Startups Reject FCC’s Net Neutrality Proposal

Engine Advocacy, an organization that advocates for startups filed comments today with the FCC. They believe the Chairman’s proposed rule would crush startups:

According to recent news reports, the Commission is considering adopting a rule that authorizes discrimination by ISPs and permits them to charge terminating access fees to technology companies. We believe such a rule, if adopted, would crush startups,and therefore undermine American technology entrepreneurship, innovation, and job creation.

Engine posted on its blog about the important issue here. You can read the full comments here.

I’m proudly on the board of Engine.

Net Neutrality: A Solution to an Existing Problem

While AT&T, Comcast, and Verizon have argued—with incredible message discipline—that network neutrality is “a solution in search of a problem,” that’s not true.

There are many concrete examples of network neutrality violations around the world. These network neutrality violations include ISPs blocking websites and applications, ISPs discriminating in favor of some applications and against others, and ISPs charging arbitrary tolls on technology companies.

We have seen network neutrality violations all over the world.

Even in the U.S., there have been some major violations by small and large ISPs. These include:

  • The largest ISP, Comcast secretly interfering with peer-to-peer technologies, including some of the most popular basic technologies used to distribute online TV and music (2005-2008);
  • A small telephone ISP called Madison River blocking Vonage, a company providing competing telephone service online (2005);
  • Apple blocking the application Skype on the iPhone, subject to a secret contract with AT&T, a company that competes with Skype in providing telephone service (2008-2009);
  • Verizon, AT&T, and T-Mobile blocking the functionality of Google Wallet on Nexus devices, while all three of those ISPs are part of a competing mobile payments joint venture called Isis (late 2011-today);
  • and Comcast’s disputes with Level 3 and Netflix over termination fees and the appearance that Comcast is deliberately congesting its network connections to force Netflix to pay Comcast for an acceptable connection (2010-today).

In other countries, including democracies, there are numerous violations. In Canada, rather than seeking a judicial injunction, a telephone ISP used its control of the wires to block the website of a union member during a strike against that very company in July 2005. In the Netherlands, in 2011, the dominant ISP expressed interest in blocking against U.S.-based Whatsapp and Skype.

In the European Union, widespread violations affect at least 1 in 5 users. That is the conclusion of a report issued in June of 2012 by the Body of European Regulators for Electronic Communications (BEREC), a body composed of the regulatory agencies of each EU country. Most of these restrictions were on online phone services, peer-to-peer technologies (which are used not only by copyright pirates, but also in a variety of well-known technologies, including Skype and several Amazon cloud services), as well as other specific applications “such as gaming, streaming, e-mail or instant messaging service.”

ISPs block and discriminate against applications and websites even in countries that require disclosure of the violations and even in countries with far more competition among ISPs than the US. A recent Oxford dissertation on the topic explores the wide-scale blocking and discrimination in the United Kingdom, a market with both considerable competition among ISPs and robust disclosure laws.

Essentially, a specific rule that would be upheld in court is necessary protect network neutrality and address a major, global problem.

* Footnote: Thanks to Stanford professor Barbara van Schewick, whose recent letter to the FCC inspired my thinking in this post.

Interconnection Disputes Are Network Neutrality Issues (Of Netflix, Comcast, and the FCC)

A lot of people have been talking about the “interconnection” deal between Comcast and Netflix and whether that deal is related to network neutrality. (It is.) This question comes partly because the FCC’s 2010 Open Internet Order (also known as the network neutrality order) was recently struck down. So network neutrality lands back at the FCC, with a new Open Internet proceeding, at the same time Netflix starts working so poorly on Comcast that Netflix had to cut a special deal with Comcast.

Several people have argued that interconnection issues should be considered in the new Open Internet proceeding. These people include Reed Hastings, the CEO of Netflix, the Internet backbone providers Cogent and Level 3, Consumers Union, and the Internet Association (Google, Facebook, eBay, Amazon, Airbnb, LinkedIn, etc.)  On the other hand, the FCC Chairman Tom Wheeler has stated“[p]eering and interconnection are not under consideration in the Open Internet proceeding,” apparently because interconnection is “not a net-neutrality issue.” My friend Harold Feld at Public Knowledge has said, “Wheeler is right, this is not a ‘network neutrality’ issue.”

