More evidence arrived this week that Internet Overcharging schemes are becoming a thing of the past for many global broadband users.

Sky has announced it is getting rid of its usage limits and speed throttles for most of its broadband customers.  It’s also giving away a free speed upgrade to up to 20Mbps for its DSL-provisioned broadband service.

“It comes with no usage caps, fair use policies or traffic management, making it ideal for those who want the freedom to download emails, photos, TV programs, movies and games. It’s also ideal for those who want to access live and on-demand TV through Sky Player,” Sky said.

That may be part of the plan.  Sky, a satellite television company serving the United Kingdom, is preparing to launch new video on demand features that will work in conjunction with its broadband service.  Delivering faster access, without limits, could be part of the equation of making their video on demand service a success.

For occasional broadband users who don’t exceed 2 gigabytes of use per month, Sky is giving free usage-limited broadband service to customers who also subscribe to Sky’s telephone service.  For those that don’t, the 2 gigabyte-capped service costs £5 ($7.59US) per month.

For those looking for unlimited service, Sky Unlimited is available for £7.50/$11.38 per month for Sky customers with Sky Talk or £12.50/$18.97 per month for those without.  In the United Kingdom, line charges for the phone line are broken out from broadband pricing and have to be considered towards the total monthly cost for broadband service.  Line rental from BT costs £12.50/$18.97 a month for customers who pay by direct debit and receive paper billing (£11.25/$17.08 with paperless billing).

Sky requires a 12 month service commitment.  These prices and plans take effect June 1st.  New customers can get a promotion offering six months of free broadband service, including line rental, when signing a 12-month service commitment.

New customers can get six months of broadband service for free when signing up

Is there a downside to this offer?  Not as far as usage limits are concerned.  However, the service is dependent on BT-provisioned DSL phone lines, which can create great variability in the maximum actual speeds customers receive.  The further away from a BT exchange office, the slower the maximum speed a customer will achieve.

But for existing Sky satellite customers looking for a discount on bundled service and an end to worries about monthly usage or speed throttles, Sky Broadband is a welcome relief for those tired of Internet Overcharging schemes.

It’s also one fewer example North American providers can point to as an excuse to attempt Internet Overcharging schemes of their own.

Sometimes you have to wonder who telecom front groups hire to push their agenda.  In the Stop the Cap! e-mail box came a news tip last week that a new study proved beyond doubt that passing Net Neutrality would put up to 1.5 million jobs at risk by the year 2020.  Just as bad, the study warns, broadband investment would plummet as a result, causing an investment retreat worth up to $5 billion dollars.  They thought I should know.

All of this ruinous news results from a government that wants to make sure your Internet Service Provider doesn’t block, impede, or censor the traffic of independent websites that don’t  pay a protection fee to keep their content online and accessible.  What’s that I smell?  The easily recognized scent of plastic grass — more astroturfing from a broadband industry intent on keeping broadband regulation as far away from them as possible.

The Employment and Economic Impacts of Network Neutrality Regulation: An Empirical Analysis, by Dr. Coleman Bazelon — working on behalf of something called “The Brattle Group, Inc.,” is a real page-turner.  I tore right through it myself.

Just reading the background of Dr. Bazelon rang all sorts of warning bells:

• Dr. Bazelon consulted and testified on behalf of clients in numerous telecommunications matters;
• Dr. Bazelon frequently advises regulatory and legislative bodies;
• Dr. Bazelon was a vice president with Analysis Group, an economic and strategy consulting firm.

More ordinary folks use a different, less fancy term to cover all this: lobbyist tool.

The key finding for the report:

New network neutrality regulations proposed by the FCC could slow the growth of the broadband sector, potentially affecting as many as 1.5 million jobs, both union and non-union, by the end of the decade.

So how does Bazelon come to this conclusion?

The academic literature on possible effects of network neutrality regulation does not provide a consensus view on whether such regulations should be expected to help or harm the broadband sector, although several economists have concluded that such regulation would be harmful.

I tore right through Bazelon's report.

