I usually don’t spend a whole lot of time debunking the more crazy conspiracy theories about Net Neutrality because I presume most online users are smart enough not to be suckered into sideshow distractions, usually paid for by providers trying to wave shiny keys at consumers to get them to support things exactly opposite their own best interests.  Unfortunately, there are a few shills out there who insist on trying to conjure up bizarre conspiracy theories about Net Neutrality representing some sort of Obama Administration/left wing takeover of the Internet.

When Newsbusters, a conservative media watchdog group, bought into this (and also sprang for the deluxe undercoatings, fabric protection, and deluxe floor mats), it was time to fire up the Debunk-o-matic once again and set the record straight.

What is particularly insulting is the ongoing effort to try and co-opt conservatives into this corporate protection circus, when truth be told, conservatives should absolutely be in favor of Net Neutrality for the same reasons any other person, regardless of where they fall on the political spectrum, should be — it protects their rights to be able to speak out on the issues that concern them the most, judged on the quality of their content, not on how much money they can pay to be sure those views can travel unimpeded to interested readers across the country and beyond.

Put on the rubber boots, because we’re going to splash through some inch deep puddles:

Enter the similarly-misnamed ‘net neutrality’ movement, which advocates total government control of Internet browsing. Net neutrality would forbid Internet service providers from regulating traffic on their networks, and would place that regulatory control in the hands of the FCC.

While the left bemoans restrictions by private companies on their subscribers’ use of the Internet, progressives have few qualms with allowing the federal government a say in what we can or cannot see, do, or say on the Internet.

The centralized control of Internet use by the federal government would provide a powerful tool for the censorship of websites deemed politically unfavorable. The current administration’s labeling of right-wing fringe groups as ‘extremists’ and potentially national security threats, and the labeling of town hall protestors as ‘political terrorists’ suggests that the realm of impermissible internet use could conceivably include groups that espouse intense opposition to federal policies.

I think author Lachlan Markay has been stuck in a parallel universe, like in that Star Trek episode, because he defined Net Neutrality the exact opposite of its reality.

The FCC can’t even get rational limits on cable system ownership to survive court review.  How Markay believes a naked attempt by the FCC to regulate political content on the Internet will pass muster requires something more than simply writing alarmist claims it will happen because he says it will.

The feeble effort to link town hall protesters and Obama conspiracy theories to the issue of Net Neutrality is a transparent effort to co-opt conservatives into a cause that means standing with the providers waiting to throttle their broadband speeds and charge their favorite websites more money.  I don’t believe for a second conservatives trust the local cable or phone company to do the right thing by them, as they continue to be stuck with ever-increasing bills for channels they don’t watch and certainly don’t want to pay for and phone features they don’t want or use, but end up paying for anyway.

Though no elected net neutrality advocate would ever suggest that the movement intends to regulate content, pundits on the left have been far more forthcoming. In March, a blogger at the Huffington Post lauding net neutrality wrote, “We have a very rare opportunity right now to lock in a progressive advantage in Internet communications, information sharing, and Netroots mobilizing.”

Markay attempts to bolster his argument by linking to a Huffington Post blogger that supposedly lets it all hang out in public — conspiracy revealed, case closed.  He assumes his readers won’t bother to click on the link, because if they do, they’ll discover Markay’s source didn’t have to be linked via HuffPost, he could have just turned around to the guy figuratively sitting at the desk behind him and quoted him directly.  Yes folks, he linked to a “Contributing Editor for NewsBusters.org,” the very site Markay writes for.

Seton Motley isn’t the go-to-guy for the quality expose either.  Indeed, Motley himself quoted from Joseph A. Palermo, another HuffPost blogger who penned a piece that proved he didn’t really understand Net Neutrality either.

Palermo instead advocated that progressive causes use broadband to bypass the “media filter” and talk to audiences directly.  Motley saw the words “Net Neutrality” in the headline and figured he’d done his job for the day.

Not so much. Not one of these people appears to understand what Net Neutrality is all about.

Net Neutrality is completely above the partisan divide because it insists, regardless of content, if it’s legal it should not be impeded by a broadband provider and should be allowed to travel unfettered across their wires.  Indeed, it also demands that the Internet be a true democracy of ideas, not one of entrenched interests with lots of money that can buy their way onto the fast lane while others make due with a potentially slower “free lane” that some providers proposed.

