After months spent gathering comments about preserving an open and competitive Internet, the F.C.C. requested more feedback on Wednesday about whether regulations should apply to wireless Internet service.

The agency is also asking for comments about one of the most hotly debated Internet regulatory issues: special services that offer to prioritize certain digital traffic for a fee. …

The F.C.C.’s decision to seek further comment during the next 55 days effectively precluded any commission actions until after the Congressional elections in November.

Source

With that single action the FCC buys time. The comment periods generally run 90 days or more depending on depth and technical complexity. But the singular act pushes any decision by the FCC till after the midterm elections. (Feld, if you are out there, I told you this was exactly what the FCC would do.) This is a no decision decision.

Now if you read this HotAir piece, one comes away with a position that the FCC will do a rule making in the dead of night kind of thing. Personally I don’t think it that way. Remember that the FCC is uniquely a device answerable to Congress not the Executive. So this is a move to, like a trapped animal, look for a way out of the trap they are in. The FCC realizes that they may have new masters come January. No since angering them during a lame duck session for any rule making along those lines could be dispatched in short order by reshuffling the Commission.

This is just another indication that the FCC is generally irrelevant to most matters associated with communications. Technology has nearly eliminated the general necessity for band allocation in all but a few distinct areas. And consumer protection, if its needed is the purview of the FTC not the FCC.

Wimax  based networks have already demonstrated the capability ability to deliver serious bandwidth in fixed applications. For those of us using the mobile version, we’re still stuck in the sub 6MBPS quicksand we had on AT&T’s tired old DSL service. New standards will extend Wimax’s capability to deliver more. This leapfrogs the competing LTE standard capability. Without more competition, service providers will have little reason to extend its benefits to consumers regardless of the technology used. In fact, the wireless marketplace is consolidating. The FCC’s proposed solution is to allocate more spectrum by auction. Without rules governing how much spectrum a single entity control in a market, wireless bandwidth will remain expensive and scarce.

More on Wimax 2

Ok lets get something straight. We here at ThirdPipe are FOR a Net Neutrality requirement for carriers. But the current ‘Net Neutrality’ option winding its way thru the halls of the FCC is NOT Net Neutrality. Its nothing but a power grab by the Beltway Bandits to squelch dissent.

Oh but it gets worse. The economics of its do not bode well either —

The study, authored by Charles Davidson and Bret Swanson, forecasts that the nation would hemorrhage 500,000 jobs in a best-case scenario were broadband reclassified as a Title II telecommunications service. That just so happens to be an objective currently under pursuit by members of the Federal Communications Commission (FCC) with support from backers of “net neutrality” policy.

The forecasted job losses are likely to make for unpleasant headlines for the FCC at a time when jobs and the economy remain paramount in the minds of most voters and legislators.

“Especially at time when the national economy is attempting to recover from a major and enduring downturn and private sector job creation remains a concern, the destabilizing impacts of the FCC’s proposals place the nation’s economy at even greater risk,” the study reads.

Telecommunications companies have for months now warned that a formal adoption of the FCC’s reclassification proposal could hamper innovation and infrastructure investment, and observers say this study could provide them with fresh ammunition in the fight against reclassification and net neutrality.

“If this Title II regulation looks imminent, we have to re-evaluate whether we put shovels int he ground,” AT&T chief executive Randall Stephenson said earlier this month in an interview with the Wall Street Journal.

From 2003 to 2009, broadband service providers invested, on average, an annual $30 billion for deployment, which created or sustained some 431,000 jobs. Were that level of investment to dip by a conservative 10 percent in the wake of reclassification, 502,000 jobs would disappear and the nation’s GDP would shrink $62 billion. At 30 percent, the study projects the U.S. GDP would drop by $80 billion, for a loss of 602,000 jobs.

Following suit of their Republican colleagues, a growing chorus of senior Democrats have in recent weeks expressed opposition to the FCC’s regulatory rewrite, asking they instead pursue a legislative solution. Cross-chamber whip counts reveal at least 285 legislators disapprove of the measure.

Flush 500k jobs? Sure could. Do the major Telcos have that many jobs? No. But what is not known by many in the beltway crowd is that a large percentage of the Outside Plant work is today done by contract firms. They would be the first to be laid off on the street if the current proposals are adopted. But even at the Telcos there would be follow on layoffs in the management ranks. Why keep an outside plant manager or a facility supervisor if nobody is laying any FIOS cable? They too would be on the street.

