In late July, Chattanooga broadband provider, EPB, and the City of Wilson, North Carolina, asked the FCC to preempt their state laws, which limit where they can serve customers. This matter was put up for public comment by the FCC, and MediaFreedom filed the attached comments with the agency on Friday.

In this filing, we urge the FCC to reject the request of EPB and the City of Wilson because:

  • The FCC lacks the authority to preempt such state laws;
  • The states have a constitutional right to protect taxpayers by limiting muni-provided broadband;
  • Muni-provided broadband runs contrary to the pro-competition goals of the Communications Act;
  • The FCC can effectuate the rollout of broadband in a less constitutionally offensive manner, with present authority and regulatory reforms; and
  • Government’s spotty IT track record urges caution for the FCC in promoting government-provided broadband.

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COMMENTS OF MEDIAFREEDOM

On July 24, 2014, the Electric Power Board of Chattanooga, Tennessee, and the City of Wilson, North Carolina (herein Petitioners) filed petitions asking that the Federal Communications Commission preempt pursuant to Section 706 of the Telecommunications Act of 1996 (‘96 Act) portions of Tennessee and North Carolina state statutes, which limit their ability to provide broadband services. On July 28, 2014, the FCC established a pleading cycle for these proceedings, putting the matter out for public comment. MediaFreedom[1] believes the FCC lacks the proper authority to preempt state law as urged, and thus respectfully asks that the Commission reject the Petitioners’ request.

MediaFreedom would like to briefly outline its core concerns on the present proceeding: [click to continue…]

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As we approach the final phase in the FCC’s third attempt to create a legally viable Net Neutrality rule, the anti-property groups pushing for “real” / “simple” Net Neutrality have expressed near hysterical support for the idea that the only way to protect the open web from “evil” ISPs is to ensure that they are regulated like public utilities.  Through FDR-era Title II regulation.  And lots of it.

I guess they believe that public utilities – like water, gas, electricity, and our streets – have been the paradigm of growth and innovation?

Sure they are.

You know, U.S. Broadband gets two times better every three years, with no increase in price.  Can those utilities do that?  Umm, no.

Why?  Because they’re regulated to death.  There’s no incentive for them to do it.

Hopefully the FCC can see this, and avoid the catastrophic hit to our way of life if it were to make private ISPs public utilities by imposing Title II on them.  Such a move would kill the web’s vibrance by neutering the very companies the ecosystem depends upon to deliver its services.  (And, of course, the regulation would eventually go further – well beyond policing just ISPs – because that is the nature of regulation.)

Still, it remains unclear where the final rule – which has taken over 10 years to produce – will end up.

Innovating at government speed is a mess.  Pretty much always.

A shot I took yesterday of a newly constructed, two-mile piece of road here in Virginia, though seemingly off-point, is illustrative of this point.  When 9-11 occurred, a street which this road replaced was closed for security reasons.  From the very moment it was blocked 13 years ago, the local community demanded an alternative route.

Utility Road Service1

13 years later, moving at the speed of government, the new road – a public utility – is just now being put into service.  If that road were constructed on private property, it would have been completed in less than six-months.

An Internet generation goes by in essentially one-and-a-half years.  For companies like Apple, Google, Comcast, Verizon, etc. – this rapid, unforgiving time frame presses them to the edge of their abilities to meet consumer demand.  Sadly, imposing public utility regulation on this sector would force the ecosystem to innovate at the speed of government.  Companies would be asking, “FCC, can I do this, or that?” instead of just doing it and letting consumers decide.  Now, that may be appealing to regulators, but in a regulatory sense it is the exact opposite of where we’ve been since the unregulated Internet exploded with growth and development these past 10 years.

Society moves on Internet time.  That road, which regulators can’t hope to transit, should continue to guide the Internet and its thriving ecosystem. To this end, the FCC must avoid regulating the Internet as a public utility.  If it chooses otherwise, it will block a proven path to growth and prosperity that has served Americans, and the world, so well.

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The anti-private property group Free Press believes Title II – which the radicals want imposed on network providers to ensure “real” Net Neutrality – is getting some bad press.  So, it’s embarked on its own press deluge to shore up the idea that heavy-handed government regulations are actually good for investment, noting (in page-after-page of home economics-level “analysis”) that:

“…[C]ommon-carriage rules have coincided with the healthiest periods of investment and growth in the telecommunications sector.”

Um, sure they do, guys.

Here’s my response in a simple graphic:

Snail10

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Houston, we have a problem.

Last week saw a highly unusual letter from FCC Chairman Tom Wheeler to Verizon, taking issue with the company’s plan to ease wireless data traffic congestion.

As Wheeler writes:

“Your website explained that this was an extension of your ‘Network Optimization’ policy, which, according to your website, applies only to customers with unlimited data plans. Specifically, Verizon Wireless ‘manage[s] data connection speeds for a small subset of customers – the top 5% of data users on unlimited data plans’ in places and at times when the network is experiencing high demand. Verizon Wireless describes its ‘Network Optimization’ as ‘network management.’”

