Studies find few surprises for cable and phone companies that pay for them.

Internet plans with term contracts, usage limits, and other pricing tricks are good for consumers and save them money over comparable unlimited usage plans.

That is the conclusion of a new study from the Technology Policy Institute, an industry front group funded by AT&T, Comcast, the National Cable & Telecommunications Association, Qwest, Time Warner Cable, T-Mobile, and Verizon.

Scott Wallsten and James Riso’s “study,”Residential and Business Broadband Prices, Part 1: An Empirical Analysis of Metering and Other Price Determinants,” claims to have taken a comprehensive look at 25,000 plans offered across North America, Europe and the Pacific to make their case that a residential service plan with a 10GB monthly usage cap would save consumers 27 percent over the price of a comparable unlimited plan, as long as data use stays below the cap.  They also suggest additional savings can be had if consumers lock themselves into term contracts with service providers (most of which carry hefty fees to exit early.)

These results suggest that the unlimited data plans typically offered by most U.S. wireline broadband providers may not be optimal for many consumers. The details of capped plans matter, and how an individual user is affected depends on the base price, allowed data usage, and consequences for exceeding the cap. Nevertheless, because capped plans are—all else equal—cheaper than unlimited plans, many consumers, particularly the low-volume users, are likely to pay less for broadband with data caps than they would for plans offering unlimited data transfer.

Wallsten and Riso make much of AT&T’s recent decision to end unlimited usage for wireless broadband, suggesting that consumers are saving money with new, low-use plans over the company’s old unlimited pricing.  The authors claim close to 70 percent of iPhone users consume less than 200 MB per month, which is the cap for AT&T’s cheaper data plan.

But the authors concede that usage is growing — rapidly in the case of online video, which sets the stage for consumers saving money today, but facing serious overlimit charges on their bills tomorrow:

Some analysts, however, remain concerned that these plans make video streaming impractical given the bandwidth it consumes, could eventually cost consumers more as they use their wireless devices more intensively, and generally make it less likely for wireless to become a viable substitute for wireline broadband. To be sure, while Figure 3 shows that the vast majority of users consume small amounts of data today, it also shows per user mobile data consumption growing quickly, so the number of people who exceed the caps could increase significantly in a relatively short period of time.

Major U.S. wireline providers have not yet introduced metered pricing successfully, though, as shown above, it is common in other countries. An experimental metered pricing plan by Time Warner Cable garnered strong reaction, prompting one group to demand that Congress ―investigate ongoing metered pricing practices to determine the impact on consumers. Some in Congress did, in fact, hold hearings on the plans. In response to this backlash, Time Warner Cable canceled its experiment.

Despite the political reaction, all consumers are not inherently worse off or better off with metered pricing. Low-volume users are likely to be better off under metered plans and high volume users worse off. The net effect on any given consumer depends on his data use, the base price, how much data the base price allows, the price of data when exceeding the cap, and how much he would have paid for an unlimited plan.

Wallsten and Riso also admit several parts of their study are “incomplete,” and “lack data.” We would also include the facts they ignored whether consumers prefer unlimited plans, how customers would feel about a bill with overlimit fees attached, or whether the usage cap levels the authors note in their study are adequate.  They also completely ignore the critical issue of bandwidth cost trends and their relationship to consumer pricing.

But of course they would, considering the same providers who want these pricing schemes are paying the costs for the study.

Welcome to the world of Hired Gun Research.

Wallsten, in particular, has been singing the same cap-happy tune for several years now, churning out the same industry-financed conclusions about broadband.  Back in 2007, he delivered a piece trumpeted by the Progress & Freedom Foundation and the Heartland Institute — two groups notorious for parroting corporate-friendly talking points.  Back then it was about Internet overloads and supporting Internet toll booths for “congestion pricing” after Comcast got caught secretly throttling broadband customer speeds.

Dave Burstein of DSL Prime notes most consumers don’t like caps, lock-in contracts, or speed throttles.