There you have it, straight from the horse’s mouth. The left is seeking net neutrality as a means of consolidating control over the Internet, the same way it sought consolidated control over the airwaves with the Fairness Doctrine, and the same way it is now seeking that same objective in the guise of ‘diversity’ and ‘localism.’ Those on the center-right should not be fooled into thinking that ‘localism’ or ‘net neutrality’ promote free enterprise or free speech.

Yes, three people who completely misunderstand the basic premise of Net Neutrality have weighed in and passed judgment on Net Neutrality. Palermo wasn’t writing about Net Neutrality and it should have not been in his headline.  Motley went along for the ride and assumed Palermo knew what Net Neutrality was, and then reflexively attacked just because Palermo plays for the blue team and Motley plays for the red.  Markay just provided the frosting for this big cake of wrong and added even more rhetorical sprinkles on top.  All that’s missing from this recipe for disaster is a provider to come on by and overcharge everyone for a piece.

The true risk of consolidation of control of the Internet isn’t coming from the federal government, it is coming from the providers themselves.  Where Markay has no concrete examples of actual government abuse, I do have real world examples of what happens when Net Neutrality protection is not guaranteed by law.  Providers in Canada, where Net Neutrality does not exist, uniformly throttle the speeds of certain content, and at least one provider directly blocked access to a website because of a political/business dispute the site had with that provider.

What should really scare conservatives is not having Net Neutrality.  These policies guarantee the right for all Americans to speak their minds and share their views, even those polar opposites Glenn Beck and Janeane Garofalo.  Let the best ideas win.

Opponents of Net Neutrality regularly dismiss concerns about providers blocking, interfering with, or rejecting content as little more than scare-mongering.  Even in the case of competitors, they assure us, no provider would ever consider getting between the customer and the services they choose to use.  Therefore, we don’t need Net Neutrality provisions enacted into law.

Wouldn’t you know, Cablevision-owned Newsday, a newspaper on Long Island, just unknowingly illustrated what happens when a company puts its own competitive and ownership interests ahead of not only the customer, but also newspaper common sense.

As any newspaper reader knows, the local cable and phone companies are not shy about advertising their products.  For years, Verizon has been spending several hundred thousand dollars a year to run full page ads touting its FiOS service on Long Island.  Such regular advertisers are hard to find these days in the ailing newspaper industry.  Last year, Newsday itself was put up for sale, acquired by Cablevision for $650 million dollars.

Now that the local cable company owns Newsday, they’ve decided to reject advertising from Verizon for its FiOS service. Verizon is now Cablevision’s biggest competitor, providing fiber optic service for television, broadband, and telephone service across Long Island.

The New York Times reports that Newsday has basically told Verizon “don’t call us, we’ll call you” when the phone company inquired about advertising space.

Newsday won’t comment about the reasons why Verizon’s ads were rejected, other than issuing a generic statement:

“We do not comment on specific ads except to say that Newsday, like every other media company, including The New York Times, accepts or rejects advertising at its own discretion,” said Deidra Parrish Williams, a Newsday spokeswoman.

Eric Rabe, a senior vice president of Verizon, told the Times that was fine with him, noting that’s money from Verizon’s pockets not going to feed Cablevision’s pervasive presence across Long Island.

The Dolan family, which runs Cablevision, dominates Long Island, running the cable system, a popular news channel – News 12, and is still the primary place consumers go to acquire broadband service.  Now they also own the biggest newspaper on Long Island as well.

This hasn’t been the first instance that Cablevision-owned Newsday has gotten embroiled in ethical controversy.  The Times notes:

In January, the top three editors at Newsday did not report for work for a few days amid reports that they had been fired or had resigned in a dispute with Cablevision over the paper’s coverage of the New York Knicks basketball team, which is also owned by the company. The editors returned to duty, and neither they nor the company offered a full explanation of what had happened.

Newsday also recently rejected advertising from the Tennis Channel, which is upset with Cablevision because it will not carry the channel.  The Tennis Channel was rebuffed by Newsday when it tried to buy ads inviting viewers to find the network on Verizon FiOS or satellite.

Kelly McBride, the ethics group leader at the journalism foundation Poynter Institute, was troubled by Newsday‘s antics.

