telecom policy – Techdirt (original) (raw)

US Broadband Monopolies Once Again Push Idea That Tech Giants Should Pay Them Billions For No Reason

from the please-pay-me-twice-for-no-reason dept

We’ve noted several times how European telecom giants have somehow convinced European policymakers that technology giants like Netflix and Google should annually give them billions of dollars… for no coherent reason.

The proposal is dressed up to sound like a sensible adult policy aimed at shoring up broadband access to the downtrodden. In reality it’s net neutrality 2.0: telecom giants using their leverage and power politically to try and offload network build and maintenance costs to someone else. Namely you, since companies like Netflix and Google will simply pass on the cost of this cash grab to consumers.

Emboldened by the success telecom lobbyists are seeing in the EU and South Korea, telecom lobbyists are trying to revisit the idea here in the states. Captured telecom regulators like the FCC’s Brendan Carr have been seeding lies in the US press for a few years about how tech giants are lazy free riders gobbling up bandwidth, and it’s only fair they give telecom monopolies billions for no reason.

We’ve examined how that’s bullshit in great detail, repeatedly, but that obviously doesn’t matter to lobbyists paid to be intractable.

Case in point: Jonathan Spalter, the CEO of AT&T’s pet lobbying and policy group, USTelecom, penned a blog post once again making the case that AT&T and companies like it are somehow owed billions of dollars by tech giants. He, again, pushes the lie that because services like Netflix and Google use up a big chunk of overall internet bandwidth, those companies aren’t “funding critical infrastructure”:

Today, six companies account for half of all internet traffic worldwide. These six companies have a combined market cap of $9 trillion. It’s a far cry from their garage start-up days, and without question, they are tremendous American success stories.

But three decades later, the question is being asked: Does it still make sense that the government and broadband providers alone fund this critical infrastructure? Is there no shared obligation from the primary financial beneficiaries of these networks – the world’s most powerful internet companies?

So again, the lie at the base of this proposal is always that these companies don’t already pay their fair share for bandwidth. That’s been a telecom industry policy lie we’ve spent decades deflating.

In reality, all of these tech companies invest billions in CDNs, undersea cables, transit routes, on top of the money they pay for bandwidth. Some of them, like Google, even own their own residential ISP. From consumers and local businesses to giant tech companies, everybody in the chain already pays more than their fair share for bandwidth. Often too much, in fact.

It’s important to understand that US consumers and businesses all pay telecom giants significantly more for bandwidth than most developed nations thanks to the fact that the US telecom market is heavily consolidated and monopolized by a handful of players, who exploit the lack of competition to drive up costs and saddle users with an absolute ocean in additional bullshit surcharges.

Still, the core lie in the telecom industry proposal is that tech companies somehow get a free ride. But when it comes to concentrated telecom monopoly power, nobody gets a free ride. You pay, and then you pay, and then you pay some more. Everybody pays. Ridiculous sums of money. Often for substandard, patchy service and terrible customer service.

Now there is an adult conversation to be had about whether Netflix, Google, and others could contribute to struggling FCC programs like the Universal Service Fund (USF) that help bring broadband to low income rural schools. The program genuinely is faltering as its primary contribution base, traditional phone service, has waned.

But that’s not what’s happening here despite Spalter’s attempt to wrap his post up in a shell of purported altruism. Whenever companies like AT&T or guys like Spalter actually get around to fielding concrete policy proposals, they unsurprisingly tend to favor telecom interests in dumb and strange ways.

In the EU, for example, telecoms are proposing a system that bypasses government entirely, and just has any company that accounts for more than five percent of an ISP’s peak traffic throw money directly at telecoms. And you can be assured, once AT&T implements its preferred program it won’t be altruistic; it will involve throwing billions more in subsidies at a company with a history of subsidy fraud.

AT&T, Spalter and US Telecom’s primary financial backer, has a long, long history of ripping off taxpayers in a wide number of ways, whether that’s taking millions for networks they never actually complete, getting huge tax breaks for jobs that never arrive, or systematically ripping off school broadband investment programs they then turn around and breathlessly pretend to be worried about.

If you’ve watched telecom giants behave, it’s painfully clear they’re not operating out of empathy for underserved rural school children. Since the net neutrality debate began, their singular goal has always been to double dip on already overpriced and monopolized broadband access, and increasingly offload the costs of upgrading and maintaining their networks to somebody else to please investors.

