Telecommunications Giveaway @ Senate Commerce Committee Thursday

Next stop for "Net Neutrality" and the video ambitions of AT&T and Verizon: The Senate Commerce Committee markup votes on Thursday.  Alaska Senator Ted Stevens is trying to float a deal that would avoid a party-line split over who controls speed and price of content on the Internet, with Republicans favoring the phone companies and the Democrats pushing the position of cable companies and software empires like Google and Microsoft.

Stevens has added a new section to his proposed bill aimed at preserving consumers' ability to surf anywhere on the public Internet and use any Web-based application, according to the latest draft obtained by Reuters this weekend.

However, the draft by the Alaska Republican does not include a ban on pricing content companies have demanded.

Earlier versions of the bill only called for the Federal Communications Commission to report on Internet access, prompting Hawaii Sen. Daniel Inouye, the top Democrat on the committee, and some others to call for more protections.

Striking a compromise would likely make it easier for the bill to pass this year. AT&T and Verizon Communications want it to pass quickly because it would also make it easier for them to get licenses to offer cable television service.

Two weeks ago the House passed this mess, which gives a federal franchise to phone companies seeking to sell video over their phone lines, and not coincidentally, does NOT contain any statement that the content that passes over said wires is NOT under the technical and economic control of the owners of the wires.  This is the cable television model of content, speed and distribution control that the phone companies have envied for years, burdened as telcos have been by the old "common carrier" model that kept them from involvement with the Internet's content.  Waxingamerica said then, and repeats now in boldface:

This is a massive economic and power grab.

Here's a good source for the economic part of the deal's history:  "$200 Billion Broadband Scandal," an ebook by Bruce Kushnick. In the runup to the Senate vote, the book's free for downloading here.   A warning, this thing's massive: 400 pages, 526 footnotes of documentation with lots of those eyelid-weighting figures and statistics.  The argument:

Customers paid the phone companies billions of dollars per state in 'extra fees" for open, ubiquitous,  fiber optic, 45 mbps, high-definition video, 500+ channel  service (in both directions) that were never received. ...Where's all the money?  What happened to the networks?

To get state and federal permission to merge and merge and merge, the telcos made lots of promises to build out broadband networks and create competition. Now they want expedited permission to offer video, and the rationale is to build out broadband networks and offer competition. Kushnick's short version of the questions this raises is here.

The "Network Neutrality" issues are similarly complex.  The SF Chronicle has a good summary.  A couple of excerpts:

In this age of information, wealth and ideas flow through wires and cables just as wheat, iron and other goods once traveled over railroads and highways. Who controls today's digital thoroughfares, and whether they get to charge extra for safe and speedy passage, has emerged as a potentially defining debate for the Internet.

This issue is commonly referred to as "network neutrality," a slogan that leans heavily to one side of the argument. The debate, which the Senate is poised to consider as soon as this week, centers on whether all Internet traffic should be given the same delivery treatment at the same price, as it has since the start of the Internet, or whether the companies that deliver the traffic to consumer's homes can charge heavy users more.

And:

Supporters (of neutrality) argue that changing the Internet pricing formula would kill the goose that laid the golden egg. They call the Internet a "dumb pipe" or "stupid network." David Eisenberg, a former AT&T Laboratories researcher and now a telecommunications consultant who coined the latter term, recently tallied the innovations -- e-mail, e-commerce, Web browsing, instant messaging, blogging, Internet telephony and multiplayer video games -- created by imaginative Internet users who simply fed content into the dumb pipe.

Giving telephone and cable companies, who currently control access to consumers, the ability to negotiate preferential service deals with certain content vendors relegates the rest of the Internet community to second-class status -- and inhibits the serendipitous inventions that have typified the Internet thus far, neutrality advocates say.

"A handful of massive companies would control access and distribution of content, deciding what you get to see and how much it costs," wrote Stanford law professor Lawrence Lessig in a commentary co-authored by Robert W. McChesney, a communications professor and co-founder of the media reform group Free Press.

Inouye said the bill had insufficient protection for consumers:

"In the absence of meaningful consumer protections, network operators will have the unfettered capacity to discriminate against unaffiliated online content, degrade their quality of service, or impose steep charges for prioritized traffic, he said. Without further improvements that restore principles of nondiscrimination, competition and service will suffer as network operators begin to dictate the choices available to consumers. For a bill of this importance and impact, consumers deserve far better."

If this gets finessed with a study or a report by the FCC, be prepared for a very different Internet than we are used to, with branded and "premium" content using the fast lanes, and the rest of us info-rabble on the service roads.

- Barry Orton