“Newspapers accept ads at their own discretion, but they generally set the bar pretty high for rejecting advertising, because they don’t want to be seen as denying access to free speech,” she said. She added that appearing to deny an ad for competitive business reasons, rejecting an ad that is not obviously offensive or failing to explain the rejection, could undermine a paper’s credibility.

Could a company that considers it has the discretion to reject competitors’ access to its properties also extend that notion to its broadband service?  If a competing video provider used broadband to deliver access to its channel lineup, would a competitive threat like that be welcome on Cablevision’s Optimum Online?  How about criticisms of the company or its assets?

Newsday has chosen loyalty to its owner over lucrative advertising revenue to help sustain the paper.  That has disturbing implications for the broadband world as well.

Enacting Net Neutrality protections into law guarantees a company never finds itself in a quandary over where loyalties lie.  These protections guarantee that providers do not hamper, block, or interfere with the online services customers want to utilize.  No “competitive reasons” need ever be used as an excuse to block service from consumers.

Cablevision has not engaged in any online bad behavior to date, but why wait around to find out what the future holds?

Astroturfers like Scott Cleland got all excited yesterday about another misinformed piece about broadband usage caps from George Ou, a technology blogger who previously gained infamy from his strident opposition to Net Neutrality and his ridicule of the “scare-mongers” who predicted throttled speeds, multi-tiered broadband service, penalties and blocks for using Voice Over IP services, and providers trying to control what you see on the net.

Back in 2006, he wrote a three-pager on ZDNet lambasting Save The Internet, MoveOn, and other Net Neutrality proponents who didn’t agree with Ou’s position that this was simply a technology issue.  He accused the groups of hysteria at a fever pitch over their concerns Net Neutrality opposition was much more about politics, profit, and protection of the providers’ business models.

With positions like that, Ou need not ever worry about job security because his rhetorical stars are in perfect alignment with big telecommunications companies.  I’m sure as long as he joins the broadband tug of war on the side of AT&T and other big providers, some policy institute, astroturf group, or other industry-friendly job would always be there for him to take.

Oh wait.  He has.  But more on that later.

These days, Ou has been pondering broadband usage caps, our bread and butter issue on Stop the Cap!

You do not get a cookie if you guessed he’s all for them, because that would be too easy.

Ou decided that the recent comparison between broadband usage caps in Japan and the United States by Chiehyu Li and James Losey of the New America Foundation, was… problematic.  That usually means we are about to get a technological-jargon-cannon barrage in an effort to suggest those folks at the New America Foundation ‘just don’t understand how the Internet works.’

You decide:

Li and Losey point out that while Japanese ISPs caps the upstream; they are generous with unlimited downstream while American ISPs are beginning to cap both the upstream and downstream.  But this is a flawed analysis because capping the upstream effectively cuts to total downstream peer-to-peer (P2P) traffic to the same levels.  And because P2P is one of the most heavily used application on the Internet accounting for the vast majority of Japanese Internet traffic, cutting upstream usage greatly reduce all P2P traffic and all Internet usage which was necessary because their Internet backbones were severely congested.  I’ve argued that it is far more efficient to manage the network but until then the caps are needed.

Another problem with Li and Losey’s analysis is that it only looks at the usage cap without an analysis of the duty cycle and its ramifications.  When we compare the usable duty cycle between ISPs in Japan compared to ISPs in the U.S. derived from Li and Losey’s data, we see a completely different picture.  By splitting the U.S. ISP usage caps (some of these caps are only in proposal phase) into an upstream and downstream cap proportional to the upstream/downstream connection speeds, I was able to generate Figure 1 below.  What it actually shows is that U.S. broadband providers have usage caps that allow users to use their Internet connection far more frequently than users in Japan.  So while a user in Japan is capped to 40 minutes a day of upstream Internet usage, which indirectly caps download speed because it severely trims the number and generosity of P2P seeders.  AT&T’s proposed DSL usage caps (similar to other DSL providers) allow for 1111 minutes of usage per day on the upstream and 97 minutes on the downstream per day.  So broadband consumers who are dissatisfied with their tiny Time Warner usage caps can simply switch to their DSL provider.

I guess that wraps that up.  Or not.

