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Congress Looks to Offer Big Telecoms ‘Prizeâ€TM

Media activists say Net access, local TV control at stake

by Megan Tady

New legislation that fails to enshrine principles of “network neutrality” also federalizes now-local control of TV providers and lets broadband companies leave underprivileged communities behind.

June 21, 2006 – As Congress advances plans to overhaul rules for telecommunications companies, grassroots media groups are outraged over lawmakers’ refusal to enshrine in legislation the principles of "network neutrality," which hold that all Web content should be equally accessible to a given user.

Less publicized portions of the bill could undermine local public-television access and allow Internet and cable providers to keep service out of less-profitable neighborhoods.

The Communications Opportunity, Promotion and Enhancement (COPE) Act of 2006, which passed the House by a vote of 321–101 on June 8,was created to update the Telecommunications Act of 1996 and address changes in voice, video and data services. It would streamline both phone and cable companies’ ability to offer TV, voice and Internet services to consumers.

Critics are blasting the bill as a "give-away" to the telecommunications industry.

"The bill does nothing for the public interest," said Craig Aaron, communications officer for Free Press, the media-advocacy organization leading the "Save the Internet" campaign.

House Energy and Commerce Committee Chair Joe Barton (R-Texas), the author of the bill, did not return The NewStandard’s requests for an interview.

According to the Center for Responsive Politics, which tracks federal campaign donations, telephone utilities firms that stand to gain from the bill have donated an average of $12 million per year in campaign contributions to Republicans and Democrats over the last four years.

Network neutrality proponents fear that without regulation, telecommunications companies will begin discriminating against some content as it comes over the wires to consumers.

The Senate’s Commerce, Science and Transportation Committee will vote on its own version of the bill, called the, Communications, Consumers’ Choice and Broadband Deployment Act, in late June. Free Press says this bill only offers to study network neutrality without establishing any enforceable protections.

Media activists, however, are putting their hope in a separate act introduced by Senators Olympia Snowe (R-Maine), Byron Dorgan (D-North Dakota), and Commerce Committee Ranking Member Daniel Inouye (D-Hawaii), which does provide protections for net neutrality.

The Fight for Network Neutrality

Network neutrality is the longstanding principle that Internet users should be able to access any content available on the Internet with equal convenience and without interference or speed discrimination from Internet service providers.

The COPE Act makes no provisions to enforce network neutrality, which has never been legally enforced, but only calls on the Federal Communications Commission (FCC) to execute its policy statement adopted in 2005. The policy says that consumers have the right to access Internet content of their choice, but it does not mention network neutrality or content speed. The FCC refused to comment to TNS.

Network neutrality proponents fear that without regulation, telecommunications companies will begin discriminating against some content as it comes over the wires to consumers. Companies that provide Internet connections – known as Internet service providers (ISPs) – could control how fast or slow users see information, giving priority to content from companies that pay special fees. Internet activists also fear that aside from the financial incentive to give priority to certain content, companies might have an ideological motive to slow information from dissident websites or sources that criticize certain corporations.

Telecommunications companies would essentially be “double dipping” by charging both for bandwidth and again for content delivery.

But while many groups are sounding the alarm that the COPE ACT will re-write the rules of the Internet, Evan Henshaw-Plath, an Internet consultant who has helped organize dozens of Independent Media Centers around the world, says people should keep in mind that net neutrality has existed for years without a legal mandate.

"It’s a shame that the law didn’t incorporate net neutrality language," Henshaw-Plath said of the House bill. "That said, there has been no law enforcing net neutrality for the last 15 years, since the Internet was commercialized. We’ve had, for the most part, the telecoms abiding by the practices of net neutrality."

Speaking of the current fight over the COPE Act, Henshaw-Plath said: "Is this an important struggle? Yes. Does loss here mean that we’ve lost forever? Well, no."

Henshaw-Plath said telecommunications companies "promised to be good" during the failed struggle to legally safeguard net neutrality under the 1996 Act. "They promised to not implement tier traffic," he said. "And that promise was good enough for awhile, and now they’ve been talking, ‘Wouldn’t it be nice?’"

In fact, many telecom executives have publicly and privately stated their intention to force content providers to "pay for the pipes" that load information.

“It’s a problem that the people who most need to be encouraged to participate are the ones that are most likely to be discriminated against and not have access.”

Edward Whitacre, CEO for AT&T, told Business Week in November 2005, "Now what [Internet upstarts] would like to do is use my pipes free, but I ain’t going to let them do that because we have spent this capital and we have to have a return on it." Whitacre continued, "The Internet can’t be free in that sense, because we and the cable companies have made an investment and for a Google or Yahoo or Vonage or anybody to expect to use these pipes [for] free is nuts!"

