All Things Digital

As predictable as day following night, litigation has followed the Federal Communication Commission’s sanctions against Comcast. In a long-expected action, Comcast sued the commission today, claiming the FCC had no legal grounds on which to punish it for throttling file-sharing traffic on its network, as David Cohen, Comcast’s executive vice president, explained in a statement:

We filed this appeal in order to protect our legal rights and to challenge the basis on which the Commission found that Comcast violated federal policy in the absence of pre-existing legally enforceable standards or rules. We continue to recognize that the Commission has jurisdiction over Internet service providers and may regulate them in appropriate circumstances and in accordance with appropriate procedures. However, we are compelled to appeal because we strongly believe that, in this particular case, the Commission’s action was legally inappropriate and its findings were not justified by the record.”

As legally inappropriate and unjustifiable as Comcast (CMCSA) might find it, the cable company will abide by the FCC’s order during the appeal. And it will forge ahead with plans to develop more net neutrality-friendly network management techniques by the end of the year. Said Cohen, “We will follow through on our longstanding commitment to transition to protocol-agnostic network congestion management practices by the end of this year. We also remain committed to bringing our customers a superior Internet experience.”

Superior Internet experience until you hit that 250GB broadband cap, that is.

A tough act to follow, last year’s D: All Things Digital 5. How do you best, or even match, a 75-minute joint interview with Microsoft (MSFT) Chairman Bill Gates and Apple (AAPL) CEO Steve Jobs–a history-making history lesson taught by two principal protagonists of tech’s narrative? Summon Thomas Edison, Nikola Tesla and George Westinghouse from the dead to reminisce about the “War of Currents”?

No. Better to let history make itself, as it always has, and focus on making news. And it’s likely there will be quite a bit of it coming out of D: All Things Digital 6. With this year’s lineup, how could there not? Microsoft’s Bill Gates and CEO Steve Ballmer onstage together just a month before Gates steps back from his day-to-day duties as company chairman. Time Warner (TWX) CEO Jeff Bewkes talking strategy as the media giant prepares to spin off Time Warner Cable and tries to figure out just what the hell to do with AOL. Lowell McAdam of Verizon Wireless (VZ) and FCC Chaiman Kevin Martin appearing separately, but together offering an insider view of the telecom industry as it grapples with issues of Net neutrality, open access and early termination fees. And then there’s Yahoo’s (YHOO) Jerry Yang and Sue Decker, who’ve been struggling to right a foundering Internet pioneer as it battles Google (GOOG), Microsoft, investor-agitator Carl Icahn and itself.

And that’s just a sampling. Clearly, there’s much to talk about. Much news to be made.

Sure, we may not have managed to arrange another tete-a-tete as historic as last year’s Gates/Jobs interview.

But we did manage to get Microsoft CEO Steve Ballmer and Yahoo Co-Founder Jerry Yang on the same stage–albeit at different times. Still, no easy feat, that.

And who knows, perhaps we’ll get them onstage together as well.

So join us at d6.allthingsd.com tomorrow for as-it-happens, all-access coverage of the conference. Liveblogs of the sessions and demos. Videos of the speakers. Photos of attendees. You’ll find it all here.

(Photo illustration by Beth Callaghan)

It’s quite a road-to-Damascus conversion Comcast (CMCSA) is having these days, isn’t it?

Back in February the cable company claimed it was perfectly reasonable for it to throttle or degrade the performance of peer-to-peer file-sharing services on its broadband network. But when Federal Communications Commission Chairman Kevin Martin suggested the agency was mulling action against it, Comcast had a moment of clarity. In March, it said it would work with BitTorrent to develop P2P-friendly network capacity-management techniques. And today it announced plans for an industry-wide effort to create a “P2P Bill of Rights and Responsibilities.”

The document–which is to be created with the help of other Internet service providers, P2P companies and content providers–would specify how ISPs should manage P2P applications running on their networks and how consumers should use them. Said Tony Werner, Comcast Cable’s Chief Technology Officer, “By having this framework in place, we will help P2P companies, ISPs and content owners find common ground to support consumers who want to use P2P applications to deliver legal content.”

And by announcing its plans to create this framework right before the FCC hearing on its P2P-throttling techniques to be held at Stanford (in Palo Alto, Calif.) Thursday, Comcast is hoping the agency won’t take action against it for violating its Net neutrality rules.

The Federal Communications Commission isn’t buying Comcast’s (CMCSA) argument that throttling or degrading the performance of the peer-to-peer file-sharing service BitTorrent on its broadband network is a necessary traffic-management technique.

Speaking at the Stanford Law School Center for Internet and Society, FCC Chairman Kevin Martin said he’s considering taking action against the cable operator for violating the agency’s network-neutrality principles. Seems Martin was troubled by Comcast’s dissembling around the BitTorrent issue, not to mention its efforts to pack an FCC hearing on Net neutrality with its own employees.

“A hallmark of what should be seen as a reasonable business practice is certainly whether or not the people engaging in that practice are willing to describe it publicly,” said Martin, adding that the incident offered the commission a good opportunity to establish a precedent for future cases of this kind. “I have said in the past the commission is ready, willing and able to take action on individual complaints,” he said. “I think that is what we are going to end up doing, and I think that will end up setting an important precedent going forward: that we are willing to address individual complaints when they come in.”