Many of those economists were paid by the broadband industry to conclude that in their own “reports.”  Many of Bazelon’s footnotes reference himself, telecommunications company executives, or other connected parties who have a financial interest in opposing Net Neutrality or broadband regulations.

At the heart of Bazelon’s theory is that content-related jobs, those involving the development of the websites you like to visit to read, listen, watch, or download from, cost more money to create than broadband “dumb pipe” jobs.  In other words, if you’re developing iTunes content or a network to stream Netflix movies, your job cost more (and probably pays more) than a line splicer at AT&T who is rolling out 3 Mbps DSL service in Rolla, Missouri.

So, if we penalize content developers with Internet Overcharging schemes or speed throttles that discourage your use of iTunes or Netflix, AT&T can use the savings from dramatically lower demand and hire more people to wire up communities for basic DSL service.  That’s okay, because it creates new jobs: “to the extent that the absence of network neutrality regulations leads to a transfer of ‘wealth’ (or sector revenues) from the Internet content sector to the broadband sector, such a transfer would be expected to have a positive impact on employment.”

That’s a great deal for you, right?

Net Neutrality doesn’t impede bigger profits for broadband providers – it just insists that they don’t earn those profits parasitically on the back of someone else’s content.  If your cable or phone company owned Netflix, there wouldn’t be an issue.  They would provide a service and earn from it.  But they don’t, and demand a piece of the pie anyway.

By the way, Bazelon’s myopic report completely misses another fundamental fact.  In today’s non-Net Neutral world, large phone companies like Verizon and AT&T have slashed tens of thousands of jobs just fine without pesky Net Neutrality or other broadband regulations getting in the way.  It’s like telling a New Orleans resident standing in four feet of water during Hurricane Katrina that if we don’t do something about the levees next year, the city could be flooded.

The author also states the obvious:

Broadband open access and net neutrality regulations are both regulatory interventions aimed at restricting a broadband network owner’s ability to exercise market power. The first acts at a structural level to eliminate any potential market power in the provision of the good; the second acts at a behavioral level restricting the broadband provider’s ability to benefit from any such market power.

Sounds like a plan to me and millions of other consumers who see the results of the industry’s market power workout routine… in the form of ever-increasing monthly bills.

Bazelon's vision for the Internet's future

Bazelon is even willing to predict some winners and losers with the FCC’s proposed Net Neutrality regulations:

Under the strict network neutrality regime being considered by the FCC, different Internet content might flourish. In particular, some Internet content is less commercial and generates very little revenue. Content that does not generate much economic value may be advantaged by a network neutrality regime. It is worth noting, however, that such content, by not primarily being engaged in the economy, does not significantly impact employment. Larger commercial sites have the potential of doing better or worse under network neutrality regulations. On the one hand, potentially lower costs of access should benefit them; on the other hand, potentially less developed broadband infrastructure could harm their businesses. With some content winning and some content losing, there is no reason to believe that the total amount of content will be more or less (or more or less valued by Internet users) under one regime or the other. Some business models will do well under one regime, others under the other regime.

In other words, in Bazelon’s world, the formerly level playing field where content is king and website value is decided on its merits is replaced with a corporate-controlled broadband network where only the big, well-financed players will get to play.  If you’re CNN or Amazon.com, you’ll have no problem meeting the protection racket prices providers could demand to guarantee your content isn’t blocked or slowed to a crawl.  But if you’re a poor blogger, a new business start-up, or use the web to argue for and against various causes, get to the back of the line (if you are allowed in the line in the first place.)

The Internet gets reincarnated as Prodigy, for those old enough to remember using that online service.

Ultimately, Bazelon believes only big broadband providers can create economic success stories in our online future.  Making them play by certain rules will kill that success, he argues.

Only one problem – when Bazelon gazes up into the sky, he sees AT&T logos everywhere he looks.  That’s because Mobile Future, the group that paid for the study, is yet another creature of AT&T.  To hide the fact this is yet another AT&T front group, several of AT&T’s usual friends also turn up on the membership roster.  Just a few days after calling out LULAC – the League of United Latin American Citizens for selling out the Latino community to AT&T’s agenda, here they are again — joined at AT&T’s hip as a member of Mobile Future.

