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Pai challenges the notion of government providing a free, open internet

Federal Communications Commission chairman Ajit Pai today laid out his vision for removing broadband access from under Title II regulations imposed in 2015 by a 3-2 Democratic majority on the Commission.  Two decades prior to the Commission’s net neutrality order that imposed Title II regulations, the internet was already free and open. Companies such as Google, Facebook, and Netflix came into being under a non-Title II regime. Title II was an archaic regulation designed in the 1930s for plain old telephone services.

Title II boiled down to a solution in search of a problem, Mr Pai further argued. Rather than energizing a demoralized Democratic Party base licking its wounds from the butt hurt of the 2014 mid term elections, Former president Barack Obama and the rest of his Title II proponents wound up disincentiving $5.1 billion in capital investment and dissuaded companies to not hire or lay off 75,000 to 100,000 laborers.

What particularly caught my attention in Mr Pai’s remarks was his highlighting the belief that Title II proponents have about government and freedom, namely that government was going to guarantee freedom on the internet. A close read of the American Constitution tells you that its framers were concerned about the natural propensity of government to squash freedom. This is why the document put in place checks and balances against attempts to usurp power over individuals. Net neutrality opponents and members in Congress who support continued imposition of the rules confuse “rights” with “freedom.” The rights issued by government are permission slips that say “a person can be, but only up to the limits we allow them to be” versus freedom which is innate.

This is not to say that freedom doesn’t have its limits. You can’t just violate another person’s spectrum without facing the consequences that result from moving into another person’s space. But how those consequences are managed should be left up to the individuals or in the case of broadband, the broadband access providers and their customers. Allow customers and access providers to define the limits, terms, and consequences of their relationship, including price and type of service. In the 21st century, this type of strategic partnership between customer and access provider is very possible.

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Replace “telecommunications carrier” with “broadband access provider and voila, privacy rules

The Federal Communications Commission today issued some guidance on protection of consumer privacy.  Short of any specific privacy rules, the FCC will apply provisions of Section 222 of the Communications Act to providers of broadband access services.  In other words, substitute the term “telecommunications carrier” with the phrase, “broadband internet access service provider” and we will have a template for broadband access providers to follow when determining how to use consumer information that they collect either from consumers themselves or the other broadband access providers with which traffic, data, and private information are exchanged.

Which has me asking.  Just what type of consumer information do broadband providers collect and how do they use it? To provide an example of information collected and how it is used, I took a look at the privacy agreement provided by All Points Broadband, a broadband provider located in Loudon County, Virginia.  The company collects personal information including a subscriber’s name, billing address, credit card information, service address, and the nature of the devices used by the subscriber.

Personal information provided by the subscriber to the company may be combined with other personal data gleaned from the company’s Facebook page, the company’s affiliates, third party operators, market research firms, or credit reporting firms.  All Points also collects non-personal information such as the specific device identifier for a subscriber’s device, the browser being used by the subscriber, or the page requested during a subscriber search.

The company also collects information about the use of their network including the equipment used on the subscriber’s premises, time when the service is being used, the type of data being transmitted, the content received and transmitted by the subscriber, and the websites visited by the subscriber.

And just how is this data being used?  Network information is used by the company to monitor the performance of the company’s network.  The company, using network information, assesses how the subscriber uses the company’s services including the amount and type of data beineg received and transmitted.

Personal information may be used to send the subscriber marketing and advertising messages about the company’s servivces and website.  While disclosure of personal information to third parties is provided only with a subscriber’s consent, the company reserves the right to disclose non-personal information or any other information that the subscriber decides to make public.

In an era of big data, broadband companies are sitting on a treasure chest of information that can generate up to 10% economic value, depending on the quality of analytics, both from internal and external monetization points of view.

Could the FCC’s application of Section 222 to data collected by broadband providers threaten a provider’s revenues and profits?  My answer is yes.  For example, take Section 222(c)(1) of the Communications Act.  Under this section, broadband access providers receiving customer proprietary network information would only be able to use this network information in the provision of broadband services from which the information was derived or for service necessary for providing broadband servivces.

Broadband providers would have to make the argument that network information has a distinct meaning from personal  or run the risk of losing revenues from the acquisition and distribution of this data.  Should the FCC’s network neutrality rules survive court challenge, the agency should consider making a distinction in its rules between network information and personal information.

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Taking “toll free” to the 21st century level

If you want to see the true colors of net neutrality rule proponents look no further on their stances on zero rating.  A zero rated site is a site that a wireless carrier has exempted from its fee structure or data cap.  The company behind the site may have decided that exempting access to its site via its app may be good for attracting additional eyeballs which means more people viewing the ads that may be appearing on the site.  For a wireless carrier wanting to heat up the competition with other carriers, offering their subscribers data cap exemption when accessing popular websites like Facebook may help garner subscribers.

So far it looks like when 12 June 2015 rolls around and the Federal Communications Commission’s net neutrality rules kick in that the strategic partnership between mobile carriers and app developers in the form of zero rating may remain unharmed.  Carriers, according to published reports, are turning to zero rating because of the additional revenues that can be generated by advertisers.  And as I allued to earlier, app developers or advertisers are taking advantage of the traffic they can create by making it easy for consumers to avoid additional data charges when viewing their sites.

The FCC, in some deference to the net neutrality advocacy groups, will apply additional scrutiny to these arrangements because at the core of the net neutrality debate is whether content providers that bring better value, better marketing, or both, should be able to dominate a market against those content providers who are not able to market their content as valuable.  The FCC will, on a case-by-case basis, determine whether a consumer’s lawful access to internet content is being hindered by broadband access providers.

