Hijacking the Internet: How Big Cable and Phone Companies' Plans for Broadband Threaten Democracy

Jeff Chester, Center for Digital Democracy/b>

The nation's largest telephone and cable companies have a vision for the Internet's future. Verizon, AT&T (formerly SBC), Comcast, and Bell South want to create a privately run and branded "pay-as-you-go" Internet, making everything we do online a "billable," revenue-generating service. Our every cyberspace move will be tracked and stored so we can be better marketed to (a data collection system that might even rival the NSA's!). Those with the deepest pockets--think corporate special interest groups and major advertisers--will get preferred treatment. Their content will show up (and be processed) the fastest on our computer and television screens. Content seen as undesirable, such as peer-to-peer communications, may be relegated to a slow lane or simply shut out, say "white papers" and other documents given to the cable and phone industry.

Under the plans they are considering, all of us--from large to small content providers to individual users--will have to pay more when surfing online, streaming videos, or perhaps even sending and receiving email. Companies are mulling the imposition of new subscription plans that will limit our online experience. There will be "gold," bronze," and "silver" forms of Internet access that tightly define what they call our "level of service" (limiting how much downloading we can do, etc.)

Gone will be the more open and nondiscriminatory network of today.

To help ensure that their "vision" succeeds, the phone and cable lobbies are now engaged in a political campaign to further weaken the nation's communication policy laws. Both the Congress and the Federal Communications Commission (FCC) are considering proposals that will have a far-reaching impact on the Internet's future. They want the federal government to permit them to operate Internet and other digital communications services as "private" networks--without policy safeguards or governmental oversight. Telephone and cable companies are now using the same kind of political snake oil that helped them pass the now-infamous 1996 Telecommunications Act (ten years ago on Feb 8, 1996). They have unleashed the tried-and-true rhetoric designed to lure compromised and clueless lawmakers. Our proposals, they claim, will "empower the consumer" and lead to "innovation." But these are code words used to cloak their real goal: to turn the Internet into a turbocharged digital retail machine.The telephone industry has been somewhat more candid than cable about its plans for the Internet. Senior phone executives have publicly discussed their plans to begin imposing a new scheme for the delivery of Internet content, especially from major Internet content companies. As Ed Whitacre, CEO of AT&T, told Business Week in November, "Why should they be allowed to use my pipes? The Internet can't be free in that sense, because we and the cable companies have made an investment and for a Google or Yahoo! or Vonage or anybody to expect to use these pipes [for] free is nuts!"

The phone industry has been unleashing its political allies to help win it the freedom to begin imposing its broadband business model. At a conference held in December by the pro-cable and -Bell "think-tank" Progress and Freedom Foundation (PFF), there was support for the idea that it is okay for phone companies to begin charging some content users more and others less. "Price discrimination," noted PFF's resident media expert Adam Thierer, "drives the market-based capitalist economy." That's "good discrimination." Not surprisingly, PFF, is funded by Comcast, Verizon, AT&T and many other media companies. (PFF is also part of the conservative State Policy Network lobbying machine. SPN groups have increasingly been working to promote Big Media interests.)

Alarm Bells

To ward off the prospect of virtual toll booths on the information highway, some new media companies and public interest groups are calling for new federal policies requiring "network neutrality" on the Internet. This group includes Amazon, Google, Free Press, Media Access Project and Consumers Union, among others. Under their proposal, broadband providers would be prohibited from discriminating against all forms of digital content. For example, phone or cable companies would not be allowed to slow down competing or undesired content.

Without a proactive intervention from the public, the values and issues that we care about--civil rights, economic justice, the environment, and fair elections--will be further threatened by the push for ever-greater corporate control. Imagine how the next presidential election would unfold, if major political advertisers, with strategic payment to Comcast, had their ads from Democratic and Republican candidates presented in a more visible and user-friendly way than the ad of a less well-funded third party candidate. Consider the media landscape if an online advertisement promoting nuclear power prominently popped up on a cable broadband homepage, while a competing message from an environmental group was relegated to the margins. It is possible that all forms of civic and noncommercial online programming would be pushed to the end of a commercial digital queue.