Sounds like Verizon’s making sure the network works, which is a good thing.

The FCC’s transparency rules – the only Net Neutrality rules that are still legal, that is – seem to work, too. As the letter shows, Chairman Wheeler learned about the new policy from Verizon’s own website. No ball-hiding there.

Still, the Chairman remains troubled, stating:

“I know of no past Commission statement that would treat as ‘reasonable network management’ a decision to slow traffic to a user who has paid, after all, for ‘unlimited’ service.”

You can almost see the activists salivating, “Oooh, a Net Neutrality violation. Go get ‘em, Tommy Boy!”

Except, of course, nothing’s happened yet – the plan begins in October. Further, it could turn out that there is no noticeable change / harm experienced by any user as a result of the policy. Moreover, even the Commission has defined “reasonable network management” as that which mitigates the effect of traffic congestion on the network.  It appears that Verizon is attempting to do just that here.

But in the Chairman’s world, one which is being pushed more than ever by the radicals who want everything for free, “unlimited service” seemingly means that the service must remain essentially unchecked or unregulated by the company. To heck with the other 95% of customers who are having a hard time getting connected due to heavy users.   Unlimited means untouchable. Period.

Hogwash.

The Chairman (and taxpayers) would be well served if Verizon could figure this out on its own.  If “unlimited plans” are causing congestion, the company shouldn’t be foreclosed from optimizing the system for its customers.  Network engineers, not FCC bureaucrats, are in the best position to make these judgment calls.  If real harm occurs, it can be adequately addressed after all the facts – not conjecture – are known.

Of course, Verizon (and others) might not be so challenged in serving wireless users if more spectrum were available and secondary markets were more flexible. That said, should the company be thwarted from managing its network as here, imagine what this means for the Chairman’s “commercially reasonable” formula that he’s pushing for the new Net Neutrality rules?

This new and “improved” version of permissionless innovation – a pre-clearance of sorts – will kill the Internet if companies have to go to the FCC to ensure that what they want to do is OK with the agency.

This has always been a concern with the shifty idea known as Net Neutrality.  As WSJ’s L. Gordon Crovitz writes today (in Fast Lanes Saved the Internet):

“‘Net neutrality’ has become a meaningless plaint of ‘Unfair!’ Activist groups in Washington with benign names like Free Press and Public Knowledge want the Internet reclassified as a public utility, subject to the sort of regulations that micromanaged railroad monopolies in the late 19th century and the phone monopoly in the 20th.

“That would spell the end of permissionless innovation on the Internet. Bureaucrats would have authority to dictate how networks operate, which technologies can be used, and what prices can be charged. Regulators would approve or disapprove innovation in business terms as well as in technology. If [a company like] Netflix wanted to charge ISPs for the right to carry its video, regulators and not the market would decide…”

How optimum would that be?

Not very.

Houston should abort Tom Wheeler’s mission.

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FCC Working to Poke Taxpayers’ Eyes Out in Tennessee and North Carolina

July 29, 2014

In early June, Tom Wheeler touted in a blog post that “I believe that it is in the best interests of consumers and competition that the FCC exercises its power to preempt state laws that ban or restrict competition from community broadband. Given the opportunity, we will do so.” And like, shazaam, just last Friday, […]

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MediaFreedom Urges Against FCC’s Net Neutrality Proposal in Comments to Agency

July 15, 2014

Comments of MediaFreedom to the FCC MediaFreedom.org[1] has long-argued against FCC imposition of its Net Neutrality rules, believing that the vibrant Internet ecosystem would be harmed by this unwarranted regulation. Although the latest proposal by the FCC appears headed in a more moderate Section 706 / “commercially reasonable” direction, the very idea of protecting the Open […]

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#FAIL – FCC Turns into DMV, Servers Clogged on “Net Neutrality Day”

July 15, 2014

#FAIL – On the last day to take comments for its Net Neutrality rulemaking – a day that the FCC has no choice but to make the Internet work for it due to the expected high volume of comments streaming over the medium to the agency – their servers are clogged. Looks like the FCC’s […]

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Free-Market Advocates Opposed to Internet Regulation Net Neutrality Comments

July 15, 2014

Comments of Free-Market Advocates Opposed to Internet Regulation For 10 years officials at the Federal Communications Commission have told Americans that the Internet will “break” unless the agency steps in to keep it “free and open.” All the while, the Internet’s privately driven development has been vibrant, relentless and universal. Nevertheless, at points during this same […]

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“Simple” Net Neutrality Ain’t So Simple – What Al Franken Should’ve Said at Free Press Event

July 12, 2014
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It’s Just “Simple” Net Neutrality, Says Stuart Smalley

July 10, 2014

We hear a lot from the groups pushing for Net Neutrality about how it’s really a simple concept.  After all – it only involves what’s already baked into the Internet. Like, “neutrality,” or something really fair and cool for “edge” innovators. Tuesday afternoon, Free Press – one such group pushing that “simple’ concept – hosted […]

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