But if you genuinely want to shore up programs designed to expand U.S. broadband access, a good first step would be to start meaningfully cracking down on monopoly power, which is directly responsible for limited competition and soaring bandwidth costs in the first place. From there, the focus needs to be on cracking down harder on the endless subsidy fraud telecom monopolies have engaged in for decades.

Guys like Brendan Carr or Jonathan Spalter understandably don’t want to talk about the fact U.S. taxpayers have already spent billions on broadband networks that were routinely half delivered by powerful telecom monopolies empowered and coddled by decades of corrupt legislative and regulatory bureaucrats. That’s the core problem; but because these companies are tethered to our domestic surveillance and first responder networks, that conversation is curiously off limits.

If the EU proposal at a “big tech tax” succeeds, you’re going to see a massive, renewed lobbying effort here in the States to implement something similar. And, as Spalter demonstrates, it’s going to come wrapped in a shell of phony altruistic concern about the kind of rural, downtrodden customers AT&T, Comcast, and Verizon have historically and repeatedly shown they didn’t give two shits about.

Filed Under: big tech, big telecom, brendan carr, broadband, digital divide, fcc, high speed internet, jonathan spalter, net neutrality, sending party pays, subsidies, telecom, telecom policy, usf
Companies: at&t, us telecom

Biden FCC, Like Trump FCC, Spends A Disproportionate Amount Of Time Hyperventilating About China

from the hyperventilation-as-a-distraction dept

Wed, Jan 25th 2023 05:38am - Karl Bode

To be clear: the Chinese government is a violent authoritarian mess, and making U.S. networks more resilient to Chinese attacks is an important thing. But U.S. telecom policy is bizarrely obsessed with China to the point where all other policies, especially any policies that might upset the nation’s powerful and entrenched telecom monopolies, are routinely put on the back burner.

Whether it’s our obsession with beating China to the “race to 5G,” or FCC Commissioner Brendan Carr’s obsession with banning a social media company he doesn’t even regulate, the FCC spends a lot of time obsessing about China… but literally no time talking about U.S. market failure caused by monopolies that have spent the last few decades dismantling market disruption and competition.

In fact, the Biden-controlled FCC is very similar to the Trump-controlled FCC on this front. A disproportionate amount of time is dedicated to hand wringing about China. Not because dealing with China is more important than every other policy issue the FCC addresses, but because talking tough about China is the politically safe choice for career politicians with future ambitions.

FCC boss Jessica Rosenworcel is no exception. At a speech at the Center for Strategic & International Studies last week, Rosenworcel focused on hyping 5G (despite U.S. 5G being much slower and far more expensive than most developed nations) and making scary noises about the dastardly Chinese:

We are doing a lot—in fact, right now the agency is doing more to address network security than at any point in its history. It’s a strategy to deter, defend, and develop: deter bad actors, defend against untrusted vendors, and develop a market for trustworthy innovation. By doing this, we are working to help improve communications security at home and shine as an example for the rest of the world.

As far as speeches go, the speech is fine. Rosenworcel discusses working in much tighter coordination with intelligence and law enforcement to help secure U.S. networks. Which is, again, fine. But hyperventilating about China takes up the lion’s share of the agency’s time. And it’s often used as a shield to help distract the public and press from the U.S. government’s ongoing failures elsewhere.

For example, we’ve noted how Carr’s obsession with TikTok is a giant distraction from our ongoing failures on privacy legislation. And the fact the FCC has been an abject failure on consumer protection for going on 30 years. The U.S. broadband sector is dominated by predatory, politically powerful telecom monopolies that have similarly been abusing U.S. consumers for decades. For most of that time, telecom giants have effectively dictated the trajectory of nearly all FCC policies, and it shows.

You’d think the nation’s top telecom and media regulators would occasionally propose solutions to this problem, or occasionally acknowledge that monopolies exist. Not in the U.S., where Republican FCC Commissioners effectively side with the monopolies on any issue of note, and the Democratic Commissioners spend their time just… pretending that monopolization doesn’t exist.

Case in point: you’d be hard pressed to find a single instance during their tenure where Democratic FCC Commissioners Jessica Rosenworcel or Geoffrey Starks clearly acknowledge that monopolies are a major cause of the nation’s broadband problems. They’ll ambiguously complain about the “homework gap” or “digital divide,” but they’ll never directly criticize the companies actually responsible.

