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Legislative Update
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February 21, 2008
Comcast in the Hot
Seat at FCC Internet Hearing; Legal scholars,
technology experts, entrepreneurs make the case
for an open Internet
CAMBRIDGE,
Mass. -- On Monday, Comcast will be scrutinized
by the Federal Communications Commission at a
public hearing about the policies that will
shape the future of the Internet. The Cambridge
event will feature testimony from legal
scholars, technology experts, entrepreneurs and
industry representatives as part of the FCC's
ongoing investigation into the blocking of legal
content by the cable giant and other Internet
service providers. The
SavetheInternet.com Coalition will be
recording public testimony outside the hearing
throughout the day.
In January, the FCC launched an official inquiry
in response to a complaint filed by Free Press
and members of the
SavetheInternet.com
Coalition -- as well as thousands of letters
from concerned citizens. The Associated Press
first exposed Comcast last fall for actively
interfering with peer-to-peer file-sharing
networks. The company argues the FCC has no
authority to prevent it from blocking Internet
traffic on its networks.
Comcast and other big
phone and cable companies have been lobbying to
kill Net Neutrality -- the longstanding
principle that prevents them from discriminating
against Web sites or services based on their
source, ownership or destination. Last week,
Reps. Ed Markey
(D-Mass.) and
Chip Pickering
(R-Miss.) introduced the "Internet
Freedom Preservation Act" (HR 5353) -- landmark
legislation that firmly establishes baseline
consumer protections in communications law to
ensure the Internet is open and free from
discrimination.
"The value of the
Internet comes from the millions of people and
businesses who use it," said
Marvin Ammori
, general counsel of Free Press and lead author
of the complaint that spurred the FCC's
investigation. "We can't let the narrow
interests of Comcast or any other network
providers short-circuit the Internet's limitless
economic and social possibilities. With stakes
so high, the FCC must act quickly to shut down
anti-competitive and discriminatory actions that
put the open Internet in jeopardy."
The hearing will open
with statements from all five FCC Commissioners,
followed by a policy panel, where Ammori and
renowned legal scholars
Tim Wu
of Columbia Law School and
Yochai Benkler
of Harvard Law School will square off against
representatives from Comcast and Verizon.
"What we're going to
see on Monday is a trial of the Internet," said
Wu, who coined the term "Net Neutrality."
"Comcast is in the docket, accused of crimes
against the public interest, and we'll see how
well they are able to defend themselves."
The second panel will
delve into the technological aspects of Internet
traffic. It will feature, among others, several
experts from the Massachusetts Institute of
Technology;
Scott Smyers of Sony Electronics; and
Eric Klinker,
chief technology officer of BitTorrent --
developer of the innovative file-sharing service
targeted by Comcast.
Vuze Inc. -- which
filed its own complaint against Comcast with the
FCC -- will demonstrate its technology for
sharing high-definition video prior to the first
panel. Outside the hearing, there will be a
"technology fair" where online innovators will
show off their products and services.
"Now is the time to
establish rules and regulations that will enable
the evolution of the Internet," said
Gilles BianRosa,
CEO of Vuze. "A few powerful companies control
the bandwidth through which consumers access
Internet content, and through which innovative
companies like ours deliver services. We support
building an open Internet that fosters
innovation for all."
In addition to testimony from experts in the
field, the FCC has invited the public to share
opinions for the official record. The
SavetheInternet.com Coalition will be
recording public testimony outside the hearing
throughout the day. And consumers across the
country unable to attend the hearing are invited
to record and upload their testimonial videos to
www.vuze.com.
Both the testimony
recorded outside the hearing and the videos
uploaded to the "FCC Channel" on Vuze will be
submitted as a part of the official public
record in this hearing.
Experts are available
for interviews prior to the hearing. To schedule
an interview, contact Craig Aaron of Free Press
at (202) 265-1490, x25 or
caaron@freepress.net.
View the FCC's official announcement and agenda
here:
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-280373A1.pdf
The
SavetheInternet.com Coalition is a
grassroots, nonpartisan alliance of hundreds of
groups, thousands of bloggers, and more than 1.6
million concerned Americans who have joined
together to protect Internet freedom and Network
Neutrality. No corporation or political party
funds the coalition. Statements by the
SavetheInternet.com Coalition are not
necessarily endorsed by every participating
organization. Learn more at
www.SavetheInternet.com
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FEBRUARY 19, 2008
http://rghm.wordpress.com/2008/02/15/peg-access-in-the-digital-age-the-entire-congressional-hearing-in-order-in-youtube-clips/
PEG Access in the Digital Age”: The Entire Congressional
Hearing, in Order, in YouTube Clips
Posted February 15, 2008 by Rob McCausland
Here are clips of the January 29 hearing held by the House
Telecommunications & Internet Subcommittee, “PEG Services in
the Digital Age.” The clips are in chronological order,
beginning with opening statements (1-7), witnesses testimony
(8-11), and representatives’ questions (12-20).