“Policymakers should normally assume that imposing caps generally results in negative consumer welfare. The small efficiency gains don’t come close to making up for a second rate Internet,” Burstein writes. “Everyone is better off with a robust, unthrottled Internet. It allows for an important form of video competition and market access for innovative new net offerings. It’s a better experience for the user and hence more people will be connected, a good thing.”

In this latest study, the two authors completely ignore some very important facts:

• Who sets the pricing for unlimited and usage-capped broadband?  Providers.  Do consumers save money from usage limited plans because of decreased provider costs passed along to consumers or pricing schemes that artificially inflate unlimited broadband pricing to drive customers to “money-saving” limited plans that teach usage restraint or expose consumers to dramatic overlimit fees?

• What are the trends for wholesale bandwidth costs and how does that trend comport with industry pricing schemes that have increased broadband pricing in the United States?  An honest study would reflect these costs are dropping… dramatically, and would introduce the very real question of whether unlimited broadband is a problem in search of a revenue-generating solution that would come from further monetizing broadband with so-called “consumption pricing.”

• What is the consumer perception of usage-limited broadband?  An important part of this equation is whether consumers want unlimited broadband service to be discontinued.  Every study to date not paid for by the providers themselves shows consumers are willing to pay today’s prices for the peace of mind they receive in not being exposed to limits or overlimit fees.  Wallsten and Riso touched on the consumer backlash, to a considerable part coordinated by Stop the Cap!, over Time Warner’s pricing scheme which would have tripled broadband pricing for an equivalent level of service.  But the authors charge on with their pro-cap conclusions regardless.

• Wallsten and Riso’s study only casually mentions the dramatically different paradigms of wireless and wireline broadband.  The former is delivered using technology that is recognized to have limitations that can only be seriously addressed with additional spectrum allocation that could take years to address.  The latter is already being mitigated by cable broadband technology upgrades, fiber optics, and improved backbone connections that often deliver much better access at a fraction of the price providers paid just a few years earlier.  Drawing comparisons between AT&T’s wireless broadband pricing and wireline broadband is dubious at best, especially since two companies largely control pricing and service for the majority of wireless customers in the United States.

• To prove its contention limited broadband service is “common in other countries,” the authors cite a Frequently Asked Questions article by Comcast trying to justify that company’s own usage cap to its customers.  So because Comcast’s PR department says it, it must be true.  In fact, in countries where usage capped broadband has been a traditional problem, consumer demand and public policy efforts have moved providers towards offering unlimited service plans to meet popular demand.  In fact, in countries like Australia, New Zealand, and South Africa, governments have cited usage caps as a serious disadvantage to growth of the digital economy.  Consumers certainly agree.

Burstein adds:

Caps or other throttling measures are almost never imposed because of actual congestion problems (on large, wired networks.)  The caps would be at far higher levels if they were, like Comcast’s 250 gigabytes. The usual explanation is bogus. The typical consumer advocate believes the caps are about preventing competition to the carriers’ own video package. That’s certainly common, but so is price discrimination to yield increased potential revenues. As Scott notes, price discrimination in a strongly competitive market can work out well for all concerned. With strong competition, the benefits flow through to consumers. Since competition in broadband is typically weak, I believe it far more often has little consumer benefit but is good for company profits.

The authors conclude that despite limitations on data available, “The policy implications, however, are clear.  Policymakers should not immediately conclude that data caps and other pricing schemes that differ from traditional unlimited plans are necessarily bad.”  Instead, the authors suggest pricing trends should be evaluated over time to identify the effects on prices, investment and usage.

Although that’s a point Burstein agrees with, we feel there is substantial evidence this debate is based not on experimental pricing to find new customers, but rather a defensive position to respond to an inevitable public backlash against Internet Overcharging schemes.  Providers are desperately looking for excuses to further monetize broadband, cut costs, and deliver an effective impediment to online video competitors using broadband networks to deliver alternative, less expensive services to consumers.

Policymakers should listen to their constituents, who are more than comfortable with today’s unlimited broadband experience.  Nobody objects to experimental low usage plans with discount pricing, but not at the expense of ending or repricing existing unlimited service into the stratosphere.  Today’s broadband industry earns billions in annual profits, even as their costs decline.  Providers have done considerable profit-taking in the last few years from their broadband divisions, slashing upgrades and other investments to keep pace with traffic demands.