A selection of other Mobile Future (brought to you by AT&T) members

Asian Business Association – No national website, which already makes this suspicious, but the San Diego chapter admits AT&T is a corporate sponsor.

Asian Women in Business – AT&T underwrote their website.

Bump.com – The company is self-described on Mobile Future’s website as “the world’s largest purpose-formed safety, communication and marketing network. BUMP uses safe and convenient voice recognition and ALPR (automatic license plate recognition) to provide drivers worldwide with a communication platform that promotes safety on the roads and builds a unique global network.”  They should win an award for puffery.  In fact, this “world’s largest” enterprise doesn’t even have a website.  It claims it was founded in 2009, but its Facebook page just showed up April 15th of this year with a handful of photos showing… license plates.  Why license plates?  Because the group’s real aim is to set up a registry of those willing to receive text messages sent by typing in someone’s license plate and quietly linking it to your cell phone.

The Century Council – Public interest group padding.  Ask yourself what a group fighting underage teen drinking and driving built from and run by distilleries has to do with mobile broadband, Net Neutrality, spectrum demand, and wireless phone taxes — the primary issues Mobile Future seeks to address.

Climate Cartoons – The group’s CEO is a Washington, DC lobbyist specializing in fighting telecommunications issues.  Among Arnold Consulting Group’s “accomplishments:” building a “telecommunications coalition that successfully opposed federal and state ‘Net neutrality’ legislation” and a “cable television coalition that successfully opposed federal, state and local efforts to enact open access broadband regulations.”  Need I say more?

Hispanic Technology and Telecommunications Partnership – Another LULAC — follows AT&T policy initiatives around like a friendly puppy.  HTTP was busted by Ars Technica when asked whether AT&T had any hand in helping the group draft its opposition to Net Neutrality.  HTTP’s Sylvia Aguilera insisted she initiated the drive to oppose Net Neutrality, but was silent on whether AT&T helped draft the letter opposing it.

That’s only halfway down their so-called “coalition” list.  You get the point.  The only name that truly matters among all of Mobile Future’s members is AT&T because they are the ones spreading the money around to pay for it.  At the same time, if AT&T is writing contribution checks to your public interest group, or hiring your consulting/lobbying firm to represent your agenda, those are two compelling reasons for both to hurry on over to sign up for the cause in this, and other astroturf front groups.

On behalf of Climate Cartoons, which purports to “lure people into earth friendly behavior,” please be sure to give all due respect to this latest industry-backed study from Dr. Bazelon by tossing it into the nearest recycling bin.

Last year I participated in an online focus group about wireless broadband pricing.  The subject was consumption billing vs. usage limits — do consumers value unlimited broadband plans with overlimit fees more than strict usage caps that cause speeds to plummet for customers who reach them.  Also under consideration were various usage allowances sold at different price points.  Focus group members could rate the plans’ acceptability from a scale of “extremely interested” to “would not consider this plan.”  It took me mere minutes to work my way through dozens of combinations, rating them all unacceptable.  Participants were next directed into an online forum to discuss the different plans amongst ourselves, with a moderator focusing and encouraging discussions.

Inevitably, I was asked why I rated every plan on offer as not worthy of my consideration.  My short answer was that while I understand wireless was not presently a limitless resource, the plans suggested all included overlimit fees or plan allowances that would-be customers had to choose, many with no insight into what their monthly usage could or would be.  Not on offer was a true consumption plan that charged wireless customers only for what they used during a month.  If they didn’t use it at all, no bill would result.  My bottom line — customers should not have to take a crash course in data consumption to predict their usage or face steep penalties when they guessed wrong.

T-Mobile has found a third way, although Cricket’s wireless broadband service beat them to it well over a year ago.

