Phillip “How far will $20 get me in your office?” Dampier

Congress is famous for obfuscation when it comes to introducing legislation that promises one thing and delivers something quite different. Take the 2003 “Clear Skies Initiative,” which would have allowed the energy industry to increase polluting emissions, or “The Disclosure of Hydraulic Fracturing Fluid Composition Act,” which allows frackers to keep secret the ingredients of millions of gallons of chemicals pumped into the ground to displace natural gas, and potentially your potable drinking water.

So it shouldn’t be much of a surprise that Rep. Bob Latta (R-Ohio) wants to “protect” the open and free Internet by introducing a new bill that opens and frees the telecom companies that steadfastly support his campaign coffers to install paid Internet toll booths. Like many pieces of legislation coming from some House Republicans these days, “freedom” only extends to corporate interests, not to you or I (unless we want to start a corporation of our own.)

Reclassifying broadband as a telecommunications service under Title II of the Communications Act is the Holy Grail for Net Neutrality supporters. It offers clear oversight authority that would make future lawsuits from Comcast, Verizon and other telecom companies untenable. Earlier court decisions have laid a foundation for broadband oversight under Title II, but the FCC itself must take advantage of that opportunity, and so far it has not.

Congressman Latta has introduced legislation to make sure the FCC can never take that step. His bill would specifically prohibit the FCC from reclassifying broadband Internet access as anything beyond an unregulated “information service.”

According to Latta, only with his legislation can America be assured the Internet will stay “open and free.” — “Open and free” for the picking by companies who dream of new revenue monetizing Internet traffic. Not satisfied charging some of the world’s highest prices for Internet access, many of the largest cable and phone companies in the country now want the right to “double-dip” — charging consumers to reach Internet content and content producers for delivering it. It would be like paying postage to mail a letter and having it arrive postage due or letting the phone company charge both the caller and the person called for a long distance telephone call.

“The legislation comes after the FCC released a proposal to reclassify broadband Internet access under Title II as a telecommunications service rather than an information service,” says a press release from Latta’s office.

Would I lie to you? Rep. Bob Latta (R-Ohio)

That is patently false. In fact, FCC chairman Thomas Wheeler has twisted himself into a human pretzel with clever language and a clear determination not to reclassify broadband under Title II. Wheeler prefers sticking to the rickety Section 706 faux-authority for Net Neutrality — the same section that keeps handing FCC lawyers loss after loss in federal court. After Wheeler announced his intention to propose allowing Internet companies to build paid fast lanes for Internet traffic, the resulting backlash from content companies and the public made him grudgingly offer a “discussion” about utilizing Title II.

That kind of “discussion” will be familiar to every 16-year old teenage girl who is told “we’ll talk about it” after asking mom and dad if she can take her new 22-year old boyfriend on vacation and stay in their own hotel room.

Ironically, detractors like Latta are the ones that usually accuse Net Neutrality of solving a problem that doesn’t exist. But that didn’t stop Congressman Latta from introducing legislation to stop the current ex-telecom lobbyist chairman of the FCC from going all Elizabeth Warren on us, suddenly imposing draconian pro-consumer regulations against those job creators at the cable companies Wheeler used to represent. But on the bright side, when Wheeler doesn’t do what Latta’s bill wouldn’t let him do, Latta can still declare victory against “big government.” If you live in Latta’s district, you can read all about it in the forthcoming government-subsidized, no-postage-needed “newsletter” he and other members of Congress will pelt your mailbox with right before election time.

“In light of the FCC initiating yet another attempt to regulate the Internet, upending long-standing precedent and imposing monopoly-era telephone rules and obligations on the 21^st Century broadband marketplace, Congress must take action to put an end to this misguided regulatory proposal,” said Latta. “The Internet has remained open and continues to be a powerful engine fueling private enterprise, economic growth and innovation absent government interference and obstruction. My legislation will provide all participants in the Internet ecosystem the certainty they need to continue investing in broadband networks and services that have been fundamental for job creation, productivity and consumer choice.”