The hearing was called largely in response to Comcast’s
recent attempt at ‘channel slamming’ in Michigan (moving PEG
access channels into the 900 digital-tier range) but also
included a look at AT&T’s U-Verse and its second-class
citizen treatment of PEG access channels. Witnesses
represented the City of Dearborn, Comcast, AT&T, and the
Alliance for Community Media.
In addition to Annie Folger’s testimony on behalf of the ACM
(11), PEG access advocates will be especially cheered by the
questions asked by Markey, Dingell, Gonzalez, Rush, and
Solis (12, 14, 16, 18, 19), as well as by Chairman Markey’s
closing remarks (20).
PEG advocates should write their representatives, whether
or not they are supportive of PEG access protections,
and whether or not they are on this Committee, and
let them know how much you and your communities value these
channels. Then plan to make an appointment to visit them
during our national conference in Washington this July )http://www.ourchannels.org/?p=125) .
(It also wouldn’t hurt if you commented on these clips as
you see fit over at YouTube. Though the clips are presented
in order here on “Clippings”, over there you can help
stimulate and broaden participation in the discussion. Soon
these will also be on blip.tv, and archive.org, so there
will be even more opportunities for creating and pursuing
public conversations on these topics.)
NOVEMBER 9, 2007:
To: Members, Alliance for Community Media
Fr: Anthony Riddle, Executive Director
Re: FCC 2nd Report and Order
The 2nd Report and Order was issued this week.
According to counsel, it is close to what was expected. The
Order underscores the potential damage to LFAs in the areas of
franchise fee & PEG support. Any real damages will be decided
by the outcome of our pending 6th Circuit appeal of the 1st
R&O.
Summary and commentary on the 2d R&O:
Please keep in mind that
this is a summary and does not include all matters contained in
the Order. It also relays the arguments made by the FCC in
support of their Order, even if we disagree that they are
correct or relevant. The original order (30 Pages) can be
found at:
www.fcc.gov
]
I. Applicability of 1st R&O
Rulings to Incumbents (¶7-25).
Overall, the FCC concludes
that the shot clock and the build-out rulings in the 1st R&O do
not apply to incumbents.
The FCC concludes that the 1st R&O's rulings on franchise fees
and most, but not all, of its rulings on PEG and I-Nets, do
apply to incumbents.
On the critical issue of
when or how these rulings will be applied to incumbents, the 2d
R&O seems to abandon the FNPRM's proposal to apply those
rulings to incumbents at the end of their current franchises.
Apparently, the incumbent must have franchises changed in other
venues such as courts or utilities commissions—though the FCC
does not offer a definitive answer on venue.
A. Shot Clock (¶ 8).
The shot clock rule will not apply to incumbents because
it was based on Sec. 621(a)(1), which does not apply to
incumbents. The franchise renewal provisions of Sec. 626 are
inconsistent with the shot clock. It would, if applied
to incumbents at renewal, place the Order in conflict with the
Cable Act.
B. Buildout Requirements (¶
9).
The FCC ruled that incumbents will have to keep existing
build-out requirements despite disallowing build-out
requirements for new entrants.
C. Franchise Fees (¶
10-11).
The FCC ruled that the Franchise Fees section of the 1st
R&O (¶ 94-109) "applies equally to incumbents and new
entrants." They are ruling that the FCC correctly interprets
the cable act definition of franchise fees and that the Act
makes no distinction between incumbents and new entrants. They
say that payments "made to support the operation of PEG access
facilities are considered franchise fees…, unless they are
capital costs, which are excluded from franchise fees under
Section 622(g)(2)(C)."
These are 1st R&O rulings which
will rise or fall on the outcome of our pending 6th Circuit appeal.
The new rulings rest on the previous ruling. We will file in one
of several ways to make sure these 2nd R&O rulings are
overturned if the court overturns the 1st R&O.
D. PEG/I-Nets (¶ 12-15).
The 2d R&O extends some of the PEG and I-Net rulings of the 1st R&O
to incumbents.
-
It extends the
PEG non-capital costs/franchise fee aspects of the 1st R&O to
incumbents.
-
It does not
adopt standard terms for PEG channels.
