October 23, 2006  ·  Lessig

Former FCC Chairman William Kennard published an op-ed in the New York Times Saturday. The main point of the piece is to lament the truly awful state of broadband access for the poor in the United States. One statistic (not mentioned by Kennard) says it all: As the OECD reported, the United States has the 4th highest level of students (by 15 years old) who have never used a computer — worse than Greece, Poland, Portugal, and the Czech Republic.

What I found extraordinary about the piece, however, was its slam of “network neutrality” legislation. As he wrote:

Unfortunately, the current debate in Washington is over “net neutrality” — that is, should network providers be able to charge some companies special fees for faster bandwidth. This is essentially a battle between the extremely wealthy (Google, Amazon and other high-tech giants, which oppose such a move) and the merely rich (the telephone and cable industries). In the past year, collectively they have spent $50 million on lobbying and advertising, effectively preventing Congress and the public from dealing with more pressing issues.

So let’s get this straight:

After 8 years of deregulating broadband in America (begun by Kennard, completed by Martin), both DSL and cable are free of any real obligation to protect the original neutrality of the Internet. Once some rules imposed in merger agreements expire, last-mile broadband providers will be free to pick and choose the content and applications they want the network to carry. They will use this power, as at&t Chairman Ed Whitacre explained, to tax the most successful content and application providers on the net. That tax, as I and many have argued, will effectively block the next generation greats.

Over these same 8 years, following this policy of deregulation, we’ve gone from 1st in the world to rivaling, as Kennard puts it, Slovenia. Broadband on average is slower in the US, and more expensive. In France, a triple play “Internet, Telephone, and TV” package is $32. Comcast offers less for $150.

At some point, you might think some would begin to worry about whether the US strategy makes sense. (compare: State of Denial). Forget the theory, forget the hand-waiving by academics and ideologues: Just ask one simple question — is the policy working as well as the (different) policies of our competitors?

I. and many, have concluded it is not. I take it, that is the view of the more than a million who have written to policy-makers arguing for network neutrality legislation. These people want policy that will finally push broadband providers to provide at least the quality and price of broadband in France. The online campaign to get Congress to do something here has been amazing, rivaling only the campaign to stop the FCC from passing rules that would permit even more concentration in media ownership.

But now comes Kennard to belittle this extraordinary online movement. It’s not a battle, he tells us, about whether competition in applications and content, ultimately driving penetration, will continue. It is instead a battle about whether the “extremely rich” will prevail over the “merely rich.” Nothing important in that battle, he tells us (except perhaps to these various flavors of the rich); Congress should therefore move on from this agenda for billionaires, and take up the real challenge of serving the poor.

It’s funny, I hadn’t realized I was a Google tool. I had thought we were pushing to reverse a failed policy because we wanted to enable the next Google (that was my point about YouTube). I thought we were angry because the “merely rich” had yet to provide broadband as broadly as in other comparable nations. And I thought we were fighting the efforts of the “merely rich” to further reduce competition, either by buying up spectrum that would enable real wireless competition, or by getting state laws passed to make muni-competition illegal. I had thought these were important issues for the new economy — keeping the platform as competitive as possible, to keep prices and quality moving in the direction they move in the rest of the developed world.

Now that Kennard has set us straight, however, I’m relieved to know we can finally move onto other, more important issues. Global warming is at the top of my list. Maybe you have other priorities.

But before we move on, let’s not forget:

Even if America’s broadband strategy doesn’t make sense for America, it makes lots of sense for certain companies. Kennard knows this well, because he sits on the board of many of those who benefit most from this deregulation. His op-ed acknowledges his work with the Carlyle Group. He is also on the board of Sprint Nextel Corporation, Hawaiian Telcom and Insight Communications (a cable provider). These companies will benefit directly if Kennard succeeds in getting Congress to forget Network Neutrality. They will become “merely richer” at the expense, I believe, not of Google or eBay, but of the next gang of kids with the next great idea that Google, and eBay (and Comcast and at&t) just don’t get.