Ou wants us to assume quite a bit in his own analysis.  His contention that the “vast majority” of Japanese Internet traffic is peer-to-peer is “proven” by linking to an earlier article… written by him… saying just that.  But let’s grant Ou the premise that peer-to-peer is at the epicenter of bandwidth congestion in Japan.  Ou defends Japanese providers for specifically targeting the upstream traffic, pointing out stingy torrent users that don’t give as much as they get will automatically be speed limited during downloads (Bit Torrent’s way of equal sharing).  But he never extends the upstream cap argument to the United States, where he implies a similar traffic overload is occurring.  Instead, he merely acknowledges that domestic providers are experimenting with caps that limit both uploading and downloading, impacting every broadband user, not just those “problem” peer to peer users.

Caps.  The necessary evil?

Ou is okay with the equivalent of dealing with a pesky fly in the kitchen by setting the house on fire.  Doing that might solve the fly problem, but makes living there unpleasant at best in the future.

In fact, the impetus for dealing with the peer to peer “problem” in Japan turns out to be as much about copyright politics as bandwidth management.¹

I also have no idea why Ou would spend time developing a “duty cycle” formula in an effort to try and convince Americans that those generous looking caps in Japan are actually worse for you than the paltry ones tested in the United States.  His formula is dependent on the speed levels offered by Japanese vs. American providers to work.  But then Ou tries to debunk the speeds on offer in Japan as more fiction than reality, and throws his own “duty cycle” formula under the bus as a result:

Li and Losey also paint a dire picture that Japan has 10 or more times the connectivity speed as the US, but the most accurate real-world measurement of Internet throughput in Japan according to the Q1-2009 results from Akamai’s State of the Internet report indicates that Japanese broadband customers only average about 8 Mbps.

Ou then exposes he is completely clueless about the state of broadband in some of the communities that actually cope with usage caps, or were threatened with them.  Ou’s suggestion that unhappy Time Warner Cable customers could simply leave a capped Road Runner for DSL service from the phone company leaves residents in Rochester, New York cold.  For them, that means coping with an Acceptable Use Policy from Frontier that defines 5GB per month as appropriate for their DSL customers.  In Beaumont, Texas, the limbo dance of caps last left residents picking between a cap as low as 20GB with AT&T or a 40GB “standard plan” from Time Warner Cable, before Time Warner dropped the “experiment” for now.

Ou should have just suggested customers in western New York and the Golden Triangle just pick up and move to another city.  It would have been more realistic than his “if you don’t like them, switch” solution.  It also presumes there is a viable DSL service to switch to, as well as whether or not the service can provide a sufficiently speedy connection to take advantage of today’s broadband applications.

And here is where you can draw lines between the special interests, astroturfers, industry-connected folks and actual real, live, consumers.

Ou brings out the shiny keys, waving them in consumers’ faces telling them to look somewhere else for answers:

So the reality is that usage caps isn’t what Americans should be focusing on and the priority should be to encourage more next generation broadband deployment.

Internet Overcharging schemes that charge consumers up to 300% more for their broadband service, with no corresponding improvement in service, is not the problem for Ou, but it certainly was for Time Warner Cable customers in several cities chosen for their Overcharging experiment.  The need to encourage more broadband deployment is fine, but American broadband customers will be broke long before that ever happens without some other pro-consumer solutions.

Ou has a problem though.  He has a new employer.

A corporate restructuring at ZDNet in the spring of 2008 meant Ou was free to pursue other professional interests, and wouldn’t you know, he turned up as Policy Director of “pro-commerce” Digital Society.  That’s a “free market think tank” website whose domain name is administered by one Jon Henke in… you guessed it, suburban Washington, DC (Arlington, Virginia to be exact).

The sharks are in the water.

Henke, Executive Director of Digital Society, and presumably Ou’s boss, has quite the agenda of his own, and it’s not consumer driven.  He has a long history of involvement in conservative politics, which brings new questions about how Henke would approach “encouraging next generation broadband deployment.”  Does he favor broadband stimulus money?  How about municipal broadband competition?

In addition to his work with Digital Society, Henke also runs something called the DC Signal Team.  What’s that?  Let’s see:

DC Signal is a strategic intelligence and communications firm specializing in new media consulting. Based in the Washington, DC area, we work with a range of clients — corporations, trade associations, campaigns, and individuals — to craft and execute an effective online strategy.  We provide timely intelligence and analysis, as well as communications that can reach and resonate with key opinion makers, policy experts, and elected officials.

