ReasonedResponse.com

One of the joys of being a grandparent is that you get to watch the 1939 film version of the Wizard of Oz all over again.  And again.  And again.

Still, for those of us who tromp the halls of tech public policy in Washington, there is a potent lesson in the Wizard's booming refrain of "Pay no attention to the man behind the curtain..." when the great Oz turns out to be a fraud. A lession that played out this week at the US Department of Justice.

For those who have been on vacation, this is the week in which we hit a new all-time high for unemployment in the US, and the stock market again began to tank with no end in sight.  The FBI announced that mortgage fraud is so rampant (and growing) that they simply can't keep up.  Someone (possibly North Korea) launched a cyber attack against the computers of the US Treasury, the Secret Service, the Federal Trade Commission and the US Department of Transportation.  Spam is out of control, as is identity theft.

Oh, and the US Department of Justice announce that it would launch a new anti-trust investigation into cell phone companies seeking to determine...ummm, something.  Or maybe nothing.  They aren't sure, and probably won't be until they have spent untold millions of our dollars.  They think, just maybe, they may decide that cell phone companies have too much power, and want to investigate that.

Understand, no crime has been committed.  In fact, when Sen. Herb ("I spent eight trillion dollars of your tax dollars and all I got for it was this crummy tee shirt") Kohl launched a similar investigation of the cellular companies, he could not find anything wrong.  He did, however, ask the the Department of Justice to launch an investigation of these non-crimes.

The reality is that the US cellular industry, for all of its faults, remains one of the best things about this country.  It is highly competitive.  It offers an incredible array of services.  It has continued to innovate, to improve services, to improve coverage, and to lower prices over the past two decades.

If you've read my columns in print publications (including my Bleeding Edge tech columns), you'll know that I am no particular fan of the cellular companies.  For the past 15 years, I have devoted two to three columns per year to berating those companies for their junk phones, goofy policies and bizarre advertising claims.  But I do so out of love, not hate.  Like a wayward child, I chastise them when they are wrong but otherwise love them for who they are:

The very best cellular services in the world.  Innovators.  Successful private companies that bring value to the nation and to their shareholders.  And companies that just might, if we don't let their competitors use cheap political games to bring them down, solve the problem of ubiquitous broadband in rural America.

In today's challenging environment, the DOJ intention to investigate these companies based merely on speculation and gossip is an outrage.  An outrage that the White House should put an immediate end to, but probably will not.

As for me, I'm saddened to think that the Justice department I once thought was the great and powerful OZ -- an agency I believed was committed to justice and the law -- looks more and more like a political hack in a cheesy suit pulling levers behind a curtain.

Time to go back to Kansas.

The Federal Communications Commission is now tasked with developing a National Broadband Plan for the United States of America.

For most of the pundits, advocates, socialists and clowns, this will mean another opportunity to shriek at the Commission for heavier regulation, stealing the infrastrucutre that broadband companies have built to give to newcomers and charlatans, and demands for legislation on "network neutrality," whatever that term means this week.

The data calls for something else.  A commitment to a national effort at Digital Inclusion.

Through the first decade of the 21st Century, much of the focus on the nation's broadband Internet capability has been on the infrastructure -- the technological platforms, wireline and wireless access, and last-mile buildout. 

As we progress in the industry's life cycle, however, we are rapidly approaching the point at which deployment of broadband to consumers will become less important to continued growth than adoption of broadband by consumers.  That is to say, the major impediment to achievement of the goal of ubiquitous broadband for all Americans will not be the buildout of infrastructure but rather finding a means to bring online the estimated 25 percent of Americans who presently choose not to have access.  In addition, it will be more critical that we begin to move the nine percent of Americans still using dialup Internet connections up to broadband. (Figures based on Pew Internet data from late 2007 and mid-2008)

It is true that in some parts of the country, covering some 8-9 percent of the population, network infrastructure is not robust enough to provide acceptable levels of broadband service.   For the most part, the population density in these areas is so low as to make it difficult to justify the investment in infrastructure.  Those areas may require specially targeted approaches to provide the needed infrastructure, as appears to be the intent of the new broadband grants programs from the Obama administration.

But it is time we stop believing that our broadband problems are infrastructure problems, or somehow the fault of evil cable and telephone companies.

