Thursday, June 01, 2006

Telco Lobby Slow Cooks Congress

The telephone and cable companies have been going all out in Washington to smooth their way for control of the Internet by proposing what appears at first to be a reasonable policy, which, on further review, doesn't hold up.

In a commentary at TPM Cafe, Art Brodsky -- the communications director for Public Knowledge -- compares the phone and cable lobbying on Net Neutrality to a metaphor called "boiling the frog." According to Brodsky, it goes something like this:

If you throw a frog into boiling water, it will jump out. But if you put a frog in warm water, and gradually raise the temperature, it will become acclimated, until it becomes cooked. Gross, but accurate. This is what the telephone companies and their allies who sell them equipment are doing.

The legislation on next week's menu is the COPE Act -- a House bill that has been gift wrapped for AT&T and Verizon.

With this bill, Brodsky writes, the telco cartel is trying to woo Congress into believing that its intentions are good -- when in reality it seeks to gain complete Internet control through a discriminatory "access tiering" scheme that returns massive profits at the expense of Internet freedom:

When the telephone or cable company picks what goes onto a network, the telephone or cable company, not the customer, and not the company the customer might want to reach, is in charge. The telephone and cable company will do what they can to improve their new toll road. And today’s Internet? Wouldn’t be as attractive in the future, would it, if companies feel they have to pay extra for “special arrangements” or be left behind.

What the telephone and cable companies are saying, is “trust us” not to disrupt the Internet. They, after all, are in the transmission business. But “trust us” only goes so far, particularly when we look at other parts of the world and see how far behind our telephone and cable companies have left us.

Compared with other developed nations the U.S. has fallen from 3rd to 16th in broadband penetration per capita, far behind countries like Canada, South Korea and Japan. The United States also numbers 16th in terms of broadband growth rates, suggesting our world ranking won’t improve any time soon.

But that's only the half of it. Recent Free Press analysis of the “low-priced” introductory broadband offers by companies like AT&T and Verizon reveal them to be little more than bait-and-switch gimmicks. On a per megabit basis, U.S. consumers pay 10 to 25 times more than broadband users in Japan.

The reason for the Broadband price gouging? According to Free Press' Derek Turner, it's due to an industry-friendly regulatory regime that gave the cable/telco duopoly control of the broadband marketplace:

The “fierce competition” among broadband platforms is seriously overstated. The FCC’s own report shows that satellite and wireless broadband continue to lose market share. Today, cable and DSL providers control almost 98 percent of the residential and small-business broadband market.

No competition means no fair pricing. As Brodsky also points out, this could become worse by regulations that allow telephone companies not to have to share their broadband networks with competitors on the theory that they will invest in the network.

But, so far, their alleged investment in broadband infrastructure has left us far behind the most developed nations. And now they're urging Congress to extend more favors by killing Net Neutrality -- the only safeguard that stands in the way of total Internet dominance by the telephone and cable companies.

The cartel has turned the heat up another notch in Washington. Unless Congress takes action on behalf of those who elected them, we'll all get cooked.

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