We compete with Comcast with delivery of content over the Internet. What we have here is a horse race and in this contest, Comcast owns the race track, in fact, the only track in town. They also own a horse. We are being told they are only slowing down our horse by a few seconds.”

–Gilles BianRosa, CEO of video provider Vuze

The network-management hearing at Harvard University this morning is turning out to be something of a comcastrophe for Comcast (CMCSA). Called before the Federal Communications Commission today to explain why it has been “throttling” or limiting BitTorrent traffic on its network, Comcast was criticized out of the gate for the practice.

Seems some folks don’t buy the company’s claim that throttling is necessary to prevent file-sharing traffic from consuming too much bandwidth. And others–specifically, advocates of Net neutrality–feel it’s outright discriminatory. “The Internet is as much mine and yours as it is Verizon’s and AT&T’s and Comcast’s,” said U.S. Rep. Edward Markey (D-Mass.) in his opening remarks to the commission. “The commission should be wary of the need of a significant network management position. Perhaps if we had competition, this wouldn’t be such an issue.”Such intercession into a user’s access to the Internet should not result in … the transformation of BitTorrent into BitTrickle. That’s a problematic result … whether it is purposeful or purely circumstantial.”

Comcast, for its part, insists results like those described by Markey aren’t problematic at all, but necessary. The company must “shape” file-sharing traffic to ease the strain on its network. “Independent research has shown that it takes as few as 15 active BitTorrent users uploading content in a particular geographic area to create congestion sufficient to degrade the experience of the hundreds of other users in that area,” David L. Cohen, an executive vice president of Comcast, explained in written testimony. “Bandwidth-intensive activities not only degrade other less-intense uses, but also significantly interfere with thousands of Internet companies’ businesses. Far from managing our network in a discriminatory way to benefit our own offerings–other than managing our network to make our high-speed Internet service faster and better–our limited network-management practices ensure that everyone else’s applications and services, even those that may compete with our services and use P2P protocols, work.”

In 2010, it could take as long as two minutes to download an episode of “Chad Vader–Day Shift Manager” from YouTube, instead of the few seconds it takes today. This according to a new study from Nemertes Research Group, which claims that the Internet could be approaching its capacity. “Our findings indicate that core fiber and switching/routing resources will scale nicely to support virtually any conceivable user demand,” Nemertes explains in “The Internet Singularity, Delayed: Why Limits in Internet Capacity Will Stifle Innovation on the Web.” “But Internet access infrastructure, specifically in North America, will cease to be adequate for supporting demand within the next three to five years.”

And what does that mean in lay terms? “Users will experience a slow, subtle degradation, so it’s back to the bad old days of dial-up,” said Nemertes President Johna Till Johnson. “The cool stuff that you’ll want to do will be such a pain in the rear that you won’t do it.”

To avoid such a scenario, Nemertes says backbone providers need to invest up to $137 billion in Internet infrastructure capacity–more than double what they’d planned. If they fail to do so, we may see that slow degradation to which Johnson referred and a stifling of innovation. “It’s important to stress that failing to make that investment will not cause the Internet to collapse,” Nemertes explains in its paper. “Instead, the primary impact of the lack of investment will be to throttle innovation–both the technical innovation that leads to increasingly newer and better applications, and the business innovation that relies on those technical innovations and applications to generate value. The next Google, YouTube or Amazon might not arise, not because of a lack of demand, but due to an inability to fulfill that demand. Rather like osteoporosis, the underinvestment in infrastructure will painlessly and invisibly leach competitiveness out of the economy.”

Nemertes’s last point about underinvestment in infrastructure is one worth noting. Because in the run-up to the Telecommunications Act of 1996 the incumbent telecoms promised to provide fiber-optic connections to millions of households across the country. In exchange, they were given some $200 billion in tax cuts and higher service rates to pay for it. But the telecoms didn’t spend that money on fiber upgrades–they spent it on long distance, wireless and inferior DSL services. “By 2005, if the Bell companies had actually delivered on their broadband promises, approximately 86 million households would have had fiber-optic-based services,” Bruce Kushnick, executive director of New Networks Institute, explains in “The $200 Billion Broadband Scandal.” “These state commitments also would have rewired schools and libraries, hospitals and government offices. And in most states, the plan called for ALL customers to be rewired equally, whether they were in rural or urban areas, rich or poor. Universal broadband was to be accomplished state-by-state because customers were, in essence, de facto investors funding these network upgrades.”

Something to think about when the Nemertes’s study begins popping up in telecom arguments against Net neutrality, as it almost certainly will.

If Google’s mission is to organize the world’s information and make it universally accessible and useful, then Democratic presidential candidate Barack Obama’s is to do the same to its tech-policy issues.

Obama made the now obligatory pilgrimage yesterday to Google headquarters, where he unveiled a high-tech agenda that might just as easily have been written by Google’s director of public policy and government affairs as by Obama’s campaign office.