But such "neutrality" safeguards are inadequate to address more fundamental changes that the Bells and cable monopolies are seeking in their quest to monetize the Internet. If we permit the Internet to become a medium designed primarily to serve the interests of marketing and personal consumption rather than civic-related communications, we will face the political consequences for decades to come. Unless we push back, the "brandwashing" of America will have serious consequences for both our culture and global society.

Digital Dollars

Why are the Bells and cable now aggressively advancing such plans? It's because our media system is undergoing a major transformation with the arrival of the long-awaited "convergence" of communications technologies. What the phone and cable companies see as their potential lucrative "triple play" by providing us with video, voice and data communications, will soon be flowing into our TV's, PC's and mobile devices (such as cell phones or iPods). All of these many billions of bits will be delivered over the telephone and cable lines, whose owners have successfully lobbied the Feds so they can impose a near monopoly over the delivery of residential broadband service.

Of foremost interest to both the phone and cable companies is video programming. Like cable, phone companies are getting into the TV and media content business, offering customers television channels, on-demand videos, and games. Online advertising is also increasingly relying on Internet-intensive multimedia content (such as animation and full-motion video). Television-related content requires a great deal of Internet space (bandwidth) to travel to our homes. The phone and cable companies want to make sure their video-based content receives preferential treatment. But their control over the pipeline into our home (or mobile device) gives them the leverage to determine how the broadband medium evolves overall.

Big Media Brother Meets Deep Packet Inspection
Now being pitched and sold to cable and phone companies are technologies that enable them to have greater control over Internet "traffic." These network management products enable your phone or cable company to make individual business decisions about all the digital content coming into your home (in the vernacular of the industry, they can set "policy" or business rules that define the quality of service you will receive online). Through what is called "deep packet inspection" they know what kind of content you are accessing online, from email, to websites, to peer-to-peer downloads.

These deep packet inspection technologies are partly designed to make sure that Internet traffic doesn't become so congested it "chokes off" the delivery of timely communications. Such products have already been sold to universities and large businesses that want to manage their Internet services more economically. They are also being used to limit some peer-to-peer downloading, especially for music.

But these products are also being sold as ways companies such as Comcast and Verizon can simply grab greater control over the Internet.

For example, in a series of "white papers" Internet technology giant Cisco warns its cable customers (such as Comcast) that they "risk" allowing their broadband service to become viewed as a "low-priced bulk commodity." [See "Cisco Service Control: A Guide to Sustained Broadband Profitability" or "Deploying Premium Services Using Cisco Service Control Technology" or "Service Control: The Next Step in Networking for Cable Operators"] They are urged to use the Cisco "service control" products so they can create an unlimited number of "advanced billing schemes" for users, all designed to increase cable's "profitability." Among the added benefits, Cisco promises, is "service intelligence," including knowing (in real-time) "the identity and profile of the individual subscriber," "what the subscriber is doing," "where the subscriber resides," and "how the subscriber can use Network resources" (meaning what "service level" they are enrolled in). They will be able to "meter individual subscriber usage by application" as their online travels are "tracked" and "integrated with billing systems." Meanwhile they can begin "prioritizing" applications that bring them money, such as video games and gambling.

Cisco and others (such as Allot Communications) warn cable and phone companies about the need to "limit unprofitable peer-to-peer communications" or even ban them. Among the applications mentioned for such treatment including BitTorrent, Gnuetella, and Kazaa. One can tell a lot about the intended role of these packet-inspection products by their names: "SmartFlow," "NetEnforcer," "NetPure," "NetRedirector," and "IP Control System."

Ironically, some companies offering deep packet inspection technology claim that today's more unfettered use of the Internet is creating "a tragedy of the commons." That the public use of the Internet and "greedy" use of P2P could lead to its "overuse and eventual depletion or destruction," claims a paper from the Sandvine Corporation ["Network Neutrality: A Broadband Wild West?"]. Companies will use the excuse that such invasive technology is required to prohibit "bandwidth hogs" from using too much of the Internet to download illegal movies. Or that it's needed to protect us from new forms of "viruses" and "worms." But these are smokescreens for a power grab of major proportions.