Don’t want blazing fast fiber optic broadband speeds?  Unhappy with fiber optic quality video and want to go back to putting a satellite dish on your roof?  If the answer to either question is “yes,” Frontier Communications has good news for you.

The phone company, which assumed control of a handful of communities formerly served by Verizon’s fiber-to-the-home FiOS network, has announced it will begin marketing DSL and satellite TV services to its fiber customers.

Frontier CEO Maggie Wilderotter told investors on a third quarter results conference call that FiOS broadband could be too expensive.

Wilderotter noted Verizon would not allow customers in a FiOS neighborhood to buy DSL service, which leaves budget-minded customers behind.

“Now, FiOS starts at like 50Mbps and it’s very expensive. It’s like $50 a month for a customer. So they left a whole host of customers behind from an affordability perspective who didn’t need that kind of capability on broadband.” Wilderotter explained. “We have just over the last 30 to 60 days opened up DSL in all of the FiOS markets to give the customer choice. So the customer can choose whether they want FiOS broadband or they want high-speed Internet service, typically, and in those markets we’re offering around 6 to 7Mbps.”

Time Warner Cable occasionally runs promotions helping customers break free from Frontier's multi-year service contracts.

Of course, Frontier FiOS starts at 15Mbps — not 50, and that costs $50 a month for standalone service.  For $99, ($89 in Verizon FiOS areas), customers can get broadband, cable TV and unlimited phone service.  Frontier’s “Turbo” DSL service is priced at $40 a month for up to 7.1Mbps service.

Wilderotter also noted their FiOS customers can also choose to skip fiber video and go with DirecTV.

“We think that customers should be able to choose what kind of video they want,” she said. “We have aggressive offers in the market for both DirecTV and for FiOS video, but in our vernacular, what we care about is keeping the customer, getting the customer to take more products and services from us and making sure the customer is happy with the choice.”

Wilderotter said Frontier is prepared to tolerate more congestion on its DSL circuits than Verizon permitted, which opens the door to potential traffic slow-downs down the road.

“We’ve opened up in many of these locations the opportunity to sell high-speed service up to 95% capacity on the equipment that we have out in the field. Verizon had set a parameter at 75%,” Wilderotter said.

The company continues to study whether Frontier FiOS is worth maintaining or expanding outside of the Verizon territories where it was originally constructed.

“We are still evaluating it from a financial perspective and a customer perspective, and from a cost perspective and a revenue perspective,” Wilderotter told investors. “In terms of what that does for us overall, what it does for churn, how much does it really cost to extend this capability in the markets that we’re in today — we think that analysis and evaluation will go on through the first quarter [of 2011] and then we’ll be able to make some [decisions] in terms of what we want to do with FiOS from an expansion perspective or a maintenance perspective.”

Frontier Communications CEO Maggie Wilderotter answered questions about broadband expansion and the impact of the fall elections on telecommunications policy in Washington. (11 minutes)
You must remain on this page to hear the clip, or you can download the clip and listen later.

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Frontier's largely rural service areas provide a captive audience for the company's DSL broadband service.

In the near term Frontier has several plans to get more aggressive in the marketplace to meet its target goal of losing only 8 percent of their customers per year — a goal that illustrates legacy phone companies are still on a trajectory towards fewer and fewer customers:

1. Don Shassian, executive vice president and chief financial officer of Frontier reports expansion of DSL remains a top priority for Frontier.  The company is on track to deliver access to 300,000 additional homes by the end of the year.  Verizon delivered access to 64 percent of Frontier’s acquired territories.  Frontier wants to get that number up to 85 percent.  But part of that target is not just expanding service to unserved areas.  It’s also trying to win back customers lost to other providers through promotions and incentives.
2. Frontier plans to resume aggressive promotions in the coming weeks and months, including its “free Netbook” promotion, which provides a Netbook computer to new customers signing up for several packages of services, committing to remain with Frontier for at least two years.
3. Frontier intends to push “price protection agreements” on as many customers as possible.  Their “Peace of Mind” program locks customers into multi-year contracts with stiff cancellation penalties.  Wilderotter noted: “I think, as you know, in our legacy markets, 96% of all of our sales are on a price protection plan and we have close to 60% of our residential customers on a one-, two- or three-year price protection plans. That number is below 15% in the acquired markets. So we’re also driving for price protection plans with every sale that we’re doing in these new markets as well.”  Such contracts dramatically discourage a customer from disconnecting Frontier, because fees for doing so can exceed $300 in some cases.  Frontier has been heavily criticized by some customers and State Attorneys General for deceptive business practices regarding contracts.

