July 09, 2004

FCC Chairman Powell Has a Blog - No, Seriously

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FCC Chairman Michael Powell has launched a blog [As Dave Barry would say: I'm not making this up] (Michael Powell Joins the Blogosphere). So what does the chairman have to say in his first post? Well, he reiterates his commitment to deregulation, that is, when it doesn't upset entrenched interests too much.

Our struggle to define appropriate regulatory regimes to promote innovation is not limited to the telephone sector. The Commission's digital television transition is yet another example of how difficult the struggle can be.
Yeah, the broadcast flag is really going to promote innovation. Why, just think of the useless technology developed because television was an open platform! To borrow some concepts from Prof. Frink, "I predict that, if the FCC were in charge of developing the VCR, that within 100 years a VCR will record twice as much programming, be 10,000 times larger, and so expensive that only the five richest moguls in Hollywood will own them."
For example, I need to hear from the tech community as we transition to digital television. It may be possible to deploy innovative wireless services in the unused spectrum between broadcast stations (for example, there is no channel 3 or channel 6 here in San Francisco)...Broadcasters, however, claim these unused channels as "their" spectrum. Yet a public policy that favors innovation and experimentation would seek to open these unused channels to develop new wireless services…just look at how much value has been created in the sliver of spectrum that has become Wi-Fi! If the high-tech community believes that new digital technologies will enable this kind of new thinking about and use of spectrum, then I need to know that.
*ahem* Chairman Powell, it may be possible to deploy innovative television services based upon an open television platform. Broadcasters, however, claim that they must control and direct development of a closed platform, that the platform is "theirs" and requires a "broadcast flag." Yet a public policy that favors innovation and experimentation would seek to open the platform to develop new services…just look at how much value has been created in the open analog television platform! Many in the high-tech community believe that new digital technologies will enable this kind of new thinking about and use of an open television platform. *ahem*
Regulated interests have about an 80 year head start on the entrepreneurial tech community when it comes to informing regulators what they want and need, but if anyone can make up for that, Silicon Valley can. This is important not just for Silicon Valley—it's essential to insure that America has the best, most innovate communications infrastructure.
You know, unless it upsets Hollywood. Because Hollywood will ensure that America has the best, most innovative communications infrastructure.

via JD Lasica

Jeff Jarvis has some harsh words for Powell's "blog" (Daily Stern - July 9, 2004).

July 06, 2004

Quote of the Day: Telecom and DRM Edition

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Telepocalypse discusses why DRM is bad for communication networks (DRM - enemy of telecom):

Ultimately, telecom is about communications, not media. DRM inhibits communications. That’s the opposite of what you’re after. If we’d had DRM before the Internet became widely available, telcos would have sold a lot less dial-up and broadband, and the industry would have even more unlit fiber than it does today.

July 02, 2004

Major Broadcast Networks to Decrease Convention Coverage - Author Experiences Schadenfreude

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Apparently, once again, the major broadcast networks will be scaling back political convention coverage, according to The Hill (TV to snub conventions). As I've noted recently, I think the "news" coming out of the conventions should get a lot less coverage (Blogging the Political Conventions). However, I must confess a bit of schadenfreude when I read The Hill article. Read on...

The Republican and Democratic parties hope to nudge the networks into more live coverage, but broadcasters have concluded that there will be little news to report.
And rightfully so. Not to mention that you never know when some politician will blurt out the f-word and get the broadcaster fined by the FCC. I mean, heck, if the VP will cuss on the floor of the Senate, where won't a politician use indecent language?
“We know we’re going to cover the nomination and the [nominee’s] speech,” said one network’s spokeswoman, but “we’re not sure about the first two days.”
That's pretty much the only thing most people care about anyway.
This [reduced coverage] is a significant challenge for candidates. Kerry must use the convention to define himself before a national audience, presenting his carefully packaged image as a veteran and a leader, and overcome characterizations in Bush’s TV ads that he is a flip-flopper, observers say.
Yeah, this explains Kerry's high profile recently, as Jeff Jarvis notes (Voting against). But it is not just the Democrats.
Democrats and Republicans will continue talks with the networks this week and plead for more coverage.
Ha ha ha. Pleading for coverage. Ha ha ha. Sorry, another schadenfreude moment. How pathetic. Is this what our politics has become? Perhaps the political parties ought to stop sucking up to the glass teat and instead seek to explode it. Of course, the parties are reaching out to alternative news sources.
MTV, Comedy Central and ESPN will also be producing convention shows.
Nothing says inconsequential circus like coverage by these three networks. Do the parties think that coverage by MTV makes them more relevant? Heck, MTV isn't relevant to anyone who's eligible to vote. Rather than pandering to entertain us, the parties might think of becoming more relevant by actually trying to be relevant.
If the networks skip the first half of the convention, they would miss events likely to create buzz in Washington.
And we should care about buzz in Washington, why? I'll bet studies will show that TiVo users fast-forwarded through most of the speeches in order to watch the commercials. However, at least some politicians are honest about this charade.
“They are much less important than everyone thinks … unless you own a hotel,” said Rep. Barney Frank (D-Mass.).
Maybe, one of these years, one of the political parties will note that sucking up to the mass media monster they have created through the FCC isn't really helping them (or us) and we'd be better off with a more decentralized distribution network.
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July 01, 2004

