Yesterday, FCC Chairman Genachowski announced his intent to launch a proceeding exploring a new regulatory framework for broadband services.  Since then, there’s been lots of commentary from industry (including our own statement here), Wall Street analysts, and pro-regulation advocates. Amidst all the storm and fury, I want to highlight an important passage in Chairman Genachowski’s statement:

“The issues presented by the Comcast decision are a test of whether Washington can work—whether we can avoid straw-man arguments and the descent into hyperbole that too often substitute for genuine engagement.”

At NCTA, we couldn’t agree more and pledge again that our industry will work constructively with the FCC, Congress and all policymakers to create an appropriate framework that preserves an open Internet and achieves the goals of the National Broadband Plan.

But as this important dialogue moves forward, it’s critical that we at least have a common understanding of some basic facts – perhaps the most basic being a common understanding of what the Internet is.

Which brings me to the odd “rebuttal” that Free Press issued today to comments by NCTA and others on the Chairman’s “third way” proposal. It includes these phrases:

“The ‘Internet’ is not the wires that deliver the content and applications, but the content itself.”

“We trust that the NCTA will be reassured by the FCC’s repeated assertions that they have absolutely no plans to regulate the Internet.  Being the expert agency for communications, the FCC recognizes that broadband communications services are not ‘the Internet’, contrary to NCTA’s deliberately misleading statements.”

Perhaps Free Press should take a closer look at the Communications Act – specifically section 230(f)(1), which was added by the 1996 Telecom Act:

“The term “Internet” means the international computer network of both Federal and non-Federal interoperable packet switched data networks.”

Nowhere in Congress’ definition does it describe the “Internet” as being the “content” provided over the networks rather than the networks themselves.  The Commission itself cited Congress’ network-based definition of the Internet in adopting its 2005 Policy Statement on Broadband Internet Access.

Congress used a similar network-based definition in the Broadband Data Improvement Act in 2008:

INTERNET.—The term ‘‘Internet’’ means collectively the myriad of computer and telecommunications facilities, including equipment and operating software, which comprise the interconnected world-wide network of networks that employ the Transmission Control Protocol/Internet Protocol, or any predecessor successor protocols to such protocol, to communicate information of all kinds by wire or radio.

Likewise, the US Supreme Court has described the Internet as a “network of interconnected networks” (National Cable & Telecommunications Ass’n v. Brand X Internet Services) and as a “worldwide mesh or matrix of hundreds of thousands of networks, owned and operated by hundreds of thousands of people”(Reno v. ACLU).

Free Press may wish that the Internet was something else, but that does not make it true.  Let there be no doubt: When you regulate broadband networks, you are regulating the Internet.

[Editor's Note: Rick Chessen is Senior Vice President, Law & Regulatory Policy for NCTA. In addition, one sentence above was edited for clarity]

The column below appeared today in The USA Today, as an opposing view to a USA Today editorial.

Opposing view on ‘Net neutrality’: Providers back Web freedom

By Kyle McSlarrow

On Tuesday, a federal court struck down a Federal Communications Commission order enforcing a rule that the agency hadn’t ever actually adopted. The court’s decision does not call into question an Internet policy adopted unanimously by the FCC in 2005 — endorsed by all broadband providers — promoting a free and open Internet. Thus, the decision has no effect on the Internet experience that consumers enjoy, and it doesn’t alter the government’s existing authorities to protect consumers or to police anti-competitive conduct.

Today, 65% of American households subscribe to services provided by a number of competing broadband companies to access a growing number of exciting applications that have changed the way we all communicate, conduct business, gather news and information and consume entertainment.

But there are still gaps. Not every community has broadband, and not every household that has access subscribes. Here, too, nothing in this week’s court decision affects our collective ability to implement the vision of a connected nation.

Broadband providers agree that consumers should have the freedom to navigate the Internet and access any legal content or application of their choice. That isn’t at issue. But fears of what broadband providers “could” do have prompted the usual and predictable calls for more — and, in some instances, incredibly far-reaching — government regulation of a marketplace that has been an American success story.

Why? In precisely two instances — and one of them is debatable — out of trillions of transactions over the past decade, has anyone even been able to point to a specific problem. Contrast that with the overwhelming evidence of hundreds of billions of investment to build and expand networks and the incredible array of new applications and sites flourishing because of a bipartisan policy of regulatory restraint.

We fully intend to work with the FCC and other policymakers to preserve the open Internet that is a reality today. But it is a massive overreaction to suggest that we should impose decades-old regulatory regimes designed for the days of Ma Bell and a government-sanctioned monopoly on the Internet.

Today, NCTA President & CEO Kyle McSlarrow gave a speech at the Media Institute, the nonprofit research foundation specializing in communications policy issues. Fittingly, since the Institute is very focused on issues of freedom of speech, the address focused on “net neutrality” and the First Amendment. You can read the speech here, but I thought it would be helpful to provide some background information.