Perhaps the simplest measure of the problem is this:  while the 2008 Global Information Technology Report rates the US broadband infrastructure 4th in the world and improving, the OECD data that tracks the percentage of consumers adopting broadband estimates the US to be in 15th place.  The conclusion is clear - the infrastructure deployment rate is good and improving; the consumer adoption rate is less so and stagnant.

In spite of this, broadband policy in the past decade has focused almost exclusively on issues of infrastructure -- open access, competition, network neutrality, Internet governance and network management.  Scant attention has been paid to the more critical issue of Digital Inclusion -- bringing online the one-third of the American population that chooses not to use broadband Internet today.

There is a sound basis for focusing on Digital Inclusion rather than flogging the failed ideas of the last century.  Helping to bring this one-third of the population online will yield specific benefits:

• Stimulation of adoption rates, creating demand that can economically justify the further buildout and operation of infrastructure.  This is particularly true of adoption rates among low income populations and rural populations (see the Pew data at http://www.pewinternet.org/pdfs/PIP_Broadband%20Barriers.pdf).

• Amortization of total network costs across a larger consumer base, lowering the basic cost of broadband for all consumers and further stimulating adoption among Americans for whom the price of broadband remains an issue.

• Stimulation of new products, services and applications, in order to meet the specific needs of Americans who have not used broadband because they do not find it relevant to their lives.

This does not suggest that we that infrastructure development should cease.  The continued development of new and more efficient platforms for the delivery of broadband is essential to maintain and enhance service levels and to support continuing growth in the demand for additional capacity to support new, bandwidth-hungry Internet applications .  But it does suggest that additional attention and resources are required for programs to stimulate Digital Inclusion.

That's where we will get the biggest "bang for the buck" -- bringing online the current one-third of Americans who don't have, don't want, and don't use broadband.

And that's exactly what I will suggest to the FCC as they start their consideration of a National Broadband Plan.

So when the dust finally settles, the Broadband provisions in the American Recovery and Reinvestment Act of 2009 are actually pretty good.

There is some money, to be doled out by the Department of Agriculture for rural broadband projects, and by the Department of Commerce for innovation.  Not a lot of money, but that may be a good thing.

There is a requirement that the FCC develop a national broadband plan within a year.  A reasonable time frame and a good project that falls well within the mission of the FCC.  I look forward to reading what is proposed, and throwing in a few ideas of my own.

And there is a requirement for a broadband mapping project, which can only lead to better coverage of broadband.

Of course, I also like it because it dropped all of the lunatic language about mandatory open access and network neutrality (which in case you missed it, has once again morphed to mean something different than it used to).  That kind of nonsense rhetoric has no place is a serious discussion of broadband policy, something that even Google now seems to have conceded.

So I look forward to the year ahead, to the evolution of a national broadband plan, and to an improving economy.  And, if there is indeed a good in heaven, a decent wine crop worldwide to help produce the Cabernet Sauvignon I desire to drink while I read the various proposals and platforms.

Word out of the Wall Street Journal this morning is that the Recording Industry Association of America will cease its senseless strategy of suing its own customers and instead attempt to force ISPs to enforce the copyright laws for them.  Certain unnamed ISPs are said to already be discussing "cooperation" with them.

Ho-hum.

Let's be blunt here.  Being invited by copyright holders to discuss "cooperation" is like being invited to dinner by Hannibal Lecter.  Copyright holders aren't interested in cooperation.  They are interested in forcing ISPs to become copyright police.  They are interested in extorting as much cash as they can from every ISP worldwide.  And they are desperately interested in maintaining control of an entertainment industry whose business model died two decades ago.

Let's examine what the WSJ article purports.  First, the RIAA says it will stop suing people for allegedly downloading music in violation of the copyright laws.  Good idea, given that the RIAA has done such a sloppy job of the lawsuits that they have filed against geriatric grandmothers, toddlers and even dead people.  The RIAA should have abandoned the strategy years ago.

For the record, ISPs have always been interested in protecting copyrights and cooperating with the entertainment industry.  I've personally been part to at least five meetings to discuss "cooperation," none of which were productive because the copyright holders have virtually no idea what an ISP is or how the Internet industry really works.  Like petulant, screaming children, they cannot be reasoned with.  They want it their way or no way. 

