Rick Boucher, a Democratic Congressman from Virginia, has become one of the more knowledgeable Democrats on tech issues over the last several years.
He was introduced to Freedom2Connect by Jonathan Askin.
Askin – I need some serious solutions about getting our message to Congress. Who was at the House hearing on the Barton bill? You missed a wonderful moment in Congressional history. There are a couple of people in Congress who actually know technology and are comitted to deploying the Internet and realizing its promise. We are fortunate to have one of those handful. That’s Rick Boucher. He wasn’t always on the page of the CLECs, but things have changed because of Moore’s Law and IP technology. I perhaps have moved closer to him.
We need to build a mutually virtuous cycle.
Opening statements on the Barton bill are due at 5.
Tomorrow is the full mark up. A lot of people like the Bells pay people to line sit, and go really early in the morning.
Rick Boucher
We are marking up a total telecommunications bill.
Note: The Network Neutrality language Boucher discussed on Tuesday was voted down 23-8 by the committee on Wednesday. It will not be part of the final bill, which now moves to the full House.
Boucher: The biggest potential problem is the current network neutrality language, which is a net minus from the status quo.
When this is done it moves to the full committee after a two week recess, with the promise it will be on the House floor in May. By mid-May this will have been debated and passed in the House. The Senate is on a somewhat different track.
The bill creates a national franchiise for multichannel video providers seeking to enter the Cable TV market as competitors. First on for this will be the telephone companies. For telephone companies this is a have-to case. Cable is well positioned to carry three valued services – cable, broadband Intenret, and telephony. It’s a tougher lift for telphone companies to compete with that bundle. “that consumers want to have.”
Research is now being done to do video switching and deliver cable in the home, offering several channels at once with rapid switching. From the consumer standpoint it seems a lot like the cable TV experience, with potentially even better quality. From a technical standpoint they have a solution. Verizon has announced a fiber to the home project. I think Verizon is doing the right thing, and it will not have capacity constraints.
All of them face a common problem. Verizon has 10,000 local franchising authorities in its service territory. It would need 10,000 franchises. Verizon tried for two years to get franchises, and were getting 15 a year.
A change is necessary, and I support this change. I think there’s a broad consensus this change should occur.
So the primary purpose of the bill is to create a national one-stop shop for franchising , through the FCC. upon filing an application they would agree to a certain set of rules. Once they file they have a legal right ot offer multichannel video anywhere.
They will have to pay a 6% franchise fee to the local government, 1% more than cable. Second they would have to carry the same public access and educational channels as cable. They would have to abide by whatever right of way requirements apply to cable. They will have to abide by a set of consumer protection requirements the FCC will promulgate –a new rulemaking would be set by the FCC under this bill. The incumbent cable provider would get the benefit of this national franchise at such point as its existing franchise expires, assuming when that occurs there is a wired competitor. Satellite doesn’t count. A fixed wireless contender would.
The bill says the provider may not redline. Once you elect to serve a community you can’t discriminate. But there is no build-out requirement. It doesn’t say that within a certain amount of years the new provider has to serve the entire community.
The only controversial element is on the build-out requirement.
A second provision I support would clearly open the door for local governments to provide broadband services. I thought people here might like that. The US is presently 16th 20th in the world in broadband deployment, measured as a percent of the population using it. (A shout from the audience said we’re now 20th.)
That is a disgrace. 16th was a disgrace, 20th is worse. We have got to address this. And the broadband we subscribe to is continually slower. In japan and Korea you get 100 Mbps. Here you get 1 Mbps and pay more.
There are a lot of things we could do to catch up.
One thing we could do is open the door for local governments to offer local communication services for their residents. Some states have prohibited that. Other states have restrictions in that which disallow the offering because they’re so onorous. And the Supreme Court decided to take a pass on this – they could have interpreted the 1996 Telecommunications Act to enable local governments.
We simply said states could not prohibit any entity from offering services, and states tried to get an interpretation that “entity” did not include local governments. The Supreme Court agreed with them. Their rationale is that local governments are the creation of the state and are thus not seprate entities – they sided with the states. That meant every state was free to set their own rules and some states have banned it. We’re going to reverse that. We’re going ot say no state may prohibit a local government entity from offering telecommunications services.
This is a huge step forward.
Tropos has led the way in introducing mesh networking technology, which creates an opportunity for the public works department in a locality to install transmitters on anything with elevation – and cover a part of the community with broadband.
Maybe this can move us to 16th if not better. It is a part of the answer. I am very glad we now have this provision within the bill, and it’s non-controversial. No one opposes it. I this bill becomes law, and I think the chance of some version of the bill passing are quite good, we will open the door for local government to offer this service.
Now for the less than good news
Network neutrality.
The FCC under Powell issued a set of network neutrality principles. They never were reduced to a formal rulemaking. They didn’t feel they had power to set these principles, and the courts have kept the agency on a very short leash. The DC circuit has often invalidated orders.
The principles do not go far enough..
- That consumers may access any content over the Internet. They may not block access to Web sites nor limit content on those Web sites.
- The consumer may run applications of his choice using the network.
- You can connect devices to the network that do not harm the network
- Every consumer is entitled to competition among network providers service and application procviders, and content providers
We have not seen applications of these principles beyond the Madison River case, where a small telephone company tried to block the Vonage port. That case went to the FCC, but because these principles did not have the force of law the FCC could not enter an order without consent to all parties. Madison River agreed to a consent order saying it would not block the port in the future. What that said in terms of precedent is not much.
Obviously we need to do things to address network neutrality in terms of these 4 principles.
What the bill before us will do is say the FCC may enforce these 4 principles. It gives the FCC statutory authority to have a complaint process. The FCC could issue orders. That’s a step forward.
