October 2016

The Federal Communications Commission released "Section 257 Triennial Report to Congress Identifying and Eliminating Market Entry Barriers For Entrepreneurs and other Small Businesses." The FCC under Chairman Tom Wheeler says it has created "unprecedented opportunities for new and diverse media voices to find audiences," primarily through Open Internet policies like Title II reclassification of Internet service providers. The FCC was asked by Congress to give a status report every three years and to make recommendations for legislative changes that would further the goals of "1) diversity of media voices, 2) vigorous economic competition, 3) technological advancement, and 4) promotion of the public convenience and necessity."

One of the changes the FCC is looking for, while Congress is asking, is more time to investigate complaints, saying that the current one-year statute of limitations should be tripled to three years, arguing that would "strengthen its ability to enforce its rules, "including its activities to protect small businesses." While it says it has acted on numerous fronts, the most important has been "the development of an open, interconnected broadband ecosystem that has given small firms access to marketing and production capabilities that were once available only to large and established firms." "Our Open Internet Order protects entrepreneurs and small businesses’ free and open access to the Internet, enabling innovation without permission," said FCC Chairman Tom Wheeler. "We all know the stories of young entrepreneurs who used the open Internet to start companies in dorm-rooms and garages that would eventually topple incumbents to become world-leading companies. But fast, fair, and open networks don’t just offer a platform to build web-based companies, they also help small brick-and-mortar businesses grow." The report argues that high-speed access has "radically" lowered small business entry costs, and has also "taken action to create new opportunities for small companies to acquire crucial inputs such as wireless spectrum and broadcast licenses" and has "reduced paperwork requirements for small firms."

[Commentary] A problem that AT&T presents, that would only be exacerbated by the merger, is the potential to invade the privacy of its millions of customers. In 2006, AT&T whistleblower Mark Klein revealed that the company was secretly sharing all of its customers’ metadata with the National Security Agency. Klein, who installed the fiber-splitting hardware in a secret room at the main AT&T facility in San Francisco, had his whistleblowing allegations confirmed several years later by Edward Snowden’s NSA leaks. While that dragnet surveillance program was supposedly shut down in 2011, a similar surveillance program still exists. It’s called “Project Hemisphere.” It was exposed by The New York Times in 2013, with substantiating documents just revealed this week in The Daily Beast. In “Project Hemisphere,” AT&T sells metadata to law enforcement, under the aegis of the so-called war on drugs. A police agency sends in a request for all the data related to a particular person or telephone number, and, for a major fee and without a subpoena, AT&T delivers a sophisticated data set, that can, according to The Daily Beast, “determine where a target is located, with whom he speaks, and potentially why.”

Where you go, what you watch, text and share, with whom you speak, all your Internet searches and preferences, all gathered and “vertically integrated,” sold to police and perhaps, in the future, to any number of AT&T’s corporate customers. We can’t know if Alexander Graham Bell envisioned this brave new digital world when he invented the telephone. But this is the future that is fast approaching, unless people rise up and stop this merger.

[Commentary] This merger is ginormous. It would put the nation’s largest multichannel video provider (thanks to newly acquired DirecTV), the second-largest wireless company and the third-largest broadband provider under the same corporate umbrella as HBO, CNN, TBS, TNT and the Warner Bros. movie studio. Forget Ma Bell. This is Monster Bell.

AT&T Can’t Be Trusted: For years and through multiple merger proceedings, AT&T has promised to expand high-speed broadband and failed to deliver, only to resurrect the same promises when it’s ready to make another deal. AT&T’s list of lies and chicanery is too long to reprint here.

More Than Just a Merger: It’s important to recognize just how much the political landscape has shifted. There is deep popular distrust of the rigged system that AT&T/Time Warner represents and broad bipartisan frustration with the failure of merger after merger to deliver any public benefits.
Is there really enough popular and political will to stand up to AT&T’s lobbying juggernaut and block this deal? Stranger things have happened.

[Craig Aaron is the president and CEO of Free Press and the Free Press Action Fund]