As for the supposed "new plan" in which ISPs will take over punishing file sharers, it's drivel and nonsense.  There is no such plan, and no major ISPs have agreed to it.  To do so would require them to violate the Digitial Millennium Copyright Act, violate their own terms of service agreements, and then put themselves in jeopardy of a network neutrality complaint by throttling back the service of consumers.  What nitwit would agree to that?

What ISPs will do is to adhere to the law, as they have since the law was enacted.  That's the fair and legal thing to do. 

Meanwhile, in the spirit of "cooperation," the copyright community is said to be actively shopping for a small ISP they can sue in the US, as they did in Australia, in an effort to force changes in the law that they can't coerce Congress to change for them.

And they are pursuing a new global trade agreement that would force liability on ISPs.  ACTA is being pushed by the Office of the US Trade Representative at the behest of copyright holders in the US, including the entertainment industry, again because Congress has been smart enough not to give them their way under US laws.

The fact that the RIAA is dropping its vile lawsuits is good news for consumers -- though they didn't say they plan to give money back to the hundreds of consumers whose lives they have ruined in this decade of lawsuits.  The fact that they may be interested in working with ISPs may be good news, if they will let go of their obsessive need to punish their own customers and instead focus on ways the entertainment industry can thrive online.

I'm skeptical that they will do this.  Every time I hear about a new plan from the RIAA the words "fava beans" and "chianti" pop into my head.  It is true that there is a future for the music and film industries online, and it is true that they will need the support of ISPs to make that future.  But that future doesn't begin by asking ISPs to break the law and violate their own customer relationships on the whim of the RIAA.

The spin doctors behind the "network neutrality" movement have been in crisis mode for the past few days, trying furiously to cover the fact that Google isn't really interested in treating all packets on the Internet the same.  In fact, Google's support of "network neutrality" now appears to have been just another one of Google's shameless efforts at self-enrichment.

For those who have forgotten, "Network Neutrality" was a movement started by Google in late 2005 in order to ensure that they kept their dominant position in the content delivery market and that consumers would foot the bill.  While they wrapped it in fancier terms -- such as insisting that all data packets that travel across the Internet be treated exactly the same -- the reality is that Google never did believe in any such thing.  They just wanted to "game" public policy for the Internet in order to gain a competitive advantage.

What they were trying to do was to keep network operators from offering better tiers of service to those who could and wanted to pay for it.  They decried any such tiered services as unfair to small net entrepreneurs, though in reality Google was already using such tiered services offered by private companies such as Akamai.

The game is this.  Google and other large content providers use a service called "local caching."  This service takes content from the Internet, transfers it to a private network, holds it on local servers all over the world until it is called for by a consumer, then transfers it back to the Internet for delivery.  Google's content benefits from faster delivery to the cache, and fewer hops to the consumer.  Faster and more secure delivery for a 21st Century Internet, just as has always been the case with the Internet.

That's not a bad idea.  In fact, George Ou of the Internet Technology and Innovation Foundation pointed out the benefits of this and other facets of intelligent networking this month in a guide for policy makers, as did the US Internet Industry Association in September.  The problem for Google is that if such services are widely available, they would be less costly.  And would thus be affordable for every web site on the Internet.  Thus cutting Google's competitive edge and profits.

Thus was born "network neutrality" -- a campaign to ensure through deceit and "gaming" Internet policy that no one other than the largest content providers would have fast, secure delivery of their products.  While Microsoft and Yahoo briefly signed on to this scheme, they have since recanted.  Good for them.

Here's the problem that Google has now.  Since the Wall Street Journal article exposed their shenanigans (see Wall Street Journal, December 15, "Google Wants Its Own Fast Track On The Internet"), they have to protect their empire while avoiding the outrage of millions of consumers, Congress-persons, president-elects and left-of-center bloggers who foolishly believed that "network neutrality" was a real issue that demanded immediate regulation.  Here's how they are handling it:

     1)  Trash the Wall Street Journal.   To hear Google's paid character assassins today, the WSJ is some crackpot bunch of rogue journalists incapable of getting their facts right.  THey are working hard to kill the messenger as quickly as possible.

     2)  Lie, lie, and lie again.  The spin is that what Google wants is "only" local caching, and while that would be a violation of network neutrality and fairness if anyone else did it, it is not if Google does it.  Really.

     3)  Rally consumers to the cause.  Or bumper sticker.  Whatever the "network neutrality" movement has degenerated into by now.  The effort must be made to cover up Google's secret actions by keeping consumers focused on hating and fearing their own ISPs.  Trust only Google.  Do not think independently.