Ivan Seidenberg, the CEO of Verizon, expressed a similar sentiment in a question-and-answer session following his keynote speech at the International Consumer Electronics Show in Las Vegas last January. He said, "We have to make sure that [application providers] don’t sit on our network and chew up bandwidth. We need to pay for the pipe."

William Smith, chief technology officer at BellSouth, confirmed in January in an interview with MarketWatch, a subsidiary of Dow Jones, that the company was discussing content charges with Internet companies. "It's the shipping business of the digital age," Smith said.

The schema would establish a dual-charge system for content, with the same ISPs charging the recipient and the content provider for the same bytes of data.

But Sascha Meinrath, a community Internet pioneer, says this double charge would create an artificial scarcity of information. "It will mean that you access certain content faster than other content," he predicted.

Critics say this content discrimination could lead to a conglomerated Internet. Assuming costs for high-speed content provision become truly prohibitive, small, independent hosting operations will lose out if they cannot afford the high costs of competing with the major players.

Several major websites and technology firms have joined grassroots groups in opposing the bill, including Google, Yahoo and eBay. If they decide to fight the major ISPs over net neutrality, telecom giants will have their hands full in choosing to establish a tiered-access Internet.

The Real Prize

Perhaps even more disturbing, say opponents of the COPE Act, is the leeway the legislation gives to companies entering national video franchising.

Calling it "the real prize of the bill," Aaron of Free Press said that in the past cable companies had to negotiate with local communities to establish a franchise. Typical promises from cable companies included providing public, educational and government (PEG) channels that served the community.

But under the COPE Act’s new rules, telecommunications companies would be able to circumvent community input and regulation by applying directly to the FCC.

The bill requires telephone companies to match the number of PEG channels already existing, and national franchises must delineate 1 percent of gross revenues to fund PEG channels. Despite this, Aaron said, "if you’re not already living in a community that has PEG channels, you’re out of luck."

Rick Jungers of the Manhattan Neighborhood Network, the organization responsible for administering the public-access cable television services in Manhattan, said public access channels tend to support "a lot of progressive community initiatives and life issues, cultural issues."

"It’s that one place where people have an opportunity to communicate with their fellow residents using a [video] medium," he said.

Additionally, there is nothing in the bill to stop telecommunications companies from refusing service in rural, low-income and communities of color while focusing instead on neighborhoods that can purchase expensive services.

"That means that all of those people aren’t involved in the community dialogue that’s on PEG," said Anthony Riddle, director of Alliance for Community Media, a national organization focused on media access. "It’s a problem that the people who most need to be encouraged to participate are the ones that are most likely to be discriminated against and not have access."

The bill also fails to force companies to extend Internet access to underserved communities. Although the bill protects "municipal broadband" by securing the rights of local governments to offer high-speed Internet service in competition with private providers, Aaron said the provision does not go far enough to ensure equitable broadband deployment.  

"Having municipal broadband would narrow that gap, but those technologies are still a ways away from being ubiquitous and available to everybody," he said, referring to the wireless connectivity relied on by most municipal networks. "The COPE Act has very weak requirements when it comes to distributing Internet services."

Small Fight In a Larger Struggle

With 45 percent of households in the US without Internet access, according a 2003 Census survey, some media activists say a bigger concern is the digital divide that keeps many Americans from accessing the Internet at all, or at extremely slow speeds.

The Census Bureau also found that for households that did have Internet access, a strong socio-economic factor existed for those who could not afford high-speed Internet. The survey found that more than half of homes with incomes above $100,000 per year had broadband, while less than one-third of households with incomes below $100,000 do.

Consumers can purchase dial-up access for around $10 per month, while broadband access costs, on average, $32 per month for DSL, a "digital subscriber line," and $41 per month for a cable modem Internet, and high-speed services are all but unavailable in many rural areas.

Henshaw-Plath said the effort to legally safeguard net neutrality is part of a larger struggle.

"[The telecoms] want the Internet to work more like your cell phones," he said, "and more like your cable TV, where they get to be the gatekeepers where only people who can pay can get access, and only people who don’t have controversial opinions get access. That’s a very serious issue. But it’s part of a larger issue. Net neutrality is one small fight in a larger war of what the future of the Internet is going to look like."

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The NewStandard ceased publishing on April 27, 2007.

This News Article originally appeared in the June 21, 2006 edition of The NewStandard.
Megan Tady is a staff journalist.

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