Marriott’s Gaylord Opryland Resort in Nashville made sure it had a corner on the Wi-Fi market by blocking the competition and charging $250-1,000 to gain access to the hotel’s Wi-Fi.

Marriott International, Inc. and its subsidiary, Marriott Hotel Services, Inc., have been fined $600,000 after a Federal Communications Commission investigation uncovered hotel employees intentionally interfering with personal Wi-Fi networks during convention events, forcing guests and exhibitors to use the hotel’s Wi-Fi network, at a cost of up to $1,000.

The FCC Enforcement Bureau, in response to a guest’s complaint that the hotel was intentionally jamming every Wi-Fi network except their own, discovered hotel workers were using a Wi-Fi monitoring system at the Gaylord Opryland in Nashville to prevent visitors from using their personal mobile broadband hotspots, a serious violation of Section 333 of the Communications Act.

Employees of Marriott, which has managed the day-to-day operations of the Gaylord Opryland since 2012, were tasked with using features of the hotel’s Wi-Fi monitoring system at the Gaylord Opryland to contain and/or de-authenticate guest-created Wi-Fi hotspot access points in the conference facilities. In some cases, employees sent de-authentication packets to the targeted access points, which would dissociate consumers’ devices from their own Wi-Fi hotspots and lock out the devices to keep them from connecting in the future.

Guests and exhibitors arriving expecting to use their AT&T, Verizon, Sprint or T-Mobile mobile hotspots found them completely disabled while on the property. Even adjacent Wi-Fi networks from nearby properties stopped working the moment users entered or approached the hotel grounds.

At the same time the hotel was blocking connections, Marriott charged conference exhibitors and guests dependent on Wi-Fi to run their exhibits or manage business matters connection fees ranging from $250-$1,000 per device for access to the Gaylord’s Wi-Fi network, the only network available.

“Consumers who purchase cellular data plans should be able to use them without fear that their personal Internet connection will be blocked by their hotel or conference center,” said Enforcement Bureau chief Travis LeBlanc. “It is unacceptable for any hotel to intentionally disable personal hotspots while also charging consumers and small businesses high fees to use the hotel’s own Wi-Fi network. This practice puts consumers in the untenable position of either paying twice for the same service or forgoing Internet access altogether.”

Marriott claimed they were just protecting their guests from cyber attacks and the FCC’s decision to fine the hotel has created confusion across the hospitality industry.

“Marriott has a strong interest in ensuring that when our guests use our Wi-Fi service, they will be protected from rogue wireless hot spots that can cause degraded service, insidious cyber-attacks and identity theft,” Marriott said in a statement. “Like many other institutions and companies in a wide variety of industries, including hospitals and universities, the Gaylord Opryland protected its Wi-Fi network by using FCC-authorized equipment provided by well-known, reputable manufacturers. We believe that the Opryland’s actions were lawful. We will continue to encourage the FCC to pursue a rule making in order to eliminate the ongoing confusion resulting from today’s action and to assess the merits of its underlying policy.”

Several hotel chains have turned to Internet connectivity as a revenue generator, but few hotels have asked as much as Marriott. Some hotel chains charge as much as $22 per day for permission to connect to the facility’s Wi-Fi network, convincing many guests to use their own personal mobile devices as Wi-Fi hotspots instead. But Marriott’s debacle with the FCC allowed several chains to get an edge on the competition and trumpet they are not in the Wi-Fi jamming business:

• Hilton Hotels:  “We do not block or jam any wireless transmissions at our properties;”
• Kempinski and Hyatt Hotels: There are no policies that allow our hotels to jam, block or prevent guests’ use of personal Wi-Fi hotspots;
• InterContinental Hotels Group (Candlewood Suites, Crowne Plaza, Even, Holiday Inn, Holiday Inn Express, Hotel Indigo, Hualuxe, InterContinental and Staybridge Suites) has no problem with guests using personal networks on hotel property, but why bother when any guest can enroll in the IHG Rewards Club at no charge which gives them free unlimited access to the chain’s Wi-Fi;
• The majority of Wyndham’s hotels are independently owned and operated, but most already offer complimentary Wi-Fi to guests, according to a hotel spokesperson.

