FTC On Net Neutrality: More Of The Same

By SamuelRose, published at 10 May 2007 - 8:12pm, last updated 10 years 27 weeks ago.

[via Smartmobs]

Broadband Reports posted a news brief yesterday about the FTC hearing on Net Neutrality. Federal Trade Commission (FTC) Chairwoman Deborah Platt Majoras is quoted

"[W]e virtually always assert the principle that, absent clear evidence of market failure or consumer harm, policymakers should not enact blanket prohibitions of particular forms of business conduct or business models or place requirements on how business is conducted."

Broadband Reports quotes Andrew Jay Schwartzman, president and CEO of Media Access Project::

"The market is failing because right now 98 percent of broadband service is provided by either the phone company or the cable companies, and a duopoly is anti-competitive and a marketplace failure"

How did we get to this point? Back in 2004, Laurence J. Kotlikoff wrote:

The local phone system is not only a public good, as defined by economists, it's also a public good as in who paid for it -- the definition understood by everyday folk. Whether the regional Bell companies and their lobbyists want to hear this or not, the local phone system is not their property. It belongs to the public, having been built over the last century at enormous public expense. True, the federal government never directly paid for the phone system. Instead, it licensed a single company -- the Bell Telephone System -- to construct this network by charging the public phone rates far above the actual marginal costs of transmitting calls and guaranteeing the Bells an essentially risk-free return.

In 1983, in a landmark decision, the courts broke up the national Bell monopoly into a long distance company -- AT&T -- and a number of regional "Baby" Bells. The Baby Bells were given the right to run our local phone systems, but under strict regulation. This was like giving Dominos the right to repair our roads as well as sell us pizza deliveries, but at a regulated price.

Blogger Susan Crawford brings us into the present posting to her own excellent blog yesterday. Susan discusses the history behind the break up and reformation of telecommunications monopolies. She writes:

...The seven operating companies [that were the "Baby Bells" have] crept back into long distance service, got rid of the consent decree [..]in the 1996 Act, manipulated/litigated their way out of allowing competitive local service to emerge, and now .... they're mostly reconsolidated. We really have two phone companies in the US: Verizon and AT&T

I realized after thinking about this, that the reason that things got to this point is that most people don't understand what Kotlikoff is talking about above, that the existing telecommunications system is indeed a public good in every sense of the word. The telecommunications companies have been highly successful at reframing the language, and public perception around the issue. From the employment and use of technical jargon and obscuring acronyms, to the endless creation of fake front "consumer interest" groups, these companies have sought to bury the reality that their main resource is a public good.

So, what can be done? In my opinion, expressing your support for net neutrality to the government is a great start. However, past and recent history is illustrating that lobbying the government is not enough in and of itself. Supporters of net neutrality will have to undo these perceptions and demystify the history of US telecommunications infrastructure creation in order to get the majority of people to understand what it is they are giving away. At the same time, supporters of net neutrality can also explore possible emerging alternatives to the current telecommunications infrastructure.