FCC to Fine Only Viacom for Broadcasting Indecency - Why?

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Reuters is reporting that the FCC is going to fine Viacom $550,000 for Janet's nipple flash on the SuperBowl (Jackson Breast Flash May Get $550,000 Fine-Source). Jeff Jarvis notes that this would mean Janet completely topless would rate a million (The Daily Stern: The million-buck boobs). Ba-dump-bump. But, seriously folks, the decision isn't final and the Commissioners still have to vote on it. What intrigues me, however, is that the fine lawyers at the FCC apparently have argued that the 20 stations owned by Viacom should pay the maximum fine allowable, but the stations that aired the incident but were not owned by Viacom pay nothing. I have a feeling that at least one of the commissioners will complain about that, but let's think about possible reasons for that distinction:

  • People are less offended when indecency is broadcast by community smut peddler, instead of national smut peddler.
  • Statement by Commission that, "The determination as to whether certain programming is patently offensive is not a local one and does not encompass any particular geographic area," just a lie to trick unwary media conglomerates into slipping up.
  • FCC Chairman Michael Powell has changed his mind, there is not one First Amendment, but two. One for media conglomerates, another for local affiliates.
  • Local affiliates aren't responsible for what they broadcast. They're just there to collect the checks.
  • FCC clumsily making up for increased media concentration by fining only concentrated media.
  • "They can't fine us all." Local affiliates were right, FCC administratively unable to fine all 180 local affiliates, too much paperwork.
  • Ooops. FCC thought they had already allowed all media to concentrate in single company. Didn't realize there were still local affiliates.
  • It's arbitrary. "We're the FCC. ALL our indecency rulings are arbitrary. What are you going to do about it, huh?"
  • Permitting local affiliates to broadcast indecency without fines will make them more competitive. Supports FCC policy goal of increasing local media diversity.
  • No one was actually watching SuperBowl on the 180 local affiliates that broadcast it.
  • FCC upset that Viacom subsidiary Paramount Pictures has ruined Star Trek franchise.
These are just a few of the possible justifications. Feel free to make up your own. The FCC will.

June 28, 2004

End-to-End Must Die So that National Security May Live

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Prof. Susan Crawford has been breaking and following some monumentally important stories recently. Her latest regards one of my favorite federal agencies, the FCC, and the huge power grab it is considering exercising with regard to the internet. This is no joke, the FCC is considering regulating everything that uses the IP protocol (Nethead/Bellhead -- Noticing DHS). If you think this is just about the big telecoms, you're wrong:

"[National Security/Emergency Preparedness] NS/EP considerations provide a compelling rationale for applying a certain amount of regulation to IP-enabled services. The purpose of such regulation would be to ensure the prioritized availability of certain communication services to Federal, state, and local officials and first responders in times of emergency or national crisis."
Crawford is quoting from the Department of Homeland Security filing in the IP-related services proceeding (In the Matter of FCC Review of Regulatory Requirements for IP-Enabled Services: Comments of the Department of Homeland Security [PDF] The fun part of this document is that it won't let you copy/paste).

How much regulation is necessary?

"In the event of crisis, NS/EP national leadership must receive end-to-end priority treatment over other users. . . . NS/EP traffic must be identified with its own class of service -- above and beyond "best effort."
This, of course, would mean the end of end-to-end as IP providers would have to check packets to see if they were specially marked by the government (which would require all sorts of checks so that we could be sure the packets hadn't been spoofed and what not). Basically, we would have to build into the internet a smart network. Once you've done that, all sorts of other regulations become possible.

As Crawford notes, all of this would be done in the name of national security. You're not against national security, are you?

FCC's Adelstein on the Need to Protect the Children With Regard to DTV

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Nearly a month ago, FCC Commissioner Jonathan S. Adelstein gave a speech at a conference sponsored Children NOW, Digital TV: Sharpening the Focus on Children. You can read Commissioner Adelstein's speech here: Before the Children NOW Digital TV Conference, June 9, 2004, Washington, DC [PDF]. Below are some parts of the speech I felt telling (this isn't line-by-line, I skip much of the speech). Read on...