The company’s new 5GB wireless broadband plan offers a traditional usage cap every mobile broadband customer is familiar with, but imposes no overlimit fees on customers that exceed it.  Instead, they reserve the right to dramatically reduce your speed until the next billing cycle begins.  T-Mobile representatives tell Stop the Cap! the company won’t automatically impose the speed throttle unless customers have a history of regularly exceeding their usage allowance (or dramatically exceed it.)  T-Mobile also may forgive a customer for an occasional breach, dropping the speed throttle for those who contact customer service and ask.

This effectively matches Cricket’s pricing and usage plan, which may cause that carrier to consider increasing usage allowances or reducing the price to compete.

T-Mobile's data plans for mobile broadband and smartphones

Broadband Reports notes that the 200 megabyte plan still requires overlimit fees, but they’ve been cut in half from 20 cents per megabyte to 10 cents.

Larger carriers like AT&T and Verizon still impose overlimit fees on their usage-capped wireless broadband accounts.  Cricket sells a $50 10 gigabyte usage allowance plan through Wal-Mart as well.

Turner

Paralleling the debate for better broadband is the fight for renewable, domestically-produced energy, and outspoken former CNN founder Ted Turner has run into the same kind of corporate-backed opposition strategies broadband advocates face in a quest to deliver improved service to Americans.  As part of an event with T. Boone Pickens to promote the cause of renewable energy, Turner launched into an all-out assault on his former colleagues at Time Warner, who he characterized as inept.

“This is what I said at the Time Warner board room. I’m not on the board anymore because they didn’t get it, but I said ‘we’ve got to stop doing the dumb things and start doing the smart things.  We had 5 percent of Google in a music merger and I said to [former CEO] Dick Parsons, ‘Dick, I think we ought to hang onto that Google stock.’ This was about 10 years ago. He said, ‘That company’s a bunch of bullshit.’

Then, listen to this one. We had CNNfn, which was in 50 million homes, as Fox [Business] is in now. And they made the decision to close it down. It was breaking even, a cable network that was breaking even. We should have been in there competing with CNBC and Bloomberg.

They closed it down without even calling Rupert up, who said publicly he was looking really hard at getting into the financial news business. We could have gotten $100 million or $200 million from him just for the name and the 50 million subscribers. They didn’t even call him — they closed it down without even doing that, and he was sitting there with the money wanting to give it to ‘em. I mean, you know, how dumb can you be?”

Whenever incumbent interests are threatened with new innovations that challenge conventional business models, look out.  The well-financed opposition will do everything possible to stop new sources of competition, something a befuddled Pickens noted when he encountered a representative from oil and gas interests opposing his domestic production ideas.  He likened the guy to “Baghdad Bob.”  Turner also confronted corporate-friendly Fox Business News who interviewed both about their joint effort, leading Turner to drop the “BS-bomb” at one point on live television.

It’s just more evidence that the fight for better broadband with fiber-based networks, Net Neutrality, competition, and more affordable access will be resisted in much the same way entrenched incumbents always fight to preserve their profitable positions in the marketplace.  Your interests come second.

As for characterizations of Time Warner management’s ability to predict trends and make smart business decisions, Turner has the credentials to back up his beliefs as a vice-chairman of Time Warner from 1996-2006.

[flv width=”480″ height=”290″]http://www.phillipdampier.com/video/Turner Blasts Time Warner 4-26-10.flv[/flv]

Speaking at the Milken Institute Global Conference in Los Angeles, Ted Turner had choice words for his former partner, Time Warner.  (2 minutes)

[flv width=”640″ height=”380″]http://www.phillipdampier.com/video/Fox Business News Renewable Energy 4-26-10.flv[/flv]

T. Boone Pickens and Ted Turner sit for an interview with Fox Business News about renewable energy.  We’re into the weeds with this clip, but it’s useful to see the same kinds of astroturf campaigns drive other causes crazy as well.  Also fun to watch Turner drop the “BS-Bomb” on live television, causing some consternation for Fox Business News, which also challenged Turner’s notions of how to pay for smart grids.  (7 minutes)

Plale

Consumer advocates are celebrating the defeat of telecommunications bills designed to favor AT&T’s corporate interests in Wisconsin.