What's funny about all of this is that Google, in trying to defend itself, has outlined very neatly why "network neutrality" is a really bad idea that actually hurts consumers, content providers and the Internet.

If you read Rick Whitt's post on the Google public policy blog, you'll find a straightforward admission that Internet traffic is growing -- thanks in no small part to YouTube -- and that it costs money to deliver that traffic.  Further, there is a tacit admission that purchasing a higher tier of service -- such as buying transit from a private network off of the Internet and using local traffic -- is necessary to give consumers a quality Internet experience.

I am hoping this is one battle the spin-meisters behind "network neutrality" lose.  They should, because it makes no sense to claim that Google can make use of advanced network services but small content providers can't.  It makes no sense to force consumers to bear the burden of the cost of content delivery so that Google can be more profitable and powerful.

Google's hand caught in the cookie jar is no surprise to anyone who knows the Internet, and no surprise to the handful of journalists who have actually studied "network neutrality" and its wacky, constantly shifting, incoherent, fact-ignoring mantra of hatred for the "duopolies" of broadband.  It will surprise only the well-intentioned Americans who thought their support was going toward a real and just cause.

Imagine a world in which our government secretly conspired with seven other countries to write new laws that would create sweeping new police powers, turn Internet Service Providers into snitches and place millions of American school children at risk -- all to line the pockets of a handful of greedy entertainment moguls.

A movie plot?  A best-selling thriller?  Bizarre fiction?

Nope, just business as usual in the Office of the US Trade Representative, an obscure offshoot of the President's staff in the White House.  For the past five years or so, the Office of the US Trade Representative has been scurrying from country to country, forcing those who want to do trade with the US to also adopt legislation similar to -- or worse than -- the Digital Millennium Copyright Act that has proven such a miserable failure in the US.

They have done this to appease the entertainment industry in the US, in a blatant political move called "off-shoring legislation."  In off-shoring, you take a really, really bad piece of legislation that you can't get the Congress to agree to here in the US, and take it overseas.  There, you use the power of the US government to bludgeon other governments to adopt the bad legislation we won't -- and then attempt to get the Congress to buy into the bad laws in the name of "normalizing" international agreements.

Examples abound.  When the US Department of Justice was unable to force US Internet Service Providers to save all the data about their customers for two years -- with no guarantees of the security of that data, and no indication of who would pay for all that storage -- they simply off-shored the bad idea to Europe.  There, the EU actually passed such a law, though with considerable resistance from clear-thinking governments.  And two years later, the EU has virtually nothing to show for it except mounting costs to consumers.  Now, Congress is being asked to pass similar laws here to "bring us into alignment with Europe."

In the US, the entertainment industries have been successful in pushing for and getting some truly bad copyright laws, including a Digital Millennium Copyright Act that allows the Recording Industry Association of America to sue millions of school kids, grandmothers who don't own computers and dead people.  Really.  I'm not making this stuff up.

But unsatisfied with their dismal performance in the US, the entertainment industries lobbied to get the Office of the US Trade Represetnative to shove our bad copyright laws down the throats of all of our business partners, whether they needed it or not (Australia, for example, has its own copyright laws, but was forced to accept DMCA-style provisions in order to get the US to finalize the most recent trade agreement).  Singapore.  Brazil.  Australia.  Vietnam.  You name the country, and we've blackmailed them into adopting our bad laws in order to enrich a handful of entertainment companies.

But that wasn't enough.

So in 2008, the United States Government initiated secret talks with the other countries involved in the G8 summit for this year, with an eye toward forcing a new global copyright agreement.  Called ACTA, the Anti-Counterfeiting Trade Agreement, this new initiative would, according to drafts leaked from the discussions, criminalize even the most minor copyright infractions, force taxpayers to bear the cost of copyright infrigement investigations, access the information of consumers without a warrant, and force ISPs to spy on their customers in search of copyright infractions.  There are great write-ups on ACTA on Wikipedia, and some excellent documents on WikiLeaks.

Just to be clear here, I don't like the idea of people stealing copyrighted materials.  And if the US government wants to conduct some negotiations in secret, I can understand.  National security and all that.  That's not my issue, though the EFF clearly feels diffrently, as do the hundreds of political and Internet leaders worldwide who have risen up in indignation over ACTA.