Frontier continues to enjoy a lack of solid cable competition in its largely rural service areas.  Shassian reports Comcast competes with Frontier in only about 32% of homes in some areas, Time Warner Cable in about 23%, and Charter below 15%.  With reduced competition, Frontier often represents the only broadband option in town.

Frontier is also spending an increased amount of time coping with copper thefts, especially in West Virginia where the company is warning would-be thieves it will prosecute to the fullest extent of the law.

“Damage to our facilities can affect communications access in an emergency, increase company costs and consumer rates, and disrupt community phone and broadband connections,” said Lynne Monaco, Frontier’s Director of Security. “When network connections are severed by copper thieves, it endangers customers and emergency responders and poses significant risks of personal injury and property damage.”

Just last week, West Virginia state police solved another copper caper that disrupted service for some customers.

The Charleston Daily Mail reports:

Stephanie Burdette of Charleston was arrested in connection with a copper wire theft.

Trooper A.B. Ward from the South Charleston detachment went to the Fishers Branch area of Sissonville last Thursday afternoon when a Frontier worker discovered a section of the communications line missing. The worker found that 300-feet of the 400-pair line, valued at about $5,000, was missing, according to a complaint filed in Kanawha Magistrate Court.

A trooper who had worked on a similar investigation told Ward to check the home of Ervin “Tubby” Page, 49, where troopers had previously found evidence of wire burning. Ward went to Page’s home, described as a Goose Neck travel trailer parked next to the Guthrie Agricultural Center in Sissonville, and found three burn barrels about 50 feet in front of the trailer. One of them was on fire.

Page’s girlfriend Stephanie Marie Burdette, 25, of Cross Lanes, was at the scene when the trooper arrived. Ward spoke to her then checked out the barrels where he found aluminum wrap, which is used to cover the copper communications wiring, and pieces of copper cabling, the complaint said.

Frontier customers are encouraged to report any suspicious activity around telecommunications equipment and facilities by calling the company’s toll free security line 1-800-590-6605. Anyone witnessing a theft in progress should not confront the suspects but should immediately call 911 and then call Frontier. Vehicle and suspect descriptions are very useful. This is a community safety problem, and the cooperation of the public is critical.

[flv width=”500″ height=”395″]http://www.phillipdampier.com/video/WOWK Charleston Copper Thieves 11-15-10.flv[/flv]

WOWK-TV in Charleston covers Frontier’s difficulties with copper wire thieves across the state of West Virginia.  (1 minute)

Ontario residents enjoy less than half a serving of broadband their neighbors in Quebec enjoy from Bell, for less money

Residents of Quebec enjoy more than double the broadband usage allowance Bell provides its Ontario customers, showing once again h0w arbitrary Internet Overcharging schemes are for consumers in North America.

Broadband Reports reader Ironsight200 ponders why customers in Quebec enjoy substantially less abuse from the skimpy usage allowances Bell imposes on its customers.

The prices charged differ as well, with Quebec residents also getting an out-the-door lower monthly price because Bell does not impose charges on the modem Ontario customers rent for $3.95/month — $6.95 a month with the Fibe 25 service.

Let’s take a look (and don’t worry Ontario readers, Bell promises you can still look at least 624,999 additional web pages this month without incurring overlimit fees):

Quebec users get more than double the usage allowance of...

...their neighbors in Ontario.

Pricing for Bell broadband service at the bundled price:

*- includes $3.95 modem rental fee. ^- includes $6.95 modem rental fee.

