New Law Would Let FTC Stop ISPs From Capping Broadband Usage
We've looked at Time Warner Cable's unnecessary, overly greedy attempts to slap meters on broadband usage before, and it's clear to everyone but TWC that metering Internet is bad policy, but now Congressman Eric Massa (D-NY) is setting out to make the practice illegal.
The Broadband Internet Fairness Act would let the FTC smack meter-happy ISPs across the face.
Consumer Affairs writes:
"The Federal Trade Commission Act authorizes the Federal Trade Commission to investigate and remedy consumer pricing practices that it determines to be unfair or anti-competitive, including pricing practices by Internet service providers," the legislation said. "Substantially above-cost pricing has anti-competitive and anti-consumer effects on Internet use, including in particular Internet use for online video delivery."
The bill was crafted with help from media watchdog group Free Press, and Rochester resident Philip Dampier of StopTheCap.Com. Among its provisions:
• Requires ISPs planning to introduce bandwidth caps to submit their plans to the FTC beforehand, as well as hold public hearings and comment opportunities.
• Prohibits metering plans if the plan is found to be discriminatory or has usage terms that are unreasonable.
• Targets ISPs with 2 million subscribers or more.
• Gives the FTC enforcement and penalty power.
"Cable providers want to stifle the internet so they can rake in advertiser dollars by keeping consumers from watching video on the Internet," Massa said. "But so long as Americans can't choose which cable channels they want to pay for, I don't think cable operators should be able to determine consumers' monthly internet usage."
Word has it TWC is responding to the legislation by building a Death Star that would destroy the Congressman's home planet of Alderon.
New Bill Gives FTC Veto Power Over Broadband Caps [Consumer Affairs]
(Photo: The Consumerist)
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Comments:
As long as the FTC can actually keep these rules up to date with the current techonology, I don't see much bad about this right off the bad. They will need to revisit their caps and whatnot every ~5 years or so, I would say, to make sure that we are not stuck in stagnation.
I'm curious what the likelyhood that this gets passed actually is? Considering how easily TWC seems to be bending North Carolina to its will. I'm aware of the fact that 95% of our Congress are professional asshats as well, bought and paid for by a myriad of anti-consumer interests, which could be a problem.
I'd go for allowing metered usage as long as I could get a choose-the-channels-I-want plan from DirecTV. I'm tired of paying for a bazillion God Squad and shopping channels that I don't watch. Just give me my baseball channels, Discovery's channels, TNT and few others. I'll be happy.
I wonder if TWC (and other providers) would simply lower speeds enough across the entire network to that point that watching video would be unbearable.
Again, the biggest problem (especially in the area that I live) is that TWC is the only game in town. If they cap bandwidth, or unilaterally slow bandwidth there isn't much I can do.
We need more options so that the market can be competitive.
Just force the cable cos to let other ISPs use their lines, and the competition that develops will fix the problem all by itself.
I like this bill a alot, I dont love it, but I like it. There is a lot of iffy wording in it that could let them squirm through to still charge us crazy fees or still put a cap of some sort on. I know we are a capatilisitc nation and this to a small degree interferes with that, I say fuck em. They still make billions a year off what people pay and much like I think the RIAA needs to get with the program on music, the ISPs need to get with the program on cable and internet.
Is the loophole in this the 2 million subscriber clause? Because I am willing to bet that each of the ISPs are renationalized sub-companies...and that's an easy way to say, "oh, we don't have 2 million households subscribing!" See, this is TimeWarner Brooklyn West RoadRunner LLC - that side of the street is serviced by TimeWarner Brooklyn East RoadRunner Inc. - we just outsource all of our customer service calls to a larger corporation we've asked to go by a generic RoadRunner Companies Customer Service name...
Alderaan.
I'm surprised that substantial rate hikes wouldn't be subject to regulatory approval either. You know the cable companies are just going to respond by sending prices through the roof.
How exactly is it "anti-competitive" to charge people per amount used, rather than a flat fee regardless of usage?
Will these same regulations apply to anything else? Is it anti-competitive for resturants to charge for individual items of food? Will Congress pass a bill declaring all resturants must be all-you-can-eat buffets?
I'm no fan of the cable companies. In most instances they ARE monopolies. But the idea that there is something *inherently* wrong with "pay as you go" is insane. Most of the people who have a problem with this are, you guessed it, people who use tons of bandwidth and would feel the brunt of the new cost. Many of these people are the same folks who used to complain about cell phone contracts charging you for more minutes than you used.
Good, because telecoms and cable cos need a bit more government manhandling in my opinion. They backed off regulation and what did we get? Stagnant high speed internet rollout (no new coverage), prices that rise about 2x faster than inflation, data caps and throttling.