I don’t know Kennard personally. People who do tell me he’s an extremely bright, ethical man. I’m sure that’s right. But there’s something unseemly to me when an FCC Chairman moves to the boards of the companies he used to regulate, and then uses the op-ed page of a paper on whose board he now sits, to argue for the poor by pushing the agenda of the “merely rich.” (How can a paper that obsesses to pretend its most brilliant writers have no opinion of their own not wonder about the weirdness here?)

They say Washington has to be like this. You could never get great people into government if they couldn’t cash-out once they left. But I bet if the next President demanded of nominees to the FCC that they promise not to take jobs in the industries they regulated for some “limited time” (let’s say, the life of a copyright), the President would find lots of qualified nominees. Maybe then it would be easier to hear the pleas for the poor, without the echo of the interests of the “merely rich” confusing the message.

  • http://isen.com/blog David S. Isenberg

    Thanks, Larry! Kennard also fails to note that the “extremely wealthy” — the Googles, Amazons, etc. — are today’s rising stars pointing to the future while the “merely rich” — the telcos and cablecos — are old, dying companies. On my own blog, I wrote
    The fight is not between, “the extremely wealthy . . . and the merely rich,” it is between us, who want to choose how we use our Internet connection and Internet providers like Verizon, Comcast and at&t, who want to choose for us.

  • Mike Chartier

    Just looking for clarification.

    1.) So, Kennard says that for the purpose of increasing broadband penetration to underserved communities, the most important thing is to revamp the USF, which subsidizes the cost of providing service to those communities. Do you disagree with this?

    2.) How is he pushing the “agenda of the “merely rich”?

  • Lessig

    (1) I certainly thing revamping USF is important

    (2) He has equated the “merely rich” with the cable companies and telcos; it is the agenda of the cable companies and the telcos to block network neutrality legislation; thus, by arguing against NN, he is pushing the agenda of the “merely rich.”

  • Rick C

    nice syllogism, Lessig.

    I’m not sure, tho. Are you allowed to use logic on the internet?

  • Mike Chartier

    Got it.
    I think his intent was to disparage both sides, but by default that ends up supporting status quo.
    It may be a fair criticism to accuse him of downgrading the importance of NN. But I don’t think it’s fair to imply it’s based on vested interest. I think he would just like to see as much energy and resources applied to USF.

  • http://tjic.com TJIC

    It seems to me that this is an empty threat by the cable companies: the bottom line is that they have to serve their customers, and if they cut off a customer’s access to google, they’ve got a lot of explaining to do.

    I’d like to see cable companies be free to run their businesses however they want *and* Google and other large websites tell the cable companies “go ahead; slit your own throat”.

  • Stephen

    The phone companies and cable companies are foul, rank institutions that have harmed, currently harm, and will continue to harm this country in numerous ways – the worst being the stifling of competition and development/fostering/getting-the-hell-out-of-the-way of new technologies and ideas. The idiots in the phone and cable industries are oblivious to the damage that they do, but rather delude themselves into thinking they are the good guys. I have far more respect for a guy running a burger stand across from Wendy’s, next door to McDonald’s, and down the street from Burger King than the delusional monopolists running the phone and cable companies. Any time a company can say “takes us or leaves us” – you have a terrible situation for everyone but the company. Anything the phone and cable companies support is immediately open to question – whatever they are against deserves every benefit of the doubt. Because the phone and cable companies are against Net Neutrality, NN *MUST* be the right thing to do. To hell with Verizon, ATT/SBC, Comcast, Time Warner and the rest of the technology advancement hindering cabal. Common carriage should continue to be the rule on the Internet – every bit is treated the same. The user has the choice/power to buy a bigger pipe if desired.

  • Greg D

    Have you read “Rainbow’s End”, by Vernor Vinge? One of the characters has a “high school” project: trying to develop algorithms to make “cheapnet” (“free”, and therefore lower priority, connection) work well transmitting a live audio performance. Is that what “Net Neutrality” would prevent? Allowing people to pay to get better service?

    Frankly, watching Google in China, YouTube censor conservatives, and Google News do the same, I’m having a hard time coming up with any reason why I should care about the phone and cable companies “gouging” them.

    They deserve it.

  • Matt

    Someone needs to tell Fed Ex, UPS, and the Post Office about this neutrality thing. I’m tired of paying tons of money to ship big heavy boxes! Don’t they know you can render the physical laws of the universe meaningless by legislative fiat?!

