Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age (47 page)

37.
Parsons,
Blue Skies
, 578.

38.
“Competition in the Telecommunications Industry: Hearings Before the Subcomm. on Communications of the H. Comm. on Interstate and Foreign Commerce,”
94th Cong., 2d Sess. 23 (1976) (Testimony of John DeButts).

39.
Parsons,
Blue Skies
, 432–33.

40.
“The American Telephone & Telegraph network is the most important communication network we have to service our strategic systems in this country … it seems to me essential that we keep together this one communications network we now have, and have to rely on” (
Department of Defense Supplemental Authorization Act: Hearing on S.
694
Before the S. Comm. on Armed Services
, 97th Congress 1 [1981] [Statement of Caspar Weinberger, Sec. of Def.]). “The Department of Commerce also lined up solidly in support of Defense's campaign to have the case dropped. Secretary Baldrige … wanted a legislative, not a judicial, solution of the telecommunications problem, and Baldrige felt that the presence of the case inhibited congressional action” (Peter Temin, with Louis Galambos,
The Fall of the Bell System: A Study in Prices and Politics
[New York: Cambridge University Press, 1987], 227).

41.
Representative Ed Markey, interview with the author, January 2011.

42.
United States v. AT&T Co.
, 552 F. Supp. 131 (D.D.C. 1982), aff'd mem. sub nom.
Maryland v. United States
, 460 U.S. 1001 (1983). See also Parsons,
Blue Skies
, 433–34.

43.
Joseph D. Kearney, “From the Fall of the Bell System to the Telecommunications Act: Regulation of Telecommunications Under Judge Greene,”
Hastings Law Journal
50 (Aug. 1999): 1395–1418.

44.
Markey, interview with the author, January 2011; James C. Goodale and Rob Frieden,
All About Cable and Broadband
(New York: Law Journal Press, 2006), 116–17. Judge Greene's opinion was decided in 1991 and affirmed by the Court of Appeals in 1993:
United States v. Western Electric Co.
, 767 F. Supp 308 (D.D.C.), affirmed by
United States v. Western Electric Co.
, 993 F.2d 1572 (D.C. Cir. 1993).

45.
Parsons,
Blue Skies
632; H.R. 3626, 103rd Cong. (1994).

46.
Parsons,
Blue Skies
632–33; Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (1996).

47.
Parsons,
Blue Skies
633–35.

48.
Federal Communications Commission, “Implementation of Sections 11 and 13 of the Cable Television Consumer Protection and Competition Act of 1992,”
Second Report and Order
, 8 F.C.C.R. 8565 (Oct. 23, 1993).

49.
Parsons,
Blue Skies
643–47, 687–89.

50.
Mark D. Schneider and Marc A. Goldman, “The USTA Decisions and the Rise and Fall of Telephone Competition,”
Communications Lawyer
22 (Summer 2004).

51.
Parsons,
Blue Skies
, 688–89; Final Transcript, T-Q1 2006 AT&T Conference Call, Thomson Street Events, April 25, 2006, available at
http://seekingalpha.com/article/9502-at-t-inc-q1-2006-earnings-conference-call-transcript-t
.

52.
Federal Communications Commission, “Chairman Michael K. Powell Launches FCC University,” news release, August 15, 2002.

53.
Declan McCullagh, “Newsmaker: The Technologist Who Has Michael Powell's Ear,”
CNET News
, September 30, 2004,
http://news.cnet.com/The-technologist-who-has-Michael-Powells-ear/2008-1033_3-5388746.html
.

54.
Michael K. Powell, “Digital Broadband Migration, Part II,” remarks delivered at Federal Communications Commission Press Conference, October 23, 2001, available at
http://transition.fcc.gov/Speeches/Powell/2001/spmkp109.html
.

55.
Michael K. Powell, “The Great Digital Broadband Migration,” remarks delivered before the Progress & Freedom Foundation, Washington, D.C., December 8, 2000; Powell, “Before Cellular,” remarks delivered before the Telecommunications Internet Association's CTIA Wireless, 2001, Las Vegas, Nev., March 20, 2001; Powell, “Q & A with Chairman Powell,” Forrester Research Telecom Forum, Washington, D.C., May 21, 2001; Powell, Remarks delivered to the National Cable Television Association, Washington, D.C., June 12, 2001. Powell's speeches are available at
http://transition.fcc.gov/commissioners/previous/powell/speeches.html
.