The Net Neutrality move is as bad as the DISCLOCE Act in many ways. But to lose a half a million jobs to boot? Somebody get a broom. The FCC needs sweeping out.

The white paper is located here.

Harold Feld lays another missive out there — Kerry, Other Ds, Defend FCC Going Ahead on Broadband Authority NOI. The primary argument is that the FCC’s detractors, as the Burger King commerical says — “Want it their way”. Now I won’t deny they do, who doesn’t? But Harold, I think you are intentionally dodging a few key points –

We saw this recently with the EPA and carbon emissions. The Congressional climate change bill stalled. So EPA acted under its existing statutes to make sure Americans have clean air and stuff. “Shocking!” Cried Industry. “An appalling power grab!” Agreed industry allies in Congress. “Just doing our actual firkin’ job you told us to do,” responded EPA. “And if you get your act together to provide more detailed guidance on climate change, we’ll be all set to do what you want. Until then, we do the job you told us to do with the tools we have.”

Which brings us back to the current fight over broadband. After the Comcast/BitTorrent case, spending some time pondering what to do, Genachowski concluded that if the FCC wanted to accomplish anything in the National Broadband Plan or have the ability to protect consumers if anything went wrong, he needed to look at the underlying basis for FCC authority and consider a new approach. That includes proposing “Title II-lite,” “Third Way,” whatever you want to call moving broadband out of the “Title I” ancillary services box and into the “Title II” telecommunications services box. Needless to say, the forces in favor of the status quo reacted predictably by fighting any action tooth and nail.

How do I think Mr. Feld misses the mark? –

• The FCC was designated as the protector and arbiter of the wireless realm to prevent conflict and promote its expansion AS A TECHNOLOGY AND SERVICE. That is what the 1934 act is all about and little has changed from that original mission.
• The expanded intent to protect consumers via ‘net neutrality’? If that is the case then the FCC is the wrong agency to even consider, it should be moved to CPSC. That is their charter. Or the FTC if one thinks that market collusion is harming the consumer. But not the FCC.
• Then here is the big one you don’t feign to mention. In your EPA example, the Court (SCOTUS) ruled that indeed the EPA had the responsibility to consider CO2 as a possibly harmful gas as part of its charter in the founding legislation. In the case of the 1st DC Court, Comcast vs FCC, the Court ruled specifically against the FCC as having no controlling authority.

  You can’t in the second instance down play the rationale of the Court for your own ends then upsell in the first instance when it suits your need. The Courts have been reasonably consistent on this matter of administrative law. Good for them and an awful red herring in your missive.

There are of course the nagging bits that the beltway does not want to face. Like, in several survey’s a full third of respondents in target exurban markets said they would not connect EVEN IF THE PIPE PASSED THEIR HOUSE. What a waste of money. Which is why the physical plant rarely strays outside the major MSA on the country. The other little bit, is even if the FCC were to move forward, how does it get funded? Tax? In an election year? With the Democrats on the defensive? And no authoritative legislative means to fulfill it? Again a waste of time.

If the Beltway wants to see a broadband implementation, then they need to change their mindset. A) The pipe for the exurban space is in the air not the ground. B) That means that Congress should grant tax incentives for WISPs to expand their foot print commiserate with the data rate capabilities. C) That the FCC provide fast track tower approvals and the development of a national construction plan consistent with the National Building Code to be able to fast track tower construction.

But Mr. Feld, the NOI is a dead letter politically.

Public Knowledge is at it again. Writing white papers and having discussions on them. All well and good I guess, it keeps somebody employed in a bad economy. But in reality, this is like poking a whale with a bang stick. It does no good for the poker and makes the whale mad. Essentially the white paper in question, Breaking the Logjam:Some Modest Proposals for Enhancing Transparency, Efficiency and Innovation in Public Spectrum Management, suggests rearranging the deck chairs. (Besides the point that verbose titles were verboten when I went to high school.) But not all is lost, there was one glimmer out of the morass —

The Federal CTO, working with the NTIA and other federal agencies, should develop policies enabling and encouraging federal agencies to move from the current system of assigned spectrum allocations to a system leveraging new technologies to permit dynamic assignment to agencies on an “as needed” basis.
In essence, the federal government would transition from a system in which agencies hold the equivalent of a spectrum license to one where the federal government manages a vast pool of wireless capacity from which agencies may “draw” as needed.

