American consumers and the American economy as a whole. Special access services are critical inputs to a wide range of businesses, including mobile broadband services, anchor institutions like hospitals, schools and libraries, public safety offices, ATM networks, and essentially any enterprise that needs access to secure, dedicated high-speed, high-capacity connections to the wireline communications network.

Why privacy pros should care about the FCC’s broadband privacy rules

[Commentary]

  1. Under Travis LeBlanc’s leadership, the Federal Communications Commission’s Enforcement Bureau has been very aggressive in bringing enforcement actions involving privacy and data security and obtaining settlements in the tens of millions of dollars. The new privacy Notice of Proposed Rulemaking would significantly expand the scope of FCC enforcement authority so that it reached a wide range of Internet service provider customer data as well as Internet advertising involving customer data obtained directly by ISPs. Although the FCC would likely bring enforcement actions against the ISP only, in response to this heightened risk, ISPs would likely impose strict privacy and security requirements on vendors who have access to Internet access provider customer data. The requirements would likely include indemnification obligations for violations attributable to the vendor and proof of sufficient insurance coverage from vendors to hold the ISP harmless for those violations.
  2. The proposal would place heavy importance on providing rapid notice of any form of unauthorized or excessive access to routine customer information that is not sensitive.
  3. Use of ISP customer data would be a complex and risky activity. These data would need to be coded and treated very differently to ensure compliance and audit logging would need to be put in place for all these data, regardless of their sensitivity.
  4. The proposal would likely create consumer confusion and significantly lengthen and complicate privacy notices. Consumers are unlikely to understand if asked to consent to ISP uses of information that the consumer choices apply only to the ISP and would have no bearing on use of consumer data elsewhere in the Internet ecosystem.
  5. The proposal would further complicate the stove-piped landscape of U.S. privacy regulation and add a fourth, highly specific layer of regulation to ISP customer data over and above the FTC privacy framework, ECPA, COPPA, state ISP and online privacy laws, and the privacy provisions of the cable and satellite portions of the Communications Act already regulate.
  6. By significantly expanding privacy, breach notice and security regulation in this area, the proposal would set a precedent that would likely be invoked at the state and federal level to call for more extensive breach notice, information security and privacy requirements, creating further uncertainty and potential regulatory complexity.
  7. And there is some risk that complex privacy and security requirements, coupled with significant potential enforcement risk may discourage broadband investment in less profitable areas.

[Halpert is a partner in the Communications, Electronic Commerce & Privacy Practice of DLA Piper U.S. LLP]

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