Monday, September 23, 2013

Constitution Week 2013

Today is the last day of Constitution Week, a week that commenced with the celebration of Constitution Day on September 17th.

I often try to take note of this celebration because, in my view, it is important for us, as citizens, to remind ourselves of our shared constitutional commitment.

I confess I was especially moved to write this year when I read the story about the Modesto Community College student in California who was prevented by campus administrators and the police from passing out copies of the Constitution on Constitution Day. He was told he could only distribute the Constitution in the school's tiny "free speech" zone and, then, only if the activity was scheduled several days in advance.

I understand that this is but one small example of many that could be cited that would make our Founders' heads shake in wonderment if they but knew. It is not news that campus speech codes and other forms of speech restrictions brought about by rigid adherence to political correctness fashions run right up against First Amendment free speech guarantees. But prohibiting a student from passing out copies of the Constitution on Constitution Day should make us stop and think.

Indeed, it calls to my mind the story, perhaps apocryphal, about Ben Franklin's remark when he was asked on the final day of the Constitutional Convention of 1787: "Well, Doctor, what have we got – a Republic or a Monarchy?" Franklin's response: "A Republic if you can keep it."

I do not doubt that we can keep it – as long as we, continually, strive to understand and remain true to an understanding of the Constitution that comports, as nearly as possible, to its original meaning and foundational principles, including the structural restraints imposed on government by the Constitution's separation of powers and the doctrine of limited, enumerated powers. And, of course, the explicit liberty guarantees in the Bill of Rights are crucial to securing our fundamental freedoms.

At the Free State Foundation, it is our goal, even amidst engaging in the sometimes nitty-gritty of today's debates about this policy or that, always to have in mind foundational constitutional principles. This is especially important for an organization that labors so heavily in fields cultivated – I should say "controlled" – by the Federal Communications Commission. This is because so much of what the FCC does in regulating communications and media companies, and now Internet providers, implicates constitutional rights.

Of course, the First Amendment's free speech guarantee comes readily to mind foremost. Our website is chock-full of papers, far too numerous even to begin to list here, that explain how various FCC actions implicate, if not violate, the free speech rights of companies – speakers, really – subject to various FCC regulatory mandates. Without delving into the substantive arguments here, I want only to suggest, in the spirit of Constitution Week, that the FCC commissioners would do well – consistent with their constitutional oaths – to consider anew whether certain existing regulations comport with the First Amendment's free speech guarantee. This can be done on a forward-looking basis without necessarily questioning whatever justifications may have been assumed to exist when the regulations were adopted.

For example, as D.C. Circuit Judge Brett Kavanaugh suggested in his concurring opinion in the Tennis Channel case decided last May, in today's competitive video marketplace, the FCC's program carriage requirements, adopted two decades ago in a then monopolistic environment, now likely are inconsistent with cable operators' First Amendment rights. I have suggested the same for many years, so I concur in Judge Kavanaugh's concurrence.

As another example, I have long contended, as I explained in this 2007 law review article, "Net Neutrality Mandates: Neutering the First Amendment in the Digital Age," that FCC regulations requiring Internet providers to carry content that they may wish not to carry violates the free speech rights of the Internet providers. In the Verizon v. FCC case now before the D.C. Circuit challenging the lawfulness of the FCC's net neutrality mandates, the Free State Foundation joined TechFreedom, the Cato Institute, and the Competitive Enterprise Institute in a brief arguing that the agency's net neutrality regulations violate the Internet providers' First Amendment rights.

To my mind, there is a fundamental problem with the FCC's approach in these and other cases in which the agency implements various access mandates and/or nondiscrimination prohibitions. The Commission, in effect, turns the First Amendment on its head. Simply put, the First Amendment is intended to prevent the government from interfering with the free speech of private individuals or entities; it is not intended to authorize the government to take measures that, however well-intentioned, are designed to equalize speech or enable more speech by one party or another.

As Chief Justice Roberts put the matter in the 2011 Arizona Free Enterprise Club case, citing the landmark Tornillo decision invalidating Florida's "right to reply" access statute, "this sort of 'beggar thy neighbor approach' to free speech – 'restrict[ing] the speech of some elements of our society in order to enhance the relative voice of others' – is 'wholly foreign to the First Amendment.'"

