Net Neutrality’s Busy Week: From Congressional Hearing to the State of the Union, Binge On, Baby

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Robbie’s Round-Up
Week of January 11-15, 2015

SOTU and Tech
President Barack Obama delivered his final State of the Union address this week. He has regularly used the speech to talk about technology and its influence across sectors, and this year was no different (As Jason Koebler wrote for Motherboard The State of the Union Was About Tech Because Everything Is About Tech). In addition to communicating a vision of continuing to innovate to make advancements in energy, infrastructure, and education, President Obama referenced some recent tech policy victories:

Net Neutrality and Internet Access
“We've protected an open Internet, and taken bold new steps to get more students and low-income Americans online."

With that line, President Obama referenced a few recent broadband policy achievements, including:

  • The Open Internet Order: On Feb 26, 2015, the Federal Communications Commission adopted the Open Internet Order, rules used to promote principles of net neutrality. President Obama had campaigned on the issue of net neutrality in the 2008 election and called for it again in November 2014.
  • E-Rate Modernization: In Dec 2014, the FCC adopted an order to modernize and streamline the schools and libraries universal service support program, known as the E-rate program. The order aims to ensure that all schools and libraries have access to high-speed connectivity and increases the E-rate program spending cap to adequately support that connectivity.
  • ConnectHome Initiative: In July, President Obama launched a pilot program to expand Internet access to low-income households, known as ConnectHome. The program, managed by the Department of Housing and Urban Development (HUD), initially reach over 275,000 low-income households and nearly 200,000 children with the support they need to access the Internet at home.
  • Lifeline: The President also may have been pointing to the FCC’s recent effort to expand its Lifeline program, which has traditionally made phone service more affordable for low income people, to include discounted broadband service as well. The FCC is expected to consider new Lifeline rules in the coming weeks. [See a preview from the FCC's Gigi Sohn]

Trans-Pacific Partnership
President Obama also called for congressional passage of the Trans-Pacific Partnership, a multinational trade deal backed by the Hollywood TV and movie studios.

"We forged a Trans-Pacific Partnership to open markets, protect workers and the environment, and advance American leadership in Asia," he said. "It cuts 18,000 taxes on products Made in America, and supports more good jobs.”

Tech Education
President Obama said that the US should be offering "every student the hands-on computer science and math classes that make them job-ready on Day One."

That drew some early, supportive statements. "Only a small percentage of public schools offer computer science education, and they tend to be located in wealthier districts with very few students of color," said Mitch Kapor, partner at the VC firm Kapor Capital. "Expanding access to computer science education has the potential not only to lift our economy but to bring thousands of young people from underrepresented backgrounds out of poverty by providing them the skills to pursue well-paying careers."

He also teased efforts to combat ISIL and the Administration's work to spread its anti-terrorism message online, days after key administration officials raised the matter with Silicon Valley executives. “Both al Qaeda and now ISIL pose a direct threat to our people,” he said, using an alternate acronym for the Islamic State in Iraq and Syria (ISIS).
“...because in today’s world, even a handful of terrorists who place no value on human life, including their own, can do a lot of damage. They use the Internet to poison the minds of individuals inside our country; they undermine our allies.”

Campaign Finance

"I believe we have to reduce the influence of money in our politics, so that a handful of families and hidden interests can’t bankroll our elections   — and if our existing approach to campaign finance reform can’t pass muster in the courts, we need to work together to find a real solution. Because it's a problem, and most of you don't like raising money….Those with money and power will gain greater control over the decisions that could send a young soldier to war, or allow another economic disaster, or roll back the equal rights and voting rights that generations of Americans have fought, even died, to secure."

Kurt Walters, campaign manager for Rootstrikers, a non-profit organization fighting the corrupting influence of money in politics, attacked President Obama’s inaction despite lofty rhetoric. “We continue to hear the same rhetoric for his entire presidency -- that he detests the Citizens United decision, that it’s incredibly harmful to the country, and yet he’s done nothing,” Walters said. “If he does not issue the executive order and continues to give the same empty rhetoric it will be a slap in the face to the millions of Americans he made promises to.”

House Communications Subcommittee Hearing on Net Neutrality Bills
On January 13, The House Commerce Committee’s Communications and Technology Subcommittee reviewed four proposals it said would protect consumers and small businesses. Two bills relate directly to the FCC’s Open Internet/net neutrality rules:

  1. The No Rate Regulation of Broadband Internet Access Act (HR 2666), authored by Rep. Kinzinger (R-IL), would prevent the FCC from regulating the rates charged for broadband Internet.
  2. The Small Business Broadband Deployment Act, authored by Subcommittee Chairman Greg Walden (R-OR), would make permanent the FCC's temporary exemption from the enhanced disclosure rules for small businesses required by the commission’s Open Internet Order.