Actually, I believe Chairman Wheeler and Mr. Feld are wrong, and I hope this post persuades them otherwise. Interconnection has always been a network neutrality issue.

I have two arguments on principle and one response on politics. First, on principle, interconnection has always been part of the open Internet proceedings, as evidenced by several major FCC and congressional orders. Second, ISPs can block traffic, discriminate, or impose access fees either once traffic is within their network (through “deep packet inspection”) or when the traffic is at the edge of their network (through interconnection). There is no reason to think the technical distinction should matter. Third, if the Chairman and Mr. Feld are taking politics into account, separating out interconnection from the Open Internet proceeding is an even worse idea, though it may not seem like it now.

First, the major “network neutrality” orders place interconnection front and center.

Among the FCC’s most important statements on network neutrality is a well-known Internet Policy Statement adopted in 2005. It included four principles, including that consumers should be able to access the content, applications and services, and devices of their choice. All four principles were adopted with this goal in mind, repeated four times on page 3: “To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet.” Open and interconnected.

This Policy Statement became a two-year enforceable merger condition in both the AT&T/SBC merger and the MCI/Verizon merger. 

The AT&T/BellSouth merger also included a commitment to the Internet Policy Statement and a “neutral network” offering no service that “privileges, degrades or prioritizes any packet transmitted.” In addition to accepting the Policy Statement rooted in interconnection, this network neutrality condition extended “up to and including [not excluding] the Internet Exchange Point closest to the customer’s premise, defined as the point of interconnection that is logically, temporally or physically closest to the customer’s premise where public or private Internet backbone networks freely exchange Internet packets.”

In 2008, in the FCC’s seminal Free Press-Comcast decision, concerning Comcast’s blocking of peer-to-peer applications, the FCC justified its decision in part based on ensuring interconnection. The Commission concluded that section 256, a section authorizing the FCC to set technical standards for interconnection, authorized the FCC’s action. Essentially, by blocking peer-to-peer traffic within its network through deep packet inspection, Comcast obviously undermined seamless interconnection amongst networks. The Commission concluded (on page 12): “It is therefore a reasonable exercise of the Commission’s authority ancillary to section 256 to promote the ability of Comcast customers and customers of other networks, including public telecommunications networks, to share content and applications with each other, without facing operator-erected barriers, i.e., to ‘seamlessly and transparently transmit and receive information.’”

Additionally, in 2009, Congress defined the FCC’s Internet Statement as imposing “nondiscrimination and interconnection” obligations. Congress imposed these obligations on any networks built with stimulus funding, stating “non-discrimination and network interconnection obligations that shall be contractual conditions of grants awarded under this section, including, at a minimum, adherence to the principles contained in the Commission’s broadband policy statement.” So even Congress considered network neutrality to include nondiscrimination and interconnection.

Finally, the Commission’s 2010 Open Internet Order relied partly on section 251, the section requiring interconnection of telecommunications networks. The FCC stated (on pages 69-70) that: “Section 251(a)(1) of the Act imposes a duty on all telecommunications carriers ‘to interconnect directly or indirectly with the facilities of other telecommunications carriers.’ … To the extent that VoIP services are information services (rather than telecommunications services), any blocking or degrading of a call from a traditional telephone customer to a customer of a VoIP provider, or vice-versa, would deny the traditional telephone customer the intended benefits of telecommunications interconnection under Section 251(a)(1). … To the extent that VoIP services are telecommunications services, a broadband provider’s interference with traffic exchanged between a provider of VoIP telecommunications services and another telecommunications carrier would interfere with interconnection between two telecommunications carriers under Section 251(a)(1).”

