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Cable Ties Itself Up in Net Neutrality Knots Posted by Jake on Thu Oct 05, 2006 at 09:43:41

It's Our Net Coalition member Art Brodsky writes that the anti-Net Neutrality alliance between the giant telephone companies and their almost as huge cable company partners is starting to fray around the coaxial cable. It seems the cable companies think that the telephone companies put them at a disadvantage. And yet they fail to see the irony of their own Net Neutrality stance. It's hard to know who to root for on this one. Here is Art's take:

Cable has now joined the telephone industry in hanging itself up on Net Neutrality issues. Back in March, it was Verizon which got its fiber in a twist when it filed a complaint under program-access rules with the Federal Communications Commission (FCC) that Cablevision wasn’t allowing Verizon access to content for its fiber network.

Now, five leading cable companies and their trade association have got their coax in a knot over the issue of their Internet telephony services being at a disadvantage when AT&T; combined with BellSouth.

What’s as outrageous as the cable complaints, filed with the FCC in the AT&T;/BellSouth merger, is the attempt by National Cable & Telecommunications Association (NCTA) President Kyle McSlarrow to draw a distinction between what his industry wants out of the deal and the overall idea of Net Neutrality. It’s a distinction without a difference.

The five companies, Advance, Charter, Cablevision, Cox and Insight, told the Commission in a Sept. 27 filing their Voice over IP services are at risk because of what the telephone companies might do to thwart competition. The filing noted: “In the head-to-head competition with cable, the ILECs (incumbent local exchange carriers, aka telephone companies), have a powerful weapon – their ability to discriminate against cable’s voice service by imposing unreasonable, costly interconnection requirements. This is clearly the case with AT&T.;”

This merger, the cable companies said, “will increase AT&T;’s incentives and ability to wield its market power over interconnection against its cable competitions. AT&T; has the incentive and ability to discriminate against cable’s voice service to retain its own customers.” The companies want the Commission to impose detailed conditions on the merger which govern interconnection, traffic flow and the like.

There is a certain logic to their argument. After all, everyone is in favor of equal competition. Certainly the competitive carriers, not including cable, have been making that case for months.

However, sympathy only goes so far when one also factors in that the cable companies which so fervently want equal competition for themselves against telephone companies aren’t so keen on it when competing with companies like Vonage.

Tom Rutledge, the Cablevision COO famously told a Wall Street conference in June, contrasting his VoIP service with Vonage: “And our service is better, its quality of service. We actually prioritize the bits so that the voice product is a better product.”

The sympathy meter drops a few more notches when the cable industry further declines to realize that the “incentive and ability to discriminate” principle they oppose on the part of the telephone companies is the same principle at the heart of Net Neutrality.

Here is what McSlarrow said in a news release on cable’s accomplishments, issued the same day that the companies filed their anti-discrimination arguments with the FCC:

The cable companies want the FCC to allow them to pick their “technically feasible points of interconnection.” The cable companies want the FCC to mandate the billing arrangements between carriers. The cable companies want the FCC to set the number of interconnection agreements per state and the length of time those agreements are in force. And there are more such requests that get into the minutiae of interconnection. In principle, there might not be anything wrong with making those arguments.

In March, we said Verizon certainly has the right to complain about access to Rainbow’s programming, but that it was extremely curious that Verizon, by opposing an enforceable net neutrality law, would not grant the same rights to others to gain access to its broadband system. Verizon appears to favor government rules to enforce competition to benefit Verizon, but not when others could benefit. (The complaint is still pending.)

The same idea now applies to cable. It is supremely hypocritical that at the same time the cable industry wants interconnection rules, it criticizes Net Neutrality as “two-steps back regulation.” It is not, and it is certainly not when contrasted with the detailed micro-management cable seeks from the Commission. Net Neutrality embodies the same anti-discrimination principles on which cable relies for its situational-ethics analysis of interconnection and competition. Those principles operate to the benefit of everyone. To some, like cable, that’s a bad outcome to be avoided. To almost everyone else (telephone companies excepted), it is a goal to be realized.