The FCC currently can’t do much of anything consumers want (like restoring net neutrality) because it lacks a functional voting majority. They lack a functioning voting majority because the telecom industry is waging a coordinated smear campaign against popular FCC nominee Gigi Sohn.

But despite Sohn having faced down a coordinated attack from industry for much of the last year, neither Rosenworcel or Sparks have provided a single instance of public defense of their future colleague. Then of course there’s Brendan Carr, who spends the lion’s share of his time on cable news proposing TikTok bans and pretending he cares about consumer privacy.

Crafting telecom policies to combat authoritarian security threats is good. But not at the cost of the agency’s consumer protection mission, which routinely sees a backseat because it’s a more treacherous road politically. And right now, our policy regulators have become a bit obsessive.

And… selective in what they discuss. The much hyped “race to 5G” wound up being more of a limp, as Chinese 5G is now not only far more widely available and faster than U.S. variants, but significantly less expensive (Chinese 5G plans can be had for as little as $10 a month). Some of that’s due to Chinese state control over the telecom sector, but some it’s courtesy of FCC policy failure (we didn’t stand up to monopolies, failed to make middle-band spectrum available, don’t protect consumers, etc.).

Even when the FCC takes action on China you’ll notice the solutions aren’t fully baked. TikTok bans do nothing, and the “race to 5G” was a notable dud. But the agency also made a big deal about ripping Chinese gear out of all U.S. networks, then flaked on helping smaller companies pay for it. So it’s not like obsessing over China is truly resulting in any remarkable or consistent policies.

The U.S. telecom sector is a picture perfect textbook example of the problems with natural monopolies and corruption, and how, when left unaddressed, both lead to sky-high prices, substandard service, spotty broadband, comically terrible customer service, and a parade of consumer and market harms.

Yet it often feels like regulators spend two-thirds of their time fixated on the other side of the planet when domestic markets are very much in need of some informed, courageous attention.

Filed Under: 5g, broadband, china, consumer protection, fcc, jessica rosenworcel, race to 5g, surveillance, telecom, telecom policy

England Makes Gigabit Broadband A Requirement For All New Home Builds

from the if-you-build-it-they-will-come dept

Thu, Jan 12th 2023 05:29am - Karl Bode

England has taken a big step toward crushing the digital divide with new rules requiring that all new home builds must include gigabit (1000 Megabits per second, Mbps) broadband. Estimates suggest that around 12 percent of the 171,190 new homes constructed in England last year didn’t have gigabit broadband capabilities upon completion.

Amendments to Building Regulations 2010 require that all new builds have gigabit-capable connections, though there is a construction cost cap of £2,000 per home. According to the government’s new guidance, if a gigabit line can’t be found within that price range, the next-fastest speed available has to suffice.

I’m not sure this will be quite as transformative as headlines suggest. Readying a home for gigabit broadband isn’t the same thing as actually delivering gigabit broadband. It can often cost users tens of thousands of dollars (sometimes hundreds of thousands) to get ISPs to expand “last mile” access to your home. Still, mandating that new homes are gigabit ready is useful.

The new laws also make it easier for ISPs to gain access to homes or apartments for broadband installs should landlords prove unresponsive:

Previously, tenants living in the UK’s estimated 480,000 blocks of flats and apartments (also known as multi-dwelling units, or MDUs) would usually have had to wait for a landlord’s permission to have a broadband operator enter their building to install a faster connection. These access rights are essential for the delivery of broadband upgrades as operators are unable to deploy their services without first obtaining permission, either from the landowner or a court, to install their equipment.

Like here in the States, there’s an awful lot of shenanigans where ISPs work in concert with landlords to block access to competitors. It’s taken the FCC here in the States decades and numerous rule revisions to even try and tackle that problem. But it remains very much a work in progress, as deep-pocketed telecom monopolies and their lawyers often tap dance around the requirements.

While many landlords are annoying and difficult, telecom giants often like to over-state landlords’ role in the overall lack of quality broadband deployments. That was evident in New York City, where Verizon flaked on a 2008 agreement to wire the whole city with fiber, then repeatedly tried to exclusively blame landlords for the company’s own (well in character) failure to follow through on the agreement.

