I Know It Because I
Read It on the Internet

Posted by: Bob Quinn on December 18, 2014 at 3:49 pm

I spoke at an investor conference on Tuesday hosted by Capitol Forum. Not surprisingly, the topic of the panel was net neutrality – what else would anyone want to talk about this holiday season.  Also not surprisingly, one of the panelists, a proponent of Title II classification of Internet service, asserted that the cable ISPs were okay with Title II and would continue to invest at current levels in their networks regardless of whether the FCC imposed Title II on their broadband networks.

I was pretty sure my co-panelist was referring to a Washington Post column from Tuesday containing snippets of quotes from executives of Time Warner, Comcast and Charter made at a UBS Analyst event held last week.  I had read that article and I disagreed that that was what the cable executives were saying or that quotes selected supported the proposition of the column.  Before I could get into it, however, an attendee at the conference took the microphone to state that he had, in fact,  attended the UBS conference and that all of the cable executives who appeared there were adamantly opposed to Title II regulation –disagreeing entirely with the characterization of my co-panelist.  I thought that really closed down that topic.  I was, however, wrong.

After the conference, the Washington Post ran a second story titled, “Why Broadband Execs Are Telling Washington and Wall Street Different Things On Net Neutrality” and quoting me from statements I had made after the panel. The story asserted that the cable companies were telling one tale to Wall Street – that the imposition of Title II would have no impact on investment decisions – while telling a different tale to Washington regulators:

“The companies are telling investors that they’ll keep making their networks better, just like always — even if federal regulators adopt aggressive Internet rules. But that’s not what regulators are hearing from the companies, who are telling them that those same rules would depress investment in the network and hurt consumers.”

So, now I was really intrigued to see exactly what these executives said at the UBS conference.  I obtained a copy of the Comcast transcript from the Comcast website and I listened to the webcast of the Time Warner Cable presentation on the Time Warner Cable website.

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Welcome to the World
Of Title II Regulation

Posted by: Hank Hultquist on November 20, 2014 at 10:34 am

Occasionally a proponent of Title II regulation of Internet access will ask, in effect, what’s so bad about Title II? What follows is a cautionary tale about the absence of regulatory certainty in the world of Title II regulation; a world into which so many net neutrality proponents want to throw the Internet.  I think this story speaks volumes about the kind of regulatory stability – so crucial to maintaining incentives to build world class Internet infrastructure – we can expect from the FCC in the years to come.  To fully understand how the Title II world undermines regulatory stability, enables regulatory capture and ultimately harms consumer welfare and innovation, let’s go back to 2010.

Once upon a time, back in 2010, AT&T was engaged in a dispute with a company called YMax (known more widely as MagicJack) over bills that AT&T was receiving from YMax for exchanging traffic. AT&T noticed that YMax was billing it for a service called “local switching.” Local switching is basically the process of peeling individual calls off of inter-office trunks on which traffic is commingled, and placing them onto the lines, or local loops, that connect to particular subscribers. When AT&T investigated YMax’s practices, we discovered that YMax was not actually connecting trunks with lines. Instead, it was simply directing all the calls it received in a commingled fashion on to the Internet. The calls then reached their destinations through the efforts of Internet backbone providers and ISPs unrelated to YMax.

AT&T filed a complaint with the FCC and argued that YMax was charging us for a service, local switching, that it was not providing. YMax argued that in fact it was providing the equivalent of local switching by connecting trunks to a “virtual” loop created by the Internet. The FCC found in favor of AT&T and said “if this exchange of packets over the Internet is a ‘virtual,’ loop, then so too is the entire public switched telephone network – and the term ‘loop’ has lost all meaning.”

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AT&T Statement re: President Obama’s Plan for the Government to Regulate the Internet

Posted by: AT&T Blog Team on November 10, 2014 at 11:56 am

The following statement may be attributed to Jim Cicconi, AT&T Senior Executive Vice President, External & Legislative Affairs:

“Today’s announcement by the White House, if acted upon by the FCC, would be a mistake that will do tremendous harm to the Internet and to U.S. national interests.  It is a complete reversal of a bipartisan policy that has been in place since the Clinton Administration—namely, to treat Internet access as an information service subject to light-touch regulation.  This classification of Internet service has been upheld by the Supreme Court and has enjoyed strong Congressional support for nearly a generation.  Now, with one statement, the White House is telling the FCC to ignore this precedent and to instead impose on the entire Internet—from end to end— onerous government regulation designed in the 1930s for a Bell phone monopoly that no longer exists, not for a 21st century technology.  This will have a negative impact not only on investment and innovation, but also on our economy overall.

“For a generation, the Internet has been an American success story.  Light-touch regulation has encouraged levels of investment unprecedented by any industry and spawned incredible innovation.  Today’s action puts all of that at risk – and puts it at risk not to remedy any specific harm that has occurred.  Instead, this action is designed to deal with a hypothetical problem posed by certain political groups whose objective all along has been to bring about government control of the Internet.  The White House is proposing to put the Internet and our economy at risk as a result of such political pressures.

“We feel the actions called for by the White House are inconsistent with decades of legal precedent as well as Congressional intent.  Moreover, if the government were going to make such a momentous decision as regulating the entire Internet like a public utility, that decision is more properly made by the Congress and not by unelected regulators without any public record to support the change in regulation.  If the FCC puts such rules in place, we would expect to participate in a legal challenge to such action.”

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Banning Paid Prioritization within a Viable and Sustainable Framework

Posted by: Bob Quinn on July 17, 2014 at 4:38 pm

Today, we filed comments at the FCC supporting the Commission’s attempt to re-craft the net neutrality rules that were vacated by the D.C. Circuit Court of Appeals in Verizon v. FCC.  In short, we have laid out a viable and sustainable framework utilizing Section 706 of the 1996 Telecom Act, which re-establishes the balance achieved by the 2010 Open Internet Order, including banning paid prioritization – where an ISP prioritizes packets over the consumer’s last mile broadband Internet access service without being directed to perform that prioritization by the consumer.  Paid prioritization has been at the heart of the net neutrality debate since it began in earnest over a decade ago (AT&T has blogged several times on this point in earlier iterations of this debate).  We disagree with those critics who claim that the Commission cannot ban paid prioritization under Section 706 and explain why they are wrong as well as why it would be much more difficult to justify a similar ban of paid prioritization under Title II.

AT&T also supported the FCC’s 2010 rules, including the ones which were ultimately vacated by the Verizon court.  We recognized then, and now, that those rules represented a purposeful and careful balance between ensuring the openness of the Internet and promoting the continued massive infrastructure investments necessary to deliver to American consumers the ever increasing amount of bandwidth needed by the enormously innovative products and services being created in technology communities across the United States.  The FCC reached this balance by utilizing a form of light touch regulation under Section 706 rather than decades-old Title II utility regulation requirements – requirements that would actually impose barriers to broadband infrastructure investment in contravention of Section 706.

History itself tells us that the FCC’s balanced, light touch approach was the right approach because it actually worked.  As the FCC has noted, from 2009 onwards, wireline and wireless broadband providers have invested more than $250 billion in broadband infrastructure.  On the other side of the equation, the Internet has remained open and consumers have accessed a dizzying array of new content, services and applications.  That is the environment that every public policymaker should want to preserve.

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