Marriott was convinced it was not in violation of the law because it was not using an illegal signal jammer, commonly available overseas and often used in restaurants and theaters to silence cell phones. Marriott’s guests could still make and receive phone calls and text messages. But the Enforcement Bureau found that argument uncompelling after discovering hotel employees intentionally targeting any non-hotel hotspots they could locate to disconnect or block consumers from using them.

The $600,000 fine, the first of its kind for an incident of this kind, won’t mean much to the Marriott Gaylord Opryland. For staying at one of the hotel’s 3,000 rooms, Marriott charges $18 a day in “resort fees” for the “free Internet access,” $6.99 a day for enhanced Internet speed “suitable for downloading files, video chat and video streaming,” and $21-28 a day to park your car there.

But the FCC enforcement action has put a stop to this kind of access blockade spreading further. Under the terms of Marriott’s agreement with the FCC announced today, Marriott must cease the unlawful use of Wi-Fi blocking technology and take significant steps to improve how it monitors and uses its Wi-Fi technology at the Gaylord Opryland. Marriott must institute a compliance plan and file compliance and usage reports with the Bureau every three months for three years, including information documenting any use of access point containment features at any U.S. property that Marriott manages or owns.

Verizon Wireless, facing scrutiny from FCC chairman Thomas Wheeler, today announced it has canceled plans to introduce a new “network optimization” policy that would have significantly throttled down speeds for heavy users still on grandfathered, unlimited use data plans.

Stop the Cap! received a statement from Verizon Wireless this afternoon announcing a sudden change of heart:

Verizon is committed to providing its customers with an unparalleled mobile network experience.  At a time of ever-increasing mobile broadband data usage, we not only take pride in the way we manage our network resources, but also take seriously our responsibility to deliver exceptional mobile service to every customer.  We’ve greatly valued the ongoing dialogue over the past several months concerning network optimization and we’ve decided not to move forward with the planned implementation of network optimization for 4G LTE customers on unlimited plans.  Exceptional network service will always be our priority and we remain committed to working closely with industry stakeholders to manage broadband issues so that American consumers get the world-class mobile service they expect and value.

Chairman Wheeler questioned Verizon’s strategy almost immediately after the company announced its “network optimization” strategy in July.

Wheeler

“‘Reasonable network management’ concerns the technical management of your network; it is not a loophole designed to enhance your revenue streams,” Wheeler wrote in a July 30 letter to Verizon Wireless CEO Dan Mead. “It is disturbing to me that Verizon Wireless would base its ‘network management’ on distinctions among its customers’ data plans, rather than on network architecture or technology.”

Wheeler reminded Mead the FCC defined network management practices to be reasonable “if it is appropriate and tailored to achieving a legitimate network management purpose, taking into account the particular network architecture and technology of the broadband Internet access service.”

Wheeler told Mead Verizon’s plans didn’t qualify.

“I know of no past FCC statement that would treat as ‘reasonable network management’ a decision to slow traffic to a user who has paid, after all, for ‘unlimited” service,'” Wheeler wrote.

Wheeler also questioned how Verizon could justify its planned speed throttling under the conditions it agreed to after winning the 700MHz “C Block.” That spectrum was accompanied by a special FCC mandate – open platform rules which prohibits Verizon Wireless from denying, limiting, or restricting the ability of end users to download and use applications of their choosing on the C Block networks. A speed throttle would make using some applications impossible.

In August, Wheeler hammered home his opposition to Verizon’s plans at a news conference.

“My concern in this instance–and it’s not just with Verizon, by the way, we’ve written to all the carriers–is that [network management] is moving from a technology and engineering issue to a business issue, such as choosing between different subscribers based on your economic relationship with them.”

Wheeler has expressed irritation that Verizon’s justification for congestion management only applied to its unlimited customers, while those paying on a per-gigabyte basis could use (and spend) as much as they like.

Verizon responded that other providers — notably AT&T — already have a similar network management policy in place, throttling speeds of grandfathered unlimited customers who consume more than 3GB of wireless traffic on its 3G network or 5GB on its 4G network a month.