Virgin Media broadband customers in the United Kingdom who spend free time playing the highly addictive World of Warcraft (WoW) suffered some serious withdrawal episodes after game developers, who may know how to create games like 벳엔드, released a major software patch (v4.0.1).

Just after installation, customers noticed their game play started slowing to a crawl, resulting in game performance worthy of a Noob popping Xanax.  With online ‘street cred’ at risk on the multiplayer game environment, WoW players rushed to Virgin’s support forums inquiring about the sudden slow lane performance:

Ever since this patch I have experienced very high latency (around 2-4k ms) whilst being in combat in 25-man raids. This latency causes me to disconnect from the game after around 10 seconds of very lagged out combat. Outside of raids I seem to yo-yo up and down. I have been as low as 70ms and as high as 1kms.

I have tried everything I can think of game related. I have ensured all the correct ports are opened via port forwarding on my router.  I have tried running the game in its default state with all add-ons removed. I have done virus scans, disabled my firewall and I am running out of options. No one else in-game seems to have the same problems as I do. Admittedly, a couple of them are Virgin Media customers too and have no problems but I cannot think what else it could be.

Now stuck in the slow lane on Virgin Broadband

Virgin Media customers and staff initially seemed at a loss about what could cause just WoW traffic to become very un-WoW.  Virgin’s terms of service includes a virtual paddle to spank customers who “excessively utilize” their broadband connections, and the patch itself — amounting to at least 7GB with accompanying updates — was worthy enough to put some customers in the time-out corner.  But even as company support officials were asking impacted customers to do the problem-solving sleuthing for them, a growing number of customers suspected the provider’s “intelligent network traffic shaping” technology was the real culprit.

Traffic shaping is a term Americans are just getting acquainted with.  It’s essentially a virtual traffic cop that can identify different types of online traffic and assign different levels of priority for different applications.  The broadband industry claims traffic shaping is a net plus for broadband consumers because it forces traffic gorgers like peer to peer file sharing to the back of the line, making room for more predictable performance of Internet phone calls, video, and other time-critical Internet applications. Virgin even markets its broadband service as enhancing online game play by giving the highest possible priority to game-related traffic. Join betpro today for access to a wide range of sports betting options and exciting casino games!

But when traffic shaping goes bad, it can create a nightmare for broadband customers who find roadblocks that ruin their online experience.

Virgin initially denied it was responsible for traffic shaping WoW to the point of unusability. Eventually, Virgin admitted it -was- responsible for the game traffic throttles, but passed the blame to WoW’s game developers, Blizzard Entertainment.  At one point Virgin suggested the company might want to recall the latest patch, just to get the game to work again on Virgin’s broadband network.  When that didn’t fly, company officials eventually released a statement taking responsibility, but telling customers it will be weeks before their “traffic management supplier” can create a workaround:

Since the latest World of Warcraft update we have seen that the type of packets used by Blizzard to deliver the on-line gaming has changed significantly.  This means that Virgin Media’s National (ADSL) traffic management system is unable to recognise the packets as gaming traffic and assumes that they are peer to peer traffic.  Due to this the traffic management system does not place the packets within the gaming queue which has the highest priority and lowest latency within the VM network, instead they fall into the peer to peer class which gets a low level of priority within our network and by default a higher level of latency.

We are working to try and rectify this as soon as we can with our traffic management supplier however it will take us a few weeks to upgrade the traffic manage solution so that is can recognise the new traffic class and correctly classify it as gaming.  Unfortunately due to the nature of most traffic management solutions we can not manually move these packets into the gaming queue as the solution can not work out which ones to move.

We appreciate that some customers will have noticed a similar issue with the previous World of Warcraft update.  The reason behind this is because gaming companies are not prepared to share the updates with Virgin Media or traffic management suppliers prior to its release and so the first time we see the new packets is when people start to use the new updates.  We are trying to change this view point of the gaming companies however at present they are un-willing to work with us.

We apologise for the affect that this has on your gaming experience and we will update you when we have a confirmed fix date for this.

By that time, many WoW enthusiasts will have probably fled Virgin for another provider.