There are plenty of freedom-loving Americans who love the Constitution. Some of them even carry around copies of that document. And yet, even among these hardcore fans, there is often a misunderstanding of the First Amendment to the U.S. Constitution.

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

There are many circumstances under which individuals may claim a violation of their First Amendment rights. Someone may lose employment after saying something in the press. A person may not be allowed to appear on a television broadcast. A student might be suspended for something written in the newspaper of a private college. These might be unjust situations, but they are not governed by the First Amendment, which says that the government may not abridge freedom of speech.  What the First Amendment guarantees is that the government doesn’t get to decide who gets to speak and who doesn’t.

In his speech, Kyle McSlarrow says:

…urging the government to impose rules that supposedly promote First Amendment values is too often used to justify regulations that instead threaten First Amendment rights.   By its plain terms and history, the First Amendment is a limitation on government power, not an empowerment of government.  Making these arguments is, ironically, almost proof that First Amendment rights are being implicated.

It’s also important to note that there are many who seem to think that the cable industry is a special case. They argue that cable’s infrastructure was built with government funding and is therefore a public utility and subject to common carrier regulation. All of these assertions are factually incorrect. To quote a previous post:

To be sure, our video services are subject to government regulation – at the federal, state and local levels – but we aren’t like telephone companies (which built their systems with captive ratepayers and a government-guaranteed rate of return) or even radio and television broadcasters (who were given public airwaves for free, but in return had to adhere to certain “public interest” requirements).  Our industry had no government-guaranteed return or government-granted public airwaves – to the extent we used any public resources, we paid for our rights-of-way with local franchise fees. Indeed, the cable industry built analog networks, our new digital networks, our cable modem and digital phone services with private risk capital with no assured return.

Some might argue that, because the FCC has previously regulated speech on the broadcast networks, such an approach would be appropriate in the Internet Age. But note what Kyle said in his address:

…in this case, the FCC is not engaged in the allocation of the public airwaves.  The bandwidth we’re talking about is capacity on private transmission facilities constructed by ISPs.  Imposing regulations that prevent providers from using “too much” capacity for speech-related services not even associated with Internet access should cause all sorts of First Amendment and Fifth Amendment Takings alarm bells to go off.

Finally, it’s not just the cable operators that would be affected. The other concern about the government deciding to involve itself in these debates – which should properly been seen as technology discussions – is that we don’t know what future applications might be developed or how they might need the network to be structured in order to work most effectively.

To quote from Kyle’s speech:

Not all content providers may need the same speed, prioritization of data and quality of service as, say, providers of high-definition video, or maybe 3D video or who-knows-what-else may be invented by application providers.  But ISPs can’t prioritize all content, due to the physical limitations of their systems.  And it may be entirely too costly (as well as unnecessary and inefficient) to offer the same quality of service that a video game service requires to every single content provider.  And so the effect of such a rule would be simply to prevent the offering of the services consumers might want that require such special treatment.

Or to quote one of my earlier blog posts:

If you want a dumb pipe, with every bit treated the same, that will significantly affect telemedicine and other advanced services which may require priority treatment. If creating some method of optimized delivery was such a terrible thing, what does this say about services like Akamai, that help make content distribution more efficient, benefiting both consumers and content producers?

Really, all we’re saying here is that these are very complicated issues and we hope that the government treads lightly as it contemplates taking action.

NCTA’s Executive Vice President, James Assey, will be participating tonight in an Oxford-style debate on net neutrality, presented by Tech Debate as part of Web 2.0 Expo New York.

The participants will debate the motion “A network neutrality law is necessary.“ Arguing for the motion will be Professor Tim Wu, venture capitalist Brad Burnham and Professor Nicholas Economides. Presenting the case against the motion will be James Assey, Robert Quinn (AT&T’s Senior Vice President of Federal Regulatory) and Professor Christopher Yoo.

The event will be streamed live this evening at 8:00 p.m. A podcast will be available afterwards at Tech Debate’s website.

James Assey did a bit of debating on net neutrality and other telecom topics at the Personal Democracy Forum back in July. You can read a write-up of that conversation or watch a video of the proceedings.

More than a year ago, I put up a post expressing my pleasure about how the “net neutrality” discussion had evolved over time. Specifically, I focused on the comments of Vint Cerf between 2006 and 2008, when he seemed to move from arguing that the Internet must be “open and neutral,” to saying that “the real question… is not whether [broadband networks] need to be managed, but rather how.”

My thoughts on the argument were confirmed for me by a panel at CES this past January, entitled “The Internet – How Do We Keep The Road Open.” If you read this account, you’ll note agreement among the panelists that managing networks is important, but so is transparency.

I understand that, as the FCC examines the issue of “net neutrality” (or the “Open Internet”), it isn’t just about network management, but I welcome having a more sophisticated, complex discussion.

So, imagine my dismay when two of my favorite cable shows – The Rachel Maddow Show and The Daily Show – recently took on the net neutrality issue and described it the way it was described back in 2006.