My issue is this: since when did the US government decide its laws were superior to that of other nations -- particualrly laws that have proven less than effective here in the US?  And when did we decide that lining the pockets of entertainment moguls is a more noble national goal that maintaining the integrity of the Internet?

ACTA has been designed without benefit of input from anyone other than bureaucrats and copyright lawyers.  It has been done in secret not to protect the integrity of the negotion process, but rather to shield the negotiations from those who would recognize them for the travesty they are.  And it is particularly galling that this is being pushed -- and pushed hard -- not by some third-world dictatorship or cabal of anti-American interests but rather by our own government as an extension of our official policy.

ACTA represents an act of bad faith on the part of the United States government.  An act of bad faith toward the broadband industry, toward consumers, toward the civil liberties guarnateed in our Constitution, toward our trading partners and toward countries unable to protect themselves from predatory bureaucrats and their bad ideas.

Those who demand the regulation of broadband -- open access rules, network neutrality rules, a national broadband plan, rate regulations, expansion of universal service, ad nauseum -- are fond of claiming that what we must fear most is the emergence of a monopoly that controls all of broadband.  One mega, evil networking company that seeks to control what we see, how we see it, who can be on it, and who can't.

They speak of monopolies, and duopolies, and whatever-big-word-we-can-think-of-to-scare-you-opolies, and point their long, sanctimonious fingers at leading network operators as likely villians.

Which is proof that those who will not learn from history are doomed to become progressive liberal telecom pundits.

Just for the record, free markets abhor monopolies.  In a free market, unfettered by government interference, the marketplace will move quickly to quash possible monopolies through innovation, competition and consumer choice.

How, then, do monopolies get created?  By governments, of course.  Only with the direct intervention and deliberate cooperation of the government can monopolies form or continue.  A case in point?  Monopoly cable franchises.

But if we are talking about how broadband might become a monopoly, we have an even better example.  Once upon a time there was a telephone company called AT&T (which, for the record, is not the same company in any way as the current one that carries the AT&T brand name).  AT&T the telephone company did not set out to become the monopoly that had to be broken up in 1982.  It followed a process, set by the United States government and agreed to by the officers of that company in what, in retrospect, turned out to be a deal with the devil.

It began with the patents, and with the confusion and meddling at the Patent Office that gave the lion's share of the telephony patents to a single, pre-selected winner.  Then, around the time of World War I, the telephone system was declared so critical to the security and future of the US that it was nationalized.  Not many years later, the government sought to ensure low rates, and so introduced rate regulation for telephony -- including cross-subsidizations, government supports and other artificial mechanisms.  The final step was to make the telephone company an instrument of social policy by implementing universal service and minimum service mandates.

All of which must sound eerily familiar to those attempting to battle for consumer choice and free markets today.  The Patent Office is an ungodly mess, giving power hither and yon based on shifting definitions and interpretations.  In the wake of 9-11, we have the Internet declared to be essential to US security and the future.  So-called consumer advocates are demanding telephony-style rate regulation.  And Congress is trying to expand the mega-billion universal service program to broadband.

How much of this is supported by the networking companies?  None.  How much do they want to return to the old days of monopoly operations?  Not a bit.

Which again begs the question:  if it is not the networking companies pushing us down the long, slippery slope that could lead to a monopoly, who is it?

I'll take a wild guess that it is the same bunch of academics, policiticians and pundits who are pushing hard to put all the pieces of a monopoly in place -- the net neutrality/open access/rate regulation crowd.  They are not a bit interested in letting consumers in a free marketplace keep us off of that path, and are pushing as hard as they can to create the government co-conspiracy that will enable them to choose which monopoly company will succeed.

Which is why I can't and won't ever support them.

The OECD has again released a ranking of broadband penetration worldwide, and once again the United States is ranked 15th in the world, somewhere slighly below the Grandy Duchy of Luxembourg. 

You can already hear the gears grinding.  Disreputable blog sites are gearing up to use this factoid to again attack America's broadband industry.  Pundits are pontificating, politicians are blustering, and the lunatics on the left are again DEMANDING that the government seize control of broadband -- or at least tie it up in 19th Century-style regulations.  Woe is U.S., again.

But before this nonsense goes to far, will someone please actually read what the report says, instead of simply swallowing the OECD press release?  Because even the most cursory glance at the data would make any rational person ask, "Are they just making this stuff up?"  And the answer, sadly, is "Yes."