The “case-by-case” review will cause snarls on the way to product deployment and those delays will increase an app developers cost of deployment combined with lost ad revenues as the FCC makes up its mind as to whether a strategic partnership between app developers, advertisers, and broadband access providers violates net neutrality.  I believe that such arrangements even under the FCC’s net neutrality rule shouldn’t be viewed as violations.

First, there is apparently no blocking on the part of a broadband access provider pursuant to Section 8.5 of the FCC’s net neutrality rules.  The app providers are, by definition, edge providers and they are offering sponsorship of subscriber data as such.  Nothing in a zero rating scheme appears to prohibit any broadband access provider from visiting sites that compete with a zero rated site.

Second, zero rating a site is not the same as throttling according to Section 8.7 of the FCC’s rules.  Throttling is defined as impairing or degrading lawful internet traffic; slowing it down and negatively impacting the quality of the traffic’s flow.  Nothing in the definition of zero rating implies that a broadband provider would have to slow down traffic to site B in order to meet its zero rating promise to site A.  There would be no incentive since the company behind the app is reimbursing the broadband provider for revenues lost when exempting subscribers from data caps.

Finally, I wouldn’t equate zero rating with paid prioritization, and apparently not even net neutrality proponents are doing so.  Under Section 8.9 of the FCC’s net neutrality rules, paid prioritization sees a broadband access provider managing its network in order to favor one content provider’s traffic over another provider’s traffic in exchange for compensation.  In the case of zero rating, a content provider’s traffic is not being given any higher priority treatment.  Nothing in the definition of zero rating says that one provider’s traffic moves through a faster lane.  Neither can an argument be made that consumers are being disadvantaged.  On the contrary, the consumer benefits because they are accessing more content at a lower cost.

Zero rating is a win for consumers and content providers. The FCC, while expected to scrutinize these relationships, should not go overboard with oversight in this area.

 

 

 

http://www.npr.org/blogs/alltechconsidered/2015/02/25/388948293/what-net-neutrality-rules-could-mean-for-your-wireless-carrier

Ajit Pai asks Netflix what gives on net neutrality

Federal Communications Commission member Ajit Pai yesterday wrote a letter asking Netflix to explain why it is not participating in the development of open standards for video streaming and why, according to press reports, the largest generator of online traffic in North America is using its own proprietary software to cache its traffic.

Mr. Pai is curious about the reports that Netflix may be charting its own course for delivering video services including the development of of fast lanes for its own traffic, all while advocating for equal treatment by internet service providers of content provider traffic.

Open standards, as defined in a paper by Ken Krechner, represent common agreements that enable communications.  Open standards help provide interoperabilty on the internet and maximize access to resources.  I guess what drives Mr. Pai’s curiosity is if the concept of net neutrality is based on transparency of management practices and the equal treatment of data, why would Netflix want o use proprietary caching technology to speed up the transmission of its video services at the cost of competition with other content providers?

Mr. Pai has asked Netflix to respond to his letter by 16 December 2014.

 

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Open data sounds like a big library

Posted January 23rd, 2014 in net neutrality, Network Compact, open data and tagged , by Alton Drew

I dropped by the Data Innovation Day festivities via cyberspace a couple hours ago and as always it’s good to learn about what’s happening in the information and knowledge space.  Poor buffering of the webcast has me blurring the individual panels, but I noted one panelist’s description of data as an asset.

Assets bring tangible and intangible benefits and while I agree that data and its side kicks, information and knowledge, are assets, I prefer the term working capital.  No matter how you phrase it, data, knowledge,and information should be allowed to generate tangible residuals for the producers.  This means how the data, information, and knowledge are managed is very important.

Herein lies a conflict or dilemma for open data.  Open data has a three-prong definition.  The first part has to do with availability and access.  According to the website, OpenDataHandbook.org, “the data must be available as a whole and at no more than a reasonable reproduction cost, preferably by downloading over the internet. The data must also be available in a convenient and modifiable form.”

The second part of the definition is premised on reuse and redistribution.  ”The data must be provided under terms that permit reuse and redistribution including the intermixing with other datasets.”

Third, there is universal participation.  Again, according to OpenDataHandbook.org, “everyone must be able to use, reuse and redistribute – there should be no discrimination against fields of endeavor or against persons or groups. For example, ‘non-commercial’ restrictions that would prevent ‘commercial’ use, or restrictions of use for certain purposes (e.g. only in education), are not allowed.”

When you add in the notion of interoperability of datasets, open data sounds like a big library system that combines inter-branch book exchanges and a steroid infused Wikipedia-esque ability to update information. Interoperability would be defined here as the capability to inter-mix datasets.  The problem, according to some of the panelists, would be where would you store this information matrix and who would pay for it?

The likely natural place, in my opinion, would be at one state university in each of the fifty states and the U.S. territories.  When I think of open data I think of what the internet was meant to provide; an exchange of information, and not the social interaction nonsense on Facebook, but knowledge and information that can help improve economies and societies.  Individuals accessing the information would pay an annual nominal fee for a digital library card with proceeds from the subscriptions and contributions from governments and corporations used for purchasing data from content providers.

To make these hyped-up libraries marketable, they should be able to purchase super fast access to subscribers via internet cyber lanes, especially given the huge amounts of data that could be stored at these super-libraries.  Deploying this type of information service could only be best promoted if the Federal Communications Commission decided to not apply any of the available section 706 tools for exercising jurisdiction over broadband providers and by default edge providers.

As capital, data, information, and knowledge increase in value the faster and further they can be redistributed and converted into productive activities.