The idea that the spectrum is a pool resource not carved up between the FBI, DEA, NSA, etc in small pockets. Much of which because of the utilization never gets used period. So that is a move in the right direction. But other suggestions —

• The NTIA and the Federal Communications Commission (FCC) should expand the cooperation required between the agencies by statute. In particular, the agencies should publish an annual joint spectrum plan based on the mandatory consultation between the Chairman of the FCC and the Administrator of the NTIA,2 and should clarify the “expedited” process mandated by statute for processing applications for mixed federal and non-federal use.
• The NTIA should take steps to improve opportunities for public involvement in its spectrum management decisions, and should launch its own e-government initiative, similar to the Reboot.FCC.Gov.
• The NTIA, the Secretary of Commerce, and the Director of the OMB should “zero base” federal spectrum use, requiring all federal agencies to reapply for spectrum allocations. Failure to reapply, and provide adequate detail on use, will result in elimination of existing spectrum allocation.
• The President should require all agencies to prepare a “spectrum budget” in the same manner they prepare a federal budget, assessing existing and future needs. The NTIA would serve as coordinator for these agencies and would provide technical support, assisted by the federal Chief Technology Officer (CTO) and the Office of Management and Budget (OMB).
• Based on these exercises, the CTO, with support from the NTIA, would assist agencies in upgrading wireless equipment and enhancing the use of spectrum resources for individual agencies, in order to enhance their overall missions.
• The NTIA and the OMB should conduct a comprehensive review of existing federal statutes to determine how private entities can make contributions to federal agencies to enhance federal spectrum efficiency and promote innovative use of wireless resources by the federal government. The review should also seek to establish ways to further enhance public transparency and account ability with regard to spectrum use.
• The NTIA and the FCC should work with state and local governments, and their trade associations, to find ways in which federal, state and local governments can enhance emergency communications and spectrum efficiency, and promote innovative uses of wireless technology at all levels of government.

The rest is merely paper shuffling, for paper shuffling sake for which someone will be issued a grant handsomely, pretty printed, shelved and forgotten in the matter of 18 months. Great work if you can get it. But it solves nothing and in the end just triggers a turf war among agencies in the whole matter.

What is lacking in this paper is the realization that technology renders most of the proposal moot. The glimmer out of the piece was the realization that spectrum is a pool to be utilized, not hoarded. But it does not go far enough. The technology exists today that CPE (Customer Premise Equipment) is capable of self allocation. With that capability in hand, all the other discussions are rendered useless. Poof.

Spectrum utilization by most entities are broken down into two components, infrastructure and ad hoc. Infrastructure being those facilities that have a long lived use of a band. Example being point to point wireless nodes interconnecting buildings. An example of the latter being tactical radios to be used by, say an FBI team for a mission. Regardless with spread spectrum equipment and a valid reservation system, on demand spectrum allocation is possible.Nay it is already being done by the DoD, so it is a reality.

So here is the ThridPipe Federal Proposal –

• Congress shall mandate that in 7 years that all federal wireless usage shall be self allocating spread spectrum CPE. Funding to be allocated to realize this end.
• The FCC is directed to a) Realign the ownership of spectrum to a single entity. b) Licensing is soft revoked, continued use but ownership transfers. c) That a drop dead date is issued for final revocation of license.
• The FCC is directed to issue an RFP for a) The development of infrastructure and ad hoc wireless CPE. b) The development of a spectrum reservation system for (a). c) Implementation of (a) across the federal footprint.

We are at the point, this is not a matter of technology, or a matter of discussion. It is a matter of the will to do it. Lets DO IT, not TALK it to death.

I’m guilty of spending a great deal of time ranting about how we lost competition over the last mile as access transitioned from dial up to broadband. News  of  new competitor Allied Fiber reminds me that there is also a largely uncompetitive market in the backbone:

Newby, who was the chief strategy officer at colocation provider Telex, is pretty impassioned about his plan to bring wholesale fiber to places where existing backhaul providers may not go. It’s a plan similar to Google’s experimental fiber network for consumer broadband, but enacted on a much larger scale, and for businesses. Newby believes that in underserved areas where Allied Fiber will have a presence, the cost of bandwidth will be driven down significantly because Allied will be willing to sell access to the long haul network, at competitive rates, to anyone who wants them — something the incumbents aren’t inclined to do. (Gigaom)

