Digital Destiny

One shouldn’t be fooled by all the PR and rhetoric (let alone the ads) coming from both Bells and cable about what is supposed to be our innovative and creative media future. What Verizon, AT&T, Comcast and others want to give us is a souped-up interactive digital system delivering lots of TV-like entertainment—accompanied by a torrent of personalized advertising. That’s why the cable and phone monopoly are opposed to network neutrality. A truly open system would permit our eyeballs and clicks to really roam free. That’s something that terrifies them, since we would likely be engaged with content they either don’t own or are able to impose a mafia-esque system of payments on (Telco/cable bosses to Gates, Page, Brin, Diller [fill in your name here or favorite site]. If you don’t pay us our digital “vig,” your content is going to end up buried in silicon floating in the East River).

So we think it’s instructive, as part of this blog’s early digital warning function, to give folks a preview of the content soon coming to our broadband screens. What does Verizon plan to offer us, in exchange for killing off community oversight of cable and the scuttling of network neutrality? “Widgets.” Yes, Verizon is running fiber to the home so, according to The Deal, it can offer a “widget” service that “will display local weather and traffic info on TV screens without interrupting a program” [“The Phone Man: Verizon’s CTO, Mark Wegleitner, on how the Bells plan to compete with the cables.” Chris Nolter. June 19-25. 2006]. Wegleitner told The Deal that Verizon is also planning products for “heavy-duty gamers. Maybe they are watching the equivalent of QVC for gamers and say, Boy, I’d like to get more information on that. So they click a button and zip to an infomercial on that game.”

That’s not all. Verizon wants to sync up its mobile video service with what we view over broadband. Verizon SVP, video solutions, Marilyn O’Connell told Screenplays magazine (which covers the broadband market) that the company is thinking about all the triple play revenues it can make from selling music, gaming and information across all platforms. So we are going to see what she calls “threads between what VCAST [Verizon’s mobile content service] is developing in portable snacking on entertainment, and what we’re creating over on the TV side, as well as on the broadband side” [“A View of Things to Come on Verizon’s Roadmap,” June 2006].

This is what we’re going to get if we allow Sen. Ted (“Internets”) Stevens and the bunch of “under the Bell $ influence” R’s and D’s in the House (led by Joe Barton) to get their way with the Telecom bill.

The Center for Democracy and Technology (CDT) has long been part of the political support system for the communications industry. Although it considers itself a public interest group, CDT has ultimately served the interests of its many corporate funders (AT&T, Doubleclick, Verizon. Acxion, Time Warner, etc.) Indeed, the group backed away from the network neutrality issue several years ago (then known as “open access”) because, in the words of one CDT executive, “our funders would kill us” if the group called for a truly open (let alone privacy protected) digital media system. CDT’s policy briefs and lobbying often enable its corporate supporters to achieve their political goals (including preventing unwanted legislation, such as safeguards. We think that in the case of CDT’s recent proposal on net neutrality, that’s what they are doing here. For it would fail to protect our (U.S.) digital media environment from being controlled by a tiny handful of broadband giants—AT&T, Comcast, Time Warner and Verizon.

In this case, CDT [read their June 20 policy paper] would permit these monopolists to control the vast expanse of digital distribution that will likely deliver the majority of content to us. In its report, CDT says that “some basic rules requiring network operators to preserve nondiscrimination and openness” would only apply to “those portions of broadband networks dedicated to the Internet.” In other words, the vast majority of capacity used to deliver video and other multi-media content could likely be off-limits to any net neutral safeguards. The phone and cable companies claim they are building private networks—where broadband applications may not traverse over what is considered the “public Internet.” Hence the need, in our view, for far-reaching safeguards to ensure true Internet freedom. CDT also is opposed to any federal rule ensuring common carriage and price protections for consumers.

CDT would like to consider that its proposal is well founded, while others (such as the proponents of true network neutrality) engage in “public rhetoric.” This is also part of CDT’s modus operandi, with a “let’s make a deal we can broker on the Hill” mentality. One shouldn’t be fooled by CDT. What’s needed are strong rules across all digital platforms to ensure a democratic media system. Not—as CDT would have it—give us a small portion of capacity, while electronic privateers control most of the network.

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The Bush Administration’s attack on the New York Times is a poisonous and despicable political tactic. It was the Administration—backed by most of Congress—which led us into a war based on lies and deception. They should be held in contempt by the American people for directly causing the loss of so many lives (let alone the daily misfortune of many). Bravo to the New York Times and the few other news outlets courageous enough to keep the American people informed about domestic spying and other surveillance schemes that threaten our civil liberties. The White House has clearly lifted a tactic out of Richard Nixon’s political playbook: the use of Spiro Agnew to help defend another disastrous war–Vietnam. In a much-publicized speech, Agnew attacked the news media as “nattering nabobs of negativism” as part of Nixon’s political counter-offensive. As now, the White House was desperately trying to change the growing public disenchantment with that war. Plus ça change, plus c’est la même chose.