-
It allows that
requirement for PEG support is reasonable as long as such support is
subject to the franchise fee cap.
In other areas, the 2d R&O
declined to extend aspects of the 1st R&O to incumbents. Of
particular note, the FCC held that, while the 1st R&O ruled that it
would be unreasonable to impose greater PEG carriage or support
obligations on new entrants than incumbents, the reverse is
not true: The 2d R&O states that it "may very well be
reasonable" for an LFA to impose more burdensome PEG carriage or
support obligations on an incumbent than on a new entrant. The FCC
added that it "see[s] no statutory provision that categorically
precludes such an approach."
This claims that in those cases
where an LFA grants a new entrant a franchise with lesser PEG
obligations than the incumbent, the incumbent operator cannot rely
on this Order or the Cable Act to support any claim that it is
entitled to the same lesser PEG obligations as the new entrant. The
cable industry is likely that the cable to appeal this part of the
2d R&O.
The FCC attempts to fix
problems in the 1st R&O regarding the meaning of “pro
rata” and “matching” support of PEG by new entrants. We will
forward clarification on this as we work through the difficult and
somewhat confusing passage.
The 2d R&O rules that most of
the I-Net determinations in the 1st R&O do not apply to incumbents.
The FCC added, however, that incumbent operators are free in the
future to present the FCC with evidence that the I-Net rulings in
the 1st R&O should apply to them, but that providers will have to
identify the particular problem that application.
E. Renewal
The FCC said that it disagrees with suggestions that its rulings
will mean that PEG support would be frozen at current contribution
levels without the possibility for future modification. They seem
to be saying that new entrants eventually face the renewal process
with its mechanisms for adjusting PEG requirements to changed
community needs.
This means that when new
entrants like Verizon come up for renewal, they will be subject to
the same Sec. 626 PEG need and interest reassessment as, in fact,
Verizon will be an "incumbent" when its renewal rolls around. There
do not seem to be minimum lengths to franchises anywhere in the law
or in the rulings.
F. Timing of Applicability to
Incumbents (¶ 19).
This is perhaps the key issue in the 2d R&O. The 2d R&O concludes
that the 1st R&O's rulings are applicable to incumbents 30 days
after Federal Registry publication. The 2d R&O, however,
places several potentially helpful qualifications on this
conclusion.
G. MFN Clauses (¶ 20).
The FCC notes that some franchises may contain most favored
nations (MFN) clauses that would allow the incumbent, consistent
with its existing franchise, to take immediate advantage of the
FCC's rulings.
The FCC rules that MFN clauses
are NOT preempted. The MFN ruling will be particularly problematic
for LFAs whose incumbent franchises have both an MFN and a
substantial I-Net obligation. We know that Verizon and AT&T do not
build I-Nets.
The 2d R&O recognizes that
"franchise agreements involve contractual obligations and also
note[s] that some terms may have been implemented as part of a
settlement agreement regarding rate disputes or past performance by
the franchisee. As a result, we believe that the facts and
circumstances of each situation must be assessed on a case-by-case
basis under applicable law to determine whether our statutory
interpretation should alter the incumbent's franchise agreement."
The FCC goes on to say the 2d R&O "should in no way be
interpreted as giving incumbents a unilateral right to breach their
existing contractual obligations," nor can the 2d R&O "be
used [by an incumbent] as an independent basis for obtaining
retrospective relief."
Conflicts
The Order addresses some of the ways the FCC perceives that
conflicts between LFAs and incumbents concerning the applicability
of the FCC's rulings to existing franchises might be resolved.
First, the FCC "urges LFAs and incumbents to work cooperatively to
address those issues." If that fails, the FCC recognizes that some
disputes "may make their way to courts." This strongly suggests
that the FCC expects disputes between individual LFAs and incumbents
over individual franchise agreements to go to the courts, not the
FCC.
There are strong arguments
that the FCC's decision not to preempt MFNs is arbitrary, capricious
and inexplicably inconsistent with its 1st R&O ruling preempting
franchise "level playing field" provisions. Like all level playing
field provisions, an MFN is designed to deter an LFA from granting
more favorable terms to a new entrant than the incumbent's franchise
terms -- precisely the supposed evil that the 1st R&O relied on to
justify preempting franchise level playing field provisions.
II.
Sec. 632 Customer Service Standard Issues (¶ 26-33).
As LFAs urged, the FCC adopted its tentative conclusion that Sec.
632 prohibits the FCC from preempting state or local customer
service laws that exceed the FCC's cable customer service standards.
It recognized that, under Sec. 632, the FCC's standards "are a floor
…, rather than a ceiling, and thus do not preclude LFAs from
adopting stricter customer service requirements."