Said another way, ensuring interconnection has always been at the core of the FCC’s “Open Internet” mission, and explicitly so in all the FCC’s major Open Internet orders. In 2005, the FCC stated that mission in terms of consumers’ ability to access the content, applications, or devices of their choice. It first applied that mission in the Free Press-Comcast case, which involved the use of deep packet inspection to block uploads from Comcast’s own users. So the Commission simply did not have occasion in that case to address blocking and discrimination (or access fees) through interconnection with other networks. The Commission’s repeated emphasis on ensuring interconnection—including relying on it as a basis for jurisdiction twice—makes it clear that interconnection is part of the Open Internet proceedings.

Sure, the FCC’s involvement with interconnection is much older than the Open Internet orders—but that’s why the FCC knew to be concerned about interconnection from the very first of the Open Internet orders.

Second, it does not matter if carriers engage in blocking, discrimination, or access fees through deep packet inspection or through interconnection. Either way, consumers and edge providers would be affected, and innovation and free expression stifled. The Commission has generally sought to exclude agreements among backbone and transit providers that do not have termination monopolies over users, as such providers appear to operate in a competitive market. ISPs with termination access monopolies, such as Comcast, AT&T, and Verizon, were the target of the open Internet proceedings, and the DC Circuit found it reasonable for the FCC to impose rules on them because of this termination monopoly. There was no exception allowing these carriers to engage in abuse (undermining the open and interconnected Internet) if that abuse was through interconnection, not deep packet inspection or domain name blocking.

The evidence for excluding interconnection disputes is thin. The primary evidence is footnote 209 of the 2010 Open Internet Order: “We do not intend our rules to affect existing arrangements for network interconnection, including existing paid peering arrangements.” That statement, however, seems to apply only to then-existing arrangements. As a result, it seems that the Commission may have meant to address all future agreements. Moreover, this footnote attaches to a paragraph, in fact, that explicitly forbids termination access fees:  “Some concerns have been expressed that broadband providers may seek to charge edge providers simply for delivering traffic to or carrying traffic from the broadband provider’s end-user customers. To the extent that a content, application, or service provider could avoid being blocked only by paying a fee, charging such a fee would not be permissible under these rules.” Since the Commission says charging the fee would be impermissible, we should consider how an ISP would assess such a fee. It would do it by threatening to block edge provider either through deep packet inspection or some other means—perhaps congestion in interconnection links or domain name blocking. It would be illogical for this footnote somehow to permit access fees for discriminatory treatment, as the Commission concluded (page 43): “it is unlikely that pay for priority would satisfy the ‘no unreasonable discrimination’ standard.” The footnote therefore is pretty weak evidence, in the face of the rest of the order and the string of FCC Open Internet decisions rooted in interconnection.

Third, the politics of separating interconnection from other network neutrality disputes is deeply flawed. Mr. Feld’s blog post suggests that the Chairman, whom he believes wants to address interconnection, is brilliantly avoiding the term “network neutrality” because he understands that this term brings political heat. The Chairman is playing chess, making a strong opening move, getting some political breathing room to analyze interconnection disputes, according to Mr. Feld. If the Chairman wants to set interconnection rules not only for Comcast (in their merger request), but also on Verizon and AT&T, he will need some political finesse.

But a great chess player also has to plan an endgame. When the end comes for interconnection, the carriers will bring overwhelming political heat. Their armies of lobbyists and lawyers will not be fooled by terms. They will know that interconnection, like network neutrality, might cost their bosses money, and one does not easily take money from Comcast, Verizon, or AT&T. When the Chairman faces this political heat, he would love to have a broad coalition and the American public on his side. During nine years of public discussion, the American public has shown over and over that it supports network neutrality. Most of the public does not know the term “interconnection.” Tech executives and lawyers who support network neutrality need to be educated on interconnection (or told it’s always been part of the same proceeding) before supporting it. And the broad coalition of companies active in D.C. might have to split resources, as Netflix, Cogent, and Level 3 perhaps focus on interconnection while other companies focus their resources on the Open Internet proceeding. I have trouble seeing a political endgame where the Chairman can rule for the public on a term that even readers of Reddit, Wired, and Ars Technica don’t understand, when the carriers will bring their usual full-frontal attack. It’s better to keep the broader coalition together and use the term that the public and tech companies understand.