There is a fundamental difference between the ""beggar thy neighbor" understanding of the First Amendment too often adopted by the FCC which regulates speech in the name of equalizing access or preventing discrimination and a proper understanding which holds the First Amendment is a guarantee against government interference with private speech.

At the Free State Foundation, with due respect for the perspectives held in good faith by others, we will continue to advocate for what we consider to be a proper understanding of the First Amendment. And we will do the same, of course, with respect to other constitutional guarantees, such as the Fifth Amendment's due process and "takings" clauses which protect private property.

Finally, in closing, I want to take the opportunity afforded by Constitution Week to call your attention to the series of four "Perspectives from FSF Scholars" papers, authored by Seth Cooper and me, which explore foundational principles of intellectual property grounded in our constitutional system. The discussion in these papers ranges broadly from the natural rights, Lockean origin of intellectual property protection, to the significance of James Madison's little known "On Property" essay, to the even less well-known collaborative efforts of Madison and Noah Webster to secure IP rights in the federal Constitution and early state constitutions, and on to an explanation as to why the Founders' anti-monopoly and pro-IP rights protection views are not inconsistent.

If you are looking for some "extra credit" reading as Constitution Week draws to a close, you might want to sample these Perspectives:


Thursday, September 19, 2013

Update: The U.S. Still Leads Europe in Broadband Speeds, Connectivity, and Value

The FCC will soon be releasing its Ninth Broadband Progress Report – or 706 report. These reports track the progress of broadband deployment and adoption throughout the United States. In anticipation of this report’s release, it is timely to provide an update on the progress of broadband development. Back in March, I compared broadband development in the United States to the buildout and availability of high-speed broadband Internet access in Europe. The data at that time clearly showed that the United States was leading Europe in broadband speed, penetration, choice in access, and investment. Recent data confirms that Europe still trails the U.S. in broadband development.
In March, the latest data indicated that most Americans had access to broadband speeds of 7.2 Mbps, which placed the U.S. as the ninth fastest broadband provider in the world. Since then, Akamai has released its latest State of the Internet Report. Akamai reported that in the first quarter of 2013, more than 733 million IP addresses from 243 unique countries/regions connected to the Internet; over 3% more than the previous quarter, and 10% more than the first quarter of 2012. The United States ranked first, leading the world in the number of unique IP addresses accessing the Internet. 
The Office of Science and Technology Policy and National Economic Council reported in June of this year that overall, average delivered broadband speeds have doubled since 2009. In 2012, North America’s average mobile data connection speed was 2.6 Mbps, the fastest in the world, nearly twice that available in Western Europe, and over five times the global average.
The global average connection speed continued to increase in the first quarter of 2013, growing 4% to 3.1 Mbps. The U.S. ranked 9th in average connection speed, reporting 7.4 Mbps, and ranked 8th in high broadband connectivity, with South Korea, Japan, and Hong Kong taking the top three spots in both categories. The U.K. ranked 12th, while other European countries fell further behind.
Annual investment in U.S. wireless networks grew more than 40% between 2009 and 2012, from $21 billion to $30 billion, and exceeds investment by the major oil and gas or auto companies; wireless investment in Asia (including China) rose only 4%, while investment in European wireless networks remained flat during this time period.