Our expertise in new media communications sets DC Signal apart, allowing us to filter out the background noise on the Internet to deliver just the most relevant information, make creative, appropriate recommendations based on that information, and target communications directly to the most influential audiences.

I love the smell of plastic grass in the morning.

That’s right, folks.  DC Signal is a classic PR firm that uses targeted communications to reach the most appropriate audience for their campaigns.  Need to reach consumers and sell them on a pro-industry position?  Set up a “grassroots” group to do it.  Need to baffle the media, lawmakers and opinion leaders with industry BS?  Set up “authoritative” websites to deliver carefully filtered “relevant information.”  What better way to do that than with a blog like Digital Society?

But wait, there’s more.

Henke is also working for an innocuously named group called Arts+Labs, which starts its mission statement out innocently enough:

Arts+Labs is a collaboration between technology and creative communities that have embraced today’s rich Internet environment to deliver innovative and creative digital products and services to consumers. From the early development of motion picture technology, voice recordings and radio to today’s 3D computer graphics, streaming digital movies, “on-demand” entertainment,  online games, news and information, innovative technologies and creativity have always gone hand in hand to enrich our understanding and appreciation of arts, entertainment and culture.

Then things become more ominous.

At the same time, Arts+Labs is working to educate consumers about how net pollution – spam, malware, computer viruses and illegal file trafficking – threatens to transform the Internet from an essential catalyst to safely deliver this content to consumers, into a viral distribution mechanism that will choke off the Internet for consumers and future innovators and creators alike.

I can understand the threats from spam, malware, and computer viruses — what groups out there actually advocate for these? — but the “illegal file trafficking” thrown in at the end had me wondering.

I smell industry money, probably from providers who oppose Net Neutrality and want to throttle peer to peer applications, from Hollywood content producers who want to keep their content off The Pirate Bay, the music industry who is always paranoid about piracy, and of course equipment manufacturers who sell the hardware that does the bandwidth management.

So who “partners” with Arts+Labs?

• Viacom
• NBC Universal
• AT&T
• Broadcast Music, Inc. (BMI)
• Verizon
• Microsoft
• Songwriters Guild of America
• Cisco
• American Society of Composers, Authors and Publishers (ASCAP)

There you go.

Arts+Labs tries to be clever about its agenda, not so much with strident opposition to Net Neutrality, but instead promoting “consumer interests” by insisting that providers fully disclose the abuse about to be heaped on their customers.  In a press release in June, the group advocated its own national broadband strategy recommendations to the FCC:

A Safe Internet and Smart Management Will Boost Digital Society

It also said that a safe Internet must be a core part of a national broadband strategy and that the failure to protect online data and crack down on net pollution such as malware, spam, phishing and other Internet crime will erode the value of the Internet and discourage broadband adoption.

“To drive adoption and build a successful digital society that reaches every American, all of us must accept responsibility for minimizing online risks, protecting users’ privacy, and ensuring data security against malicious online activity and cybercrime,” A+L said.

It also urged the Commission to embrace “smart management tools and techniques.”

“Used effectively, smart management of our networks will stimulate broadband adoption by expanding the scope of activities available to consumers, by addressing network congestion, and by defending against hacking, phishing, identity theft and other forms of cybercrime,” the filing added.

But it said network operators must not abuse management tools to interfere with competitors or consumers rights and noted:  “In a digital society, network managers owe their customers transparency about their network management practices, including proactive disclosure of new policies or innovations that may affect users’ experiences.”

A+L Urges Collaborative Effort, Says Pragmatism Should Trump Ideology

It also urged the Commission to avoid unnecessary regulatory constraints that would interfere with the ability of content providers, network operators and other Internet-related businesses to experiment with new business models and to offer innovative new services and options to consumers.

Finally, A+L urged every Internet industry and every individual who uses the Internet to work together to achieve the nation’s broadband goals.

“Building an inclusive digital society and achieving our broadband goals will require all of us to think outside of silos, to choose pragmatic and effective policies over ideology, and to drive broadband adoption by encouraging the creation of exciting content, protecting intellectual property, and ensuring that the Internet is a safe place to be.  And, the guiding principle on every issue should be to find the solution that moves broadband forward,” A+L concluded.

Broadband throttles and Internet Overcharging aren’t anti-consumer — they are “new policies or innovations.”  As long as the provider discloses them, all is well.