56.
Marguerite Reardon, “With Internet TV, Cable Wins Even if It Loses,”
CNET News
, October 29, 2010,
http://news.cnet.com/8301-30686_3-20021118-266.html
.

57.
Parsons,
Blue Skies
, 656.

58.
National Cable & Telecommunications Association to Hon. Julius Genachowski, Re:
Preserving the Open Internet
, GN Docket No. 09-191;
Broadband Industry Practices
, WC Docket No. 07-52;
A National Broadband Plan for Our Future
, GN Docket No. 09-51, February 22, 2010.

59.
Michael K. Powell, “Addressing Academic and Telecom Industry Leaders at University of California (UCSD),” remarks delivered at the University of California, San Diego, December 9, 2003), available at
http://www.fcc.gov/realaudio/ch120903.ram
.

60.
Parsons,
Blue Skies
, 288;
Final Report and Order
, 21 F.C.C.2d 307, reconsidered in part, 22 F.C.C.2d 746 (1970), aff'd sub nom,
General Telephone Co. S.W. v. United States
,
449 F.2d 846 (5th Cir. 1971);
Second Computer Inquiry
, 77 F.C.C.2d 384 (1980), aff'd sub nom,
Computer & Communications Industries Association v. FCC
, 693 F.2d 198 (D.C. Cir. 1982).

61.
Parsons,
Blue Skies
, 433–34. The telecommunications service/information service dichotomy in the 1996 act largely codifies the preexisting regulatory distinction that the Commission had drawn between “basic” common-carrier communications services and “enhanced services.” See Jason Oxman, “The FCC and the Unregulation of the Internet,” Federal Communications Commission Office of Plans and Policy, July 1999, and Earl W. Comstock and John W. Butler, “Access Denied: The FCC's Failure to Implement Open Access to Cable as Required by the Communications Act,”
CommLaw Conspectus
8 (Winter, 2000): 10–12.

62.
Brand X Internet Services v. F.C.C.
, 345 F.3d 1120, 1127 (9th Cir. 2003) rev'd and remanded sub nom,
Nat'l Cable & Telecommunications Ass'n v. Brand X Internet Services
, 545 U.S. 967 (2005).

63.
In Re Inquiry Concerning High-Speed Access to Internet over Cable & Other Facilities
, 17 F.C.C.R. 4798, 4800 (2002).

64.
Nat'l Cable & Telecommunications Ass'n v. Brand X Internet Services
, 545 U.S. 967, 979, (2005) (Scalia, J., dissenting).

65.
In the Matters of Appropriate Framework for Broadband Access to the Internet over Wireline Facilities Universal Serv. Obligations of Broadband Providers, et al.
, 20 F.C.C.R. 14853 (2005).

66.
Mark Thompson, “Questionable Future Looms for Common Carriage Regulations,”
OJR: The Online Journalism Review
, December 2, 2004,
http://www.ojr.org/ojr/stories/041202thompson/
.

67.
Michael K. Powell, “Preserving Internet Freedom: Guiding Principles for the Industry,” Silicon Flatirons Symposium,
The Digital Broadband Migration: Toward a Regulatory Regime for the Internet Age
, University of Colorado School of Law, Boulder, February 8, 2004, available at
http://hraunfoss.fcc.gov/edocs_/files/06/15/76/f061576/public/attachmatch/DOC-243556A1.pdf
.

68.
Statement of FCC Chairman Kevin J. Martin, “Comments on Commission Policy Statement,” FCC news release, August 5, 2005 (“While policy statements do not establish rules nor are they enforceable documents, today's statement does reflect core beliefs that each member of this Commission holds regarding how broadband internet access should function.”); Statement of Commissioner Michael J. Copps, August 5, 2005 (“While I would have preferred a rule that we could use to bring enforcement action, this is a critical step.”).

69.
“We respect the leadership of Commissioner Copps and others in attempting to promote the principle of open networks in the Commission's policy statement today, but we also believe consumers and the market would have benefited if the FCC had included an openness requirement in the order itself,” (news release cited in “FCC Allows Telcos to Close DSL,”
In the Know, Public Knowledge
, August 24, 2005,
http://www.publicknowledge.org/news/intheknow/itk-20050824
).