Assembly Bill 696 and Senate Bill 469 were designed to give AT&T and other telephone companies the option of no longer being classified as telecommunications utilities.

Once that happened, the state Public Service Commission would lose the authority to oversee much of their operations.  In practical terms, it means phone companies could raise their rates at will and never have to justify them by reporting their profits and expenses to the Commission.  Another provision would have eliminated the PSC’s authority to deal with phone service complaints on behalf of consumers and businesses.  But considering the bills would have also eliminated the universal service requirement, AT&T and other phone companies could have simply disconnected land lines in unprofitable areas of the state and left rural Wisconsin with no phone service to complain about.

The legislation was introduced by Senator Jeff Plale in the Senate and Representative Josh Zepnick in the Assembly.  Both men are Democrats serving districts in Milwaukee.

Zepnick

Potentially motivating the legislation were substantial campaign contributions from AT&T.  For Plale, who is the top recipient of telecom contributions among all Democrats across the state, AT&T provided $4,000 and the cable industry donated $6,446 from 2003 through 2009, according to the Wisconsin Democracy Campaign. Zepnick received $1,400 from cable providers and AT&T during the period.  In total, at least a half million dollars in contributions from the phone and cable companies have been spent on Wisconsin legislators over the past six years.

Zepnick’s legislative maneuvering to push through the bill in the waning days of the state legislative session collided with Senate Majority Leader Russ Decker, who pulled the rug out from under AT&T and other telecom interests by referring the bill to the Legislature’s budget committee for review — a black hole from which the bill had no chance of emerging.

That triggered a reaction from Zepnick and his friends in the telecom front group community.

Zepnick told Wisconsin newspapers he wasn’t sure what to make of Decker’s diversion of his legislation, which political observers suggest is nonsense.  At the end of every legislative session, large numbers of orphaned bills are dumped in study committees or never taken up in both bodies.

“If it doesn’t get done, that’s going to be a huge missed opportunity for Wisconsin,” Thad Nation, executive director of AT&T-backed Wired Wisconsin told the Associated Press.  Nation claimed the bill would have traded regulatory authority away in return for more investment in the state by communications providers. “As other states move forward, Wisconsin will be left behind.”

Consumer advocates suggested Nation had it exactly backwards.

“It eliminates the regulations the Public Service Commission has used to ensure affordable and reliable landline telephone service for decades,” said Charlie Higley, executive director of the Citizens Utility Board, who told the AP three million landlines still exist in Wisconsin.  That turns back the clock on service standards.

Nation

With AT&T and other providers left to increase rates at a whim, the only thing moving forward, and upwards, would be Wisconsin phone and cable bills.

Not every legislator bought AT&T’s position that less regulation equals more service.

Rep. Gary Hebl (D-Sun Prairie), opposed the legislation from the day it was introduced, suggesting he would push for amendments to ensure the PSC would continue to protect landline phone customers and, for the first time, extend that power to cell phone service.

“If a service provider is not doing their job, consumers should have recourse. That’s one of our jobs as legislators,” he told AP. “We have to be sure that consumers get the service they paid for and it’s properly provided to them.”

As late as last week, AT&T had a dozen lobbyists working the Wisconsin legislature for votes.  Wired Wisconsin, which is actually an extension of corporate lobbying firm Nation Consulting, pushed the idea that Google would bypass Wisconsin for its Think Big With a Gig fiber to the home network if the state didn’t adopt the deregulation bill the firm was promoting.

Ultimately, the proposed legislation passed the Wisconsin Assembly but was never taken up by the state Senate.  Since being shelved for the session, Wired Wisconsin has moved on to re-tweeting Broadband for America pieces bashing Net Neutrality and FCC broadband oversight.  As Stop the Cap! readers know, Broadband for America is the largest telecom Astroturf effort ever, with dozens of members that are funded by Verizon or AT&T or equipment manufacturers whose businesses depend on contracts with large telecom companies.