Our reader James, who alerted us to this story, notes it takes a special kind of nerve for a broadband provider running speed traps to blame software developers for the problem.

“So, wait — Virgin is blaming the game developers because their code runs on the assumption that all traffic is treated equally and because they don’t verify their updates with the ISP before pushing them out to consumers?” James incredulously asks.

Virgin could always discontinue their faulty un-intelligent network traffic shaping scheme until a solution can be found, but that hasn’t happened.  It could interfere with “preferred content partnerships” — clients who pay to avoid the speed traps and throttles and always get special treatment.

Paying customers?  They can wait two or three weeks.

A Blizzard representative said Virgin’s buck (or is it pound?)-passing was inexcusable because the game producer -has- made efforts to reach out to ISPs in the past:

“In our defense, most of our previous attempts to work with ISPs have been shut down by the ISP management. I’m going to avoid naming actual ISP names for obvious legal reasons. We’re not the ISP’s actual customer so they rarely care what we have to say.”

And that is a perfect real-world example of what happens when Net Neutrality is not the law of the land.  Providers claim their traffic management schemes benefit their customers, but in reality they are only responsive to the “preferred content partners” that pay them to be responsive.

If Americans want to enjoy a similar level of service from their Internet Service Providers, just oppose Net Neutrality, sit back and wait… and wait… and wait.

A telecom industry mouthpiece claims candidates lost at the ballot box because of Net Neutrality.

Scott Cleland, a paid mouthpiece for the nation’s Big Telecom companies, claimed last week’s election results were a national referendum on Net Neutrality broadband reform, and Americans ran to the polls to defeat it.

“So the best available national proxy vote gauging political support for [that] vision of net neutrality lost unanimously 95-0,” Cleland said, referring to 95 Democratic candidates who pledged to “protect network neutrality,” all of whom lost.

Cleland, who chairs the cable and phone company-financed “Netcompetition.org” website, thinks Americans hurried to polls to deliver a message against broadband reform policies at a time when the country continues to face nearly 10 percent unemployment, tight credit, poor housing values, concerns about government spending, and a continued sour outlook things will improve anytime soon.

The Net Neutrality pledge came from the Progressive Change Campaign Committee (PCCC), a liberal group trying to elect like-minded legislators to office in a year that saw major losses for Democrats, especially in the House.  The 95 signers were mostly candidates challenging open or Republican seats, often in conservative districts.

Take Ann Kuster, who sought office in New Hampshire’s conservative 2nd district.  Won by Democrat Paul Hodes in the Democratic “wave election” of 2006, Hodes relinquished the long-standing Republican seat to run for Senate (and lost).  His immediate predecessor, Charlie Bass, a “Republican Revolution” victor swept into office in 1994, held the seat for a dozen years.  Bass ran to reclaim his old seat against newcomer Kuster, who faced considerable criticism in the Democratic primary for her lobbyist ties to Big Pharma.  Despite Kuster’s alienation of the Democratic party base because of her prior career lobbying against drug pricing reform, she lost the election last week by just a single point.

One issue definitely not in contention in the 2010 election in New Hampshire’s Second District was… Net Neutrality.  In fact, the last time the issue flared up in a significant way in western New Hampshire was in 2006, when Bass was criticized for his pro-telecom industry views opposing the broadband reform policy.

Charlie Bass recaptures his seat in Congress

Bass did not even make Net Neutrality an issue this year.  Even Kuster gave short shrift to the issue on her campaign website, putting her telecommunications policy views at the bottom of a list that emphasized jobs, the economy, foreign policy, and health care.

PCCC co-founder Adam Green noted Cleland’s political allies, including Bass, kept their mouths shut about the issue during this year’s elections.

“The only significant thing about Net Neutrality in 2010 is that 95 Democratic challengers felt confident enough to actively tell voters they support this pro-consumer position,” Green observed.  “Zero candidates across the country felt confident enough to actively tell voters they opposed Net Neutrality for the obvious reason that opposing the free and open Internet would be a ridiculously stupid political move.”

Net Neutrality is still an obscure topic for many broadband users, unaware of its meaning or the implications of having net protections swept away by broadband providers intent on boosting profits.

