Tag Archives: FCC

Comcast Wins Web Traffic Authority Over FCC

Julius Genachowski, head of the FCC, at a hearing last month

On Tuesday, a federal appeals court ruled to limit the power of the FCC (Federal Communications Commission) over internet traffic. What makes this extraordinary is that the decision will allow ISPs (Internet Service Providers) to block or slow specific sites and charge video sites to deliver their content faster to users.

Under the banner of “net neutrality,” the FCC was poised to require ISPs to provide equal speed coverage to all users. However, the service provider giant Comcast Corporation (NASDAQ: CMCSA) contested that the FCC had no jurisdiction in the matter and that ISPs should be granted the ability to increase control over the content of the internet they provide.

Comcast’s concerns for their content speeds came after increasing network congestion from users of a file sharing program called BitTorrent, which is infamous as a major source of pirated media and software.

Conservative supporters have weighed in on the ruling saying they are philosophically opposed to granting further power to the FCC who are already famous for their control of other media including radio and television. Moreover, they argued against the government’s interjection saying that ISPs should be free to set their own policies and the prices for their services.

After the decision, however, Comcast released that they have since changed the management policies that lead to restricting access to BitTorrent and originally brought this case to court. Yet, despite Comcast’s claims that they will remain “committed to the FCC’s existing and open internet principles,” this court decision leaves the possibility for abuse open with only the guarantee of an oligopolist for protection.

This is especially unsatisfying for consumers with the impending Comcast majority stake acquisition of NBC Universal, which currently owned by General Electric (NYSE: GE) and Vivendi (EuroNext: VIV). With NBC Universal, the temptation to favor NBC cable channels and discriminate against other broadcast groups would be greater and make Comcast more likely to take advantage of their position as an ISP. In practice, for example, Comcast could prioritize NBC video streaming services over competitors.

Some consumers fear that without FCC oversight, such abuses could occur indiscriminately. However, until the FCC is granted control over internet traffic, it is the opinion of this publication that the only protection the general public would have would be in the competition of the free market.

In February, Google (NASDAQ: GOOG) announced that it would begin testing its own fiber optic system, connecting homes, schools and business, in an attempt to one day become an ISP itself. Boasting speeds of 1Gbps (Giga bites per second), Google would be poised to compete with Comcast if it could find ways to make its system affordable. Google’s entrance into the ISP market without ulterior motives would represent better assurances that ISP providers will remain honest suppliers of the world wide web.

Ironically, Google has earlier “net neutrality” to thank for its success, foremost, as the most widely used web-based internet search engine. Google stock went public in August of 2004 and closed Wednesday at $563.54.

Trading in my iPhone for the iPad

Before you write this off as the psychotic ramblings of a raving mad man, hear me out!

Because I am a radio hobbyist, I feel this is the best way for me to explain this, as it was also the immediate thought I had right before this revelation. In 1996, the F.C.C. (Federal Communications Commission) released its famous Telecommunications Act which lifted restrictions on radio station owners limiting the number of stations they could own in each market. This lead to a buying frenzy in a period of, what is known today as, “consolidation” where leaders in the broadcasting field began buying stations in each market by the crate load. This widened the profitability gap between large commercial owners and individual owners. Thus, out of the fray, companies like CBS, Cumulus, Citadel and Clear Channel (owning the most with 1,190 of the 13,660 total stations in the US) changed the landscape of the radio industry with their nearly monopolistic hold over it.

In recent years, however, the radio industry has begun hemorrhaging money — losing their most profitable demographics to streaming radio (i.e. Pandora and Last.FM). This was due in part to a stagnation that occurred because of their contentment with mediocrity. In short, they did not search out new content like they had before when they were in ardent competition, each looking for an edge. This provided a chink that outlets like Pandora and Last.FM have happily filled. Since this time, radio industry leaders have slowly begun to deconsolidate — realizing that their most profitable structure is not particularly in owning as many stations as possible, but in most efficiently utilizing their already present infrastructure and matching up with content think tanks. In fact, in our home of the Bay Area, this is the case with Channel 92.3 (once Channel 104.9) who, after moving to the stronger 92.3 FM frequency, was put on the chopping block by owner Clear Channel who had deemed it a profit loss. When I last checked, they were put into a Trust, with Clear Channel poised to sell them.

Now, what does this have to do with my move from the iPhone to the iPad? Well, it has to do with this realization of what is most “profitable” (I use the word liberally). Should I, like the radio giants did, consolidate as many of Apple’s products as possible? To what end?! Specifically, I couldn’t wrap my head around the necessity of having an unlimited data plan for the iPad 3G on top of my current combination phone and unlimited data plan on my iPhone 3G.

As I compared and contrasted the iPhone and iPad, I realized something: “YES! WHAT PEOPLE SAY IS TRUE! The iPad is a GIANT iPhone!” So, instead of not buying the iPad, I shall sell my iPhone, buy some cheap phone through AT&T and have the iPad for everything I’ve always wished I could do with my iPhone!

What are these things, you ask? THE ANSWER IS IN ITS SIZE! The iPad’s size offers more usability! I don’t want to watch movies on the puny Nano or my iPhone! Throw it away! I don’t want to play games which require my two thumbs that take up two thirds of the screen! Throw it away! I don’t want to type notes and contacts with that tiny keyboard! Throw that iPhone away — and give me the iPad instead!

You thought THIS would happen? fo' realz?!

I have believed for many years that, while man’s technological innovation up to this point has been defined by building things smaller and increasingly more powerful, there would come a point when his creations would stop decreasing in size when they began detracting from his maximum capabilities. For me, that time has come.

What else can I say other than, anyone wanna buy an iPhone? Other wise, I’ll give it to the “Will It Blend?” guy…