In the late 90’s, there was a tremendous fiber backbone land rush, with start ups investing billions to carry the explosive traffic they expected the booming Internet would generate. Low operating costs, and lots of demand from a growing number of last mile access  providers who fought intensely for subscriber dollars seemed to insure success.  Unforeseen by most was the ability of the duopoly to kill a competitive market with intense lobbying combined with limiting bandwidth demand  by constraining last mile access and a little help from a recession

Instead of investing in infrastructure, the telco and cable duopoly was obsessed with mergers and acquisitions. Nearly all of the new investment by duopoly players during this time was focused on enlarging geographic footprint. While objections were raised, every large merger was approved by a woefully negligent government. Aided by a recession, new multiplexing technology and regulatory manipulation, the duopoly was able to overwhelm most of the start ups . Their assets were bought up for pennies on the dollar by a handful of incumbents whole control the backbone today.

In our current anti-competitive environment a new access provider faces challenges that extend beyond the last mile. Even when a new competitor manages to overcome the local loop roadblock, it will likely be disadvantaged by inflated back haul costs from an incumbent.

Lets hope that Allied fiber not only open new markets in the under served areas, but also helps level the paying field in the rest.

Theaters and studios are complaining about flat revenues at the box office. –

Movie Tickets Reach the $20 Mark

For the first time, a major Hollywood film will hit the $20 threshold at the box office, as movie-theater owners test the public’s ability to absorb ever higher ticket prices.

Several theaters will charge $20 per adult ticket to IMAX showings of the animated 3-D family film “Shrek Forever After,” the fourth “Shrek” installment from DreamWorks Animation. The theaters include the AMC theater in Manhattan’s Kips Bay neighborhood, AMC Loews 34, AMC Loews Lincoln Square and AMC Empire 42nd Street.

The increases weren’t officially announced, but were reflected in prices posted Wednesday on movie-ticketing Web sites such as Fandango.com and tracked by BTIG LLC media analyst Richard Greenfield.

Source

$20 for a ticket. Are they out of their minds?? I will grant that IMAX if done right is worth a reasonable premium but no $20 worth. I can go down to BestBuy 6 months after the fact and buy that movie in Blu-Ray for $24.99. So I spend a marginal overhead for the film vs a single ticket experience. But I just acquired the right to view the thing as many times as I want.

The Suits wonder why the movie going public does not show up any more. Why should they? The prices are too high. Beside with many going to personalized home theatre the rationale for going to a movie house is gone. Buy the flick, or rent, at view at your schedule. But the math is pretty simple — $80 for a family of 4 vs waiting a little and spending merely a $1 from RedBox. Pretty dang clear to me.

How about you?

Update: It appears that the source article was in error. Or should I say that several AMC theaters were in error in how they reported pricing for Shrek. We pass along this as a corrective action.

With the FCC’s broadband baseline set at a paltry 4MBPS, Europe’s recently announced 30MBPS standard should be sounding alarms.  There’s much more to the story than just the minimum acceptable broadband speed arbitrarily set by bureaucrats. The back story is competition and the role it plays.

European broadband has been lead by healthy competition in the most unlikely of places like France and the UK. That open market that includes last mile line sharing for  competition has raised the standard urban connections to some of the world’s most robust at some of the world’s lowest prices. Competition has forced the old school telcos to upgrade infrastructure and streamline operations. New networks cost considerably less to run. And ….. we hear no whining about the need to recover investment in decades old infrastructure.

With the sea change that has made free and accessible information and media the fuel of economic development critical to economic security, broadband competition should be a top priority. At the risk of bending Third Pipe editorial policy on political posts, I have a question for the Obama administration: While you are so eager to emulate all failed aspects of European socialism, why do you shy away from emulating what the Europeans are doing well?

The grand master plan for European broadband is out, and one target leaves the United States in the digital dust—a goal of 30 Mbps “or above” for all Europeans by 2020. So says the European Commission’s Digital Agenda for Europe, which also wants 50 percent of EU households subscribed to links of 100Mbps or more by that year.