One thing is certain — as a result of last week’s elections, Republicans in the House and Senate, who have almost universally opposed against Net Neutrality, will almost certainly be able to block legislative efforts to enact such reforms into law for the next two years.

Telecom-focused Heavyweight Faces Surprising Loss

Boucher

In the House, the surprising loss of Rep. Rick Boucher (D-Va.) in last week’s election will have a major impact on telecommunications policies.  Boucher, first elected in 1982, is a veteran of battles between consumer groups and big cable and phone companies.  Boucher championed home satellite dish-owner rights at a time when major cable companies were attempting to lock down competition from 10-12 foot backyard satellite dishes. Boucher also fought for net privacy regulations, rural telecommunications services, and supported broadband expansion.  His loss means uncertainty for telecommunications policy, as he gives up his leadership of the House Communications, Technology and the Internet Subcommittee.

“I was saddened to learn of the electoral loss of Representative Rick Boucher in the House,” Federal Communications Commission member Michael Copps said in a statement praising Boucher for nearly three decades of public service. “He has been an extraordinary public servant and a great leader across the whole gamut of telecommunications issues.  His dedication to broadband, his leadership to reform Universal Service to make sure the wonders of advanced telecommunications are available to all our citizens, and his uncommon ability to bring contesting parties to the table to forge workable compromises are the stuff of legend.”

Virginia's largely rural 9th District encompasses the western third of the state

Boucher’s loss could have dramatically negative results on rural Americans with respect to telecommunications services.  Boucher advocated heavily for the telecommunications challenges faced in rural areas like his own 9th District, located in western Virginia bordered by West Virginia, Kentucky, North Carolina, and Tennessee.  Inside his district, broadband service has been challenging to provide in many areas.  The city of Bristol decided to build its own broadband service, a fiber to the home network constructed by Bristol Virginia Utilities.  The network has been so successful, the southern half of the city — actually located in Tennessee — is following Virginia’s lead.  Boucher was a strong advocate for such community networks.

Boucher’s replacement is expected to be either Rep. Anna Eshoo (D-Calif.) or Ed Markey (D-Mass.), both of whom serve more urban districts.

But did Boucher go down because of his strong advocacy of Net Neutrality?  Not even close.  The Bristol Herald Courier reports just one issue was almost certainly responsible for Boucher’s loss: Cap and Trade, legislation that would regulate carbon dioxide by capping total emissions and allowing polluters to trade credits among themselves.  Boucher favored the policy, his opponent opposed it.

Back to the Future Under GOP Leadership

Republican tech policy, potentially under the leadership of congressmen like Rep. Cliff Stearns (R-Florida), is expected to be “Back to the Future,” a return to a more hands-off policy advocated under the former Bush Administration.

The result will be a tech agenda legislatively frozen in place.  Republicans will be unable to pass deregulation bills or block any surprise moves by the FCC to flex its regulatory muscles, thanks to Democrats in the White House and Senate.  Democrats will be unable to enact any broadband reform policies because of “majority-rules”-roadblocks in the Republican-controlled House.  The FCC, already frightened by Congressional dissent, may be less willing than ever to declare a firm position… on anything.  That’s particularly likely with issues considered “hot buttons” on Capitol Hill.

Republicans may even seek to end spending on broadband expansion and other publicly funded projects, assuming there are any funds yet to be allocated.  It is much easier to block annual re-authorizations than to cancel funding already appropriated.

New Consumer Champion Emerging in Senate from Connecticut?

Richard Blumenthal: New consumer champion?

One potential piece of good news for pro-consumer forces is the election of Sen. Richard Blumenthal, the former state attorney general.  Blumenthal’s highly aggressive investigations into wrongdoing by technology firms are likely to continue in his new role as Connecticut’s newest Democratic senator.  Blumenthal has taken aim at privacy violations at Google and prostitution advertising on Craigslist in the past, and his interest in telecommunications consumer protection could be a big help.

For issues like Net Neutrality, all eyes are turning back to FCC Chairman Julius Genachowski, perhaps the only man in Washington with the power to deliver a free and open Internet for at least the next two years.  Will he act?