Consumers not included. Maybe he just forgot.

“At a time when the Internet economy is thriving and driving robust productivity and economic growth, it is reckless to suggest, let alone adopt, policies that threaten its success. Reclassification would heap 80 years of regulatory baggage on broadband providers, restricting their flexibility to innovate and placing them at the mercy of a government agency. These businesses thrive on dynamism and the ability to evolve quickly to shifting market and consumer forces. Subjecting them to bureaucratic red tape won’t promote innovation, consumer welfare or the economy, and I encourage my House colleagues to support this legislation, so we can foster continued innovation and investment within the broadband marketplace.”

Guess not. The Internet should only be about business in Latta’s mind. Consumers that support Net Neutrality are nothing more than parasites sucking away valuable potential profits from the dynamic, flexible and innovative world of traffic shaping, usage caps, and double-dipping.

Latta isn’t interested that your provider is turning your weekend Netflix binge into an exercise of maddening rebuffering futility as your cable/phone company waits for protection racket proceeds a paid peering agreement with Netflix. That is because he doesn’t represent you. He represents AT&T, Time Warner Cable, Comcast, and CenturyLink.

Latta can afford to travel through the Internet toll booth when one considers who his top contributors keeping his campaign flush with cash are:

• More than $32,000 in contributions from AT&T and its executives;
• $29,500 from Tom Wheeler’s old haunt — the National Cable & Telecommunications Association (Big Cable lobby);
• $15,000 from the American Cable Association (Small Cable lobby);
• $21,000 from Time Warner Cable and its executives;
• $16,000 from Verizon and its executives;
• $11,400 from CenturyLink;
• $11,000 from Comcast (they are ditching Ohio customers to Charter after merging with Time Warner Cable so why throw good money after bad).

Latta’s close friendship with Big Telecom is so obvious, it has made co-sponsoring his fact-free bill about as popular as Justin Bieber at an NAACP convention. Even his like-minded Congressional colleagues are staying away. But his industry friends sure appreciate his efforts on their behalf.

One wonders why his constituents return him to office when he would be obviously much more comfortable in his next job — lobbying for AT&T or Comcast. Before our Internet connections slow, let’s hope his constituents hasten a much-needed turbo-speed departure for the congressman, already a shadow employee of AT&T.

227194356 05 28 14 LATTA Broadband Bill (Text)
 

The New York Times recommends the Justice Department and Federal Communications Commission reject Comcast’s $45 billion purchase of Time Warner Cable, if only because the combined company will have an unregulated choke-hold on telecommunications services not seen since the days of the regulated AT&T/Bell monopoly.

In an editorial published Sunday, the newspaper called out many of the “merger benefit”-talking points claimed by the two cable giants as specious at best, hinting some even bordered on misleading:

By buying Time Warner Cable, Comcast would become a gatekeeper over what consumers watch, read and listen to. The company would have more power to compel Internet content companies like Netflix and Google, which owns YouTube, to pay Comcast for better access to its broadband network. Netflix, a dominant player in video streaming, has already signed such an agreement with the company. This could put start-ups and smaller companies without deep pockets at a competitive disadvantage.

There are also worries that a bigger Comcast would have more power to refuse to carry channels that compete with programming owned by NBC Universal, which it owns. Comcast executives say that they would not favor content the company controls at the expense of other media businesses.

The company argues that this deal would not reduce choice because the company does not directly compete with Time Warner Cable anywhere. Comcast would face plenty of competition in high-speed Internet service, they say, from telephone and wireless companies.

The reality is far different. At the end of 2012, according to the FCC, 64 percent of American homes had only one or at most two choices for Internet service that most people would consider broadband. Wireless services can handle streaming video, but many customers of Verizon or AT&T would blow through their monthly wireless data plan by streaming just one two-hour high-definition movie, at which point they would have to fork over extra fees.

Comcast executives argue that companies like Sprint are planning to provide very fast Internet service that will compete with wired broadband. But wireless companies have been working on such services for more than a decade with little success.