….Needless to say, Europe isn’t jealously comparing itself to the United States, high-speed Internet-wise. Here our supposedly bold and fearless Federal Communications Commission thinks it’s cool by setting a pokey universal broadband goal of 4Mbps, sans fiber, which the agency says costs too much. (ARS Technica)

So far, FCC regulation has made US  internet access less competitive than most of the free world. In the pre FCC days of dial up, any and all providers had equal access to the PSTN network, and while telcos enjoyed an advantage, competition for subscribers was robust. Prices fell as low as free (with advertisements).  When broadband came along, the same open access rules enabled competitors to deliver DSL Service over that same network. Exhibiting it’s extreme cronyism, the FCC declared a duopoly to be a competitive market and ended fair (paid) access to last mile to consumers homes. This effectively rubbed out fixed line competition. When the FCC opened new wireless spectrum for a competitive “Third Pipe” to the Internet, it waived rules that would have prevented Verizon and AT&T to buy the spectrum in most major markets (They already controlled most of the communications frequencies in these areas).

Now we have a new chair at the FCC, who has all of the credentials to be called a duopoly super crony. His determination to gain the authority to regulate the Internet should be sounding alarms everywhere. Unfortunately, most big media and tech media are also an agenda media.

Federal Communications Commission Chairman Julius Genachowski on Thursday plans to lay out a roadmap for regulating broadband. This step has been eagerly anticipated since a federal court ruling last month cast doubt on the agency’s authority over high-speed Internet access.

The FCC now regulates broadband as a lightly regulated “information service” and had maintained that this gave it legal authority to act on its national broadband plan, which it released in March, and to mandate net neutrality. But the U.S. Court of Appeals for the District of Columbia rejected this argument.

Since then, the FCC has been trying to decide whether to reclassify broadband as a more heavily regulated telecommunications service, which would be subject to “common carrier” obligations to share networks and treat all traffic equally.

Late Wednesday, the agency said it will seek a “third way” approach that strikes a balance between “weak” rules for information services and “needlessly burdensome” rules for telecommunications services. This approach, the FCC said, would apply a “small handful” of telecommunications regulations on broadband providers and would include “meaningful boundaries to guard against regulatory overreach.” (Yahoo)

Anyone who believes giving the FCC new authority to regulate the pipes needs to objectively review the agency’s past behavior and the professional connections of  it’s board. An open market would be the best way to insure good behavior by access providers. Not only has the FCC stifled competition, Genachowski has publicly stated the last mile line sharing is not on the table. While he advocates opening new wireless frequencies, he also advocates auctioning them to the highest bidder over open public access. If you really think the FCC’s “neutral net” will really be neutral you’ll be very disappointed if the FCC gets what it wants. Don’t say I didn’t warn you.

While the FCC searches for a way to get the authority to regulate the Internet, the net neutrality debate rages on. I stand firm on my position that net neutrality is a very poor substitute for real competition.

Competition ended the day the FCC quit requiring telcos to share their last mile right of ways and lines. That left the telcos and cable guys as a fixed line duopoly. Next, the FCC destroyed the promise of a wireless Third Pipe by not preventing the sale of broadband spectrum to the telcos along with allowing the cable guys buying up a chunk of Clearwire’s national Wimax network. So, with an uncompetitive market, net neutrality rules are being pushed as the fix for unfair traffic management. Never mind the fact that the FCC has done a pathitic job of protecting the public interest so far. It wants us to trust it to do better with new regulations.

As the FCC gets closer to crafting network neutrality rules (assuming they even have the authority to do so), AT&T lobbyists have worked overtime to push the idea that creating such rules would automatically result in job losses. To help nudge this scary meme into the press, they hired their old friend Bret Swanson, formerly employed at the Discovery Institute — a think tank that created both the “Exaflood” (debunked here countless times) and “Intelligent Design”. Back in February Swanson, like most AT&T hired policy wonks, used completely bogus “science” to insist that network neutrality rules would result in 1.5 million job losses. He came to that number simply by adding up all of the people employed by companies that submitted comments to the FCC opposing network neutrality (seriously). (Techdirt)

The idea that net neutrality will result in job losses at AT&T or anywhere else is just plain silly. So is the notion that FCC regulations will prevent unfair traffic management practices. I What is needed is an open market. That means fair sharing of the old copper infrastructure we all paid for years ago combined with some open access broadband spectrum. When there are 4 or 5 options in a given market, the net neutrality issue will take care of itself. That doesn’t mean some regulation isn’t needed. In rural market’s someone will need to intervene. I think that task is best left to LOCAL GOVERNMENTS, not the FCC.

By the way, I can guarantee you that an open market will result in job losses at AT&T. The silver lining to that cloud is that here will be better employers in the same line of business for the displaced to work for.