Broadband prices vary extremely across the world, ranging from $5.50 a month in Sri Lanka to an exorbitant $1,753 a month in Cuba. Prices in the U.S. and Europe are comparable, as both regions offer access for approximately $20 a month. This is contrary to some critic’s views that Europe offers cheaper services to consumers. However, the ITU reported in 2012 that the U.S. leads Europe in the relative value of broadband services: The U.S. provides broadband access at prices equal to just 0.5% of Gross National Income per capita.
Despite these statistics, some critics still claim that America lags behind Europe in Internet speeds. While it is true that some countries, such as Switzerland, offer peak connection speeds that surpass those offered by the U.S., this does not detract from the fact that the U.S. offers greater availability, value, choice, and high average connection speeds to its consumers. 
Additionally, The Innovation Files’ author Richard Bennett analyzed Susan Crawford’s reaction to criticism of her views that the U.S lags behind Europe in the deployment of high-speed Internet access. Mr. Bennett accurately notes how Ms. Crawford systematically mischaracterizes current data, or utilizes unreliable sources. 
For example, Ms. Crawford claims the European Commission’s Digital Agenda Scoreboard says: “the U.S. is behind South Korea, the UAE, Hong Kong, Japan, Taiwan, Latvia, Lithuania, Norway, Sweden, Slovakia, Bulgaria, Portugal, Iceland, Denmark, Estonia, Finland, and Norway,” yet the report makes no such claim and doesn’t even mention most of the non-European countries on Crawford’s list. The report actually finds, “Fixed broadband penetration in the EU was slightly higher than in Japan and just below that of the U.S. as of July 2012.” In fact, Mr. Bennett points out, Europe’s fiber buildout is well behind that of the U.S. According to OECD data, FTTH buildout in the U.S. was ranked sixth in 2010, behind only Japan, Korea, Slovakia, Finland, and Denmark. The U.S. likely ranks even higher now because, since 2010, the U.S. has installed more fiber miles per year, 19 million, than the rest of the world except China. 
Although the latest data clearly favors the U.S. as a leader in high-speed Internet access, Mr. Bennett properly acknowledges that network quality is less important in America than the challenge of getting more people connected to the Internet by either wired or mobile broadband.
As Free State Foundation Board of Academic Advisor member Justin (Gus) Hurwitz noted in his piece “Let Them Eat Cake and Watch Netflix released earlier this month, an important measure of success in broadband deployment is the speed at which broadband availability is bridging the digital divide, not the peak speed sparsely available in a given country or community, or the speed at which a single consumer can download multiple HD Netflix movies simultaneously. Mr. Hurwitz correctly noted that the definition of “high-speed Internet” used by the FCC, 4 Mbps down/1 Mbps up, accurately measures how many average users can access the Internet to learn, work, participate in public discourse, and become part of the digital community. 
It is important to take stock of where the U.S. stands among other countries regarding broadband deployment. However, the same “talking broadband down” crowd I mentioned in my March blog is too focused on the few areas where U.S. broadband progress could improve.
As FSF President Randolph May has said since 2007, the correct path is not “defining down” the U.S.’s broadband progress. Critics of the policies and progress of broadband buildout in the U.S. frequently mischaracterize data in order to justify unnecessary regulation and market interference. Instead, critics should ask the more important questions: Is the market providing choice, value, and widespread, affordable high-speed Internet access, and is broadband deployment meeting consumer demands. As discussed above, the answer to these questions is “yes.”
The U.S. continues to make great progress in broadband development and deployment. In order to remain a world leader in broadband service, U.S. policies should continue to support the current trajectory of growth and innovation by forbearing from imposing unnecessary regulations and barriers to broadband deployment.  

Wednesday, September 18, 2013

FSF Seminar Panelists Weigh How Next FCC Chairman Should Respond to Verizon v. FCC

On September 9, oral arguments were held in the legal challenge to the FCC's network neutrality regulations. How the D.C. Circuit might rule in Verizon v. FCC has been a hot topic for discussion in legal circles. 

The public policy question of what the next FCC Chairman should do in response to the D.C. Circuit's future legal ruling was raised at FSF's June 2013 "If I Were the FCC Chairman..." lunch seminar. The seminar panel featured Gail MacKinnon, Executive VP and Chief Government Relations Officer for Time Warner Cable; Craig Silliman, Sr. VP for Public Policy & Government Affairs at Verizon Communications, and Gigi B. Sohn, President & CEO of Public Knowledge. FSF President Randolph May moderated the seminar's discussion and posed that question to the panelists. 

What follows is an excerpt from the edited transcript from the seminar containing the panelist's responses:

Look at both sides of this scenario, if the FCC wins or if the FCC loses Verizon v. FCC.  Even assume that it's going up to the Supreme Court.  We're going to go right down the line.  Just explain succinctly what you think the Commission should do in that event and why you think it should do it.  That involves both assessing where we are now, what the effect of the rules has been since they've been in place, the potential harm.  Let's really sharpen that, because, ultimately, it's going to be decided one way or the other.  And you're going to have to know what to do as the FCC chair.