Plus, network neutrality has always been about interconnection.

(Aside, if you’re wondering why anyone would avoid the term “network neutrality” in D.C., even though it is popular among the public, keep in mind some things that are popular in D.C.: telecom lobbyists, oil companies, mass surveillance, contractors that build stuff like healthcare.gov, and investment banks. Network neutrality is popular outside of D.C. but it’s sometimes hard for folks in D.C. to remember that so they talk of interconnection.) 

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Very Troubling Copyright Ruling on Innocence of Muslims

The Ninth Circuit issued a very troubling ruling ordering that the infamous “Innocence of Muslims” video be taken down based on one actress’s claim to copyright based on her presence in five seconds of the video. (Order here. Read more: here, here, here.)

Last year, I wrote a book on Internet freedom. In that book, I discussed the threat that over-broad copyright law poses to free expression online (among other threats). This case is a perfect–and unfortunate–example of how copyright law can sometimes censor more speech than any other law.

In the book, I discussed how the US government could not censor “Innocence of Muslims,” even though it was an inflammatory, juvenile, deeply offensive “film” that sparked riots around the world. It actually wasn’t illegal in the US under the existing precedent of the Supreme Court, which would protect a video (speech) unless it incited imminent lawlessness or was a direct threat against specific people. The trailer was therefore protected under the First Amendment–even if the creator was foreign, and lacked First Amendment rights, we Americans had the right to receive the speech and watch it.

That trailer was available on the largest video platform, YouTube, owned by Google. So the U.S. State Department reportedly contacted the folks at Google and YouTube and asked them to take down the film. Google determined that the video wasn’t illegal in the US, didn’t violate Google’s terms of service, and therefore wouldn’t be taken down globally. It disabled access in only a few countries, where the video was illegal or the circumstances were considered special. Google received a mixture of praise and sympathy from free speech advocates for favoring freedom of speech in the face of a difficult situation; after all, it’s easy to be committed to free speech only when it’s not difficult.

Now, years later, the video has finally been ordered taken down by a US court. The order, however, formally has nothing to do with the movie’s offensiveness. It has everything to do with copyright law. An actress in the trailer had received death threats for being in the trailer. She also was conned by the film’s producer; she had no idea the plot or that the producer would dub over the actors’ lines. She’s very sympathetic. This feels like a case where “good facts could make bad law”–and it is. The court ruled that she had a copyright interest only in her own acting (no other part of the film) and largely because the producer lied to her about the part.

The greater stakes of this ruling are disastrous for free speech for a few reasons. People who are merely in 5 seconds of a video and had no control over its script, shooting, or editing, shouldn’t have a copyright interest to take down a video. If that were the case:

  1. Lots of people will be able to sue to takedown videos.
  2. Lots of people will not even need to sue–they’ll just send DMCA takedown notices to take down videos.
  3. Governments could likely work with potential copyright-holders to get videos taken down that they couldn’t otherwise have taken down.
  4. Legitimate movie producers and actors would face increased uncertainty about who has copyrights in a movie.
  5. Oh, and did I mention you can remove speech, really important speech from a historical perspective? This movie in particular is a historical record of the protests it spurred and of the free speech debate it catalyzed.

This would create what law professors call a “tragedy of the anti-commons“–a situation where a lot of people have multiple competing pseudo-property rights over the same work.* You need permission from a huge number of people to use the work. Any one of them can veto the use. So, in the end, works aren’t available–a problem when those works are speech.

Even though the US government failed to remove this video for its offensiveness, copyright law can do the trick.

*(It’s the flip-side of the problem called the tragedy of the commons–when nobody has a property right in a piece of property.)

**I do legal work for Google, particularly on free speech and copyright issues. (See here and here.) I didn’t work on this case.

Some further points on my network neutrality article in Wired

I published a piece in Wired today called “We’re About to Lose Net Neutrality — And the Internet as We Know It.” It is apparently #1 on Wired, front-paged on Reddit, and receiving many thousand views at the same time. 

