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The Metamorphosis of Communications Competition -- A New Framework

For those seeking to better understand how communications competition has evolved, expanded, and accelerated to cloud communications competition, don't miss my new six-chart powerpoint presentation: "The Metamorphosis of Communications Competition," here.

My bottom line conclusion: The transformation of communications competition requires a transformation in communications law.

  • Specifically, the world has changed with technology, but obsolete technology-specific laws have not.
  • Communications policy obsolescence undermines infrastructure's utility and value and renders property less attractive and competitive.

I presented this new easy-to-understand framework for understanding exploding communications competition at a NetCompetition event today on Capitol Hill, which also featured excellent presentations by Jeff Eisenach, Managing Director of Navigant Economics, and Ev Ehrlich, President of ESC Company.

Implications of DC Circuit Hearing Net Neutrality Appeal

Since the D.C. Circuit Court of Appeals was selected to hear appeals of the FCC's Open Internet Order -- it is now even more likely that the FCC's net neutrality regulations will be overturned in court as unlawful and/or unconstitutional.

 

  • Regardless of which Appeals Court heard this case, Verizon was highly likely to win in its appeal against the FCC rules on the merits.
  • Now Verizon's chances increase further given that the most knowledgeable, expert, and experienced Circuit Court of Appeals is hearing this case.
    • (See analysis here for why the FCC is highly likely to lose this case.)

 

The D.C. Circuit is the Appeals Court that traditionally hears cases involving independent regulatory agencies like the FCC, so the D.C. Circuit Judges are very familiar with both the limits of the FCC's statutory authority and the FCC's proven penchant for trying to overreach their statutory authority.

In a nutshell, the FCC's legal case stands on two very slippery assumptions.

 

Why Verizon Wins Appeal of FCC's Net Regs

See my Forbes Tech Capitalist post here "Why Verizon Wins Appeal of FCC's Net Regs."

  • It analyzes why the FCC's net neutrality regulations will offend the Court of Appeals and why they are highly likely to be overturned.
  • This is one of the most poorly defended FCC decisions I have reviewed in my twenty years following the FCC.

Why FCC Net Neutrality Regs Are So Vulnerable

See my Forbes Tech Capitalist post on net neutrality here, entitled: Why FCC Net Neutrality Regs Are so Vulnerable.

FreePress Cries Wolf -- Yet Again

FreePress with its "all complaints all the time" approach to advocacy has been caught once again "crying wolf" when there was no real problem or threat.

A new FCC study that shows ISPs are effectively delivering on the broadband speeds they advertise, exposes FreePress for crying wolf -- yet again.

  • FreePress has to acknowledge Verizon's FIOs far exceeds advertised speeds, Comcast and Charter exceed advertised speeds, and other ISPs are more than close enough to advertised speeds to show that there is not a problem here for the FCC to be concerned about.

FreePress also continues to cry wolf about its spurious tethering" complaint against Verizon because users are prevented from unauthorized tethering of additional devices trying to bypass users' terms of service agreement.

Netflix' Glass House Temper Tantrum over Broadband Usage Fees

Netflix continues to throw stones at the common economic practice of usage-based pricing, to which broadband carriers are naturally migrating, all while Netflix stands inside a glass house filled with mis-managed usage pricing practices. 

Netflix as Stone Thrower:

In a concerted campaign for net neutrality regulation that would ban broadband usage caps or pricing, Netflix has generated a:

Netflix as Glass House:

How FCC Data Roaming Order Undermines FCC's Net Neutrality Regulations

The FCC's Open Internet Order is even more likely to be overturned in court than before because the FCC's extraordinary delay in publishing its December net neutrality regulations has oddly moved the FCC's April Data Roaming Order to the front of the line of cases challenging the FCC's overall legal authority to regulate broadband.

 

  • (The April 7 Data Roaming Order was published in the Federal Register 29 days after the decision; the December 21 Open Internet Order may not be published until late summer or fall, 7-9 months after the decision, per Politico's Morning Tech.)

 

 

Consequently both cases are now more likely to be heard in the FCC-unfriendly D.C. Circuit Court of Appeals.

Why Verizon Wins Appeal of FCC's Net Regs

Top Ten: 

Verizon is highly likely to win its appeal of the FCC's December Open Internet order, because the FCC's order is likely to deeply and broadly offend the legal sensibilities of the Appeals Court, just like the FCC offended the DC Appeals Court's sensibilities when it punished Comcast for violating a regulation that did not exist.

 

  • The Court responded to that FCC injustice last April by ruling in its Comcast vs. the FCC decision that the FCC had no authority to regulate broadband or the Internet.

 

To understand the most likely outcome here, it is critical to cut through the FCC's claims, assertions, and arguments, and focus on the big picture context of what the FCC is actually doing in this Open Internet Order, i.e. what is the effect of the FCC's decision and process on the rule of law. That is what matters most to the Court.

House Net Neutrality Legislation Takeaways

House Democrats have proposed a resolution to Net Neutrality that strongly signals to the FCC majority to not pursue its considered Title II reclassification of broadband as a 1934 regulated telephone service. The House Democrats' draft is here. The implications of this House draft are broad, important and constructive.

First, this House Democrat draft signals to the FCC Democrat majority loud and clear that House Democrats do not support the radical FreePress-driven proposal to regulate broadband Internet networks as 1934 common carrier telephone networks.

Second, it proves that the FreePress-driven proposal to takeover the Internet and regulate it as a public utility is extreme, way out of the political mainstream, and a non-starter.

Third, this legislation proposes a sensible resolution and workable alternative to this destructive polarizing issue that is serving no one who seeks an open Internet that works, grows and innovates without anti-competitive concerns, but only the revolutionary interests of FreePress and its allies that claim they want net neutrality, but really seek a utopian "information commons revolution."

NetCompetition Statement on FCC's Broadband Legal Framework NOI

FOR IMMEDIATE RELEASE

June, 17 2010

Contact:  Scott Cleland

703-217-2407

 

 

“FCC Regulating the Internet like a Phone Company Would Enthrone “Ma Google”

“FCC’s Broadband De-competition Policy Would Accelerate Google-opolization of the Net”

 

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