“‘All the kids do it’ was never something that worked with me when I was growing up and didn’t work with my kids,” Wheeler responded, noting Verizon was trying to reframe the issue instead of justifying the need for speed throttles for some customers, while giving others unlimited access as long as they pay.

The merger of Comcast and Time Warner Cable includes castoffs that will be served by a completely unknown spinoff – GreatLand Connections, that nobody can speak with and does not have a website.

At least 2.5 million Comcast customers in cities like Detroit and Minneapolis could soon find their service switched to a new provider that doesn’t have a website, doesn’t answer questions, and won’t give detailed information to municipal officials about its plans, pricing, or service obligations.

GreatLand Connections is the dumping ground for communities Comcast no longer wants to serve, including cities in Alabama, Indiana, Kentucky, Michigan, Minnesota, Tennessee and Wisconsin.

Formerly known as “SpinCo” for the benefit of Wall Street investment banks advising Comcast, the new cable company has been created primarily to help Comcast convince regulators to approve its merger with Time Warner Cable. Comcast believes supersizing itself with Time Warner Cable will win a pass with the FCC by self-limiting its potential television market share. The deal is also structured to dump a large amount of debt on the brand new cable company, allowing Comcast to avoid a significant tax bill.

GreatLand will, for all intents and purposes, be Charter Cable under a different name. Charter will act as the “management company,” which means it will be in charge of most consumer-facing operations.

Beyond that, almost nothing is known about the new cable company, except that it will open its doors laden with $7.8 billion in debt, according to a securities filing. That is equal to five times EBITDA, or earnings before interest, taxes, depreciation and amortization. In comparison, Comcast is 1.99 times EBITDA and Time Warner Cable is 3.07 times EBITDA, making the new cable company highly leveraged above industry averages. Charter Cable, which declared bankruptcy in 2009, is loaded down it debt itself, as it continues to acquire other cable operators.

Finances for the new company appear to be “less-than-middling,” according to MoffettNathanson analyst Craig Moffett, in a note to investors.

Because cable operators face little serious competition, the chances of any significant cable company liquidating in bankruptcy is close to zero, but a heavily indebted company may be very conservative about spending money on employees and operations. It may also leverage its market position and raise prices to demonstrate it can repay those obligations.

With many customers having only one choice for High Speed Internet access above 15-25Mbps — the cable company — the arrival of GreatLand concerns many municipalities facing deadlines to approve a transfer of franchise agreements from Comcast to the new entity.

Jodie Miller, executive director of the Northern Dakota County Cable Communications Commission in suburban Minneapolis said it was impossible to find anyone to talk to at GreatLand. The commission needs to sign off on franchise transfers by mid-December, but nobody can reach GreatLand and the company has no track record of service anywhere in the country.

“We’re not even saying it’s unqualified,” she told Businessweek. “We’re saying we don’t really have information.”

Coon Rapids, Minn. has put franchise renewal negotiations on hold. Michael Bradley, a municipal cable TV attorney and the city’s longtime cable counsel said the deadline has been extended from Oct. 15 to Dec. 15.

“It’s a challenge,” he said. “No one knows who we can deal with locally. Nothing is certain yet and discussions are on hold.”

“We don’t have the answers we need,” added Ron Styka, an elected trustee with responsibility for cable-service oversight in Meridian Township, Michigan, a town served by Comcast about 80 miles west of Detroit.

“Answers have been inadequate at best and mostly not forthcoming,” echoed David Osberg, city administrator of Eagan, Minn. in a filing to the Federal Communications Commission.”It’s not clear whether GreatLand will be financially qualified.”

Eagan has had problems with Comcast in the past, and does not want new ones with GreatLand, especially with broadband service, which is vital to an effort to attract technology jobs to the community.

A for-profit company that believes it can earn billions from web users who illegally download music, movies and television shows wants the power to lock your web browser until you provide a credit card number to settle allegations you illegally download copyrighted content. And when dealing with allegations of illegal activities on a computer, having a skilled lawyer by your side is imperative. These experts are adept at dissecting complex digital evidence and constructing a robust defense. Visit https://www.newjerseycriminallawattorney.com/white-collar-crime/computer-crimes-attorney/ to find an attorney who specializes in this field and can offer the right support and advice. Those who are facing drug crime charges may check out a list of drug charges and sentences in Texas here.

