OpenVault’s technology can automatically slow down “abusers” who use too much internet service.

Cable companies looking for ways to raise prices for their broadband services without spending money on network upgrades may be interested in OpenVault’s “Revenue Accelerator” — a cloud based internet usage measurement system that can help push subscribers into higher priced tiers or warn them when they are about to face punitive overlimit fees for exceeding their monthly usage allowance.

OpenVault’s goal is to monetize customers’ internet usage, making cable operators certain each customer is paying as much as possible for internet service without facing customer-displeasing overlimit fees from exceeding their monthly usage allowance.

“All these solutions are designed really to do of a couple things,” said OpenVault CEO and founder Mark Trudeau, in an interview with FierceTelecom. “One is to drive incremental revenues, and two is to drive costs [for cable operators] down, all with the idea of increasing profit for cable operators.”

OpenVault will collect customers’ usage behaviors, reporting back every 15 minutes how much bandwidth each customer is using, as well as enforcing cable company policies to automatically slow down “abusers” who are sending and receiving more than their fair share of data. Enforced network management, built into the platform, can automatically punish customers based on violations of the ISP’s Acceptable Use Policies. Usage violators are then reported to the cable operator, targeted for future marketing campaigns to upgrade their service to a more expensive tier to avoid further time-outs on the internet slow lane.

The technology is cheap to deploy, relying on a set of command lines inserted into cable modem termination systems that collect Internet Protocol Detail Record data and send it on to OpenVault.

“We measure all that for the operators and then what our Revenue Accelerator product does is it helps them micro-target their upgrade candidates,” Trudeau said. “This can have just really massive impacts on their revenues, to be able to truly not just micro-target the upgrade candidates, but also provide their reps with the ammunition they need and the visibility they need into their customer’s behavior and into their homes so they can intelligently talk to a subscriber.”

OpenVault claims the implementation of usage based billing and data caps are immediate money-makers for operators, both from current customers forced to upgrade to avoid the cap and from overall usage billing that delivers an immediate payday to cable operators without having to invest in expensive upgrades or service improvements.

“In real-number terms, evidence shows an immediate return as some OpenVault customers have enjoyed as much as seven percent of subscribers upgrading their service within 90 days of usage based billing deployment,” the company wrote on its blog. “For some operators, this translates into increased ARPU (average revenue per unit) of over $5 per subscriber per month. OpenVault customers that have deployed usage based billing have experienced increased ARPU ranging from $1.50 up to $12 per subscriber per month.”

Christmas comes early for Comcast and AT&T, thanks to Ersatz Santa, FCC Chairman Ajit Pai.

In the view of FCC Chairman Ajit Pai and his Republican colleagues serving as members of the Federal Communications Commission, Monday – June 11, 2018 is Internet Freedom Day, marking the official end of net neutrality. Republican FCC commissioners, working hand-in-hand with the nation’s largest telecommunications companies, successfully abolished a pro-consumer rule that ensured all internet traffic was treated equally by your internet service provider, with a ban on paid fast lanes and other types of traffic discrimination. 

The FCC website has a new look today, one that discourages consumers from bringing internet-related complaints to an agency that has invited consumers to reach out about unresolved internet problems since the earliest days of internet access.

While much of the country is focused on the Republicans’ successful repeal of open internet protections, many might have missed the fact the FCC also intends to ‘pass the buck’ on your internet problems to the Federal Trade Commission (FTC), an agency that can take a year or more to bring action against companies suspected of violating the law.

Consumers who visit the FCC’s Consumer Complaint Center will find a stripped down resource that now primarily exists to forward consumer complaints to another federal agency. Chairman Pai has made certain the experience is as discouraging as possible for those who manage to find their way to the FCC’s complaint department (emphasis ours):

If you choose to file an informal complaint with the FCC about an Internet-related issue, we will share the information you provide, including your name and contact information, with the Federal Trade Commission (FTC). Your complaint may be used to investigate cases or in a legal proceeding.

Before proceeding with your submission, please note that an informal consumer complaint should only be filed at the FCC if you have a specific issue with your provider.

If you are interested in submitting an informal complaint about an Internet-related issue, please complete this form.

The old form made no mention of the FTC, which is central to Pai’s new “hands off” policy at the FCC.

This morning, Pai told CBS that the Federal Trade Commission will now work to prevent such cases of “bad apples in the internet economy” from ripping off consumers.

“We’ve empowered the FTC to take action against any company that might act in any anti-competitive way,” said Pai. “The consumer is going to be protected and we preserve the incentive for companies to build out better, faster, and cheaper internet access. Consumers need to be protected and the FTC is the only one under current law that can do that.”

