FreePress Concedes Broadband Is Not A Duopoly

April 6, 2009

FreePress in petitioning the FCC to apply its Broadband Principles to wireless (because they currently do not apply to wireless) effectively has conceded that broadband is not the duopoly market they have long alleged, but is a competitive marketplace.

  • This is a fundamental concession of fact and a belated recognition of market reality by FreePress, the leading advocacy group pushing for net neutrality. Free Press previously had maintained that it was a lack of broadband competition and consumer choice that justified the imposition of new net neutrality legislation/regulation.
  • Given FreePress’ official wireless petition, FreePress can no longer credibly maintain that the four national wireless broadband services (Verizon, AT&T, Sprint and T-Mobile) are not competitive substitutes to cable modems and DSL/fiber now that FreePress argues that wireless and cable-DSL/fiber are effectively equivalent services for regulatory purposes.
    • Intended or not, FreePress has effectively eviscerated its own longstanding policy case, legal justification, and political argument for mandating net neutrality by abandoning the factual predicate for their case, justification and argument.
  • While FreePress may not appreciate the legal and policy precedent significance of the Supreme Court’s Brand X Decision and the FCC’s 5-0 Broadband Policy Statement, the FCC, and the three branches of Government certainly do.
    • The FCC stated that information service providers, i.e. broadband, “are not subject to mandatory common carrier regulation under Title II.”
  • If FreePress is no longer challenging the underlying premise of broadband competition which is the foundation of current law, and also the Court/FCC’s interpretation of it — what is FreePress’ new rationale/justification warranting new net neutrality regulation? They have not provided a new one.
  • In short, to warrant change in policy, precedent, or law, there needs to be a legitimate, supported and defensible rationale/justification. FreePress no longer has one.
    • Public WiFi spectrum may require no permission or payment to use, however it offers no security or privacy protections for users and there is minimal recourse for quality of service, range, coverage, speed, capacity, security, privacy problems — if and when they do arise.
    • On the other hand, competitive, private WiFi services and commercial wireless broadband services do require permission and payment to use. They also spell out the benefits/limitations in detail in a contract’s terms-of-service — covering among other things commitments of quality of service, range, coverage, speed, capacity, security, privacy, value-added features, etc.
      • The reason wireless broadband services exist and flourish is that they offer a very different value proposition than free public WiFi. Consumers are willing and free to choose which providers’ value-added mix is the one they want.
  • Analytically, there is another big logic problem with FreePress’ petition. It effectively argues that public WiFi use over free unlicensed public spectrum is, and should be, the legal/regulatory equivalent of private commercial wireless use — under a contracted service agreement — over private-licensed spectrum that was purchased at auction for billions of dollars. Simply, they try and argue that whatever one can do on public WiFi, one should be able to do on commercial wireless networks — without any legitimate justification.

    In sum, FreePress’ new petition to apply net neutrality to wireless, spotlights two important questions:

  • What is the new rationale/justification for net neutrality regulation now that the leading advocate for net neutrality has effectively conceded broadband is a competitive market and not a duopoly?
  • Why shouldn’t consumers and businesses be free to buy and sell wireless services under contract in a competitive marketplace like they have been able to for over 15 years?

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