Here's what's interesting about the OECD data:

• It measures broadband adoption, not deployment.  The data presented isn't about where broadband reaches, but rather how many people are subscribing to the services.  Even then...
• The U.S. data is not from December of 2007, as advertised, but from 2003.  Strangely, when it comes to the data for household subscriptions to broadband, the figure is frozen at the 2003 levels of fewer than 20 million.  But it gets even worse...
• It's not even data.  The U.S. figures were, according to the authors, an "OECD estimation based on company reporting."  You have to wonder what company data they used, since current US estimates are that some 60 percent of the 105 million US households now have broadband.  But then...
• They fudge the figures.  The OECD numbers allow Korea to include people whose broadband access is via cell phone, but the US numbers don't include that.  Nor do they include the nearly 12 percent of the U.S. online population -- that would be another 7-million plus Americans -- who use Wi-Fi connections.  Include some things, don't include others, and voila!  The next thing you know, lower Botswana will have better broadband penetration than the U.S.

The rest of the so-called data is equally bad.  When they compare prices from country to country, they allow some countries to use figures that include long-term discounts that don't generally apply in the U.S.  And they fail to note where countries heavily subsidize the cost of broadband to artificially make their numbers look better.

The OECD itself -- feeling bee-stung by the tidal wave of criticism for its bogus "reports," has coyly noted in the report that the information should not be used to make conclusions about public policy, and that the report may contain some inaccuracies.  But you won't find any such statements in press release touting the report, or in the "conclusions" it presents that urge governments to push for "competition" and "open access." Those latter recommendations, it may be noted, are based entirely on the political prejudices of whoever wrote the news release -- the recommendations are neither mentioned nor supported in the data.

The OECD study is junk science, but it does provide an opportunity to remind those of us working in broadband public policy of three key rules:

1. Some people just plain hate America, and will use any bogus data or flimsy excuse to humiliate this country on the world stage -- or worse, encourage us to adopt really, really bad policies -- in order to gain some advantage over us on the world stage.  I would hate to think this applies to the OECD, but one has to wonder why, year after year, they continue to flaunt phony studies with bad conclusions that make the U.S. appear to be something other than a world leader in broadband.
2. News releases announcing studies almost never match the data.  The Wall Street Journal concluded this in an article last fall, noting that in nearly 90 percent of cases they studied the data did not support the conclusions reached in the news releases. 
3. It's about adoption, not deployment.  The United States clearly has some work to do to bring the rest of our population online.  But we won't achieve that by focusing on broadband deployment, or by continuing to attack broadband infrastructure companies.  We can only do that by addressing the reasons why some people aren't using the Internet -- primarily lack of education, lack of computing skills and a lifestyle in which Internet access is not relevant.

The knee-jerk pundits and politicians who can't be bothered to actually read the studies, or who base their positions on press releases and bluster, will eventually look as silly as they truly are.  We can only hope that happens before they adopt needless, destructive and badly-written legislation that may actually make our national broadband as bad as the OECD studies try to make us appear.

As the end of his term as Chairman of the FCC looms, I am becoming more comfortable with Kevin Martin and his style.  In fact, I'm downright tickled with his recent handling of the "network management" flap and its demonstration of how well the system works.

The furor over using forged TCP reset packages to shape traffic on Comcast's network clearly presented a legitimate question:  To what degree are such actions in the best interests of consumers, and to what degree do they violate the spirit and letter of the Principles adopted by the FCC in 2005?

The way the process is supposed to work is that such questions are first handled directly between the consumer and the broadband provider, based on terms of service and commercial agreements.  When this first step does not resolve the issue, it gets elevated to the FCC.  Which it did.

Here's where things get sticky, because this legitimate issue of consumer rights got tangled in the efforts of a lunatic minority to force the FCC to adopt new and outrageous regulations for the Internet.   This minority of roughly one one-thousandth of one percent of Internet users in the US sought to use this legitimate inquiry to bully the FCC into changing its principles into hard regulation.  This would then enable a handful of lobbyists to "game the system" whenever they want by endlessly accusing broadband companies of "violations."

The FCC knew there was a potential for the Principles to be abused.  That's why they clearly stated at the time of their adoption that the Principles did not and would not be regulatory rules.  This way, the Commission has the flexibility to address each situation as it occurs.  It was a wise move in 2005, and remains so today. 