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The vote on the new communications “reform” bill in the Senate was a victory for the nation’s communications giants. It sets the stage for the `pay as you surf, download, & post’ digital media system that is the business model for our broadband giants. The phone and cable companies wish to be first in line so they can—in their own words—monetize all digital communications. The reason they oppose network neutrality is simply because it would prevent them from readily tacking on a host of extra charges for both consumers and content providers. A net neutral U.S. Internet would also threaten their ability to ensure that their content—video games, movies, online gambling, etc—receive favorable transport, processing, and promotion. It’s great that so many committee Democrats have finally woken up to the threat (led there in part, ironically, by Sen. Olympia Snowe, R-Me). The 11-11 tie on network neutrality should be a signal, however, that all must be done to prevent Sen. Steven’s absurd “Advanced Telecommunications and Opportunity Reform Act” from passing the full Senate. Among the give-aways to our new media conglomerates was a permanent ban on Internet taxation. This is a boon for a few online operators at the expense of education, public safety, health care and other community services. The vote to make the moratorium on Internet taxes permanent was 19-3 (helping lead the charge was Sen Allen (R-Va).

Meanwhile, up in Canada, we have another example about what happens when we permit broadband monopolists to control access via unfettered Quality of Service (QoS) pricing schemes. Shaw Communications, the leading Canadian cable company, is using its clout over broadband lines to derail competition in the voice-over-Internet-protocol (VOIP) market. Shaw claims that customers of Vonage and other competitors should pay it a $10 per month “QoS Enhancement” fee in order to ensure their calls get the same favorable treatment the cable company gives its own VOIP customers. According to press reports about the litigation between Shaw and Vonage, the cable company says its VOIP service is “offered over the operator’s QoS-enabled network, managed network, while Vonage’s service travels the public Internet and is open to packet delays and other inherent limitations.”

In other words, welcome to the wacky, undemocratic, and Citizen Kane-esqe world of the two-tiered Internet. Thank you Senator Stevens! Once again, building us in the U.S. the digital bridge to somewhere. Namely, the bank vaults of Verizon, AT&T, Comcast, and Time Warner.

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Soon, the Bush FCC will launch an effort to further consolidate control of a few over the nation’s major newspapers and T.V. stations. Martin is determined to accomplish what his predecessor Michael Powell was incapable of doing. Martin will allow major daily newspapers to be folded into T.V. empires (by eliminating the cross-ownership safeguard). He will also permit a single company to own several T.V. stations in the same town. As with Powell, Martin thinks it’s fine and dandy for one company to own multiple TV stations, eight radio stations, the newspaper, the cable system, and the principal broadband Internet service provider in a single large market. Also as with Powell, Martin appears to be also giving a cold shoulder to fellow Commissioners Michael Copps and Jonathan Adelstein who want to see real public debate and a serious independent research review done prior to any decision-making. As with so many other FCC officials, past and present, Democratic and Republican, Martin has a “don’t ask, don’t tell me” policy when it comes to honestly addressing the current crisis in U.S. electronic media (recall TV’s failure to seriously cover the run-up to the war, among many other discouraging examples).

Yesterday, President Bush made clear who is calling the FCC shots. At a signing of the new Bush-Martin (and sadly, Michael Coops) indecency law, the President said, referring to Martin [according to Broadcasting & Cable] that: “He’s a part of the Executive branch. And since I’m the head of the executive branch, I take responsibility, as well, for putting people in place at the FCC who understand one of their jobs, and an important job, is to protect American families.” Of course, the FCC is supposed to be an independent agency. It’s not—as White House’s past and present frequently tell the Chair what to do via back channel. In the case of media ownership and network neutrality, you can be sure that WH has weighed in to help detail Kevin Martin’s pro-Big Media agenda.

Next week, Martin will approve a new huge give-away to the broadcasting industry, worth billions (it’s called multi-casting must carry). This will give every TV station, and powerful group owners, the leverage to extract programming and broadband distribution concessions from phone and cable companies (the TV lobby won’t need network neutrality, since Martin is giving them the ability to ensure their programming streams can run on the fast lane for free).

But Martin will find some rough seas ahead. His reputation as chair is likely to be one of a narrow-minded bureaucrat, rather than a real public servant.