Promising to use technology to bring openness and transparency to American democracy after seven years of “one of the most secretive administrations in our history,” Obama laid out a detailed package of technology policies designed to provide more Web accessibility to government records, strengthen online privacy, free up wireless spectrum, put high-speed broadband within reach of all Americans, reform the patent system and maintain network neutrality. “I will take a backseat to no one in my commitment to network neutrality,” Obama said in prepared remarks. “Because once providers start to privilege some applications or Web sites over others, then the smaller voices get squeezed out, and we all lose. The Internet is perhaps the most open network in history. We have to keep it that way.”

Impressive, yeah? But does Obama have the sort of experience needed to implement that sort of broad-reaching Silicon Valley policy wish list? Asked just this question by a Google employee, Obama replied: “Sergey and Larry didn’t have a lot of experience starting this Fortune 100 company. I suppose when they came in and started talking to [Google General Counsel] Dave Drummond about starting a company, he could have said, ‘They don’t know what they’re doing.’”

Who better than AT&T to filter the Internet for widespread copyright infringement? After all, the company has a fair bit of experience with just this sort of thing, having aided and abetted the National Security Agency in its warrantless domestic-surveillance efforts.

Anyway, together with NBC and Disney, AT&T has invested a combined $10 million in Vobile, a company whose VideoDNA is rumored to be the gold standard of video content recognition systems and is considering deploying it at the network level.

The mechanics of the initiative haven’t all been sorted out, but sources tell BusinessWeek that one scenario involves traffic on AT&T’s network being routed through racks of Vobile servers that would scan it for NBC Universal and Disney content. And perhaps child pornography as well, you know, just to make the idea of network-level monitoring a bit more palatable to the masses.

Such a strategy, if AT&T were to pursue it, would make the company the first major Internet carrier to implement a network solution to copyright enforcement. And it would beg a number of questions: Will AT&T police the Internet traffic of its customers alone? Or will it police traffic over all its backbones and peering points (IE: traffic from other ISPs)? The answers could be troubling.

Suffice to say privacy advocates who’ve been railing against AT&T over the NSA debacle and issues of Net neutrality aren’t exactly thrilled with the company’s latest move. “They better be very careful,” warned Lee Tien, a staff attorney with the Electronic Frontier Foundation. “This is serious, serious stuff, to basically invade the privacy of all of your subscribers.”

Verizon’s Advanced Web Search service was, in the words of the company, “designed to help you quickly find the destination Web site you were seeking.” But apparently that’s true only if the destination site you’re seeking happens to be Verizon’s own search-engine page.

Some subscribers to the company’s FiOS fiber-optic Internet service are finding themselves redirected to Verizon’s own advertising-laden search-engine page when they mistype a URL or query a nonexistent Internet site–even if Verizon’s search isn’t set as their default. Verizon says it’s only trying to help, and to be fair, it does offer subscribers–who never “opted in” in the first place– the chance to opt out by changing the DNS settings in their routers.

Still, it’s all a bit too reminiscent of VeriSign’s Site Finder, a service that hijacked people who misspelled domain names and sent them to a Web directory full of advertising. Which, given the hue and cry over Net neutrality, isn’t the sort of memory you want to be conjuring up as a major telecom provider.

If you didn’t know any better, you might think that the U.S. Justice Department’s ex parte filing on Net neutrality was intended as a synopsis of AT&T’s filing on the same subject, such are the similarities between the two.

In comments delivered to the Federal Communications Commission yesterday, the Justice Department’s Antitrust Division warned that imposing Net neutrality regulations could hamper development of the Internet and prevent service providers from upgrading or expanding their networks. “Precluding broadband providers from charging content and application providers directly for faster or more reliable service could shift the entire burden of implementing costly network expansions and improvements onto consumers,” the agency said in its filing. “If the average consumer is unwilling or unable to pay more for broadband Internet access, the result could be to reduce or delay critical network expansion and improvement.”

And, in the end, creating different tiers of Internet service is really no different than the Postal Service charging different rates for shipping varying classes of mail. “The United States Postal Service, for example, allows consumers to send packages with a variety of different delivery guarantees and speeds, from bulk mail to overnight delivery,” the agency explained. “These differentiated products respond to market demand and expand consumer choice. No one challenges the benefits to society of these differentiated products; nor does anyone seriously propose that the United States Postal Service be banned from charging different fees for next-day delivery than for bulk mailers.”

Right. And like BellSouth CTO William Smith has been saying for years now, providing Internet service is the shipping business of the digital age.

Internet advocacy groups were predictably peeved by the Justice Department’s filing. “It is at odds with reality for a Justice Department that approved the largest telecommunications merger in history with a mere press release to now claim that market forces and antitrust enforcement will be able to protect the free and open Internet,” said Gigi Sohn, president of Public Knowledge. “Perhaps the DoJ does not recall that there is very little in the way of market forces to protect consumers. Perhaps the department has forgotten that many consumers have little or no choice at all for their high-speed broadband services. A more vigorous antitrust analysis would have recognized there is a market failure and would have resulted in conditions on the AT&T takeover of BellSouth that would have benefited consumers and Internet companies.”