But Pai’s claims don’t ring true to Gigi Sohn, who served as a counselor to former FCC Chairman Thomas Wheeler.

Sohn

“Should consumers or innovators have a complaint about fraudulent, discriminatory, privacy violating or predatory pricing practices of broadband ISPs, the FCC won’t answer their call,” Sohn said. “For the first time since the creation of broadband, the agency will not take responsibility for protecting consumers or competition.”

Neither will the FTC, which warns would-be complainants upfront on its website: “The FTC cannot resolve individual complaints, but we can provide information about what next steps to take,” which is equivalent to calling the fire department because your house is on fire and receiving a booklet that explains how to acquire and use a hose to put the fire out yourself.

ISP’s no longer need fear having a federal agency like the FCC following every consumer complaint. The FTC claims it may share your complaint with local, state, federal, and foreign law enforcement partners, or may be used to investigate cases or hold a legal proceeding. But unlike the guidelines the FCC answered to under the Obama Administration, there is no requirement to force a provider to quickly respond to you, no easy access to statistics detailing received internet-related complaints (such as the tens of thousands of complaints about data caps, throttling, and net neutrality collected by the FCC under the last administration), and no significant likelihood of action. Want an example? The FTC has been charged with ending the scourge of automated robocalls that generated more than 275,000 complaints last year… from the state of Ohio alone. In the last two years, the FTC issued press releases touting cases brought against a total of three alleged telemarketers. Has your phone stopped ringing?

Under the Trump Administration’s FCC, it is open season on consumers, and the complaint department is now closed.

A well-coordinated campaign to manufacture news of a phony cyberattack and give false information to the press to explain why the FCC’s electronic comment system crashed while news of net neutrality went viral has been exposed.

Internal agency emails reviewed by Gizmodo show a clear intention by some agency officials to deceive the media and the public about the nature of serious outages in the regulator’s electronic public comment system during high profile coverage of net neutrality, blaming the outages on an organized distributed denial of service (DDOS) attack that appears to have never happened.

On the night of May 7, 2017, John Oliver did a segment about net neutrality on his HBO show Last Week Tonight. At the end of his piece, he urged viewers to send comments to the FCC in support of net neutrality. It was the second time Oliver’s viewers brought the FCC’s electronic comments system to its knees. After intense demand effectively locked up the system after Oliver discussed net neutrality in 2014, the FCC promised to improve the commenting system to accommodate more traffic. FCC chairman Thomas Wheeler said in 2014 the downtime could be attributed to massive interest in the issue of internet freedom from ordinary Americans.

But three years later, a new administration hostile to net neutrality and a new FCC chairman had a different story about just how interested Americans really were. Wheeler’s story was replaced by Ajit Pai’s claims that real people are not that interested in net neutrality and that the downtime, as well as what he calls “fake comments” left on the system, are the result of nefarious deeds by an unknown party or parties. Pai and his staffers have systematically attempted to de-legitimize and gaslight supporters of net neutrality. In condescending tones, Pai and his allies claimed ordinary Americans were hoodwinked into supporting net neutrality by radical internet groups that have managed to fool them. By also calling into question the legitimacy of millions of comments from net neutrality supporters, Pai and his industry friends have had an easier time decapitating net neutrality protections, despite their widespread popularity.

Gizmodo reports the FCC under Pai and the Trump Administration is extraordinarily secretive about the issue. The agency has refused to produce any credible evidence of a denial of service attack, even when members of the media have sued the agency for the information and members of Congress have demanded to see the evidence.

Gizmodo:

[I]n May 2017, under the Trump-appointed chairman, Ajit Pai, at least two FCC officials quietly pushed a fallacious account of the 2014 incident, attempting to persuade reporters that the comment system had long been the target of DDoS attacks. “There *was* a DDoS event right after the [John Oliver] video in 2014,” one official told reporters at FedScoop, according to emails reviewed by Gizmodo.

David Bray, who served as the FCC’s chief information officer from 2013 until June 2017, assured reporters in a series of off-the-record exchanges that a DDoS attack had occurred three years earlier. More shocking, however, is that Bray claimed Wheeler, the former FCC chairman, had covered it up.

According to emails from Bray to reporters, Wheeler was concerned that if the FCC publicly admitted there was an attack, it would likely incite “copycats.”

“That’s just flat out false,” said Gigi Sohn, former counselor to Chairman Wheeler. “We didn’t want to say it because Bray had no hard proof that it was a DDoS attack. Just like the second time.”

