How AT&T Is Planning to Rob Americans of an Open Public Telco Network
By S. Derek Turner
Wired.com
02.28.13 6:30 AM
http://www.wired.com/opinion/2013/02/the-latest-sneaky-plan-to-rob-americans-of-a-public-telco-network/
AT&T has a sneaky plan.
It wants to exploit a loophole in the Federal Communications Commission
(FCC)’s rules to kill what remains of the public telecommunications
network — and all of the consumer protections that go with it. It’s the
final step in AT&T’s decade-long effort to end all telecommunications
regulation, and the simplicity of the plan highlights a dysfunction
unique to the American regulatory system.
AT&T and other big telecom carriers want to replace the portions of
their networks that still use circuit-switching technology with
equipment that uses Internet Protocol (IP) to route voice and data
traffic. But because the FCC previously decided that it has no direct
authority over communications networks that use IP, this otherwise
routine technological upgrade could lead to a state of total deregulation.
We are already living with the consequences of the FCC IP decision: an
uncompetitive broadband market. Our broadband providers enjoy the kinds
of high profit margins that would make a 19th-century robber baron
blush. And our ability to use these networks to communicate openly and
freely is under constant assault. Meanwhile, consumers in other
countries not only have better access, but they pay far less for far
better services.
But there are large portions of the public telecom network that don’t
use IP, and that are still subject to varying degrees of regulatory
oversight — including traditional landlines, alarm circuits, and many of
the “special access” connections that carry voice and data traffic from
cellular towers.
Now AT&T wants approval to convert all of this to an all-IP system. And
because of the FCC’s flawed view of IP, this move would jettison all of
the public interest protections that govern common carriers like AT&T.
(The centuries-old “common carriage” concept applied to entities like
railroads, shippers, and telecoms that transport goods often using
public rights-of-way; since these functions are critical to commerce,
common carriers are usually regulated even if they don’t operate in
monopoly markets).
The immediate consumer impact of AT&T’s proposal would be swift and severe:
Higher prices. Remember what happened after California partially
deregulated AT&T in 2006? The price of some basic voice services
tripled. AT&T wants to make this happen everywhere. Also, the ability of
many smaller wireless carriers to offer competitively priced services is
based on specific regulations that prevent special access providers like
AT&T and Verizon from charging exorbitant rates. These protections
against monopoly prices will disappear if AT&T gets its way.
Service disruptions. Brinksmanship between AT&T and smaller wireless
carriers that use the public network to transport their own traffic
would lead to telecom blackouts. Just look at how cable customers are
held hostage in carriage spats between cable providers and content
owners. The rules that require carriers to get networks back online
after outages would also be history if the FCC approves AT&T’s petition.
Inequality and discrimination. Seniors, low-income families, and rural
residents — all of whom are more likely to rely on fixed-line voice
services or dial-up internet access — would especially feel the pinch.
Carriers that are now required to offer universal service will be free
to redline poor neighborhoods and disconnect consumers at will. Elderly
grandmothers living on fixed incomes rely on rate-regulated landlines to
stay connected, but they need not worry: AT&T has an expensive wireless
plan they can purchase instead.
It’s bad enough that we’re on the verge of losing all of the consumer
protections that keep the price of basic voice service reasonable and
ensure the most vulnerable stay connected. But by putting the last nail
in the coffin of the public telecommunications network, AT&T’s plan
poses an even greater threat to the future of American innovation and
internet freedom.
This is because the internet itself would not exist if it were not for a
delicate balance of public policies that made sure the public
telecommunications network was an open platform: Anyone could use it as
a building block for innovation.
Before the FCC adopted rules to keep the public network open, companies
like AT&T were able to prohibit customers from using the network for
anything other than what it approved. (We wouldn’t have been allowed to
have answering machines, for example, if AT&T didn’t approve them.)
Thanks to the FCC’s intervention then and continuing oversight, Bob Kahn
and Vint Cerf didn’t need AT&T’s permission to connect computers. They
simply used the public network as a platform to launch the IP technology
that led to the internet we all use today.
When Congress updated the Communications Act in 1996, lawmakers
reinforced this clear separation between devices on the edges of
networks and the wires that connect them. And this approach worked:
Consumers had choices for cheap long distance. There were dozens of
dial-up ISPs, and even multiple options for DSL and cable modem service.
Prices dropped, quality improved, and investment soared.
While the rest of the world followed this American blueprint to great
success, our captive regulators dismantled the competitive framework,
replacing it with nothing more than the vain hope the market would sort
it all out. So it should come as no surprise that the rest of the world
is busy undertaking its own transition to all-IP networks without
threatening the basic consumer protections that ensure universal access
to essential communications services.
We stand at the edge of a cliff, and AT&T is eager to jump. It’s the
FCC’s own bad decisions that led us to this cliff. But it’s not too late
to step back. In updating its rules for an all-IP world, the FCC
shouldn’t let the carriers kill off the public telecom network. We can
protect consumer rights and free-market commerce without sacrificing the
infrastructure’s open nature and its potential as a platform for innovation.
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S. Derek Turner
A telecommunications policy expert, S. Derek Turner is the research
director at Free Press, a nonpartisan organization advocating for
universal and affordable internet access, diverse media ownership, and
vibrant public media. It officially opposes AT&T’s petition to the FCC.
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George Antunes Voice (713) 743-3923
Associate Professor Fax (713) 743-3927
Political Science Mail: antunes at uh dot edu
University of Houston
Houston, TX 77204-3011
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