Rightscorp strongly believes in its business plan, which demands nuisance settlements from web users caught sharing or downloading copyrighted content. The company believes it has struck gold scaring Bittorrent users with service suspension and the threat of a costly lawsuit unless they agree to pay a $20 “fine” to “settle” the alleged copyright infringement. The fine amounts are seen as low enough to guarantee a quick settlement without involving an attorney.

“Based on the fact that 22% of all Internet traffic is used to distribute copyrighted content without permission or compensation to the creators, Rightscorp is pursuing an estimated $2.3 billion opportunity and has monetized major media titles through relationships with industry leaders,” the company recently told investors. Uncover the secrets of success in education with Kamau Bobb Google as your mentor.

Using “unique and proprietary patented technology,” Rightscorp says it can identify the infringement of digital content such as music, movies, software, books and games. Rightscorp’s success getting paid depends heavily on the added weight Internet Service Providers can bring when they send on notices that claim those who don’t settle risk having their Internet service shut off. Rightscorp calls their settlement offers “reasonable,” especially when compared with the possible financial consequences of a verdict in favor of the copyright holder as defined in the Digital Millennium Copyrights Act (DMCA), which can be as high as $150,000.

Rightscorp splits any proceeds 50/50 with itself and copyright holders. ISPs get nothing for cooperating.

The company has successfully extracted settlements from more than 100,000 Americans so far as cooperating ISP’s like Charter Communications forward Rightscorp’s legal threats to their broadband customers:

Dear Sir or Madam:

Your ISP has forwarded you this notice.
This is not spam.
Your ISP account has been used to download, upload or offer for upload copyrighted content in a manner that infringes on the rights of the copyright owner.
Your ISP service could be suspended if this matter is not resolved.
You could be liable for up to $150,000 per infringement in civil penalties.

The file 09 – Beyond.mp3 was infringed upon by a computer at IP Address xx.xxx.xxx.xx on 2013-06-24 02:59:08.0 .

We represent the copyright owner.
This notice is an offer of settlement.

If you click on the link below and login to the Rightscorp, Inc. automated settlement system, for $20 per infringement, you will receive a legal release from the copyright owner.

Click on this link or copy and paste into your browser:

https://secure.digitalrightscorp.com/settle/****

Rightscorp, Inc. represents the following ‘copyright owner(s)’ Round Hill Music (‘RHM’).

RHM is the exclusive owners of copyrights for Daft Punk musical compositions, including the musical compositions listed below. It has come to our attention that Charter Communications is the service provider for the IP address listed below, from which unauthorized copying and distribution (downloading, uploading, file serving, file ‘swapping’ or other similar activities) of RHM’s exclusive copyrights listed below is taking place.

This unauthorized copying and/or distribution constitutes copyright infringement under the U.S. Copyright Act. Pursuant to 17 U.S.C. 512(c), this letter serves as actual notice of infringement. We hereby demand you immediately and permanently cease and desist the unauthorized copying and/or distribution (including, but not limited to downloading, uploading, file sharing, file ‘swapping’ or other similar activities) of recordings of Daft Punk compositions, including but not limited to those items listed in this correspondence.

RHM will pursue every available remedy including injunctions and recovery of attorney’s fees, costs and any and all other damages which are incurred by RHM as a result of any action that is commenced against you. Nothing contained or omitted from this letter is, or shall be deemed to be either a full statement of the facts or applicable law, an admission of any fact, or a waiver or limitation of any of RHM’s rights or remedies, all of which are specifically retained and reserved. The information in this notification is accurate.

We have a good faith belief that use of the material in the manner complained of herein is not authorized by the copyright owner, its agent, or by operation of law. I swear, under penalty of perjury, that I am authorized to act on behalf of the owner of the exclusive rights that have been infringed. While RHM is entitled to monetary damages from the infringing party under 17 U.S.C. Section 504, The RHM believes that it may be expeditious to settle this matter without the need of costly and time-consuming litigation.

In order to help you avoid further legal action from RHM, we have been authorized to offer a settlement solution that we believe is reasonable for everyone.