I’ll use this space to expand on some points. This won’t make sense unless you read the Wired article probably, or know the issues.

1. The legal mumbo jumbo

The court will likely uphold the FCC’s authority to regulate the Internet in many ways (perhaps to do mischief or help out the telcos and cable companies) but likely strike down the FCC’s authority to do one thing: enforce network neutrality. I wrote the piece because I didn’t want people to be confused by language like this: “The FCC has authority under 706 of the Telecom Act to regulate the Internet, and to forbid blocking of websites, but lacks authority under 47 USC s. 153 (forbidding applying common carrier rules to a Title I service) to enforce an anti-discrimination principle.” Translation: net neutrality is dead. Don’t be confused.

2.   How can anyone predict the court’s decision?

You can’t be sure. But the oral argument went on for 2 hours, an hour longer than scheduled, and the judges weren’t hiding their thoughts. The media in the room reported that the court would likely make the decision I described above–regarding 706 and 153. Many just wrongly thought that was a “split the baby” decision when it was a complete loss for all of us. I wrote the article partly to clear up that misimpression.

Also, many people are afraid of predicting decisions, should they end up with egg on their faces if wrong. I’m willing to take that chance here.    

3. EFF’s worst nightmare.

Many great tech advocacy groups support adopting network neutrality rules by law–Free Press, Public Knowledge, and others. The EFF (which is also great) is a partial exception: it generally supports network neutrality as a concept but has been worried about giving the FCC the authority to do any meddling in Internet regulation, including net neutrality. That’s because the FCC is an agency often beholden to telecom and cable companies.

The court will likely decide that the FCC has authority regulate the Internet broadly under one provision (706 of Telecom Act) but not to do network neutrality under another (found at 47 USC s 153). So the FCC will be empowered to meddle, perhaps to do mischief to benefit the carriers, but forbidden to help Internet users through anything like net neutrality. (My friends at EFF should just let me if I’m wrong.)

 

Cybersecurity Panel

Cybersecurity Panel

I spoke a few weeks ago in NYC at the Louise Blouin Foundation’s Creative Leadership Summit on a panel about cybersecurity. I emphasized the importance of privacy safeguards and trust.

 

cyber_security_24E_62

Filtering the Internet is Still a Bad Idea: DCA, ABC, and Steroid Searches

A few days ago, ABC News ran an “investigative” piece called “Group Probes Ease and Danger of Buying Steroids Online.” ABC describes the “group” at issue as “an online watchdog,” the Digital Citizens Alliance. That group determined that some of the millions of available YouTube videos encourage steroid use and that YouTube (which is owned by Google) places ads next to steroid-related videos and search results. They argue that Google and YouTube should be held legally responsible for any illegal content linked or posted.

ABC News could have told the story differently: A Microsoft-backed group led by a public relations firm (but named for an “alliance” of “citizens”) is holding Google & YouTube to a standard that Microsoft fails, while effectively arguing for filtering of the Internet, through appeals to the emotional issue of teenage steroid use.

Let’s begin with the big picture and move to the details of this group. 

Filtering the Internet is a terrible idea, even to stop illegal drug sales.

It is awful that teenagers turn to any illegal drugs. But perspective is needed. We know some teenagers buy drugs at school; we don’t shut down schools, we don’t search every student, we don’t monitor everything they say, we don’t require them to get permission from an adult before speaking with one another. We engage in education efforts and responsive actions. We also know that people will use the Internet to communicate about everything from coordinating a democratic revolution and reporting government corruption to idle chit chat to illegal activity.

The Digital Citizens Alliance is actually arguing for a filtered Internet. DCA claims that companies should be liable for any illegal content shared on a site. If Twitter, Google, Facebook, Yahoo, and others were guilty of the acts of all the slanderers, copyright infringers, fraudsters, conspirators, and drug pushers on their sites, then they would have to filter all the content on their sites. With a billion users, if even 0.1% of them are wrong-doers, then a platform would be liable for one million wrong-doers. They wouldn’t be able to take on the risk of legal action for all those potential wrong-doers. That means these companies would have to filter content in advance. The Digital Citizens Alliance cannot mean that companies simply have to act quickly and take down illegal content once notified; these companies all take down content when it is reported or flagged for violating their terms of service forbidding illegal activity.

