Congress Poised to Unravel the Internet

Jeffrey Chester
article posted August 18, 2006 (web only)
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Lured by huge checks handed out by the country's top lobbyists, members of Congress could soon strike a blow against Internet freedom as they seek to resolve the hot-button controversy over preserving "network neutrality." The telecommunications reform bill now moving through Congress threatens to be a major setback for those who hope that digital media can foster a more democratic society. The bill not only precludes net neutrality safeguards but also eliminates local community oversight of digital communications provided by cable and phone giants. It sets the stage for the privatized, consolidated and unregulated communications system that is at the core of the phone and cable lobbies' political agenda.

In both the House and Senate versions of the bill, Americans are described as "consumers" and "subscribers," not citizens deserving substantial rights when it comes to the creation and distribution of digital media. A handful of companies stand to gain incredible monopoly power from such legislation, especially AT&T, Comcast, Time Warner and Verizon. They have already used their political clout in Washington to secure for the phone and cable industries a stunning 98 percent control of the US residential market for high-speed Internet.

Alaska Republican Senator Ted Stevens, the powerful Commerce Committee chair, is trying to line up votes for his "Advanced Telecommunications and Opportunities Reform Act." It was Stevens who called the Internet a "series of tubes" as he tried to explain his bill. Now the subject of well-honed satirical jabs from The Daily Show, as well as dozens of independently made videos, Stevens is hunkering down to get his bill passed by the Senate when it reconvenes in September.

But thanks to the work of groups like Save the Internet, many Senate Democrats now oppose the bill because of its failure to address net neutrality. (Disclosure: The Center for Digital Democracy, where I work, is a member of that coalition.) Oregon Democrat Ron Wyden, Maine Republican Olympia Snowe and North Dakota Democrat Byron Dorgan have joined forces to protect the US Internet. Wyden has placed a "hold" on the bill, requiring Stevens (and the phone and cable lobbies) to strong-arm sixty colleagues to prevent a filibuster. But with a number of GOP senators in tight races now fearful of opposing net neutrality, the bill's chances for passage before the midterm election are slim. Stevens, however, may be able to gain enough support for passage when Congress returns for a lame-duck session.

Don't Ask, Don't Tell

Thus far, the strategy of the phone and cable lobbies has been to dismiss concerns about net neutrality as either paranoid fantasies or political discontent from progressives. "It's a made-up issue," AT&T CEO Ed Whitacre said in early August at a meeting of state regulators. New Hampshire Republican Senator John Sununu claims that net neutrality is "what the liberal left have hung their hat on," suggesting that the outcry over Internet freedom is more partisan than substantive. Other critics of net neutrality, including many front groups, have tried to frame the debate around unsubstantiated fears about users finding access to websites blocked, pointing to a 2005 FCC policy statement that "consumers are entitled to access the lawful Internet content of their choice." But the issue of blocking has been purposefully raised to shift the focus from what should be the real concerns about why the phone and cable giants are challenging federal rules requiring nondiscriminatory treatment of digital content.

Verizon, Comcast and the others are terrified of the Internet as we know it today. Net neutrality rules would jeopardize their far-reaching plans to transform our digital communications system. Both the cable and phone industries recognize that if their broadband pipes (now a monopoly) must be operated in an open and neutral fashion, they will face real competition--and drastically reduced revenues--from an ever-growing number of lower-cost phone and video providers. Alcatel, a major technology company helping Verizon and AT&T build their broadband networks, notes in one business white paper that cable and phone companies are "really competing with the Internet as a business model, which is even more formidable than just competing with a few innovative service aggregators such as Google, Yahoo and Skype." (Skype is a telephone service provider using the Internet.)

Policy Racket

The goal of dominating the nation's principal broadband pipeline serving all of our everyday (and ever-growing) communications needs is also a major motivation behind opposition to net neutrality. Alcatel and other broadband equipment firms are helping the phone and cable industries build what will be a reconfigured Internet--one optimized to generate what they call "triple play" profits from "high revenue services such as video, voice and multimedia communications." Triple play means generating revenues from a single customer who is using a bundle of services for phone, TV and PC--at home, at work or via wireless devices. The corporate system emerging for the United States (and elsewhere in the world) is being designed to boost how much we spend on services, so phone and cable providers can increase what they call our "ARPU" (average revenue per user). This is the "next generation" Internet system being created for us, one purposefully designed to facilitate the needs of a mass consumerist culture.

Absent net neutrality and other safeguards, the phone/cable plan seeks to impose what is called a "policy-based" broadband system that creates "rules" of service for every user and online content provider. How much one can afford to spend would determine the range and quality of digital media access. Broadband connections would be governed by ever-vigilant network software engaged in "traffic policing" to insure each user couldn't exceed the "granted resources" supervised by "admission control" technologies. Mechanisms are being put in place so our monopoly providers can "differentiate charging in real time for a wide range of applications and events." Among the services that can form the basis of new revenues, notes Alcatel, is online content related to "community, forums, Internet access, information, news, find your way (navigation), marketing push, and health monitoring."

Missing from the current legislative debate on communications is how the plans of cable and phone companies threaten civic participation, the free flow of information and meaningful competition. Nor do the House or Senate versions of the bill insure that the public will receive high-speed Internet service at a reasonable price. According to market analysts, the costs US users pay for broadband service is more than eight times higher than what subscribers pay in Japan and South Korea. (Japanese consumers pay a mere 75 cents per megabit. South Koreans are charged only 73 cents. But US users are paying $6.10 per megabit. Internet service abroad is also much faster than it is here.)

Why are US online users being held hostage to higher rates at slower speeds? Blame the business plans of the phone and cable companies. As technology pioneer Bob Frankston and PBS tech columnist Robert Cringely recently explained , the phone and cable companies see our broadband future as merely a "billable event." Frankston and Cringely urge us to be part of a movement where we--and our communities--are not just passive generators of corporate profit but proactive creators of our own digital futures. That means we would become owners of the "last mile" of fiber wire, the key link to the emerging broadband world. For about $17 a month, over ten years, the high-speed connections coming to our homes would be ours--not in perpetual hock to phone or cable monopolists. Under such a scenario, notes Cringely, we would just pay around $2 a month for super-speed Internet access.

Regardless of whether Congress passes legislation in the fall, progressives need to create a forward-looking telecom policy agenda. They should seek to insure online access for low-income Americans, provide public oversight of broadband services, foster the development of digital communities and make it clear that the public's free speech rights online are paramount. It's now time to help kill the Stevens "tube" bill and work toward a digital future where Internet access is a right--and not dependent on how much we can pay to "admission control."