To access this settlement offer, please copy and paste the URL below into a browser and follow the instructions for the settlement offer:

https://secure.digitalrightscorp.com/settle/****

Very truly yours,

Christopher Sabec
CEO
Rightscorp, Inc. 3100 Donald Douglas Loop, North, Santa Monica, CA 90405 Telephone: (310) 751-7510

After initially scaring a consumer with an infringement notification, the settlement web page that appears after the customer reaches for a major credit card is more soothing:

Liability Release & Settlement Receipt

IMPORTANT: Please print and retain this document for your records. It releases you from liability for the below mentioned infringement and serves as official notice of settlement.

Round Hill Music for itself, for its past, present and future directors, shareholders, members, managers, officers, employees, agents, attorneys, representatives, partners, trustees, beneficiaries, family members, heirs, subsidiaries and affiliates, and for its and their predecessors, successors and assigns (collectively the “Releasor”);

Hereby finally, unconditionally, irrevocably and absolutely releases, acquits, remises and forever discharges Joe Smith, 123 Main Street Anytown USA and such person’s family members and heirs (collectively the “Releasee”);

From any and all manner of actions, suits, debts, sums of money, interest owed, charges, damages, judgments, executions, obligations, costs, expenses, fees (including attorneys’ fees and court costs), claims, demands, causes of action and liabilities, that arise under the United States Copyright Act, in each case whether known or unknown, absolute or contingent, matured or unmatured, presently existing or hereafter discovered, at law, in equity or otherwise, that the Releasor may now have or that might subsequently accrue against the Releasee arising out of or connected with (directly or indirectly) the specific Infringement of musical composition(s) referenced above;

Provided however, that this release shall not, and shall not be deemed to, constitute a release with respect to any other past, present or future infringements by Releasee other than the specific Infringement of musical composition(s) referenced above.

Rightscorp does not appear to be spending its limited resources actually pursuing suspected violators in court. The threat of further action alone appears to have been enough for many to voluntarily pay the firm after receiving their first violation notice. Little, if anything, has happened to those who ignore Rightscorp’s settlement messages unless their ISP suspends access.

As long as payments roll in, there is money to be made in the enforcement business.

Rightscorp now wants to further automate its copyright enforcement process by asking cooperating ISPs to lock customers’ web browsers until payment to Rightscorp has been made.

Rightscorp CEO Christopher Sabec said the company is working with more than 70 ISPs, including five in the top 10, but industry observers believe “working with” more likely means those ISPs are forwarding Rightscorp’s infringement notices to their subscribers, nothing more. Charter Communications leaves the infringement notices intact, including the settlement offer. Comcast reportedly heavily redacts the notices and strips out the settlement offer and links, eliminating the prospect of Rightscorp winning a quick and near-effortless financial settlement.

Sabec believes ISPs don’t have a choice not to work with Rightscorp because of technology that Sabec claims offers reasonable certainty of infringement, even if the offender changes IP addresses. With that standard met, Sabec says ISPs are legally compelled to take action, including cutting off Internet access at Rightscorp’s request if they do not want to become a co-defendant in a copyright infringement lawsuit.

“We’re showing the ISPs that they have this potential liability,” said Rightscorp chief operating officer Robert Steele. “Their shield for liability is contingent on terminating repeat infringers. Prior to our company, there was no way to hold them accountable.”

Steele told Ars Technica the days of Rightscorp having the power to instantly cut off your Internet access may not be too far off:

In the future, the company hopes to get more ISPs to comply—and it will expect more of those that are already cooperating, said Steele. Ultimately, Rightscorp is hoping for a scenario in which the repeat infringers it identifies aren’t just notified by e-mail. Instead, Steele hopes to see those users re-directed to a Rightscorp notice right at the moment they open their Web browsers.

“You wouldn’t be able to get around the re-direct page, and you’d have to pay a fine to return to browsing,” he explained. The company is in discussions with four ISPs about imposing such a re-direct page, according to Steele. But the details about which ISPs cooperate with Rightscorp, and how much they cooperate, is a secret that the company guards closely.

Their “partner” ISPs include defunct Qwest, which has been known as CenturyLink since 2011 and Charter Communications — the only major cable operator listed.