Bray’s exchanges with reporters, which took place via email, were obtained by American Oversight, a watchdog group, under the Freedom of Information Act (FOIA). Gizmodo reviewed the more than 1,300 pages of records last week.

Bray

Most of the claims about a nefarious (and convenient) cyberattack seem to have originated from Bray, the senior official responsible for maintaining the comment system. A subsequent rambling response to the Gizmodo piece written by Bray was posted this morning to Medium.

In it, Bray recasts himself as a victim of a tech reporter who never called him and the general nature of partisan politics in Washington. Bray repeatedly claimed he was nobily working tirelessly to make sure “actual people” could comment on the high-profile issue of net neutrality. Unfortunately, he offered no proof in the form of logs or contemporaneous e-mails or written memos to prove what could be a plausible alternative theory of the traffic jam (namely, a person or persons unknown wrote poorly developed scripts to automatically submit comments to the FCC’s electronic comment system that had the unintended side effect of hopelessly clogging it.) In Washington, staffers confronting a high-profile problem likely to be noticed by their employers and become the fodder of political debate have learned the habit of saving everything, if only to avoid the kind of “guilty until proven innocent” standard of partisan-influenced investigations. The controversy has now achieved exactly the kind of high-profile prominence staffers generally dread.

“I have seen no evidence of a DDoS attack on the FCC comment system,” FCC Commissioner Jessica Rosenworcel told Gizmodo, in a direct contradiction of Bray. “But I did see millions of Americans write in to the FCC to stop its misguided effort to roll back net neutrality. It’s time for the agency to own up to what really happened.”

FCC staffers under the current chairman have a track record of being combative and secretive. There have been occasions when Stop the Cap! has tangled with Matthew Berry, Ajit Pai’s chief of staff. Berry, and other staffers, have been willing to engage in hand-to-hand combat on Twitter and other forms of social media and pass around pro-industry talking points routinely condemning the Obama Administration and the FCC under Chairman Tom Wheeler, while generally supporting large telecom companies:

Looks like broadband providers’ capital investments substantially increased in 2017 after declining in 2015 and 2016. Reversing the failed policies of the prior FCC is having a positive impact, and we’re just getting started! https://t.co/N80UTSpxV5

— Matthew Berry (@matthewberryfcc) May 15, 2018

When not on Twitter, staffers like Bray often serve as off-the-record sources for news services like FedScoop, while also feeding talking points and fake details about the cyberattack-that-wasn’t to the Wall Street Journal. The resulting article proved particularly useful to Bray and the FCC, which used the published news story as ‘independent evidence’ from ‘a third party’ that the attacks were real.

As investigative reporters made it clear they were not going to let the story go, top officials at the FCC have since circled the wagons and have done everything possible to keep the story from leaking out. In the more than 1,300 emails obtained by American Oversight in May, the FCC redacted every internal communication about the 2017 “cyberattack” and how to handle it in the press, citing attorney-client communications or the catch-all “deliberative process privilege” — the favorite obstructive choice of secretive federal agencies looking for a way around Sunshine Laws by denying access to any request for communications involving “governmental decisions and [how] policies are formulated.”

Gizmodo points out they also redacted discussions among FCC staffers about how to characterize the “attack” in response to inquiries from Congress. They even redacted a publicly posted Politico newsletter in full.

“Some of these messages are probably correctly redacted, but avoiding potential embarrassment is not a legitimate reason for the government to conceal an email,” Austin Evers, American Oversight’s executive director, said. “We were skeptical of the FCC’s explanations about its online comment system issues last May, and it’s clear that we still don’t have the full story about what happened.”

Last week, AT&T announced its intention to abandon an appeal of a decision of the 9th Circuit Court of Appeals granting the Federal Trade Commission the right to continue its lawsuit against AT&T for speed throttling its “unlimited data” wireless customers.

The notification came in a surprising four sentence notice filed with the court May 30:

At the May 10, 2018 case management conference in this matter, AT&T informed the Court that it expected at that time to request a 60-day extension from the Supreme Court of the deadline to file a petition for certiorari. See Audio Recording of May 10, 2018 Hr’g at 7:22. Since that hearing, AT&T has decided not to request such an extension and not to file a petition for certiorari to review the decision of the en banc Ninth Circuit, see 883 F.3d 848 (9th Cir. 2018). The deadline to file a petition for certiorari lapsed on May 29, 2018.