70.
Peter Eckersley, Fred von Lohmann, and Seth Schoen, “Packet Forgery by ISPs: A Report on the Comcast Affair,” Electronic Frontier Foundation, last modified November 28, 2007,
https://www.eff.org/wp/packet-forgery-isps-report-comcast-affair
.

71.
Peter Svensson, “Comcast Blocks Some Internet Traffic: Tests Confirm Data Discrimination by Number 2 U.S. Service Provider,”
MSNBC
, last modified, October 19, 2007,
http://www.msnbc.msn.com/id/21376597/ns/technology_and_science-internet/t/comcast-blocks-some-internet-traffic/
.

72.
Neda Ulaby, “Kevin Martin's Contentious Turn at Helm of FCC,”
National Public Radio
, February 5, 2008, available at
http://www.npr.org/templates/story/story.php?storyId=18711487
; Matthew Lasar, “Comcast, Net Neutrality Advocates Clash at FCC Hearing,”
Ars Technica
, February 25, 2008,
http://arstechnica.com/old/content/2008/02/comcast-and-net-neutrality-advocates-clash-at-fcc-hearing.ars
; Matthew Lasar, “Big ISPs a No Show at Second FCC Net Neutrality Hearing,”
Ars Technica
, April 17, 2008.

73.
“Comm'n Orders Comcast to End Discriminatory Network Mgmt. Practices,”
07-52, 2008 WL 2966428 (F.C.C. Aug. 1, 2008).

74.
Comcast Corp. v. Federal Communications Commission
, 600 F.3d 642 (D.C. Cir. 2010).

75.
National Cable & Telecommunications Association (NCTA), “Cable Is Committed to Public/Private Efforts to Increase Broadband Adoption,” June 2011 position paper, available at
http://www.ncta.com/IssueBriefs/Broadband-Adoption.aspx?view=2
; NCTA, “Cable: Availability (December 2011),” available at
http://www.ncta.com/StatsGroup/Availability.aspx
.

76.
Reply Comments of the National Cable & Telecommunications Association, In the Matter of Framework for Broadband Internet Service
, GN Docket No. 10-127 (August 12, 2010).

77.
“The majority of U.S. broadband subscribers do not connect to the Internet via local-access infrastructure owned by an incumbent telephone company. The U.S. cable infrastructure was advanced and ubiquitous enough to allow cable companies to offer broadband access services to large portions of the country, in many cases before the telephone companies” (Federal Communications Commission,
National Broadband Plan Connecting America
, chap. 4, p. 37, available at
http://www.broadband.gov/plan/
. “Congress should make clear that Tribal, state, regional and local governments can build broadband networks” (ibid., chap. 8, p. 153).

78.
As reported in Cecilia Kang, “FCC Chairman Genachowski Expected to Leave Broadband Services Deregulated,”
Washington Post
, May 3, 2010: “The chairman of the Federal Communications Commission has indicated he wants to keep broadband services deregulated.”

79.
Federal Communications Commission, “The Third Way: A Narrowly Tailored Broadband Framework,” news release, May 6, 2010.

80.
“Reclassification is often referred to as the ‘nuclear option,’” notes Ryan Singel, “FCC Prepares to ReRegulate Broadband Providers,”
Wired.com
, last modified
May 5, 2010,
http://www.wired.com/epicenter/2010/05/fcc-reclassify-broadband/
. “We are concerned with reclassifying broadband service as a Title II service, which could create regulatory uncertainty that could dampen investment and innovation and ultimately, damage the consumer experience” (Time Warner Cable news release, May 6, 2010, available at
http://ir.timewarnercable.com/phoenix.zhtml?c=207717&p=irol-newsArticle&ID=1423688&highlight=
).

81.
AT&T reported spending $5,930,381.11 on lobbying in the first quarter of 2010; see AT&T Services, Inc., “Lobbying Report,” available at
Public Knowledge
,
http://www.publicknowledge.org/node/3095
; Cecilia Kang, “Update: AT&T, Verizon Ramped Up Lobbying in Q1,”
Washington Post, Post Tech
(blog), April 21, 2010,
http://voices.washingtonpost.com/posttech/2010/04/phone_giants_att_verizon_turn.html
.