THE BLOG
10/17/2012 04:58 pm ET | Updated Dec 17, 2012

Internet Freedom? You Are in an Internet Prison and You Don't Even Know It

There are more choices for bottled water or mustard or local Chinese takeout than most customers have for Internet Service Providers (ISPs) or broadband providers or cable service providers. Where is the Internet freedom?

The Republican and Democrat platforms claim that they are for Internet freedom, but their version doesn't open the networks to actual competition. Instead, it is based on the AT&T and Verizon hype. Working with ALEC (American Legislative Exchange Council), the phone companies' definition of Internet freedom is that internet-phone service (VOIP) should not be regulated, when in reality the entire thing is a verbal jujitsu to remove regulations, obligations and competition on telecommunications services offered by the incumbent phone companies. Over 20 states have passed bills based on claiming this version of so called 'Internet freedom,' California being the latest causality.

According to Multichannel News the backers of the California bill claim it "preserves the future of the Internet by encouraging continued investment and technological advances and supporting continued consumer choice and access to innovative services that benefit California."

How can you have 'freedom' when there is no "competition" for basic Internet or broadband or even cable service? Notice in the above quote that there is no mention of "open networks" or competition for Internet or broadband providers.

Without actual choice of providers, Internet freedom is an Internet prison.

Confusing? In the next few articles we will discuss "The Internet & Broadband Competition Freedom Act" and why direct competition for Internet and broadband services should be a priority in America -- not sound-bytes mumbled by politicians or those spouting the cable-phone corporate line.

And you should care because a lack of actual competition concerns everything from the future of net neutrality, your privacy, or allowing the current cable and phone companies to act as copyright policeman -- with or without the passage of odious bills like the Stop Online Piracy Act (SOPA). It also impacts everything price increases and slow broadband to 'bandwidth caps' and other odious things.

Internet Freedom Must be about Freedom to Choose Your Providers.

Like many in America, I have two communications wires coming into my apartment. The first is the cable wire, which now also offers phone, broadband and Internet. I can't get a different 'Internet Service Provider' or another company to handle the 'broadband connection' as the cable company has a monopoly over this cable wire. And if I don't buy their 'bundled' service, -- i.e., the "triple play" with cable, broadband, Internet and phone service, I can't get the cheaper price, (though, ironically that price is only an initial promotional price, which goes away after the promotion).

As I wrote, prices continue to rise on all services. How is that possible if there is competition? Prices go down with competition --- right?

The other wire is from Verizon, my incumbent phone company, which started off offering phone service, but added broadband, internet and now cable. If I want Verizon's FiOS broadband service I have to take their Internet service as well and their phone service. More to the point, basic service in New York City went up over 84 percent over the last six years so, unless you bundle, you are 'harvested' 0- stay until you scream or leave.

But the hidden truth about the phone & cable companies' 'Internet freedom' is they don't give you the basic details -- they blur the lines to confuse you.

  • The wire is not the Internet or the World Wide Web. These are services that go over the wire -- they are not the wire itself.

  • Broadband is not the Internet. It is the speed and capacity of that wire. If it is upgraded it goes faster and can handle more video, etc. without choking.
  • Internet freedom, then, should be: I get to choose which services I buy that come over the wire in my home. I have choice for which the Internet Service Provider and competitive broadband service, and even competitive cable or phone services.

    Remember, the wires were funded by us; America will have paid over $360 billion dollars by the end of 2012 for a fiber optic future than never came. Thus, we are de facto investors as we paid extra for the phone wire upgrade. And without choice, the only real freedom is freedom for the companies and allowing them to not being regulated. It is not freedom for us -- the customers.

    Five Reasons Why You Should Care.

    1) Net neutrality concerns were created because there is no Internet and broadband competition.

    If the customer only has one company that controls their Internet and broadband service, than that company can block, degrade or restrict the customers' services or give their own services advantages that harm all other competitors.

    The Telecom Act of 1996 was passed, by a Republican-controlled Congress, to open the 'last mile,' the wire to your home or office to all forms direct competitors. Historically, the utility wires were closed to competition. However, during the last decade, the FCC, with the help of the phone and cable companies closed the networks to all forms of basic Internet, broadband and even phone competition -- which caused the net-control problem.

    If there was competition for broadband and Internet, you could say -- *(fill in the blank) to the company blocking or degrading your service and then simply go to another company that did not block, degrade or harm your service.

    This problem isn't simply on the wired services but is now a hot topic on the wireless networks. If you buy AT&T's wireless service, they control both the Internet as well as the broadband for data plans. And right now AT&T claims that based on their contract, they can block Apple's FaceTime (and other services) if the service was 'pre-loaded' on the phone. A complaint was even filed with the FCC by a number of advocacy groups.

    2) One monopoly wire in many areas of the U.S. means no Internet and broadband competition. Period.