Eh. Another case of government meddling in private companies. To resolve "monopoly" arguments the government should just set up a public ISP that provides a basic level of service.
@Stephmo: I don't think congress is dumb enough to fall for that one. That's the same trick Sam Walton pulled when he tried to claim that each Wal-Mart was its own small business and therefore he had the right to pay his workers below minimum wage. He didn't win.
@Brian James Schend: That was tried and it failed because the Cable Co's got shifty about what their costs were and they complained that they were losing money.
One of the best options I've heard is to nationalize the lines (socialism: boo!). That way you can pick any provider you want and you're not locked in to a single provider. So all this socialism is bad talk is actually stifiling competition in my view.
...and before you give me the snark of "the US government does everything fine," tell me how easy it is to dispute a bill, get someone to come out, get someone to properly install your cable, etc. We tolerate waiting for someone during a 5-6 hour window and the government is bad? Big cable co's are no better than the government, they just take a lot more of your money.
@smartmuffin: Because the cable companies are trying to tie down bandwidth now, early, before the vast majority of people start figuring out about video and whatnot on the internet. Trying to stamp out the potential for IPTV which is widely availble in MANY other parts of the world. If they can control the bandwidth, they can control the content you receive. If they can it early enough and low enough, they can have these long standing policies in place so 10 or 15 years down the road, no one is actually using the lowest tier bandwidth package.
And it's not like you can make the choice, have you noticed how much more heavy websites have gotten now and days. It's not just links and text, you have flash video, music, tons of high res photos...
TWC is trying to f*ck you proper right now, so in the future they can give it to you REALLY dirty.
Lawmakers are using the Cable TV argument. You are forced to pay for blocks of channels every month irregardless of how many you actually watch.
@dave_coder: the government needs to encourage cities and towns to create their own infrastructure and let outside companies offer services on those lines, that the most fair way...
@WiglyWorm: So you're really not for the free market? Please don't pretend that you are.
What's wrong with a monopoly, anyway?
Can the government please cap iPod prices next since they have a monopoly on the industry? They have a huge SOM, and no real competition to speak of...so who's looking out for me?
I'm sorry, but you don't believe in the market if you like the FTC restricting private industry.
I'm all for this legislation and I hope it doesn't fall short of what it needs to be. The internet has become an essential household service, worthy of utility-type regulation. It is not just a luxury, or something to subscribe to with disposable income. It has largely replaced land line phone service and US Mail (except for package deliveries) and is relied upon for essential communications, banking, news, education and school work, and for access to government services, information and filings. Therefore, access to internet service needs to be readily available to all, at fair and reasonable prices and terms.
@WiglyWorm: You obviously are ignorant of things like lobbyists. Democrats are no less corrupt than Republicans.
@JMB:
The issue is its incumbent upon TWC to build an infrastructure that supports full use of the internet's capabilities with current tech and software. Which means I should be able to use as much bandwidth as I want.
The cable companies did it to themselves- a few years ago, the plan came before the FCC to allow municipalities to "wire" a city and then have cable franchises buy into accessing the common wire-
This means that every new company would not have to lay their own lines. Makes a lot of sense.
Cable Co.s opposed it-- meaning their costs of, say, laying fiberoptics throughout their network to increase bandwidth, got prohibitive.
Had they allowed this, start-ups could buy into the grid and offer cable/internet access and we'd have had real competition.
Here are the easy loopholes:
1) Multiple small ISP's.
2) Not offering "unlimited" access, everything is paying for a certain data cap and data rate.
3) Lowering data rates to create a de facto data cap.
@I Love New Jersey: I was just about to say the bill will be killed/gutted by lobbyists in 3....2....1....
Apple has plenty of competition. Walk into Best Buy, there are at least twenty other MP3 players on the shelf right next to them.
Comcast has NO competition. It is incredibly expensive to create the infrastructure to set up a network, which is why we gave them tax breaks and a monopoly.
There are plenty of things wrong with a monopoly, and if you don't understand that, (or what a monopoly is, apparently) then you need to hit your history books.
@smartmuffin: I think the problem isn't exactly the "pay as you go" it's that they're charging insane rates for the pay as you go service. They've claimed that they'll stop charging once a user's monthly bill reaches $150, but currently, most unlimited internet broadband plans are more like $30 / month. The fact that they were only rolling out this pay as you go pricing in markets where they are a monopoly makes it really obvious that TWC is really just price gouging here.
Great. I really hope this passes. Every ISP in my city implemented the same caps and (higher) rates within a week of each other. There's no competition in a situation like that, and the public loses big time.
Large companies habitually do everything they can to eliminate the "free market" part of capitalism. Legislation like this forces them to compete, which is a situation where everybody wins. I have no problem with government intervention in the economy to stop anti-competitive behavior like these caps.