The ideology reference in the press release is remarkable, considering the people who involve themselves in Arts+Media represent a veritable hackathon of the DC political elite, from Mike McCurry, former Clinton Administration press secretary, Mark McKinnon, who advised President George W. Bush, to the aforementioned Jon Henke, who was hired originally to do “new media” damage control for former Virginia senator George “Macaca” Allen and then went to work for the presidential campaign of Fred Thompson.

As usual, the only people not on Arts+Labs’ People page are actual consumers.

To wrap up this party of special interests, which consumers aren’t invited to, we wind our way back to the home page of Digital Society, which features a familiar roster of recommended blogs and websites to visit.  Among them:

• Arts & Labs blog (Henke works with them)
• Broadband Politics (run by Richard Bennett, who forgot he worked for a K Street Lobbyist, actually on K Street (read the comments at the bottom of the linked article)
• Cisco Policy Blog (also a partner with Arts+Labs, has a direct interest in selling the bandwidth management hardware)
• Verizon Policy Blog (also a partner with Arts+Labs, and an interested provider in this issue)

In the beginning of this piece, I recited some of the “scare mongering” Ou accused groups of engaging in on the Net Neutrality debate back in 1996.  The first major Net Neutrality battle was with Comcast over bandwidth throttles.  The barely-conscious FCC under Kevin Martin spanked Comcast (who sued, of course) and we’ve been in a holding pattern ever since.  But the predictions have become remarkably true north of the American border, where Canada endures all of the things Ou swore up and down in 1996 would never happen.

• Most major broadband providers in Canada throttle the speeds of peer to peer applications, reducing speeds to a fraction promised in their marketing materials.
• Most major broadband providers in Canada not only charge customers based on broadband speed, but also by the volume of data consumed, causing spikes in customer bills and a reduction in usage allowances in some cases.  Customers now face overlimit fees and penalties for exceeding the Internet usage ration they are granted each month.
• In 2006, Shaw Communications in Canada tried sticking a $10 monthly fee on broadband customers wanting to use Voice Over IP telephone service.  Vonage Canada complained loudly at the time.
• As far as controlling what you see online, that’s already in the cards in the States, if the cable industry has any say in the matter.

With a pliable FCC, what exists in Canada today will exist in the United States tomorrow without Net Neutrality protections enacted into law.

(footnoted material appears below the break)

… Continue Reading

In just the second quarter of 2009, Comcast doled out nearly $3.3 million dollars of their subscribers’ money lobbying elected officials on a myriad of issues, covering everything from executive compensation to sports channels to unionizing efforts.

Forbes reported last week the nation’s largest cable company has lobbied on:

• the Excessive Pay Capped Deduction Act of 2009, a bill that would stop tax deductions on excessive compensation given to any employee. Excessive pay is defined as any amount above 100 times the average employee’s compensation at the company;
• the Income Equity Act of 2009, which curbs executive pay by limiting tax deductions on pay greater than 25 times that of the lowest paid employee, or $500,000, whichever is greater;
• the Shareholder Bill of Rights Act of 2009, which gives shareholders the right to approve or reject executive compensation packages.  Shareholders have long been in contention with Comcast over the near $25 million annual salary paid to CEO Brian Roberts;
• the right to carry regional sports channels on terms favorable to the cable operator, both in terms of channel/package placement and pricing;
• the nation’s Broadband Stimulus program — how the funds would be allocated, on what terms, and for what types of projects;
• the issue of unionization activity at Comcast;
• limits on Comcast’s ability to increase ownership of additional cable-related assets and systems.

Meanwhile, Brian Dickerson, a columnist at the Detroit Free Press has also been noticing that AT&T, promising to bring competition to Comcast in cities like Detroit, came at the price of a trojan horse called “statewide franchising,” an issue we’ve covered at length on Stop the Cap!

Deregulating the cable TV business in Michigan was supposed to be good news for metro Detroit cable subscribers and bad news for Comcast, long the dominant cable provider in our region.

At least, that’s how area legislators justified a 2006 law that streamlined the franchising process for rival cable operators such as AT&T and stripped pesky local governments of their authority to stand up for aggrieved cable customers.

Dickerson recites a familiar tune to our readers about how AT&T came to the Michigan state legislature in 2006 promising to bring hardcore competition to Comcast, the state’s most prominent cable provider, if only they would permit AT&T to obtain one statewide franchise agreement, allowing them the flexibility to launch U-verse in cities throughout the state without negotiating with each local government first.

