"Traditional" US carriers "burn and rave at close of day" and "rage against the dying of the light" as their influence over the Federal Communications Commission wanes. Not that it'll do 'em much good. The old order changeth and upstart Internet companies will inherit the American telecoms world, as Martyn Warwick reports.
After having had an easy eight years of it under the previous administration, US telcos are coming up against a harsh and unwelcome reality; it is that times have changed and the FCC, once such a friendly and biddable poodle (as far as the incumbents were concerned anyway), is showing that it actually has teeth.
Initially, the big old telcos were so shocked when the revivified US regulator began to demonstrate that it is independent and does have a backbone that they fell into acrimonious disarray. However, as the months have passed and the issue of "net neutrality" looms ever larger over them, the likes of AT&T, Qwest and Verizon have decided to spend, and spend big, on that good old Washington DC pastime, the lobbying game.
The purse strings have been loosened, suits have been briefed and the PR machine is steaming away on overdrive in the run uop to yesterday's critical vote in the FCC. Traditional US telcos are doing everything they can to stymie the introduction of new regulations that would prohibit them from blocking or delaying content that, while coming from ISPs, perforce travels some of the way to its destination on 'traditional" telecoms networks.
The proposal, publicly espoused by FCC chairman Julius Genachowski, was passed unanimously, with all five FCC Commissioners (including the two Republican Party member Commissioners) voting for it. The draft regulation now goes out for public comment until January 14. Thereafter the FCC will review the feedback before a final ruling is issued next spring.
FCC Chairman Genachowski said, "I am pleased that there is broad agreement inside the Commission that we should move forward with a healthy and transparent process on an open Internet."
In essence the proposal is that operators like AT&T, Qwest and Verizon will be prevented from "discriminating against any legal content" that a third party wants to deliver to consumers on their networks.
That said, it does allow for "reasonable" network management sufficient to ensure the congestion-free passage of data, the tracing and removal of viruses and spam, and the blocking of unlawful content such as child pornography and incitement to racial violence. Thus there's still plenty of scope for the telcos sneakily to "manage" (i.e. discriminate against) traffic by falling back on claims that all they are really doing is housekeeping to ensure their networks don't get clogged.
The new proposal has many potential escape clauses and is by no means a universal panacea to ensure and guarantee net neutrality.
If this goes through, expect a welter of court cases in a year's time.
However, and despite the grumbling and grousing on the part of AT&T and friends, the FCC vote was democracy in action and it should be remembered that the good ol' boys were all in favour of democracy when that meant that they got their way time after time after time thanks to a majority Republican board during the George W Bush presidency.
But, now the boot's on the other foot , squeals and yelps of outrage are the order of the day. However, the fact is that the tectonic plates are moving and we are witnessing a fundamental shift of power away from the old guard and to the new boys on the block.
Unsurprisingly, AT&T and other wireless and cable operators are using scare tactics as they seek to maintain the lucrative status quo, and are even going as far as to claim that the proposal will hand control of the Internet to an "ultra leftist" US government!
It was the Scots economist Adam Smith who, a couple of centuries ago, was the first to discern the "hidden hand of self-interest" at work in matters commercial and where profit is concerned. Fair enough. Everyone seeks to protect their own interests but to scaremonger in the way AT&T is is ludicrous and counter-productive. Better to stick to peddling the old chestnut that if their networks are "swamped" by ISP content, the traditional telcos will no longer be able to manage congestion on their networks. It's not true of course, but when did a little nicety like that get in the way of a spin-doctor's determination to do his master's bidding?
Interestingly, some big "traditional" network operators are not taking the same sort of hard line as is AT&T, presumably in the belief that it's not too clever a stunt deliberately to bait a newly-refanged and freshly released rottweiler.
In a changed world, many in the FCC (and more than a few politicians on Capitol Hill) believe the days of the juggernaut US telcos are numbered and their influence is in decline
One staff member of the House Energy and Commerce Committee (the body that oversees telecoms policy) told the Washington Post newspaper, "They [the big traditional telcos] are playing the same game but they are not getting the same outcomes that they are used to. The issues and people have changed, from the Obama administration to new members down to new staff, who see things differently."
That though isn't stopping AT&T spending a lot on lobbyists. According to the Centre for Responsive Politics, the carrier has spent more than US$8 million on lobbying this year alone and seems likely to up the ante in the coming months. meanwhile, Verizon has spent $6.8 million Comcast in excess of $6 million.
Congressman Edward J Markey of Massashusetts cut to the chase when he said the traditional operators "want to frame it as big companies against each other, but in fact millions of people online see net neutrality as the ability for great ideas to come from the likes of the next Steve Jobs, Bill Gates or Sergey Brin and for them to to get out there without having to ask permission from companies like AT&T."
Or, to put it another way. The score so far? New Jersey 0. Silicon Valley 1.
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