AT&T spokesman Mike Balmoris later told reporters: “We have decided not to seek review by the Supreme Court, to focus instead on negotiating a fair resolution of the case with the Federal Trade Commission.”

AT&T’s sudden change of heart surprised many observers, including some closely following the case at the 9th Circuit, which has held regular court supervised meetings to prepare for the widely expected Supreme Court challenge. AT&T notified the court in early May it would file its appeal as soon as May 29, and the court was preparing new discovery guidelines and deadlines between the two parties as the case proceeded.

AT&T had achieved a major victory in 2017 when a three-judge panel at the Ninth Circuit agreed with AT&T’s argument that the FTC had no jurisdiction over the company because part of its business includes traditional telephone service, something defined in law as being regulated exclusively by the FCC. At the same time, the FCC did not seem to have jurisdiction either, because wireless data throttling took place over a network not subject to common carrier service regulations.

Ninth Circuit Court of Appeals — San Francisco.

The Ninth Circuit then agreed to hear the case once again, this time “en banc” — meaning the full court would re-hear the case instead of a limited panel of three judges. In February, the court unanimously found the FTC did have regulatory jurisdiction over AT&T after all:

We conclude that the exemption in Section 5 of the FTC Act – “except . . . common carriers subject to the Acts to regulate commerce” – bars the FTC from regulating “common carriers” only to the extent that they engage in common-carriage activity. By extension, this interpretation means that the FTC may regulate common carriers’ non-common-carriage activities.

[…] This statutory interpretation also accords with common sense. The FTC is the leading federal consumer protection agency and, for many decades, has been the chief federal agency on privacy policy and enforcement. Permitting the FTC to oversee unfair and deceptive non-common-carriage practices of telecommunications companies has practical ramifications. New technologies have spawned new regulatory challenges. A phone company is no longer just a phone company. The transformation of information services and the ubiquity of digital technology mean that telecommunications operators have expanded into website operation, video distribution, news and entertainment production, interactive entertainment services and devices, home security and more. Reaffirming FTC jurisdiction over activities that fall outside of common-carrier services avoids regulatory gaps and provides consistency and predictability in regulatory enforcement.

In short, AT&T’s “get out of regulatory oversight free”-card was revoked, much to its consternation. The company promised a fast appeal to the Supreme Court. The case concerned a number of observers, not the least of which was the Federal Communications Commission, which has been so concerned about AT&T’s novel argument to escape regulation, it filed a brief supporting the FTC with the court:

If the en banc Court were to adopt AT&T’s position that the FTC Act’s common-carrier exception is “status-based” rather than “activity-based,” contrary to the reasoned analysis of the district court below, the fact that AT&T provides traditional common-carrier voice telephone service could potentially immunize the company from any FTC oversight of its noncommon-carrier offerings, even when the FCC lacks authority over those offerings—creating a potentially substantial regulatory gap where neither the FTC nor the FCC has regulatory authority.

That approach is contrary to a common-sense reading of the relevant statutes and could weaken or eliminate important consumer protections. While AT&T may prefer to offer services in a regulatory no man’s land, the law does not dance to AT&T’s whims.

While AT&T publicly expressed confidence about its appeal right up to the day it abandoned it, minutes from the Ninth Circuit trial scheduling and progress conferences reveal AT&T and the FTC were already privately talking with each other to avoid further litigation:

“Parties reported that they are conducting settlement negotiations.”

All observers agree a successful appeal by AT&T to the Supreme Court could have put telecommunications laws and regulations into chaos. Had AT&T successfully restored the three-judge panel’s decision, any telecommunications company could walk away with impunity from FCC and FTC oversight by simply starting a small telephone company serving just a handful of customers. Just one product or service subject to common carrier rules could effectively immunize a phone or cable company from regulations indefinitely, or until Congress changed the law to close that loophole.

Some observers predict AT&T’s decision not to appeal is a prelude to an imminent, favorable permanent settlement of the four-year old case. The evidence strongly suggests AT&T will likely escape any significant monetary punishment, and affected consumers may not get significant (if any) compensation for AT&T’s prior acts:

• The FCC shows no sign of following through on a 2015 press release threatening AT&T with $100 million in fines for its failure to properly disclose its speed throttling policy arbitrarily imposed on unlimited data customers who exceeded a company-defined amount of data usage. At the time the press release was issued, there were three Democrats and two Republicans serving on the Commission. Both of those Republicans opposed the fine and are now part of the Republican majority at the FCC under the Trump Administration. The FCC admitted in court papers that no further action has been taken to fine AT&T. The case was largely left in the hands of the FTC.
• During the Obama Administration, the FTC claimed it was interested in pursuing refunds for affected customers and punishing AT&T for its throttling practices. Last week, Andrew Smith, the FTC’s new director of the Consumer Protection Bureau told an audience today’s priority it to monitor providers over traffic throttling and making sure those practices are transparently disclosed to customers. “We’re planning to examine current practices in the industry,” Smith said. “We’re looking for areas in which ISPs may be engaged in unfair or deceptive practices, and we will bring enforcement action as appropriate.”