The FCC also rejected "AT&T's
request for uniform local customer service standards or data
collection requirements."
III. Applicability to
Statewide Franchising Laws.
The 2d R&O never mentions or addresses the question of whether the
"state law exemption" that the FCC fashioned in the 1st R&O extends
to the 2d R&O's application of 1st R&O's rulings to incumbents.
Leaving this question unanswered in the 2d R&O will be a source of
considerable uncertainty & confusion for LFAs in states falling
within the 1st R&O's state law exemption.
Please keep in mind that this
is a quick summary and does not include all matters contained in the
Order. It also relays the arguments made by the FCC in support of
their Order, even if we disagree that they are correct or relevant.
It is a good idea to read the
Order itself—especially the dissents by Commissioners Copps and
Adelstein
10/31/2007
What the FCC Ruling Might Mean to Public Access
Anthony Riddle
Executive Director, Alliance for Community Media
In a 3-2 vote, the FCC decided to extend the video franchising rules
that it issued in December to incumbent franchises.
It is somewhat difficult to know exactly what this means since the do
not issue the rules to the public when they vote on them. However, our
conversations have suggested the following may be true:
1) The franchise fee and PEG funding components of the original order
will likely apply to incumbent franchises—they may not have to wait
until the franchises expire before adopting these rules.
2) On the other hand, the FCC seems to be saying that the franchises are
not automatically rescinded by the order. They are punting, it appears,
to other authorities such as, perhaps, the courts or regulatory bodies
for how the order affects the language of specific franchise agreements.
It would depend on state law, the franchise in question and specific
wording.
3) It is not clear how this order is affected by state laws. One might
assume that those areas of state law not preempted by the original order
would like-wise not be affected by this second order. We don’t know.
4) The order seems to not preempt “most-favored nation” clauses of
franchises. This would mean that an LFA would have to offer an incumbent
a deal substantively no worse than that offered a new provider.
It is expected that the rule would go into effect in two to three weeks,
when the FCC finally issues it in writing. There are likely some legal
procedures following that and before implementation could take place.
This is our first take from second-hand information. Please return here
in the next few days for additions, corrections and deletions.
This ruling is one more attempt to destroy even the most humble aspects
of community control, self-determination or diversity in media. Note
that media concentration, localism, net neutrality, and broadcast
ownership by women and minorities are all on the verge of negative
rulings by a three member majority of the FCC. It is an unacceptably
greedy and small-minded view of our future as a nation. It will not long
stand.
10/31/2007
Order Prevents Local Authorities from 'Unreasonably Refusing to
Award Competitive Cable Franchise
John Eggerton
Broadcasting & Cable
In a 3-2 vote with
Democrats
Michael Copps and
Jonathan Adelstein dissenting, the Federal
Communications Commission Wednesday extended immediate video-franchise
relief to incumbent cable operators. The commission extended
similar relief to telco video providers in
March and said at the time that it planned to do the same for incumbents,
although it also said at that time that it said it planned to apply the
relief only when existing cable-franchise agreements were up for renewal.
Read more:
http://www.broadcastingcable.com/article/CA6495913.html
10/31/2007
FCC Vote Opens Cable Competition
By Kim Hart
Washington Post Staff Writer
When several Loudoun County neighborhoods were built five years ago, a
Dulles company won long-term exclusive contracts to provide cable service to
hundreds of residents.
The Federal Communications Commission voted today to ban such contracts
between cable TV providers and the owners of apartment buildings,
condominium complexes and planned subdivisions. The ban on exclusive
agreements will help promote competition and reduce cable rates for an
estimated 100 million consumers, FCC members said in interviews.
The move opens the door for telephone giants Verizon and AT&T, which now
offer video services, and smaller cable competitors such as RCN. Those
companies have argued that long-term cable contracts lock them out of key
markets.
Cable companies and apartment-building owners say exclusive agreements allow
them to offer reduced rates to residents. Property owners can negotiate
rates in return for guaranteeing a large number of customers for cable
providers, who in turn say they could not otherwise afford to extend their
networks into apartment buildings.
The ban had unanimous support from the five-member FCC. Chairman Kevin J.
Martin said in an interview that cable rates have almost doubled over the
past decade while rates for Internet and wireless services have dropped
because of competition.
Now that other companies are trying to go head-to-head with cable operators,
"we have to make sure we are removing any barriers for people to be able to
come in and compete," Martin said.
The FCC has pressured the cable industry to adopt more competitive
practices. Last year, it forced municipalities to speed the process for
phone companies to enter television markets. Another proposal approved today
extends that provision to cable companies.
