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Internet Privacy, FreeBee, and the Public Cloud

Submitted on January 22, 2016

You’re reading the Benton Foundation’s Weekly Round-up, a recap of the biggest (or most overlooked) telecommunications stories of the week. The round-up is delivered via e-mail each Friday; to get your own copy, subscribe at www.benton.org/user/register

Robbie’s Round-Up
Week of January 18-22, 2015

FCC Pressed on Internet Privacy Rules
More than 50 digital rights and consumer groups, including the Benton Foundation, put pressure on the Federal Communications Commission to start drafting Internet privacy rules “as quickly as possible.”

The groups sent a letter to FCC Chairman Tom Wheeler arguing the need for privacy rules, saying, “[Internet service providers’] position as Internet gatekeepers gives them a comprehensive view of consumer behavior and until now privacy protections for consumers using those services have been unclear.”

A lack of clear privacy rules means there is an increased potential for surveillance, leading to a “chilling effect on speech and increase the potential for discriminatory practices derived from data use.” By contrast, the letter reads, commonsense protections may lead to a broader adoption and use of the Internet, as individuals gain confidence in conducting everyday business and exploring new services online.

Specifically, the letter asks for rules that:

  • Protect consumers from having their personal data collected and shared by their broadband provider without affirmative consent or for purposes other than providing broadband Internet access service.
  • Provide for notice of data breaches, and hold broadband providers accountable for any failure to take suitable precautions to protect personal data collected from user.
  • Require broadband providers to clearly disclose their data collection practices to subscribers, and allow subscribers to ascertain to whom their data is disclosed.

The Concern
Behavioral data is becoming central to the Internet economy, highlighting a growing urgency for clear privacy rules. As Brian Fung wrote for The Washington Post, “Internet providers can see that you’re listening to Spotify while watching Netflix and Googling for reality TV shows at the same time — whereas each of those sites might only capture a slice of your overall Internet habits. And that gives Internet providers a major potential advantage.”

Broadband companies have shown an increasing interest in consumer data:

  • Verizon bought AOL for $4 billion, allowing the telecommunication company to integrate AOL’s substantial advertising technology into its own business, improving how it targets ads on Internet videos.
  • AT&T runs a program that offers a monthly discount on Internet service in exchange for letting the company track your online behavior.
  • Comcast made a series of acquisitions in 2014 to boost its own targeted-advertising efforts.

Since privacy and access to information are core elements of a well-functioning democracy, it is critical the FCC establish rules that protect broadband consumers.

FreeBee Adds to Net Neutrality Buzz (yet another example of sponsored "AppiCulture"?)

The Federal Communications Commission recently had “productive” discussions with Comcast and T-Mobile about whether their new offerings of data cap exemptions conflict with the goals of network neutrality. (A meeting with AT&T has also been scheduled.)

Now, we can add one more provider to the growing list of companies testing the limits of the FCC’s Open Internet rules. Verizon launched a sponsored data program, called “FreeBee”. For Verizon customers, content that is part of the FreeBee program will have a literal “bee” icon on it, denoting that it will not count against their monthly data allotments. Brands will be able to sponsor some or all of the data used by their apps or websites. An FCC official confirmed that Verizon, “proactively let FCC staff know about the new offering and provided associated materials,” and that the FCC will continue to communicate with the company on the issue.

I wrote about T-Mobile’s Binge On service last week, but it should be noted that there is a big difference between Binge On and FreeBee. As Sean Captain wrote in Fast Company, “In Binge On, T-Mobile picks up the cost of the extra megabytes (or gigabytes). In FreeBee—as well as AT&T Sponsored Data—the content providers pay.”

Is this ‘Paid Prioritization’?
When the FCC passed its Open Internet rules last February, it prohibited “paid prioritization”, the process of putting some content ahead of others in the data queue because the source pays for that better placement. Is FreeBee paid prioritization?

This week, Joan Engebretson wrote in telecompetitor, “Verizon likely will argue that the service isn’t paid prioritization because it doesn’t involve traffic engineering in the network. And because Verizon is offering the service to Go90 competitors, the company likely expects to avoid running afoul of the net neutrality guidelines that prevent carriers from favoring their own content offerings.”

Matt Wood, policy director for Free Press, said, “[AT&T and Verizon] are not blocking, unless we stretch it to say, you're blocked unless you pay. They are not speeding you up or slowing you down. It's not prioritization for pay." Still, Wood continued, “"I'm really shying away from 'paid prioritization' because it has a meaning in the [FCC net neutrality] order," he says. "I definitely think it's a net neutrality concern."

What’s Next
The FCC will continue to monitor the programs and communicate with providers concerning the Open Internet rules. All of the new sponsored data programs being rolled out are adding weight to an already momentous decision from the US Court of Appeals for the DC Circuit expected in the coming months.

Microsoft Donates $1 Billion in Cloud Services

Microsoft pledged to donate $1 billion in cloud services to nonprofits and university researchers over the next three years, as the company updates its philanthropic initiatives to reflect shifts in technology.

In a Financial Times op-ed, Microsoft CEO Satya Nadella said, “If we are not to be left facing a digital divide between those with access to rich data intelligence and those without, we must find ways to spread the benefits of cloud computing to all.”

Importantly, Nadella outlined a policy framework to tackle some of the toughest global problems, with cloud computing at the heart of it. Nadella insists cloud computing will play a central role in realizing 17 sustainable development goals adopted by the United Nations to tackle poverty and hunger, as well as health and education concerns.

Nadella laid out four elements of the policy framework:

  1. Investment in infrastructure that provides low-cost broadband offering rural areas access to the cloud.
  2. Building the next generation of skills to ensure data does not just sit in the cloud. Nadella says, “Data are little more than exhaust without coders to write algorithms that extract insights from it.”
  3. Governments need to lead by example. “As holders of public data and the largest consumers of IT services, government agencies should make data accessible to the public and encourage people to use the cloud by doing so themselves.”
  4. A balanced regulatory environment that protects both security and privacy while enabling data to flow freely across borders.

While most acknowledge the resources Microsoft is offering will be valuable to recipients, some argue that the moves are a clear lobbying tactic and an effort to gain ground on competitors.

David Meyer, writing for Fortune, said Nadella’s call for governments to “lead by example” and to keep data flowing across borders serves the firm’s interest in preserving the potential of global-minded cloud services. With privacy concerns surrounding upcoming negotiations of a new US-EU safe harbor deal, Nadella is encouraging EU governments to use the very services that are being scrutinized as part of the negotiations.

As for the competition angle, Geroge Micronescu, research manager at IDC, said, “With this move, it’s a way for Microsoft to be re-discovered by entities in these sectors and to get such organizations to test its public cloud capabilities and to potentially keep them away from competitors such as Google and Salesforce.”

Special Note:
January 20 marked the four-year anniversary of the SOPA/PIPA protest. Read Kevin Taglang’s write-up Biggest Day Ever of Online Protest in English

Quick Bits

Weekend Reads (resist tl;dr)

Events Calendar for the Week of Jan 25-29

ICYMI From Benton
“Poverty and the Cost of Broadband” by Dr Colin Rhinesmith

By Robbie McBeath.
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