Those wireless services that do exist uniformly impose low usage caps and cost considerably more than traditional wired broadband plans, especially when considering the cost compared to the actual speed delivered to consumers.

The Times doesn’t believe imposing a litany of conditions in return for approving the deal, similar to those involving Comcast’s purchase of NBCUniversal, would be sufficient to protect consumers from monopoly abuse.

“This merger would fundamentally change the structure of this important industry and give one company too much control over what information, shows, movies and sports Americans can access on TVs and the Internet,” concluded the newspaper. “Federal regulators should challenge this deal.”

Cuomo

New York Gov. Andrew M. Cuomo has ordered the New York State Public Service to immediately start a thorough and detailed investigation into Comcast’s proposed purchase of Time Warner Cable, using new regulatory powers to reject any merger not in the “best interest” of Time Warner’s customers in New York.

“The State is taking a hands-on review of this merger to ensure that New Yorkers benefit,” Cuomo said. “The Public Service Commission’s actions will help protect consumers by demanding company commitments to strong service quality, affordability, and availability.”

New York implemented one of the nation’s strongest cable franchise laws in April that will now require the two cable operators to prove that any merger is in the public interest. An earlier law backed by the telecom industry put the burden of proof on the Commission to prove such transactions were not beneficial to the public.

Cuomo has requested the PSC check how the proposed merger will expand broadband in under-served areas and offer better broadband access to schools. The PSC will critically review the protections being offered to low income customers as well as how the proposed merger might impact consumer pricing and telecommunication competition overall.

PSC chair Audrey Zibelman said, “To determine whether the proposed transaction is in the public interest, the Commission will examine the proposal to ensure services the merged company would provide will be better than the service customers currently receive.”

One way to prove the merged company would not offer better service is to alert the Commission Comcast plans to reimpose usage caps on its customers while Time Warner Cable does not have any compulsory usage limits or usage billing.

Time Warner now serves 2.6 million subscribers in every major New York community: Buffalo, Rochester, Syracuse, Albany and the boroughs of Manhattan, Staten Island, Queens and parts of Brooklyn.

The PSC is likely to hold public forums across the state in June to hear the views of affected consumers, but the record is now open to written and telephoned comments from anyone interested in the merger.

There are several ways to provide your comments to the Commission. Comments should refer to: “Case 14-M-0183.”

Via the Internet or Mail: The public may send comments electronically to the Hon. Kathleen H. Burgess, Secretary, at [email protected] or by mail or delivery to Secretary Burgess at the New York State Public Service Commission, Three Empire State Plaza, Albany, New York 12223-1350. Comments may also be entered directly into the case file by clicking on the “Post Comments” box at the top of the page.

Toll-Free Opinion Line: Individuals may choose to phone in comments by calling the Commission’s Opinion Line at 1 800-335-2120. This line is set up to receive in-state calls 24-hours a day. These calls are not transcribed, but a summary is provided to staff who will report to the Commission.

Comcast will introduce usage-based billing on all of its broadband customers nationwide within five years, whether they like it or not.

Comcast’s executive vice president David Cohen told Variety he predicts the new usage limit will likely be 350GB a month but could increase to 500GB in 2019. Cohen claims consumers in usage-capped test markets prefer a preset usage limit and an overlimit fee of $10 for each additional 50GB of usage.

But Stop the Cap! has learned at no time has Comcast surveyed customers about whether they want their Internet usage metered or capped. That question is evidently not an option.

If Time Warner Cable territories are merged under the Comcast brand, usage billing would likely immediately follow.

Usage caps will go a long way to protect Comcast’s cable television package from online video, which if viewed in significant amounts could put customers over their monthly usage limit and subject them to higher fees.

“We’re trying to go slowly, not out of a regulatory concern (but because) we have no desire to blow up our high-speed data business,” he said.

If the merger is approved, Comcast will face significantly less competition in many Verizon service areas also served by Time Warner Cable. Verizon FiOS expansion has ended and the company continues to de-emphasize its DSL service, which is the only broadband competition Time Warner Cable faces in many upstate New York and western Massachusetts communities.