  • Bobnormal

    Wow,I always thought you had some logic up there in that brain of yours,France? You can’t get a job there so how do you pay for cheaper service,especially if your poor? try markets not socialist twttle.If I dig a ditch to get water do I also have to let everyone else use the fruits of my labor for Free?

  • http://linuxworld.com/community/ Don Marti

    Bogus metric alert: “the United States has the 4th highest level of students (by 15 years old) who have never used a computer”.

    Just going by “used a computer” includes all kinds of awful “educational” software and office application training — you might as well count people who can work the order terminal at McDonald’s as “computer literate”.

    Alan Kay: “Now you’ve got millions and millions of people who think that doing even the most trivial things on a computer is a sign of computer literacy. This includes parents, teachers and the kids themselves. But most of what is done is about as worthwhile as playing an air guitar.”

    Better metrics might be whether or not the person sends and receives email, or has contributed content to some kind of web forum or collaborative site.

  • three blind mice

    I had thought we were pushing to reverse a failed policy because we wanted to enable the next Google

    past performance is no guarantee of future returns.

    it seems really odd professor that you deride the fact that broadband connectivity in the US is so poor, yet support an agenda (NN) that focuses on applications (like google).

    YouTube, and any similar bandwitdh hungry application, is barely tolerable on dial-up, and completely useless if you don’t have a connection to begin with. or are we missing something?

    blaming the telcos for not throwing good money after bad… comcast should invest in building out its cable network just so google (and the next google) can make more money whilst undermining comcast’s media business. under what rules of business does this make sense?

    It’s funny, I hadn’t realized I was a Google tool.

    saying it is a battle between the extremely wealthy and merely wealthy is a (poor) way of placing himself on the side of the underdog, but Mr. Kennard is absolutely correct is saying this is a battle of competing and powerful commercial interests. no one is pure and innocent here. shilling for NN does quite make you a tool of google as we might be said to be tools for the ISPs.

    Even if America’s broadband strategy doesn’t make sense for America, it makes lots of sense for certain companies. Kennard knows this well, because he sits on the board of many of those who benefit most from this deregulation.

    ad hominen claptrap and quite unbecoming of you professor.

  • BillW

    So, I have DirecTV, SprintPCS and Clearwire Internet (wireless, city wide). Where do I want a phone or cable company doing anything to the public net or anything in my life?

  • Mr L

    “blaming the telcos for not throwing good money after bad… comcast should invest in building out its cable network just so google (and the next google) can make more money whilst undermining comcast’s media business. under what rules of business does this make sense?”

    This is absolutely true and key to the nature of the problem. What’s their incentive to improve the connection? None, as far as I can tell, unless they can start charging for bandwidth by the megabyte…which consumers HATE HATE HATE and is functionally identical to a repeal on net neutrality (only the incentive to moderate usage are on the consumer end so it’s even worse).

  • http://taoist.wordpress.com/ taoist

    Unfortunately I think you’re only seeing one half of the equation. Telcos have indeed set up a non-competitive oligopoly. Net Neutrality is not the way to solve this issue though: Adding more regulations in favor of Google and Yahoo such as Net Neutrality would suggest would add legislation in the other direction, postponing the current troubles but creating more down the road. On the other hand, if we were to simply use our existing marketing laws to crack the monopolistic practices these companies are currently engaged in, we would solve these problems.

  • Phil H

    “Limited time” = “life of copyright”
    Love it.

  • mik

    “United States has the 4th highest level of students (by 15 years old) who have never used a computer — worse than Greece, Poland, Portugal, and the Czech Republic. “

    All 4 are countries with pretty homogineous population.
    Poland has higher average IQ than US and Czech Repubs has the same. Unless they are extremely poor, these countries are supposed to have a higher computer literacy than US.
    US has significant minority population groups with significantly lower IQ than those 4 countries. That also lowers average IQ of US and makes comparisons with homogineous countries meaningless.

    Is it really that important for low performing kids use computer? Isn’t it better at least to learn read and write?

  • wuuuuu

    you may want to check out the OECD statistics on US broadband penetration at http://www.oecd.org/sti/ict/broadband

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