"We want to even the playing field for similarly situated players,"
Commissioner Robert M. McDowell said. "What's fair is fair."
About a quarter of the U.S. population lives in apartments, and industry
experts estimate that 5 to 10 percent of those buildings have exclusive
contracts. Many contracts last five to 10 years, while a small number can
last indefinitely.
The order abolishes exclusivity clauses in existing contracts as well as
future deals -- a reversal of the commission's previous ruling that such
contracts benefit consumers by letting landlords negotiate lower rates.
8/20/2007
FCC To Extend 'Franchise Reform' To Cable
http://www.broadbandreports.com/useremail/u/141383
FCC Commissioner Robert McDowell says that the agency is preparing to offer the
cable industry the same video-franchising help they gave the telcos last
December(http://www.broadbandreports.com/shownews/82067).
The FCC is currently being sued (http://www.lasarletter.net/drupal/node/437) by
States who say only Congress has the authority to implement such rules, which
the FCC insists /"streamline"/ the TV franchise system, allowing faster
deployment of TelcoTV.
McDowell, who recently penned an editorial (http://www.broadbandreports.com/shownews/FCC-What-Broadband-Problem-86061)
downplaying broadband penetration woes, spoke before the free market think tank
the Progress & Freedom Foundation, informing them of the looming changes
(http://money.cnn.com/news/newsfeeds/articles/djf500/200708201415
DOWJONESDJONLINE000363_FORTUNE5.htm): While a handful of states have
created statewide franchises, the majority of the U.S. still operates on a local
basis, meaning a new entrant would have to seek literally thousands of licenses
in order to be able to operate a national television service. The FCC rules are
aimed at streamlining that process. They place a 90-day shot clock on local
governments to rule on a franchise application. The rules also prevent
governments from making unreasonable demands on applicants or attempting to levy
exorbitant fees on them. Of course in modern FCC parlance, /"unreasonable
demands"/ includes forcing an operator to offer broadband and TV service to more
than just a city's most profitable neighborhoods. Phone operators, their think
tanks and the FCC have been working hard the part few years to demonize
the existing franchising process (http://www.broadbandreports.com/shownews/82501)
so they can eliminate build out requirements (the very reason many
/"unprofitable"/ rural neighborhoods currently have cable TV).
8/16/2007
Here is a glimpse of what is happening across the country in
regards to contracting with the incoming television providers, Verizon and AT&T.
This city commission meeting took place in Pittsfield, MA.
http://video.google.com/videoplay?docid=-3778309293400410978&pr=goog-sl
8/14/2007
AT&T Asks Court To Reconsider 'U-verse' Decision
Company's new interactive video service must abide by cable-TV rules, judge said
by Patricia Daddona The Day (CT)
AT&T has asked the U.S. District Court in New Haven to reject a recent federal
opinion that finds the same rules for cable programming apply to a new video
product offered by the phone company. At the same time, one of the plaintiffs in
the case, the state's Office of Consumer Counsel, has asked Judge Janet Bond
Arterton to halt AT&T's acceptance of its new "U-verse" interactive video
technology until it obtains a cable franchise license and to direct the state
Department of Public Utility Control to require the company to take that step
immediately. --->
http://www.theday.com/re.aspx?re=a2c05fec-cc83-4daa-88aa-2cfcb26b7ae4
8/14/2007
Cable TV PEG channels deserve lawmakers' aid
Asheville Citizen-Times (NC)
Competition usually results in lower prices and better service and products. Who
can argue with that? The question is, better service and lower prices for whom?
In the case of cable television franchises, a 2006 North Carolina law passed in
an effort to encourage competition could eventually mean better service and
lower prices for densely populated affluent areas. It could mean poor or no
service for poor or rural areas.
That's not all the Video Service Competition Act accomplished. It provided a
windfall for cable companies, which will no longer have to negotiate contracts
with local governments. Local governments demanded capital and operating revenue
for public, education and government (PEG) channels and other benefits as a
condition of granting franchises. They also required service to all areas
meeting basic density requirements. To make matters worse, the hoped for
competition hasn't materialized.
An effort to mitigate the impact on PEG channels, sponsored by Sen. Walter
Dalton, D-Rutherford, passed the Senate during the 2007 session but stalled in a
House committee after significant provisions were removed from it. Despite great
demand and potential economic significance, PEG channels are barely scraping by.
Lawmakers should restore the provisions that were removed and pass the bill into
law during the short session. --->
http://www.citizen-times.com/apps/pbcs.dll/article?AID=200770813050
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