The astroturfers turned up right behind AT&T’s open checkbook (the company spent at least $672,000 in 2006 in Michigan on lobbying and political contributions), touting the benefits of AT&T’s “creative solution” to cable competition.  FreedomWorks even invaded one meeting of the Michigan Municipal League and Michigan Townships Association in the spring of that year “to set the record straight.”  That really meant representing AT&T’s position, and offering plenty of empty promises to Michigan communities seeking competition and lower prices for their residents.

FreedomWorks rapidly also devolved the debate into a partisan “conservative” vs. “liberal” sideshow, hoping to pick up conservatives that would reflexively adopt a pro-AT&T position if it meant doing battle with “liberals.”  And in a two-for-one win for AT&T, the conservative action group also helped jettison Net Neutrality protections.

FreedomWorks President Matt Kibbe was quoted in a December 2006 press release: “To the very end, liberal special interests held out for additional regulatory mandates misleadingly labeled “neutral.” On behalf of more than 12,000 citizen activists in Michigan, I applaud the franchise reforms adopted this week while warning against new efforts in the 94th Legislature to deny basic property rights under the banner of “net neutrality.” We are prepared to defend consumer interests and property rights through relentless grassroots education and advocacy.”

FreedomWorks Michigan Director Randall Thompson concluded, “The issue of franchise reform is evidence that the Freedom Movement is deeply rooted in Michigan. Regular citizens made their voices heard, leading free market think tanks and scholars weighed in on the issue and as a result, public officials adopted good policy.”

Freedom Isn’t Free: Prices escalate across Michigan despite “competition.”

Now, three years after AT&T’s champions in the Legislature crowed that Comcast’s reign as the 800-pound. guerrilla of Michigan cable service was over, Comcast remains the state’s dominant provider, maintains a de facto wire-line monopoly in most its franchise areas, charges higher rates for basic cable service, and has far fewer legal obligations to the subscribers and communities it serves.

Indeed, the story is even worse for Michigan consumers, who in effect paid, as part of their monthly cable bills, for the lobbying and astroturf campaign battle launched against their own best interests and wallets.

The promised competition has arrived in some parts of Michigan, but often at pricing even higher than that charged by the dominant cable company in the area.  Many customers enjoy temporary savings as part of promotional new customer offers, that once expired, leave the customer stuck with everyday high pricing.  As seen in Tennessee, AT&T U-verse packages compete more on numbers of channels offered, not on the pricing of monthly basic service.  A-la-carte channel choice remains unavailable.

In fact, the second biggest winner of the Lobbying Money Party from AT&T ironically turned out to be Comcast.  After all, if AT&T was to be granted special provisions for statewide franchising and other deregulatory benefits, why can’t Comcast receive those benefits as well?

It seemed only fair that if legislators were prepared to relieve AT&T of any obligation to negotiate with local governments, Comcast and other cable providers should enjoy the same privilege. But what about the franchise agreements Comcast had already struck in places where AT&T had no immediate plans to compete?

Some legislators suggested that Comcast be required to live up to existing franchise agreements until competitors were offering service to at least 5% of the community’s residents. But when Sen. Nancy Cassis, R-Novi, proposed such a rule, she was defeated by a voice vote — the anonymous roar of Comcast’s many beneficiaries on both sides of the aisle.

As is the case in Tennessee, should a local franchise agreement not be renewed on favorable terms, there is always the possibility of securing that statewide franchise, bypassing local officials, reneging on hard fought agreements on things like:

• Guarantees that cable service would be made available to all residents, from the poorest to richest neighborhoods;
• Cable operators would agree to customer service benchmarks from call answer time to repair call timeframes;
• Provision and funding of local Public, Educational, and Government (PEG) access channels on the basic tier.

And so, three years after the blizzard of cash was long since pocketed, and astroturfers like FreedomWorks moved on to other industry-sponsored causes célèbre, where are the consumers after the “good public policy” applauded by FreedomWorks was adopted?

Absolutely in the exact same place they were before, only worse.

The Michigan Chapter of the National Association of Telecommunications Officers and Advisors says Comcast celebrated the first anniversary of cable deregulation by raising the price of its cheapest cable package by 25% in many communities; rates for other service tiers jumped between 9%-25%.