All About Blocking?

On October 23rd, Maddow said, “Telecom companies want to be able to slow down access to some parts of the Internet and to block some others. Essentially, they want the right to privilege the content that they want to privilege for their own telecom corporate purposes.” Maddow’s guest, Boing Boing editor Xeni Jardin, said that net neutrality is about everyone having equal access to all Internet content: “No cable companies, no telcom, should be able to slow that down because what you want access to is against their competitive interest.” [Watch the whole Maddow/Jardin segment here.]

The following Monday, October 26, Jon Stewart devoted a whole segment on The Daily Show to the same topic. He said, “The Internet Service Providers – your Comcast, your AT&Ts – would like net neutrality not to happen so they would have the ability to decide which content and websites get the preferential treatment.”

Let’s start right there. The charge is leveled that cable companies will slow down content that competes with their interests. FCC Chairman Julius Genachowski, in his September 21 speech at the Brookings Institute, listed reasons that he thought net neutrality regulation might be necessary. Blocking competitive content was not one of those reasons. Nor am I aware of any instance of a cable company ever doing such blocking. NCTA’s President & CEO Kyle McSlarrow has said on a number of occasions that our member companies don’t block and won’t block lawful content.

All Bits Are Not Treated Equally.

In addition, Xeni Jardin is being disingenuous and Jon Stewart (I presume) doesn’t know any better. Jardin says, “All packets are created equal.” Stewart says, “Currently everything moves through those tubes at pretty much the same rate. Like, if you’ve got a packet of information from a major corporation like Google that information gets exactly the same treatment as, say, a packet from a little startup company…”

But, in fact, all packets aren’t the same. You wouldn’t want a voice packet, a video packet, an e-mail packet or an image packet to be treated the same. TCP/IP isn’t neutral and never was. There are times when you need to prioritize different packets.  George Ou at Digital Society has done some great work explaining the difference between low-bandwidth and high-bandwidth applications. If you want a dumb pipe, with every bit treated the same, that will significantly affect telemedicine and other advanced services which may require priority treatment. If creating some method of optimized delivery was such a terrible thing, what does this say about services like Akamai, that help make content distribution more efficient, benefiting both consumers and content producers?

Stewart posed the question, “Why are all these people so opposed to this innocuous, populist legislation?” If all that was being discussed was the right of consumers to visit any website they want, or use any legal Internet service they desire, there would be no problem. NCTA has gone on the record many times that our member companies are in favor of this. When Chairman Genachowski proposed the two new principles in his Brookings speech, we applauded efforts to preserve an Open Internet. The trick is that the conversation is more about how and when networks can be managed.

Jardin proposes, “Whenever there’s a fight on the Internet, it’s always good to side with the geeks who actually built the Internet, rather than, sort of, fat-cat telcom lobbyists. You have guys like Vint Cerf… he’s coming out, saying this is a dangerous thing.”

• Point One is that Mr. Cerf has worked for Google since 2005; that company is hardly a little garage start-up, nor are they a disinterested party in telecommunications.
• Point Two is that Professor David J. Farber (the “Grandfather of the Internet”) thinks that net neutrality is not such a good thing.
• Point Three is that we agree that network management is an issue best addressed by engineers rather than policymakers. The cable industry has a lot of engineers of its own. For the past 15 years, cable companies have been able to offer high-speed Internet access thanks to the hard work of these engineers, who still have to manage these networks on a daily basis. Let’s cast our minds back to 1994 and remember that it’s those cable engineers that helped drive all the broadband we currently enjoy.  It was cable that developed the DOCSIS standard and first laid significant amounts of fiber out in the field, ahead of the phone companies.

(It’s ironic that Maddow, who is so publicly a fan of infrastructure, seems to miss this last point.)

The Challenges of Creating Neutrality Rules

As long-time telcom reporter and industry analyst Gary Kim pointed out, the need for management is exactly why net neutrality poses some difficulties:

It is very hard to define and covers a range of business discrimination issues, network management and performance practices as well as potential future services that consumers might very well want to buy, that provide value precisely because they allow users to specify which of their applications take priority when the network is congested.

Kim notes that it’s a good thing for ISPs not to discriminate against the competition, but he is concerned “whether ‘affirmative’ packet handling, as opposed to ‘negative’ packet handling, will be lawful in the future.”

Swing too far in one direction and you create broad draconian rules that stifle innovation. Swing too far the other way and you end up with vague principles that don’t let anyone know for certain what’s allowed and what isn’t.

Finally, let me observe that there is a lot of hubbub about what might happen without net neutrality. I am reminded about a recent tweet from Blogads.com Founder & CEO Henry Copeland.

RT @nickbilton What life w/out Net Neutrality will look like: http://j.mp/2UYL2H ++Umm, wait, there’s no NN law right now.

As he says, when you imagine what life might be like without net neutrality, you might want to remind yourself that we have no such regulation right now.