First signs of ‘neutrality creep’ at Westminster

What is it about internet commerce that leads some to believe the normal rules of economic regulation should be stood on their head?  First we had Senator Al Franken claiming that the Comcast/NBC merger violated Net Neutrality principles. Now, on this side of the Atlantic, we have Graham Jones MP, arguing that Google’s success as a search engine is squeezing out UK competitors: “British companies are being stifled. Moreover, the Treasury is losing out," according to Jones.  And what does the MP for Hyndburn see as the solution to this grave situation?  A complaint to the OFT, perhaps, or a competition reference to the EU?  No, what we need is a whole new layer of regulation!

“It is time to look beyond network neutrality and consider search neutrality: the principle that search engines should have no editorial policies other than that their results be comprehensive, impartial and based solely on relevance… Without search neutrality rules to constrain Google's competitive advantage, we may be heading toward a bleakly uniform world of Google everything…”

I’m no lobbyist for Google, and they certainly don’t need me to defend their business practices, but I don’t see how the company can be criticised for being good at what it does.  As for global domination, brand pervasiveness is nothing new in the UK: just think Tesco…

Ofcom finally blinks

In an earlier piece, I described how responsibillity for UK broadband policy has bounced between government departments in the 18 months since Digital Britain was published. Throughout this period, the industry regulator has remained essentially silent on the Report’s proposals – even the idea of using public funds to promote broadband deployment.  As Peter Phillips of Ofcom said at the time: ‘Spending public money to build out the broadband network is primarily a question for Government rather than regulators’.

OK, but it’s that word ‘primarily’ that matters here.  While Ofcom might go on pretending that issues such as defining or developing a universal broadband commitment were outside its brief, it was only a matter of time before the hoopla emanating from DCMS and BIS was going to rub up against the core policies of even the most myopic communications regulator – not least Jeremy Hunt’s £830 million strategy to secure ‘Britain’s Superfast Broadband future’.

And so it came to pass that Ed Richards spake at the closing session of the Oxford Media Convention.  And he did issue dire warnings against the creations of government, speaking thus:

“…we must also not forget the Government’s £830 million investment, through the licence fee, where we will be keeping a very close eye to ensure that proposals emanating from that expenditure and the procurement associated with it do not distort competition and do not inadvertently create islands of monopoly, offering short term benefits but with long term costs”.

And it was good.

UK broadband orphaned again?

Is it just me that finds the recent transfer of telecoms policy to DCMS a little depressing?  Perhaps I fret too much about semantics but there’s a bit of a clue in Jeremy Hunt’s job title –‘Secretary of State for Culture, Olympics, Media and Sport’.  That’s a pretty eclectic brief already, and perhaps not a natural home for issues such as the development of the UK’s next generation broadband infrastructure.

There’s some history here. The Digital Britain Report, essentially the Labour government’s roadmap for the UK’s  broadband future, was published in July 2009 by Stephen Carter, then the Under-Secretary of State for Communications, Technology and Broadcasting.  In spite of its strong steer for UK broadband policy, the White Paper was effectively orphaned when Carter subsequently resigned his ministerial position to pursue a career outside government.  Responsibility for delivering the report’s recommendations then fell to Stephen Timms as a minister within BIS - in addition to his existing position as Financial Secretary to the Treasury (a dual role that attracted considerable criticism).

Under the coalition, the broadband mantle was passed to Jeremy Hunt, the incoming Culture Secretary, but BIS (under Vince Cable) has, until recently, been expanding its own role.  Indeed, this joint departmental parentage was formalised when it was announced that BDUK, the government agency tasked with overseeing broadband deployment, would be “reporting to Ed Vaizey (as a joint DCMS & BIS minister)”.  However, as part of the fallout from Vince Cable’s ‘war on Murdoch’ gaffe, Vaizey reverts to being a straightforward DCMS minister.

Oh well, perhaps once the Olympics are out of the way, telecoms policy will stand more chance of getting the attention it deserves…

Garbled messages on the BBC

The Guardian’s reporting of Mark Thompson’s speech yesterday to the Oxford Media Convention appears to be unduly alarmist.  According to the paper, the BBC Director General:

·                ‘says its delivery of content will be undermined if ISPs start charging for [an] online 'fast lane'

·                ‘said the ‘fast lane’ could undermine the BBC's responsibility to ensure its content is available to all licence fee payers over every platform.

·                ‘has warned broadband providers not to introduce charges for delivering the corporation's programmes to homes via the internet’

I’ve read the full speech several times and I can find no evidence that the DG actually said any of those things.  Oh sure, he obviously has some worries about access to content over broadband platforms, and that’s a legitimate concern, but this is expressed in a far less adversarial way than The Guardian piece suggests.  For instance: “Don't assume then that the web itself is naturally immune from the technological and economic forces which could limit quality and … choice”.  Well, no, we don’t.  And, in relation to the dread ‘fast lanes’, Thompson actually has some pretty positive things to say, e.g. “Such premium services are a good idea, could help de-commoditize broadband and make the business case for infrastructure investment”.

But if all this seems to confirm that The Guardian is pursuing its own agenda on Net Neutrality, it has to be admitted that the DG takes a rather unconventional view on the subject:

“…net neutrality does mean that, no matter how many fast lanes there are, the basic internet service…should itself provide a very good, and consistently and fairly delivered, service…[The] objective should be that, once we've achieved universal broadband roll-out, every household…should enjoy a quality service”.