There are other policies that are common sensical that we just don’t do because it would (gasp) make it easier to drive competition into monopoly markets. Such as “dig once” requirements that all new highway builds come with fiber-ready conduit already installed. This sort of policy is a no brainer, yet in the U.S. meaningful mandates on this front always seem stuck just around the next corner.

Filed Under: dig once, digital divide, fiber, gigabit, high speed internet, landlords, telecom policy, uk

Tech Lobbying/PR Firm Outed For Faked Op-Eds

from the what-will-the-corn-farmers-do? dept

We get tons of PR spam here at Techdirt, most of which is simply an attempt to get us to write about this or that startup or product launch. It pretty much all gets trashed. Occasionally we hear from various tech lobbyists as well, pushing an angle on a story that supports the angle they’re pushing. But one of the oddest experiences we’ve had was with a firm called LawMedia Group, which we wrote about earlier this year when Declan McCullagh outed the group as having allegedly composed a letter from a group of corn farmers somehow opposed to Google and Yahoo working together. Why corn farmers would be interested in such things isn’t clear — but McCullagh pulled back some of the curtain on the way these sorts of lobbyist groups act, picking a somewhat random “group” and then writing these sorts of letters and simply placing the group’s name on the top — even if (as in the corn farmers/internet advertising situation) the group has nothing to do with the issue at hand.

In our case, as mentioned, the folks at LawMedia Group started out by acting as if we were close friends, and then insisting that they had some really secret info that was damaging to FCC boss Kevin Martin. It’s no surprise why they would approach us on the subject — as we’ve written critically about Martin for years. After ignoring repeated requests for a phone call during which this info would be “revealed,” I finally said that if they had anything they wanted me to see, just send it over. And so they sent a bunch of stuff that basically confirmed what was well known: Kevin Martin has friends who work at AT&T. Shocking, right, that a telco regulator might have friends at a telco? But, of course, it was positioned in a way to make it look really secretive, even to the point of suggesting that Martin really worked for AT&T. In other words, it was totally bogus. I told the guy at LMG that the info seemed pretty pointless, and never spoke to him again — though he and other colleagues keep emailing stories that might make Martin look bad.

Now Declan is back with more stories of questionable activities by LawMedia Group, including what would appear to be a series of op-ed pieces published in newspapers using the names of people who don’t even agree with what’s in the op-ed, but, from the sound of it, may have effectively rented their name out to LMG to use in the op-ed. Most of the article focuses on a guy in Boston who is in favor of net neutrality, but had an op-ed published under his name that strongly argues against net neutrality. The guy admitted that LMG had something to do with it, but refused to provide details. However, when asked his opinion on net neutrality, proceeded to stay stuff in direct contradiction with what was in the op-ed under his name.

While somewhat sleazy tactics like this may be every day business in Washington DC, it’s good to see it exposed, especially when it’s being done so egregiously. At the very least, maybe it’ll get LMG to stop bothering me with bogus conspiracy theories about Kevin Martin.

Filed Under: astroturfing, fcc, lobbyists, telecom policy
Companies: law media group

GAO: FCC Gives Preferential Treatment To Lobbyists, Company-Sponsored Data

from the par-for-the-course dept

It’s well known that folks at the FCC have a rather chummy relationship with the telco industry. After all, many of them either worked in the industry at one point or (more importantly) expect to get lucrative jobs in the industry after they leave the FCC. So it probably should come as no surprise to find out that the FCC tends to favor industry lobbyists and industry data to that of the consumers whose interests the FCC is supposed to be safeguarding. This is according to the GAO who has been doing a fantastic job highlight questionable government activity — specifically with the FCC. In this latest report, there are two key things, both of which are quite troubling. First, the FCC often reveals important information to industry lobbyists, including information on new rulemaking efforts, votes and even how Commissioners intend to vote. This information is often not equally shared with consumer advocates, leaving them at a tremendous disadvantage. Second, in doing research for rulemaking, the FCC often relies on the data submitted to them, by industry representatives. And we all know how trustworthy that is likely to be. It’s also probably worth pointing out that the GAO provided a draft of the report to the FCC and asked for comment, to which the FCC replied “no comment.” Indeed. It appears no comment is really needed.

Filed Under: fcc, lobbyists, telecom policy