August 2010

The Department of Justice and Comcast/NBCU

[Commentary] Comcast can potentially maintain its regional-monopoly power over video-to-the-home by making online video distributors' subscription products unattractive to consumers.

It's called monopoly maintenance, and it's just like what Microsoft did more than ten years ago -- there, the DC Circuit agreed, MSN sought to leverage its market power into the nascent browser market in order to hang onto its operating system dominance. This time, the nascent market is online video aggregation and distribution - so-called "over the top" video. Comcast knows that viewers may want to cut the cord. (Pew and comScore and other people say the cord-cutting numbers are growing.) They'd like to hang onto their pricing power in the face of this phenomenon. The cable programmers have every interest in playing along so that they can reap fees from guaranteed subscription distribution. And they have to do what Comcast wants because Comcast controls distribution access to 25% of US households.

Comcast would like cable programmers to put everything behind a TV Everywhere wall. So, if you're a DirecTV subscriber with a AT&T DSL connection, you won't be able to purchase access to Comcast's TV Everywhere online portal (currently weirdly branded Fancast Xfinity TV) a la carte. And if you're a competing online video distributor, with a new goofy name that we haven't yet taken to heart, you won't necessarily be able to buy access to programming that your subscribers love at a reasonable price. Not only that, but because Comcast is effectively pricing online video subscriptions at zero - by tying access to their cable subscription - consumers will be unhappy paying separately for anything substantial online. The cable companies may be succeeding in holding off the threat to their cable video franchises.

This delay is good for Comcast and other cable companies, because it maintains their monopoly in regional video-distribution. It's good for traditional programmers. But it's bad for consumers -- who will inevitably be paying higher prices.

CCHIT, Drummond as Named Electronic Health Record certifiers

The Office of the National Coordinator for Health Information Technology (ONC) named the Drummond Group, of Austin (TX), and the Certification Commission for Health IT (CCHIT), of Chicago (IL), to be the first organizations authorized to test and certify electronic health records under ONC's temporary certification program.

Announcement of the certifying organizations means that EHR vendors can begin to get their products certified as capable of the functions necessary to support meaningful use of health IT, said Dr. David Blumenthal, the national health IT coordinator, Aug. 30. The temporary program, which will expire in December 2011, is designed to enable health IT vendors to have their products and services certified in time for providers to meet 2011 deadlines for qualifying for first stage meaningful use requirements.

Hurricane Earl may test telecommuting workers

If Hurricane Earl, now a major hurricane, hits the East Coast of the U.S. later this week, the top concern for IT executives may not be data center outages but loss of Internet access for telecommuting workers.

Forecasters say the storm could possibly hit land somewhere between the Carolinas and New England sometime before the start of Labor Day weekend. Critical data centers, with backup generators, facilities and fuel supplies, are now built to continue operating during storms. The same can't be said for the computing setups that telecommuters maintain in their homes, and they may be put to the test this year.

NASUCA Talks Broadband, Universal Service Reform at FCC

NASUCA spoke with Federal Communications Commission staff to discuss universal service and broadband issues. NASUCA discussed whether it is necessary to continue to support traditional voice services for rural and non-rural carriers, the need for a rate census for rural carriers, whether there are amounts in the high-cost fund that are not necessary, and the need to ensure rates for broadband services in rural areas are reasonably comparable to those in urban areas.

AT&T Says No Dark Fiber for E-rate

AT&T met with Federal Communications Commission staff to discuss the FCC's proposal to make dark fiber eligible for E-rate support. AT&T said Section 254 does not support making dark fiber eligible for E-rate funding because dark fiber is not a "service" and is merely a physical facility that can only be used to provide a service if electronics are attached to it.

AT&T said Section 254 calls for making "services" available to schools and libraries. AT&T said if the FCC decides to make dark fiber eligible for support, it should do so in a manner that furthers the goal of increasing broadband deployment in un-served areas.

AT&T Defends Paid Prioritization Of Web Traffic

In a filing this week to the Federal Communications Commission, AT&T defended the idea of allowing businesses and others to pay to ensure faster access to their Web content, saying the Internet's key standard setting organization has supported the idea of paid prioritization and that it is being used today by businesses of all sizes.