Well, if it’s a matter of motherhood, apple pie and decent broadband, I’m all for it.  By all means, go tell that to BDUK - but it ain’t Net Neutrality!

Promises, promises…

Quite rightly, yesterday’s regulatory approval of the Comcast/NBC merger comes with a lot of strings attached.  Non-discrimination requirements are, of course, ‘meat and potatoes’ for any competent competition regulator but it will be interesting to see how the FCC deals with the ‘soft’ commitments Comcast offered to sweeten the deal. 

For example, in relation to broadband adoption and deployment. Comcast has said:

“it will make available to approximately 2.5 million low income households: (i) high-speed Internet access service for less than $10 per month; (ii) personal computers, netbooks, or other computer equipment at a purchase price below $150; and (iii) an array of digital literacy education opportunities. Comcast will also expand its existing broadband networks to reach approximately 400,000 additional homes, provide broadband Internet access service in six additional rural communities, and provide free video and high-speed Internet service to 600 new anchor institutions, such as schools and libraries, in underserved, low-income areas”.

Now that’s a compliance challenge…

Wounded of Southwark

Ofcom’s latest Annual Plan understandably points out that the organisation is being asked by Government to do more for less money, But the regulator’s wounded pride is writ large in the document, and it does tend to lay it on a bit thick.  For instance:

‘There is still demand from the government for Ofcom to offer its technical and

industry knowledge to provide support on policy issues……. However, given our limited resources we must adopt a rigorous approach to prioritising our work and focusing our efforts where we can make a beneficial change’. 

‘Inevitably, there will be more difficult choices to make in relation to resource priorities than at any point in Ofcom’s history…Ofcom is already delivering its duties with reduced resources that are 27% lower, in real terms on a like-for-like basis, than those of its predecessors’.

OK, we get the message…

Nice sound bites, wrong conclusion

I rather liked The Economist’s end-December opinion piece on the FCC’s handling of Net Neutrality.  The magazine prides itself on the quality of its prose, and this short article didn’t disappoint.  For example, in comparing the arguments for and against neutrality, The Economist offers this:

‘From a consumer’s perspective, both sides are half right. Without some neutrality rules it is unclear how a network operator can be stopped from blocking particular sites or services. But overly prescriptive rules that fossilise the internet in its current form could indeed hamper innovation’.

And, in relation to the FCC’S recent rule-making:

‘..the fact that zealots on both sides are moaning about the new regime finally passed by America’s telecoms regulator on December 21st is on the whole a good sign’.

Where I part company with the editorial is its overall conclusion that ‘the fundamental problem’ in the US is the absence of a wholesale market in internet access.  But that’s a very long story…

The propaganda goes on

I know I shouldn’t but I do get irritated by the amount of disinformation on evolving Net Neutrality policies, particularly in the US.. Whatever else it is, Net Neutrality is a complex challenge, requiring a lot of very careful negotiation between all sides of the argument.  What it doesn’t need is the sort of rabble-rousing rhetoric evidenced this week by Boulder Weekly, a free-paper with some lofty ambitions, e.g.

“As Boulder County's only independently owned newspaper, Boulder Weekly is dedicated to illuminating truth, advancing justice and protecting the First Amendment through ethical, no-holds-barred journalism and thought-provoking opinion writing”. 

It was disappointing, therefore, that this champion of impartial journalism should allow the following nonsense to appear in its pages today:

“On Dec. 21, the FCC passed new rules — written by corporations — that will end net neutrality.  For the first time in history, the U.S. government approved corporate censorship of the Internet, putting the future of online free speech at risk….”

Tha author, Jason Rosenbaum, is evidently a fan of Senator Al Franken – whose views on Net Neutrality I have criticised previously.  Sadly, the debate remains ill-informed: I must try harder!

Oops, was that the playing field tilting?

The Ofcom announcement today on re-farming of 2G spectrum was very bright and breezy.  A good news story for broadband customers, certainly, but some of Ofcom’s ‘stakeholders’ might have expected the Regulator to spend at least a little time considering the market implications of this late Christmas gift to the mobile incumbents – particularly their access to valuable sub-1GHz spectrum. Apparently not: it seems that the Government – in the form of Ed Vaizey – has said it will all be OK.  I quote.

“The Government has explained that it has undertaken the competition assessment in relation to 900 MHz spectrum that is required by the amended GSM Directive - See for example letter from Ed Vaizey (Minister for Culture, Communications and Creative Industries) to Adrian Bailey MP (Business Innovation and Skills Committee) 27 July 2010.  Ofcom does not consider that it is required to carry out and consult on a separate competition assessment before varying the 900MHz and 1800MHz licences”.

Persuaded?  I’m pretty sure some folks in Maidenhead won’t be.

Infrastructure lives!

If you’re ever tempted to think that modern telecoms is really just about software smoke and mirrors, I recommend that you give a thought to submarine cables.  The latest of these, The Europe India Gateway (EIG) cable, is due to be completed this summer at a cost of over £450m.

According to today's Times, the new cable will enable data speeds of up to 100 gigabits per second between London and Mumbai, 200,000 times faster than its 1980s’ predecessor.   But even more impressive is the fact that the deployment, requiring 6 ships and 9,000 miles of cable, has had to contend with pirates, mines off the coast of Libya and attacks from hungry sharks (who apparently mistake the cable’s electromagnetic fields for those given out by distressed fish).

Who said romance was dead…?