Brian Brown, spokesman for a consortium of Michigan cable providers led by Comcast, says the price increases reflect the cost of enhanced services subscribers are demanding. “That’s what the market wants,” he says.

Meanwhile, Comcast has shuttered many of the local service locations it was obligated to maintain under franchise agreements, and is waging a federal court fight to move public access programming off the basic cable line-up.

That’s right.  The market wants higher prices, no local service locations, and a parade of formerly analog cable channels being moved into digital tiers, necessitating additional consumer expense to rent digital converter equipment for every cable-connected television in the home.

Those are the same consumers whose interests have routinely been ignored by the politicians and the providers, and distorted by their bought and paid for political astroturf groups that hoodwink consumers into believing this is a “right-left issue.”

As the battle for Net Neutrality protections begins again this summer, and as we vigilantly maintain watch and prepare for opposition to any reintroduction of Internet Overcharging schemes, just remember the tale of Michigan and Tennessee and the real agenda of the astroturf groups sure to raise their well-financed opposition to pro-consumer legislation and activism yet again.

The astroturfers remain hard at work trying to convince conservatives the best way to oppose Obama Administration telecommunications policies would be to adopt industry-friendly views opposing Net Neutrality.

The latest to buy in is The American Spectator, publishing a piece this morning titled, “The Great Regrouping.”  In it, The Prowler casts Net Neutrality as part of the Obama Administration’s plot to impose government controls on the Internet, representing a “grave threat … to free speech and conservatives’ ability to organize and mobilize politically.”

During the last day the House was in session before leaving for its August recess, Rep. Ed Markey’s staff introduced HR 3458, the so-called “Internet Freedom Preservation Act,” which would essentially enable government control of the Internet, treating the networks as a government-managed utility. (For more information about “net neutrality,” read this interview that one of the key “net neutrality” supporters gave to a Canadian socialist publication.) The Markey legislation is considered the last piece of what some conservatives consider to be Democrat and progressive attempts to control the Internet and limit citizens’ ability to use the networks to organize and oppose their agenda.

The bill was introduced the same week it was revealed that the Obama Commerce Department was demanding from the phone and cable companies highly detailed data about private citizens’ Internet and broadband connections as part of plans of “map” broadband networks across the country.

Stop the Cap! readers will recognize the source of the link The Prowler promotes — it’s from the very same Heartland Institute astroturfer we chased last week, who was arguing Net Neutrality was a tool to achieve “socialist utopia.”  I pulled a muscle just reading that overreach.

My direct response can be found below the fold.  Suffice to say, this is an example of classic astroturfing at work:

1. A company’s government affairs department recognizes a potential threat to their business model through government oversight or regulation, or sees a financial benefit from industry-favorable legislation or deregulation.  It considers a range of options, including direct lobbying, consumer outreach, and hiring experienced “inside the beltway” expertise.
2. The company approves a plan of action and frequently hires a Washington-based public relations firm.  That firm usually either has direct contact or close associations with astroturf organizations.  As part of the PR firm’s fee, they assure the company its message will be delivered in ways that help steer any public policy debate towards their corner, using astroturfers to reach both consumers and media suspicious of a direct industry appeal, but will listen to an “independent” group.
3. Suddenly, supposedly independent “public interest” groups start beating the drums.  Some speak directly to consumers raising doubts and fears about regulatory matters, others attempt to suggest the public needs to get behind industry-friendly positions for their own benefit.  Press releases and interview opportunities are made available to the media.  Astroturfers with a known political angle wrap industry positions in ideological shells, using them to illustrate a broader ideological point.
4. Most importantly, carefully avoid exposing the direct industry connection.  Industry executives don’t want to admit they are paying for these campaigns.  PR firms help shield the source of the industry money that flows into astroturf groups, and astroturfers work hard to avoid disclosing where the money is coming from.  Even elected officials who take an industry friendly view do not want to directly reference the companies writing big campaign contribution checks.  They’ll cite those supposedly independent “consulting” and “research” and “public interest” groups when reading the talking points.

Unfortunately for them, this convenient public interest shell game has been exposed.

In today’s case:

Industry opposed to Net Neutrality -> Astroturfer Groups -> Outreach to fuel opposition to Net Neutrality for “consumer” or “ideological” reasons.

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