Members on both sides of aisle in the subcommittee appeared to be in agreement that the FCC should not regulate broadband rates. Republicans argued that given that both President Barack Obama and FCC Chairman Tom Wheeler said new Title II- based Open Internet rules should not regulate access rates, codifying that should be a bipartisan no-brainer of sorts. Democrats agreed with no traditional rate regulation for broadband, but argued the bill's language was too broad and could sweep away consumer protections from monopoly rates, anticompetitive interconnection charges, and even rural broadband subsidies under the Universal Service Fund.

There also seemed to be some agreement that the FCC should make some accommodation in its Open Internet rules for small ISPs -- but just how ‘small ISPs’ are defined and how that should be achieved divided the committee along political lines. Elizabeth Bowles, on behalf of the Wireless Internet Service Providers Association (WISPA), said the FCC should have made the exemption permanent, that compliance costs were a hardship, and that many smaller operators could not afford the lawyers it took to figure out what the new requirements were much less having to defend the company’s action from lawsuits if they guessed wrong or frivolous lawsuits. Harold Feld of Public Knowledge said it would be premature for Congress to make the exemption permanent before the FCC had a better handle on what the actual compliance costs would be, and that where exemptions were made permanent, bad actors would follow to take advantage of not having to provide enhanced disclosure of their practices.

For a full recap of the hearing, be sure to check out Benton’s summary.

T-Mobile and the Electronic Frontier Foundation Spar Over Binge On: Is It Throttling?
This week saw a back and forth exchange between T-Mobile’s CEO John Legere and non-profit digital rights group the Electronic Frontier Foundation (EFF). The sparring was over T-Mobile’s “Binge On” program which some fear violates the FCC's net neutrality rules.

T-Mobile introduced its Binge On service in November saying that it would help customers stream more video from certain services (like Netflix, HBO GO, Hulu, etc.) by not counting these services against a consumer’s monthly data allotment. However, the program seems to violate the principles of net neutrality, because:

  • T-Mobile is discriminating in exempting some applications from data caps.
  • When it launched Binge On, T-Mobile decided to reduce the technical quality of all video on its network for subscribers within all data plans.

On Jan 4, EFF released a report claiming that “T-Mobile is throttling video streams, plain and simple.” Three days later, EFF tweeted T-Mobile CEO John Legere the question “Does Binge On alter the video stream in any way, or just limit its bandwidth?”. In response, Legere said,

What Binge On does, it includes a proprietary technology and what the technology does is not only detect the video stream but select the appropriate bit rate to optimize to the video, the mobile device. That’s part A of my answer. Part B of my answer is, who the f--- are you, anyway, EFF? Why are you stirring up so much trouble, and who pays you?

EFF encouraged members to tweet to Legere, and Legere responded again in a video saying, “There are people out there saying we’re ‘throttling.’ That’s a game of semantics, and it’s bullsh-t.” In a ironic twist, some noted, his video message was available only in a high-quality 1080p video on YouTube, which wouldn’t be available via Binge On on a mobile device because YouTube is not one of the companies partnering with the carrier to make its content available.

On Jan 11, Legere released a less-colorful open letter to consumers informing them on the benefits of Binge On and reiterating that “T-Mobile is a company that absolutely supports Net Neutrality.”

What’s Next:
Does Binge On violate net neutrality? No one’s certain at this point. First Amendment lawyer Marvin Ammori believes Binge On does violate net neutrality, and called on the FCC to stop the practice, in addition to other net neutrality violating practices occurring in the industry. In a December article he said, “Unless the FCC investigates and stops these practices across the Internet market, its vaunted net neutrality rule could be remembered more as useless, lovely poetry than breathing, living law.”

T-Mobile, which is expected to meet with the FCC to discuss the program, is making the case that since it can be turned off, agency is essentially left up to the consumers, and therefore does not violate net neutrality. Berin Szoka, who practiced Internet and communications law and is now president and founder of TechFreedom, said that T-Mobile has a strong argument that it isn’t violating net neutrality rules. “It’s not entirely clear whether the no-throttling rule bars throttling programs where users can opt-out (or where they have to opt-in),” Szoka said. The FCC’s Open Internet Order says the no-throttling rule “does not address a practice of slowing down an end user’s connection to the Internet based on a choice made by the end user.”

After the November FCC Open Meeting, FCC Chairman Tom Wheeler praised the Binge On program, but he also said from the beginning that the FCC would "keep an eye on it" and measure it against the net neutrality order's guidelines. The FCC could still recommend changes, and we will be watching to see how the FCC handles this potential net neutrality violation.

Quick Bits

Weekend Reads (resist tl;dr)

Events Calendar for the Week of Jan 18-22
Jan 20 -- “MMTC’s 7th Annual Broadband and Social Justice Summit"

ICYMI From Benton

By Robbie McBeath.