The question for the new FCC chair is, if Verizon prevails, what does he do?  He can either say, "Look, we've tried under the jurisdiction we thought," or "It's up to Congress now to pass legislation to give us clear authority."  The thing that worries us about the Title II proceeding just hanging out there is it does create an overhang.  That's why we'd like to see it closed.  We think if the FCC goes down the path to Title II, it would be pretty destructive for us.  Again, that's why Title II is such an issue for us…[I]f people are worried about having a cop on the beat look at this, whether it's anti-consumer or anticompetitive, there is the FTC.  It has authority to look at these things.  I'd also point out that BITAG gets together and talks about industry best practices.  There are a lot of other options out there.  If the new FCC chair were to say, "Look, Congress has to do this," I think there would be an attempt.  But given the divided Congress, I really don't see realistically that legislation making its way through Congress is actually a viable outcome.

Win or lose the appeal of the Open Internet Order, the question for the FCC, to some degree, is this larger future decision and future policy direction, which asks, "Where are we going to try to assert our jurisdiction?"  At its core, this question is about where the FCC's jurisdiction ends and the FTC's jurisdiction begins.  If the order and the FCC's jurisdiction is upheld on appeal, the question for the FCC then is: how aggressive are you going to be in asserting that jurisdiction in the broader Internet ecosystem and the broadband Internet ecosystem?  As you look at the evolving technology, you look at Microsoft and Skype.  You look at Google.  You look at some of the services that are going on out there.  You say, "This now gives me a clear path to assert jurisdiction over that broader Internet ecosystem."  If, on the other hand, the Court does not uphold the FCC's jurisdiction over this, then the question becomes: do you keep trying to fit this square peg into a round hole?  Do you say, "Listen, this is where the technology's going, and so I'm going to find my way by hook and by crook to find the jurisdictional hook there"?  Or, do you say, "Listen, the courts have spoken. Congress, if this is where you want the jurisdiction to be, then change the law to put jurisdiction over the Internet ecosystem with the FCC."  If jurisdiction should stay with the FTC, I would recommend people look at a very thoughtful speech that FTC Commissioner Wright gave a month or two ago in which he laid out the consumer protection angle on net neutrality, and asserted the competition law in consumer protection.  Those are the FTC's fortes and the FTC has the easy ability to handle these issues.  From a larger government policymaking perspective, the federal government would be saying we have the ability to protect consumers in this space.  This question is whether that happens in the FTC or the FCC.  And the FCC has to decide how far they want to fight that jurisdictional fight.

It's really important to note that Verizon's challenge is not just about the open Internet rules.  It's about the FCC's ability to set rules of the road with regard to predatory billing practices and with regard to public safety.  It's about whether companies like Verizon had to have back-up battery power if there is a natural disaster… The question, in front of the court, at least in my opinion, is whether the FCC has any ancillary authority at all to regulate broadband Internet access.  It's not just about open Internet.  It's about pricing.  It's about competition.  It's about public safety.  The question is not that narrow.  There's a second question, about whether the rules themselves are arbitrary and capricious.  But it's really about FCC authority writ-large with regard to broadband Internet access.  FTC has some powers, but they don't reach a lot of things that organizations like mine are concerned with.  They reach unfair, deceptive trade practices.  That is actually quite narrow.  And they reach some anti- competitive practices.  Some of the things that we're talking about, really are anti-consumer, but not anti-competitive.  And I can see the little shell game going on.  Get the FCC out of it.  Let the FTC do it.  And then when we bring complaints to the FCC, we're told, "Well, Section 5 only really goes to unfair, deceptive trade practices."  There is an area, beyond what the FTC does, that is needed to protect consumers.  As far as the BITAG is concerned, I'm very proud of my participation.  It's the Broadband Internet Technology Advisory Group.  The purpose of that group is to determine what a reasonable network management practice is when it comes to provides managing their networks.  I'm very proud of that.  But it's a very, very narrow scope, and it's a technology group.  It's a bunch of engineers.  We're not allowed to meddle in their engineering decisions; it is not a policy organization.  Frankly, I hope it stays that way.

Will the FCC's network neutrality regulations ultimately survive Verizon's legal challenge? That question was the subject of an episode of C-SPAN's The Communicators, featuring FSF President Randolph May.