Whether ISPs will grant unprecedented access to a third-party company trying to turn off their customers’ broadband while maintaining a financial interest in extracting settlements from those customers is doubtful.

Last week, Texas-based independent ISP Grande Communications informed the Austin-based U.S. District Court for the Western District of Texas that Rightscorp was engaged in shenanigans. In a strongly worded advisory to the court, Grande’s lawyers accused Rightscorp of using improper DMCA subpoenas to extract identifying information about alleged copyright offenders — a practice ruled improper more than a decade ago in RIAA v. Verizon, because no judge typically reviews the subpoena application. Rightscorp’s subpoenas rely entirely on the signature of an ordinary district court clerk in California:

Internet service provider and cable operator Grande Communications Networks LLC advises the Court that, one (1) business day after Grande filed its Motion to Quash Subpoena in this proceeding seeking to quash a subpoena served by Rightscorp, Inc. (the “Subpoena”), counsel for Rightscorp, Mr. Dennis J. Hawk withdrew the Subpoena.

The abrupt withdrawal of the Subpoena is consistent with the apparent desire of Rightscorp and its counsel to avoid judicial review of their serial misuse of the subpoena power of the federal courts. In addition, the withdrawal comes only after Grande was forced to expend considerable resources handling the Subpoena (and attempting to discuss it with Rightscorp’s counsel) and then preparing and filing the Motion to Quash.

As detailed in Grande’s Motion, the Subpoena presented an extraordinarily undue burden (over 30,000 subscriber lookups) and was issued to a cable operator without an order as required by the Cable Communications Act. Even more egregiously, it appears that the Subpoena is only one of approximately one hundred (100) or more similar subpoenas issued by Rightscorp to regional Internet service providers located across the country (presumably chosen because they are less likely to contest the subpoenas than national Internet service providers with larger in-house legal departments) upon the signature of the Clerk of the U.S. District Court for the Central District of California, seeking the personally identifiable information of thousands of individuals beyond the jurisdiction of the California courts, despite the fact that such subpoenas may not be sent and issued under 17 U.S.C. § 512(h) to an Internet service provider acting as a conduit under law that has been established for a decade.

Under the circumstances, this Court or the U.S. District Court for the Central District of California may consider ordering Rightscorp and its counsel to show cause why they should not be sanctioned for misusing the federal court’s subpoena powers. Such an order would be appropriate in connection with Grande’s request for costs and attorney’s fees in the Motion.

Beyond any doubt, Rightscorp and its counsel failed and refused to “take reasonable steps to avoid imposing undue burden or expense” on Grande. Fed. R. Civ. P. 45(d)(1). As Grande has explained, before the Motion was filed, Rightscorp’s counsel’s only response to Grande’s efforts to confer was a threat that “[w]e expect compliance by the service providers” and that Rightscorp “does not pay to obtain the address details on infringers.”

In addition, Rightscorp’s conduct also raises concerns under Rule 11, and, regardless, may present appropriate circumstances for the imposition of sanctions under the Court’s inherent powers.

The next business day after the Motion was filed, Rightscorp’s counsel made a hasty retreat. If Rightscorp believed it had a good faith basis for the Subpoena, it would have asserted its position before this Court.

But Rightscorp must know that its position and practice would not survive judicial review. If Grande had not challenged the Subpoena, Rightscorp would have improperly obtained the personally identifiable information of hundreds (or thousands) of Texas Internet subscribers using an invalid procedure, without the notice to any of them that would have followed from the court order that Rightscorp refused to seek to obtain, and without the slightest requirement of any showing to the California court whose signature Rightscorp improperly utilized. It appears clear that Rightscorp and its counsel are playing a game without regard for the rules, and they are playing that game in a manner calculated to avoid judicial review. Hopefully, they will not be permitted to continue much longer.

[flv]http://www.phillipdampier.com/video/CNBC Rightscorp Piracy 5-1-14.flv[/flv]

CNBC talked with Rightscorp CEO Christopher Sabec about copyright infringement, Net Neutrality, and whether or not copyright holders should simply cut the cost of their content as a disincentive to piracy. (5:28)