@Jesse: And doesn't everyone hate that? Wouldn't most people prefer to only pay for the channels they watch?
That's what metered broadband is. Pay for what you use.
The fact that they're "charging too much" for it is a totally separate issue. The fact that they're monopolies is another separate issue (one created by government).
This has been attempted in many towns and cities. The cable companies fought it. They will up and leave a community rather than face competition.
Eric Massa for President!!!
@pgh9fan1: I think you're on to something with the a la carte option. Its not like you have to choose one channel, just better grouping. That way the AMCs of the world can survive, as a part of a drama package (along with crowd friendly TNT).
@dragonfire81: Ehhhh, I think Congress, regardless of the party holding the majority, is dumb enough to fall for ANYTHING like that. Especially when the lobbyists start calling. Besides, America has this love-hate relationship with Wal*Mart that I think helps it in the long run.
@Saboth: Yeah, but from a Public Utilities Commission and Ratepayer Advocates standpoint, NOBODY is ever happy. We don't have Ma Bell anymore because telephone was deregulated. That created its own issues. So now we're slowly REregulating it because there's a public outcry. And, after a few more years, it'll be back to full regulation because it was "demanded" by the rate-paying public. Then they'll demand that it be DEregulated again to allow free enterprise to work its magic. The pendulum keeps swinging from extreme to extreme. Right now, we're in mid-swing. I'm going to just ride it out because I know it will be corrected.
@smartmuffin: My first question is why are they totally seperate issues in your mind? The reason people dont want it is for those exact reasons. If you seperate causation from an arguement anything can sound reasonable, lets take slavery for instance. Take away that they dont get paid, or that they are slaves, and hell you have efficient, extremely cheap labor! But the world doesnt work like that, there are side effects that have to be assessed with the problem at hand.
Metered broadband isnt inherently bad but the side effects that come with it are: stiffling of newer technologies, overcharging, the growth and spreading of an already problematic monopolistic system.
@pgh9fan1: An a la carte option would be a good thing. There are all sorts of channels I don't watch and pay for. It would also be nice to get west coast network feeds, too.
Do you mean "Alderaan," or is there a joke there I'm missing?
@superberg: Yeah, but if they up and left, another company WILL fill that void. There is a profit to be made...there is a demane to be filled, someone will fill that demand. A small, much more manuverable company could come in, offer reasonable prices and still make a very tidy profit.
The profits that TWC requires for an area to be considered profitable and the profits required by a much smaller semi-local company are going to be two entirely different figures.
@JMB: If they slow down the bandwidth that much I can see ISDN making a comeback. That's the only point where I would consider streaming video unbearable.
@Jeremy82465: The point is that TWC has been a monopoly for awhile. Metered broadband doesn't change that. Getting rid of metered broadband won't suddenly make them not be a monopoly anymore.
That's why they're separate issues. One did not cause the other. Whether or not metered broadband exists doesn't have *anything* to do with whether or not TWC is a monopoly. If congress cared about TWC being a monopoly, they could fix that totally independent of anything having to do with metered broadband.
@grapedog:
That's not necessarily true. My parents live are stuck with 3rd rate internet because their only option is MediaCom. Verizon doesn't even offer DSL in their area. Comcast won't touch them.
MediaCom blocks the slingbox my brother had hoped to use while serving in Afghanistan (it wouldn't work out there anyway, but anytime I tested it, the feed stopped after seven minutes). To add insult to injurt, my parents pay something like $70 a month for 6 MB down.
If MediaCom left, they'd be screwed.
I guess the point I was making is that it doesn't make any sense that someone should have to pay for what they don't use when subscribing for cable television but now get to pay for useage when it comes to the internet.
Believe me, I think metered broadband isn't a bad thing, in fact I support it. But cable companies are not being fair across the board with selective a la carte pricing for all their products.
Oh now you're in for it...you misspelled a Star Wars term. Bring on the Geek rage....
What pisses me off is these companies want it both ways. They want to gouge their heaviest users and their rationale is that oh, well it's just this small minority that uses up the most bandwidth. Well then if that's the case, following their logic, shouldn't they be providing equally large credits to the people doing nothing but checking e-mail once a day and consume no bandwidth.
I could go all the way and just say that the Libertarian concept of a true free market is as much a fantasy as Lord of the Rings...
It's nice to have dems in office so this has a chance of passing.
Look, I'm all for the free market, but there's no such thing as a free market when you let certain companies have monopolies and the occasional duopoly. If you are fortunate enough to have no real competition to speak of in your geographical region, then *someone* needs to look out for the consumer, because it sure as hell won't be the business that does it.