AT&T Senior Vice President of Regulatory Affairs Robert Quinn aimed to dispute claims from Free Press and other supporters of network neutrality, the idea of barring broadband providers from discriminating against content, that paid prioritization "is not taking place today, and, if permitted, would be a viable option only for a few select 'content giants that have deep enough pockets' to pay for it, to the exclusion of smaller and minority-owned businesses and non-profits," he wrote. He added that "paid prioritization is expressly contemplated by the Internet Engineering Task Force (IETF), the Internet standard-setting organization; it is widely available from multiple providers today; and, no less important, it is used by many businesses of all sizes." Quinn argued that banning paid prioritization would be a "colossal mistake that would harm countless businesses and their customers."

Why the FCC can't do its job on broadband access

In a letter to the editor, Commissioner Copps says an Aug. 26 editorial "An open, innovative Internet" wrongly stated that a court decided the Federal Communications Commission has no authority over Internet service providers.

What the D.C. Circuit Court of Appeals said was that the section (Title I) of the communications statute cited by agency lawyers did not support the FCC ruling against Comcast's blocking of BitTorrent. This was a predictable outcome of FCC actions during the Bush administration that consciously moved broadband Internet access from Title II, which would have supported the commission's authority, to a murky place that invited court challenge. This was a major flip-flop from the historic -- and successful -- approach of forbidding discrimination on our communications networks. Now is the time to put broadband back under Title II, where it belongs -- and under which many smaller companies continue to offer Internet access to the public. Nor is this debate about regulating the Internet. It's about whether consumers or a few huge Internet service providers will control consumers' online experiences.

The Verizon-Google plan that The Post endorsed creates a two-tiered Internet at the expense of the open Internet we now have, almost completely excludes wireless and transforms the FCC from what is supposed to be a consumer protection agency into an agent of big business. I thought we'd had enough of that. To expect big telecom and cable duopolies to protect consumers while a toothless agency stands quietly by is to expect what never was nor will be.

Verizon's Pact With Google Would Keep Internet Open, Tauke Says

Verizon's proposal with Google for Internet-traffic rules will meet demand for an open Internet, said Thomas Tauke, Verizon executive vice president for public affairs.

"We need to get this right" to promote investment, Tauke said in a speech at an Aspen, Colorado, conference. Tauke said consumers would benefit from added services. "We want to protect the Internet but we also want to offer consumers more services," such as remote monitoring of blood pressure, Tauke said. "The broadband platform, in addition to the open Internet, is the platform for innovation and growth in the years ahead."

He said adopting the proposal would allow President Obama to meet a promise he made to voters on the campaign trail. "It fulfills the president's campaign promise of non-discrimination and transparency on the Internet."

Verizon Defense of Veroogle Plan Falls Short

[Commentary] Tom Tauke's case came up short in two general areas and in a few specific ones.

First, the internal contradictions of an Internet divided against itself cannot stand. Second, the defense skirted the uber-issue of how to implement any programs -- Verizon's, Google's, or anyone's -- without the Federal Communications Commission having any authority to do so.

As a framework issue, it's not sufficient to say that the plan meets President Obama's campaign promise of "non-discrimination and transparency on the Internet," as Tauke claimed. It would be acceptable if the Internet existed only in the wired world, but, alas, it doesn't. As FCC Chairman Julius Genachowski has said, it's the same Internet, whether reached from a personal computer or from a mobile phone. So by excluding the wireless world from even the minimal suggestions the two big companies made, they cleave out all of the future growth in Internet usage from wireless devices and networks. Between the two of them, Verizon and AT&T control about 70 percent of the wireless market, so it's easy to see why they want the high-growth sector to be fenced off.

Why net-neutrality rules should be applied equally

[Commentary] In one way, the joint network neutrality proposal from Google and Verizon earns its skeptical reception. Google and Verizon make a fundamental mistake in not treating wired and wireless connections alike.

What about the competitive nature of wireless access, compared with the monopoly or duopoly of wired broadband in most areas? Verizon, Google and other advocates of keeping wireless unregulated neglect two factors that constrain competition. First, 3G coverage maps of carriers illustrate how many areas have just one or two choices for mobile broadband. Second, long-term contracts mean most users can vote with their wallets only every two years. The biggest reason to apply network neutrality regulations to wired and wireless alike is basic economics. Anytime the government applies one set of rules to some competitors in a market but not others, it distorts that market.

Benton

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