An unrepentant Cohen also doubled down on paid prioritization — Internet fast lanes — declaring regardless of what the FCC decides on Net Neutrality, Comcast still has the right to offer paid prioritization to customers.

“Whatever it is, we are allowed to do it,” said Cohen, speaking at the MoffettNathanson Media & Communications Summit in New York. “We are not sure we know what paid prioritization, or what a fast lane, is. Fast lane sounds bad… (but) I believe that whatever it is, it has been completely legal for 15 or 20 years.”

The way Comcast’s lawyers read “Title II,” even if the FCC declares broadband ISPs to be common carriers, Cohen says Comcast will go right on selling prioritized access, claiming Title II doesn’t prohibit paid prioritization — indeed, he said, “the whole history” of Title II is that carriers are allowed to provide different levels of service at different prices, reports Variety.

Cohen said he expects Washington regulators will promptly approve the company’s buyout of Time Warner Cable with no delays, insisting the deal is “not that difficult” in terms of antitrust implications.

Neil Smit, CEO, Comcast Cable (left), Ryan Lawler, TechCrunch (right)

Of all the tech companies to turn up at TechCrunch’s Disrupt New York 2014 event, Comcast Cable seemed the least likely to qualify as the kind of innovative start-up TechCrunch loves to cover.

But there sat Comcast Cable CEO Neil Smit with TechCrunch’s Ryan Lawler, discussing Comcast’s mega-merger with Time Warner Cable, its peering agreement with Netflix, broadcast TV streamer Aereo, and Comcast’s legendary dismal customer service.

Smit’s arrival on stage to a smattering of tentative applause was a clear sign there was no love for the cable giant in the audience, particularly from many New York area Time Warner Cable customers dreading a future with Comcast.

Smit was immediately confronted with the fact Comcast was recently voted the Worst Company in America by Consumerist readers, prompting yet another promise that improving customer service was Comcast’s “top priority,” the same promise Comcast gave in 2007, 2008, 2009, 2010, 2011, 2012, and 2013.

“I think if there’s one thing to disrupt in our business, it’s customer service,” Smit added.

Smit defended Comcast’s merger with Time Warner, relying heavily on video subscribers to downplay the concentrated market power Comcast would have after the merger. Smit pointed out Netflix has the largest subscriber count of any pay television channel or platform and denied Lawler’s contention that a merger would give Comcast more than 50% of the American broadband market.

“I think the number is a little less than that — it is closer to 40% but if you include wireless than it would be less than 20%,” Smit responded, referring to the LTE 4G wireless networks from wireless carriers that come with very low usage caps and very high prices.

Smit also promised major broadband speed upgrades and other improvements for Time Warner Cable customers, but nobody mentioned Comcast’s gradual reintroduction of usage caps on residential broadband accounts.

Comcast Cable’s CEO also addressed several other hot button issues:

Smit claimed Comcast has a good working relationship with the FCC and is providing advice on whatever changes to Net Neutrality FCC chairman Tom Wheeler will propose later this month.

Despite the fact Comcast could ultimately benefit if Aereo is found to be legal by the U.S. Supreme Court, Smit recognized Comcast also owns NBC and other broadcast programmers and was concerned about the economic impact if cable operators stopped paying for over-the-air programming.

“We pay $9 billion a year for content,” Smit said. “One of the things that I question in the Aereo solution is: are they paying for content? The spend for that content has to come from somewhere.”

Smit also noted Comcast is increasingly targeting younger audiences by signing deals with college campuses to bring Comcast service to students to hook them as future subscribers. Comcast is also creating new packages with fewer channels to appeal to millennials. Smit also acknowledged many younger family members are accessing cable programming using passwords associated with their parent’s cable account.

[flv]http://www.phillipdampier.com/video/TechCrunch Interview with Neil Smit 5-6-14.mp4[/flv]

Here is the complete interview TechCrunch conducted with Comcast Cable CEO Neil Smit. (22:20)