    In most of America, the phone companies haven't upgraded that wire so if you live in rural areas you either use the cable companies' broadband and Internet service, or you are stuck. (Of course you can select a separate Internet provider if you are still on dial-up -- i.e., using a modem over you regular phone line.)

    However, in many rural areas there is one company - the cable company; they set their own prices, they set the speeds, and they set even how you can use the service. Without competition, prices can only go up, and you have to accept whatever they do. I note that there was also places where even the cable companies haven't bothered with in America.

    Just to add to the lack of serious competition, Verizon, the wire caretaker, recently purchased the cable companies' wireless spectrum and is now marketing their wireless service with the cable companies' services. They're doing this so they don't have to upgrade about 1/2 of their territories. So, one wire, a monopoly for fast broadband, Internet and cable awaits most of America. Meanwhile, AT&T simply abandoned 1/2 of its territories and didn't upgrade it for U-Verse, its cable/broadband product.

    3) Bandwidth Caps, Rate Increases & Blocking Internet Competitors

    "Vertical integration" is when one company controls all of the services over the wire. This allows them to collude with all of the companies' different affiliates -- broadband, Internet, phone and cable services -- giving them advantages to block any other competitor. are provided by one company on that wire.

    "Bandwidth caps" is just one example, where the cable companies can cap the amount of broadband the customer uses, or can charge a lot more for going over a certain amount once a threshold has been reached. They do this, not because they can make more money but because it blocks customers from using other services -- such as Netflix, or other video services, as putting limits on the broadband usage stops customers from using other outside video services over the cable wire.

    This vertical integration is also 'bundling'. In order to get the deal, the customer has to buy all of the company's services -- therefore blocking customers from buying stand alone services, such as VOIP (Voice over the Internet) products like Vonage. Why would you get another phone service -- which costs extra, when phone service was included in the bundle?

    Bundled services also can mean higher prices. The FCC claims that it is concerned with low income families not being able to get broadband. And yet, where's the investigation into the bundling of services or the lack of competition to lower prices?

    If there was actual broadband competition, another company might offer cheaper prices on just the services your want. They could offer video programming packages for a cheaper service where you buy only the programming you want -- a la carte. What a novel idea. Or, if the networks were upgraded, they could 'unthrottle' the connection and give you more speed for less money.

    4) Then there is your privacy.

    One independent Internet provider, Calyx, tells of a harrowing tale of being charged by the FBI for not revealing his clients.

    "It all started when I received a National Security Letter from the FBI demanding a long list of information about one of my ISPs clients. With the ACLU's help, I fought the FBI and DOJ in federal court for six years, under gag order. I was forbidden, under threat of imprisonment, from telling anyone that I had received the letter or that I was the plaintiff in the case."

    I bring this up because AT&T was sued by The American Civil Liberties Union and the Electronic Frontier Foundation for wiretapping customers without warrants, where according to The Hill, AT&T supposedly "provided customer information, including phone calls, emails and Web browsing history, to the NSA without a court order."

    Meanwhile, last week the Supreme Court refused to act on the case -- and AT&T got immunity for these acts.

    If there were competitors to AT&T et al, then those ISPs who believed in the rights of customers could be the voice of reason against unauthorized wire-taps.

    And it's going to get worse... just this headline, "Verizon Very Excited That It Can Track Everything Phone Users Do and Sell that to Whoever is Interested," in Forbes online from Oct. 17, 2012, should give you pause.

    5) SOPA and SIPA Concerns -- Should Your Internet Provider and Broadband Provider Act as the Copyright Police?

    The Stop Online Piracy Act (SOPA) was designed to stop online piracy of copyrighted materials. It was stopped by a massive campaign which darkened well traveled websites for a day. According to Wikipedia:

    "Provisions include the requesting of court orders to bar advertising networks and payment facilities from conducting business with infringing websites, and search engines from linking to the websites, and court orders requiring Internet service providers to block access to the websites."

    As of this writing, rumors have started based on some internal leaked AT&T 'guidelines' that the large cable and phone companies are about to start a campaign to notify customers of 'copyright infringements', then take action, including blocking the customers ability to use their Internet service.

    At the same time a new group called the Center for Copyright Information (CCI) has been established, with the Motion Picture industry (MPAA), the Recording Industry Association (RIAA) and "5 major ISPs -- AT&T, Cablevision, Comcast, Time Warner Cable and Verizon."

    The problem? By tying the broadband and Internet services together and allowing no competition of these services, the companies can take control over the customers' services -- and essentially track and spy on the customer's use of the Internet.

    So, do you want real competition and choice of your ISP or broadband service? Do you want lower prices through competition? Or do you want "Internet prison"?

    (Next article: Part II: Time for "The Internet & Broadband Competition Freedom Act")