So the issue is taken to the FCC for consideration, and things get tricky because the pro-regulation minority was howling for a one-size-fits-all regulatory quick fix they could more easily use for their own political purposes.  Kevin Martin had to weave his way through this minefield. 

But then things spun out of control at Comcast.

I've worked for enough large corporations, both inside and as an advisor, to know that things can pile up during a crisis.  Good intentions turn bad, innocent actions are in retrospect portrayed as sinister, and the whole organization is left wondering what the heck happened.  If you want proof, just consider the Exxon Valdez oil spill.

Whatever the reason, it appears that Comcast first tried to duck the issue, then prevaricate its way out of the issue, and then compound its public relations problems by derailing the FCC's hearing in Boston, filling the public seats with homeless people.

Which, of course, was the cue for Congress to open its own witch hunt over the issue.

In short order, Chairman Martin faced the task of protecting the integrity of the consumer protection process from both the raging minority of pro-regulation loons and the Congress; while dealing with the questions of policy that were presented in the first place; while keeping intact the consumer Principles enacted by the FCC; and providing support for the legitimate needs of broadband providers to manage their networks.  Oh, and punish the guilty if there were any.

It wasn't easy.  It took guts, a steel-reinforced loin cloth, a commitment to principle and a belief in the power of the process to listen to the loons without over-reacting, stare down Congress and push to a resolution.  But in the aftermath, here's the scorecard:

*  Everyone got their day in court in a hearing before the FCC.

*  The Commission clearly upheld the need for and benefits of network management, refusing to buy into the vision of a "wild west" internet ruled by anarchy. 

*  Chairman Martin held his own before Congress, outlining the policies clearly.

The process is not complete, of course.  Martin has indicated he will take action against Comcast for its behavior, though he has not specified what action.  And there remains the question of how this might impact other service providers and their efforts at traffic shaping.

There are other benefits as well.  Consumers learned more about how a handful of users are taking more than their fair share of bandwidth.  We all learned more about the progress being made to accommodate file sharing on broadband networks, through such efforts as traffic shaping and P4P.  And the process drew attention to the need for more transparency in commercial contracts and user agreements, so that both sides more clearly understand the terms of service.

Best of all, the process was validated.  It works, and we don't need draconian regulation of the Internet to assure that problems can be handled effectively.

Kevin Martin, the lame-duck Chairman of the FCC, refused to be bullied by either the loons or the Congress,  His performance through it all was calm, deliberate and purposeful.  And that's not bad at all. 

I'm perplexed about Universal Service.

On one hand, it has achieved wonders in ensuring that Americans everywhere have reasonable access to necessary telecommunications service, and has helped to make our telecom the envy of the world.

On the other hand, it is a bloated, fraud-ridden, poorly designed, hidden tax on consumers that is desperately in need of reform and rethinking.  Whether we expand it, kill it, roll it up or roll it down, something clearly needs to be done.

I'm equally perplexed, therefore, about what to think of the FCC's decision to cap funding for rural cell phone support while it and the Congress mull a more permanent reform strategy.

Capping the runaway expenditures is clearly a relief for consumers -- particularly those who don't benefit from rural cell phone deployment but must nonethless foot the bill for it.  It likewise benefits telecomm companies who are busy deploying in less rural areas and shouldn't have to sacrifice their time and money to serve markets they don't serve.

But then there is the question of broadband.

Cellular service in rural areas is often accompanied by deployment of 3G broadband services, and this is creating a quiet revolution in rural broadband.  Where you still cannot get a cable modem connection or DSL, you can often get an HSDPA or EVDO signal.  And while this is still first-generation stuff, advances like EVDO Rev. A are making it better every day.

Cellular broadband is reaching the unreachable.  It is delivering higher speeds, greater competition and more reliable Internet service to rural areas in ways that can truly deliver on the promise of broadband in the very near future.  But getting there will take a lot of investment -- much of which can't easily be justified to private investors or corporate shareholders.  And that is exactly the kind of situation Universal Service was intended to address in the first place.

On reflection, I don't have a problem with capping cell phone expenditures in the short term, if for no other reason than to help keep costs from running even further away.  But in doing so, I'd like to see more acknowledgment of the value of cellular broadband for rural America, and some commitment to ensure that it gets its fair share of attention as well as scrutiny.