Smith

For AT&T, the decision to drop its appeal may have come down to whether it preferred to temporarily escape regulatory oversight until an enraged Congress passed new laws to put AT&T and other telecom companies back under oversight, or living with the kind of “light-to-little touch” regulatory approach favored by the Trump Administration and its regulatory agencies. Whatever deal emerges between AT&T and the Trump Administration’s FTC will likely be “win-win” for the company and the regulator, with consumers offered only token relief.

The goals likely to be achieved in any settlement:

• AT&T would clearly like to avoid a $100 million fine and other enforcement actions, so agreeing to ease throttling (something it has done already) and better disclose the practice would hardly create a problem for the company, especially if fines are dropped as a result.
• The FCC’s new “net neutrality” policy depends almost entirely on effectively abdicating oversight responsibility to the FTC, something embarrassing and hard to justify if AT&T managed to permanently bar the agency from regulating the company.
• The FTC can claim victory by telling consumers they are watching ISPs for undisclosed and unwarranted throttling, without opening up new legal challenges by outright banning of the practice, heavily fining violators, or collecting damages on behalf of customers victimized by prior bad acts.

The Senate approved a resolution on a largely party line vote Wednesday that sends a symbolic message to the FCC it erred when it voted to repeal net neutrality.

The final vote pitted all 49 Democrats against all but three Senate Republicans to condemn the FCC’s decision to rollback the rules, scheduled to take effect in June. The three Republicans that joined the Democrats in favor of preserving net neutrality were Susan Collins from Maine, Lisa Murkowski from Alaska, and John Kennedy from Louisiana — the latter two a surprise.

“Today is a monumental day,” said Sen. Edward Markey (D-Mass.) during debate over the resolution. “Today we show the American people who sides with them, and who sides with the powerful special interests and corporate donors who are thriving under this administration.”

The measure faces a much tougher fight in the Republican-dominated House, where it may have trouble even coming up for a vote.

Using the Congressional Review Act, a law that permits Congress to revisit — and reject — decisions by federal agencies within 60 “session days” of their approval, Democrats drew a clear line in favor of net neutrality, which may become an issue in the midterm elections if the Republican-controlled House refuses to bring the measure up for a vote. If the measure passes the House, it will require the signature of President Trump to take effect. That may be unlikely, considering the president once claimed net neutrality was a plot by the Obama Administration to gain control of the internet.

Kennedy explained his vote in favor of net neutrality as an issue of trust.

“You either trust your cable company or you don’t,” Kennedy explained. “If you trust your cable company, you won’t like my vote. Under the 2017 order, a cable company can censor, throttle, or employ fast lanes so long as it discloses. The response from the other side of that is, well, just switch cable companies. But 22% of Louisianans and 19% of all Americans have access to only one internet service provider that can provide the minimum FCC mandated speed. So what are they going to do?”

FCC Chairman Ajit Pai reiterated his belief net neutrality protections were not needed and would deter investment by cable and telephone companies in their networks, a claim hotly disputed by consumer groups that point to evidence investment rose even after net neutrality took effect.

The issue of keeping the internet free and open remains bipartisan, with wide percentages of Republicans and Democrats in favor of net neutrality. That may put Senate Republicans who voted against the measure and are up for re-election on the hot seat this fall.

NPR:

This issue doesn’t cut along clean party lines, said Steven Kull, who runs the Program for Public Consultation at the University of Maryland and has studied public attitudes on net neutrality. The program’s research has found that majorities of Americans support government-mandated net neutrality protections.

“People are on the Internet a lot and it’s a big part of their daily experience and the prospect that it will be changed in some fundamental way is disturbing to quite a lot of them,” Kull said.

Fear is a great motivator for voters. Senate Democrats believe their resolution that put every Democrat on record in support of net neutrality — and most Republicans on record against it — can turn what was once considered a wonk issue, into a wedge issue this November. “People underestimate the passion of Internet voters, at their peril. They are mad, and they want to know what they can do, and this vote will make things crystal clear,” he said.