Will Google, Amazon.com and the others fight the plans of the Bells and cable? Ultimately, they are likely to cut a deal. After all, as Cisco notes, content companies and network providers will need to "cooperate with each other to leverage their value proposition." They will be drawn by the ability of cable and phone companies to track "content usage…by subscriber," and where their online services can be "protected from piracy, metered, and appropriately valued."

Digital Destiny

It was former FCC Chairman Michael Powell who permitted phone and cable giants to have greater control over broadband (with the support of then commissioner and now Chairman Kevin Martin). Powell and his GOP majority eliminated long-standing regulatory safeguards requiring phone companies to operate as non-discriminatory networks (technically known as "common carriers"). He refused to require that cable companies, when providing Internet access, also operate in a similar nondiscriminatory manner. As Stanford Professor Larry Lessig has long noted, it was government regulation of the phone lines that helped make the Internet a vibrant and diverse medium.

But now, the phone companies are lobbying Washington to kill off what's left of common carriage. They wish to operate their Internet services as "private" networks. Phone and cable companies claim that the government shouldn't play a role in broadband regulation--that it's an issue just involving a business decision by consumers. If consumers want to pay more to have content, such as a first-run movie or the evening news, delivered to their screens faster than what their neighbors can get, that's between them and their local cable and phone company, they argue.

The Bell and cable companies also have a more sweeping political agenda. Both industries oppose communities having the right to create their own local Internet services (such as the offering of wireless or wi-fi networks). The phone companies (and undoubtedly cable) also want to eliminate the last vestige of local control over the electronic media--the ability of city or county government to impose some terms of service in the form of a "franchise" (such as funding and channels for public access television). The Bells also want to further reduce the ability of the FCC to oversee communications policy generally, permitting it to only "regulate" if they receive a formal complaint (primarily from corporations). They hope that both the FCC and the Congress--through a new Communications Act--will back their proposals (helped undoubtedly by big campaign contributions and revolving-door employment).

The entire structure of the electronic media in the U.S. will ultimately depend on whether we let the Bells and cable determine the country's "digital destiny." In the absence of intense opposition, it's likely most policymakers will treat this issue primarily as a "business" matter. But there's much more at stake. So before there are any policy decisions, we must first have a national debate about how the Internet is to serve the public. Among the issues are ensuring that phone and cable companies operate their Internet services in the public interest--as stewards of a vital medium for free expression. That will require fighting for common carrier safeguards. Everyone must also be given low-cost access. Privacy protections are urgently required, to prevent perpetual data eavesdropping (something made more pressing by both the Bush Administration's domestic spying programming and its request from Google, AOL and others for online information about the public's web search requests). Finally, we must guarantee that a whole host of content be exempt from any commercial fee or "pay-per-use" regime, such as political speech, civic communications, and non-commercial content. In other words, we must ensure the growth of a dynamic digital information commons.

An independent commission of public interest technology experts, funded by foundations, should also publicly examine how the phone and cable industries are making decisions about Internet architecture, to help make sure their networks operate fairly and offer all users sufficient capacity at affordable rates.

Unless they agree to a change of public policy, there should be a move for divestment from Verizon, AT&T, Comcast, Bell South by responsible investment and pension funds. At the very least there should be stockholder resolutions challenging the political position taken by these companies, which have built their fortunes on vast public subsidies--whether they began as monopolies (such as the Baby Bells) or thrived because of access to streets and telephone polls (cable).

It will take the same kind of intensive opposition organized against the FCC's media ownership decision in 2003 if we are to even attempt to thwart what Verizon and others have in store for the Internet. Without such a public outcry, it is likely that many of the Democrats who rallied against further consolidation will be "tamed" by the well-funded lobbying campaigns of the powerful phone and cable industries.

Unless there is action, we will have a wonderful new medium for advertising and entertainment from Big Media companies--but a poor one for democratic discourse, alternative expression, and political dissent.

Jeff Chester is the executive director of the Washington, D.C.-based Center for Digital Democracy. His book, Digital Destiny: New Media and the Future of Democracy, will be published in the fall by The New Press.