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The Uneconomics of Data Cap Price Regulation and Legislation -- Part 14 Broadband Internet Pricing Freedom Series

 

The latest attempts to subvert the competitive success of the current free market broadband Internet to advance the fantasy of abundance uneconomics and cost-less Internet commons is the New America Foundation's (NAF) white paper entitled: "Capping the Nation's Broadband Future? Dwindling competition is fueling the rise of increasingly costly and restrictive Internet usage caps;" and Senator Wyden's proposed "Data Cap Integrity Act" to have the FCC effectively price regulate broadband usage and ban traffic discrimination a la "net neutrality."

In a nutshell, the NAF paper argues competition, usage-based pricing and the profit motive ill-serve the broadband Internet consumer; thus the Government should prohibit the market-pricing model of broadband data caps.

In a nutshell, Senator Wyden's proposed legislation argues that broadband usage and tiered pricing harm consumers by discouraging Internet use, discriminating against high-bandwidth services, and inhibiting innovation because ISPs make money on heavy broadband usage. Thus the Government should price regulate competitive broadband companies to prevent extraction of "monopoly rents."

Google Fiber's Avoidance of Phone Service Makes Case for Obsolete Law -- Part 15 Obsolete Communications Law Series

This week Google's actions made the case that U.S. communications law and regulation is obsolete.

The Head of Google Fiber disclosed that Google considered offering phone services in Kansas City as part of its bundle of Gigabit "ultra high-speed" Internet service and TV offering, but declined to do so when they became familiar with the prohibitive morass of legacy analog federal and state telephone regulations with which Google would have had to comply. While acknowledging that the incremental cost of offering voice services would have been "almost nothing," Mr. Medin lamented that Google would have had to build a more complex billing system to comply with the various state calculations in Kansas and Missouri.

It is telling that with all the special tax breaks and large business subsidies that Google was offered to choose Kansas City as the pilot Google Fiber city, they were still not enough to offset the high operational, management, and regulatory costs to comply with legacy telephone regulations.

What Court Data Roaming Decision Means for FCC Open Internet Order

While the D.C. Circuit Court of Appeals gave the FCC a significant win in upholding the FCC's Data Roaming Order, the incremental, serpentine, and limiting way the court did it suggests that this same Court will likely not uphold the FCC's sweeping assertion of legislative-like Internet regulation authority in its Open Internet Order.

In upholding the Data Roaming Order, the Court was faced with a set of facts where the FCC already had clear authority to require mobile voice roaming and the question was whether the FCC had enough authority to extend it to data roaming. In excruciating legal detail, the Court explained why the FCC had the Title III radio authority for this limited action and why the FCC "warrants deference" in this "gray area" of determining when a service is or isn't common carrier. Nevertheless, the court warned the FCC to not try and overreach beyond the narrow boundaries that the court allowed.

Simply, the court gave the FCC more leash in this set of circumstances, but still warned they remained on the court's leash.

Bad Information -- Rebutting a Shockingly Misinformed NYT Op-ed

I can't remember reading a more misinformed op-ed than today's NYT's "Bad Connections" by David Cay Johnston.

His stated premise that telecommunications competition hasn't fulfilled its promise of lowered prices, more innovation or improved quality since 1974 is apparently blind to obvious commonly-known facts.

In 1974, most all Americans used black rotary-dialed phones, suffered from prohibitively-expensive long distance rates, and phone technology that hadn't changed much for forty years.

Now thanks to competition Americans can:

See My New Presentation -- Modern Beats Obsolete in Spurring Economic Growth and Innovation

Please see my new power point presentation here entitled: "Modern Beats Obsolete in Spurring Economic Growth and Innovation -- Modernize Obsolete Communications Law and Spectrum Management." It is the culmination of a year of research and presents very powerful evidence of how woefully obsolete and absurdly dysfunctional America's communications policy has become.

This neglected problem has been bipartisan in the making over sixteen administrations and dozens of Congresses. It also will take a long-term bipartisan effort to correct. It will only become increasingly imperative to do so as more and more of our economy and society depends on a fully modern mobile Internet.

After reading this presentation you won't be able to look at current American communications policy in the same way again. America's got a lot of work to do to ensure our leadership in the Internet and high tech continues and is not slowed by the nonsensical and unnecessary drag on investment, innovation and growth of obsolete law and spectrum resource management.

Please don't miss the charts. An outline of the presentation follows:

The Real Motive behind Opposition to Broadband Usage Pricing -- Part 13 Broadband Internet Pricing Freedom Series

Now we know the real reason why there has been such strong opposition by FreePress and other net neutrality proponents to the common sense economic notion of broadband usage pricing. The newly launched Open Wireless Movement now wants to turn everyone's home WiFi routers into interconnected, free, public-community, "open WiFi" hotspots.

A Welcome Catalyst for Modernizing Obsolete Communications Law and Regulation -- My Daily Caller Op-ed

Please see my new Daily Caller Op-ed: "A Welcome Catalyst for Modernizing Obsolete Communications Law & Regulation" -- here.

  • This is part 15 of my Obsolete Communications Law research series.

*****

Obsolete Communications Law research series:

Part 1: "Obsolete communications law stifles innovation, harms consumers"

Why the 1996 Telecom Act's Unbundling Model is Obsolete -- My Daily Caller Op-ed

Please see my new Daily Caller Op-ed: "Why the 1996 Telecom Act's Unbundling Model is Obsolete" -- here.

  • This is part 14 of my Obsolete Communications Law research series.

*****

Obsolete Communications Law research series:

Part 1: "Obsolete communications law stifles innovation, harms consumers"

Supreme Court likely to leash FCC to the law

In an ominous development for the FCC, the Supreme Court agreed Friday to hear the legal question of whether a Federal Court must give "Chevron deference" to an administrative agency (FCC) when an agency interprets a law in a way which could determine its own jurisdiction. I believe this presages that the Supreme Court will decide next year that regulatory agencies cannot be the effective final arbiter of their own power and jurisdiction under the law, because that constitutional power rests with Congress and the courts.

"Chevron deference" is a 1984 Supreme Court administrative law precedent that directs courts to defer to a regulatory agency's expertise in interpreting statutes directing regulatory action unless their interpretation is unreasonable.

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Q&A One Pager Debunking Net Neutrality Myths