The existing rules strike the right balance. For the past 2 decades we have had a set of rules to ensure freedom of expression online while limiting illegal activity. Those rules generally enable companies like Twitter, Facebook, Google, and the New York Times online to carry the speech of millions or billions of people empowering all of us to publish and comment–through tweets, posts, pages and videos, or comments on stories. They are able to carry the speech of so many people because they are not guilty for all illegal content posted by every single person. (The laws include the celebrated 230 of the Communications Decency Act and also 512 of the Digital Millennium Copyright Act.)  Instead of these companies being liable, the actual wrong-doers are responsible: the slanderers, the sites that traffic in drugs, etc. Recently, the authorities busted an online drug bazaar and a child prostitution ring without having to change the Internet’s magna carta and make tech platforms liable for all the content on their sites. If they were liable, these companies simply would not be able to act as platforms and networks for billions of people. They would have to filter all content in advance and become editors of their platforms, closing opportunities for average speakers.

Companies like Google make huge efforts to remove illegal content. Most platforms for the speech of billions of users have to rely in part on users flagging or reporting content. It’s far more effective and respectful of free expression than attempts to filter through computer algorithms. Go to Twitter: you can “report” every tweet. Check YouTube: every single video has a flag icon. Every piece of content on Facebook can be reported. Considering the number of users and content shared, this flagging is essential. I wrote about this in some detail here. More briefly: one-hundred hours of video are uploaded to YouTube every single minute and that much content can’t be filtered in advance without requiring YouTube to to limit who can post. Googles search engine includes trillions of sites and reflects the web; Google can’t filter them all and shouldn’t have to. In one month alone, however, Google processed over 18 million requests to remove URLs from its search results based on copyright concerns and removed removed 97% of the requested URLs from July 2011 to December 2011. Google also makes efforts to ensure ads are not placed alongside illegal content. (I provide the sources in the other post.)

The Digital Citizens Alliance is a Microsoft-backed group, which is the only reason Microsoft is not their target.

This is an old story. The story is Microsoft’s ongoing strategy of attacking Google in slanted advertisements and through political PR efforts. It’s also the story, it seems, of the copyright industry, which has long argued, in various ways, for pre-filtering all content, including when it attempted to push an infamous censorship bill called SOPA.   

DCA is backed by Microsoft and not a citizens alliance. 

The Digital Citizens Alliance is not an actual alliance of citizens, but instead is known to be backed by Microsoft. Techdirt called DCA an obvious “astroturf” group not a real “grassroots” group. Two of DCA’s three staff members are employees of the DC public relations firm, 463 Communications (Tom Galvin and Dan Palumbo), and the other is also in PR. That is not the makeup of, say, the ACLU, EFF, or Consumers Union, or a legitimate consumer group. The alliance’s advisory board includes someone from the Alliance for Competitive Technology, an organization that receives over a million dollars from Microsoft every year. I live in DC and know folks at 463, ACT, and Microsoft–in fact I even like all of them I know. It’s just that it’s obvious to me and anyone in DC: an organization with this backing and structure is not an online watchdog or an advocacy group but a corporate PR vehicle. 

This close connection with Microsoft explains why DCA has not attacked Microsoft for the same exact things. In fact, if you do a Microsoft Bing search for “buy steroids,” you will see that ads accompany the results, but you will not for the same search on Google.

It’s understandable why something might fall through the cracks on Bing: the Internet is a big place with trillions of sites and billions of real human users who do things that are sometimes unsavory. It is impossible to police them all in advance and requiring them to do so would undermine free expression and change the nature of the Internet. The Digital Citzens Alliance should let Bing know about this issue. But that’s clearly not the intent of the alliance. It’s not around to actually make the Internet a safer place, just to be part of a PR attack on a specific company.

Disclosure: I advise several companies, including Google, on free expression law and public policy.

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