There is no authority for a rulemaking, however, so the commission could not elaborate on these principles.
The big problem is that at the time Chairman Powell was at the FCC we were not aware of a major new business model, and that is the announced plan by some of the telephone companies to derive another revenue stream, charging edge providers, content proviers like Google or Yahoo or Microsoft a fee, which would entitle that edge provider to get fast lane treatment, high speed access into the home. Everybody else will get regular speed into the home. What the telephone companies are proposing is a two lane Internet that goes into the home over their pipe. Their own content will go in the fast lane, and so will any content provider who pays for access. Anyone else is in the slow lane.
Here’s the major problem. There could be a dramatic adverse effect on innovation. It wasn’t long ago that Google was in a garage, and today there are Google wannabes in garages. How will that wannabe going to pay every last mile provider a fee to get into every potential customer’s home. The answer is they can’t. And in the slow lane they won’t be able to compete. And a lot of consumers are not going to be interested in waiting to access the slow lane when they have someone in the fast lane. The effect on innovation could be real. Admittedly it’s an unknowable. I have deep concerns this will work to the disadvantage of young innovators. It may be harder to acquire capital. They may do something else.
When I raise these arguments the telephone companies say let’s just wait and see how this all works out. We don’t have the luxury to wait and see. Experience teaches us that once revenue is being derived, it is impossible to outlaw that business model. If phone companies are deriving billions from this toll gate, and we see innovation dampened, it’s going to be too late to act. We won’t be able to take away a business from which the telephone companies are deriving billions in revenues. But what you’re going to hear is the defenders against our amendment providing real neutrality say let’s just sit back and see and if a problem arises we’ll address it. We don’t have that luxury. We have to do it now.
An amendment will be offered by 4 of us – me, Ed Markey, Jay Inslee from Washington state and Anna Eshoo from Silicon Valley. I think we’ll have some Republican support, which we need. But I think it’s going to be a close vote. This is the critical debate we’re having in Congress this year. We’re going to offer an amendment which says that if a telephone company or broadband provider decides to prioritize any content, then they have to offer that same treatment to all content providers without charge. If you create a fast lane everyone must have access to it. I think this is a valuable addition to these network neutrality principles.
Q (Bob Frankston) – The bits and the content have no more relation than selling oil and driving a car. Why isn’t there any consideration of anti-trust policy? There’s a structural problem. The industry funds itself by taking the value of applications out of the network and that’s why there is all these games.
Boucher – This is a competition issue in part. It is an effort on the part of the telephone companies to extend their market power from transport into content. That’s exactly what this is. Under antitrust principles this is suspicious. We do not have antitrust jurisdiction in the commerce committee. I serve on another committee that does have antitrust jurisdiction, however – the Judiciary Committee. We have now initiated a process there to begin looking at this, and to look at the antitrust implications of a number of events, including the recombination of Ma Bell.
The main thing I’m happy about in this new inquiry is we’re going to focus on the antitrust implications of this new business model the phone companies are talking of, extending the dominance of access into content.
That will come later. We’re taking our first shot on the amendment. It may not succeed. The next step would be the Judiciary Committee.
Q – I just sold my ISP. Because Verizon has been given to lay fiber over the entire county. They cut the copper. We’re cutting off a redundant network, which has homeland security implications for one that requires a battery in the home. And no one talks about that issue.
Boucher – I think that’s a big issue. There’s no reason why, with the copper plant going into the home, that should be rooted out. There is no reason to disconnect. In some instances they intend to pull the wires. Leaving that redundant network in place would be beneficial.
Their argument is that if you leave it in place it has to be maintained. They don’t want to have the obligation to repair it.
Here’s a better approach. I doubt we can impose a requirement that they keep it in place and workable. How about the acquisition of that copper, giving them money for it? That would be better for them than their having to root it out? If the ownership is transferred to another entity they’re relieved of the obligatoin? I’m thinking a buy out of the copper.
Q – Will it be too late?
Boucher – FIOS has only been deployed in a handful of places. Maybe the copper has been pulled in some communities. But that is not the situation across the country. There probably is time to run a copper co-op to acquire and use it. Given the fact that phone companies are concerned about a requirement to maintain, they might sell it for a small amount.
The truth is they’re not likely to face a lot of competition on twisted pairs of copper wires. There are other technologies that offer real competition, like Tropos. My sense is they would probably sell it. It might be expensive.
Q – How would network neutrality apply to CMRS (cellphone) carriers.
Boucher – It will apply to anyone offering broadband over the last mile. There’s no distinction made.
Q – Yesterday Powell was here saying not to codify network neutrality.
Boucher – I don’t agree with that. These principles are broadlly stated, easily transferred to any technology. I think the FCC at minimum needs authority to enforce an order in a situation lik the Madison River case. Right now the commission cannot do anything about it. The commission needs legal authority.
This is a transitional issue. At some point these providers will get to where Japan and Korea are. We will start seeing multiple megabit speeds. Verizon thinks that in a year they’ll be able to offer 30 Mbps for general Internet access over their fiber plant, exclusive of their fast lane. A channel of High-Definition video takes 8 Mbps.
Harold Feld: One of my problems is convincing the technical community to be involved politically.
Felten – One of the issues here is the tendency in Washington to think of the CEOs of large technology companeis as speaking for technology. That’s not really the case. uf we can find some way of getting the rank and file more involved, that’s important.
Boucher: Another place where we’re still making some progress is the education process. If you look at the younger staffers, they have more tech savvy, more education. You see law professors who were paid for writing code in their lives. I think this will help solve the problem. There are ceratin things that are second nature to technologiss which policy makers and judges just don’t now. I think the next generation will have better intuitition. Over time the situation will get better.