Think about it. Parents wouldn’t let their children wander by themselves through a neighborhood they don’t know. But many parents let their kids do just that with their minds through TV.
Perhaps this is because the FCC has given parents the impression that the FCC will take all the naughty bits off of television and make it safe for children.
Among other dangers, it turns out these neighborhoods are filled with slick storekeepers trying to lure kids in to buy candy, junk food and violent games. Not every street is Sesame Street. Clearly, some people in the neighborhood don’t have your kids’ best interests in mind.
Sounds like the internet. Oh, wait, on the internet it is the parents who are expected to protect their children, not the government.
The FCC’s job is to make sure TV has safe places for children – and that parents know how to keep their kids out of the dangerous places -- and out of candy stores.
However, heaven forbid that the FCC would help parent's have effective tools to create safe places for their children. That's the government's job. You could give tools to the parents to do the job. For example, you have filters for the internet, which fail because the material on the internet is virtually infinite, but on the much smaller realm of broadcast, you don't have similar tools. But, better that the FCC do it for you.
Parents, be warned: the cops on the beat aren’t on top of the new developments in the neighborhood.
We admit it! We can't do the job.
So let’s make sure that tomorrow’s digital television has more safe neighborhoods to wander in. Let’s insist on more informative, educational, healthy choices for our children.
You know, because the markets apparently won't supply it. For some strange unknown reason, demand for these programs is low. Must be a failure of capitalism or something.
Broadcasters are the landlords of the television landscape. But the FCC is supposed to protect the public against the natural tendencies of corporations to seek out the bottom-line above all else.
If broadcasters are landlords, it is because the FCC has made them so. Normally, we figure that the market, seeking the bottom-line, is in the public's best interest. However, if the government creates a screwed-up oligopoly structure, then the government has a reason to step in to regulate it. Bonus.
Broadcasters’ bargain with the government is that in exchange for free use of the public airwaves, they are supposed to serve the public interest....But the FCC provides very little assurance that all broadcasters will do so. It has so weakened the specific public interest obligations that broadcasters don’t have much left to prove. It’s time to restore these public interest obligations for the new era of interactive, digital TV.
How convenient that the government has structured regulations such that broadcasters must have a "public interest." After all, look at how badly cell phone spectrum is being abused without "public interest" obligations. And other than keeping naughty words off the air, what, exactly is the public interest? Who is to determine it and why? If we can figure out what the correct market for public information material is for broadcast, can we apply the same analysis to other media? Can we determine the public interest in newspapers, periodicals and books? If we determine that there not enough educational children's books being published, should the government step in and require more?
Digital TV promises to enhance the TV world for everyone, including children. Broadcasters can turn today’s single analog channel into 5 or 6 channels. This makes room for more programs to educate, inform, and inspire our nation’s children.
Heck, it makes room for more programs to educate, inform, and inspire our nation's adults. More educational programming for adults, I say! I mean, why should the children be the only ones who benefit from the "public interest" obligations? I want some more benefit too! Don't I count?
And, as Senator Brownback said this morning, datacasting can give parents real-time ratings and content information so they know what their kids are getting – and can keep them out of the candy store if they want.
But, if the parents have access to all this information, what use will the FCC have in regulating indecency? I wonder why Adelstein doesn't mention this. Or, bonus, we get better rating information and we still regulate speech! Indeed, why isn't Adelstein pushing such information right now?
Broadcasters should use this capability to expand the diversity and quality of programming. They should use this opportunity to empower parents.
Indeed they should. However, who will decide if they have or not? Adelstein, of course. Also, I thought that the FCC had the ability to regulate these things.
I firmly believe that new horizons in broadcasting should correspond to new horizons in serving the public interest. So we at the FCC must do our part. The FCC must urgently define the new rules for the digital era, and that includes children’s television.
Where was this guy when they invented the printing press? Just imagine if we set certain public interest obligations for the printing press as "new horizons" appeared. The world would be a better place, I tell you.
Six years ago, some broadcasters recognized that to the extent that multicasting expands broadcasting opportunities, the public interest obligations should also expand.
The more freedom, the more government regulation is necessary. Yes, indeedy.
Many issues involving children’s TV involve the complex relationships between electronic media and a child’s cognitive, social, emotional and physical development. Much more research needs to be done on how interactivity affects the balance.
Now the FCC will figure out the best way for us to raise our children. All praise the FCC!
It's about time we started. We can’t let our children venture into an unknown, unprotected digital media environment – all because the FCC didn’t do its job.
You know, because the internet has been such a tremendous failure for children. It has ruined them.
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June 09, 2004

Re-Charter the FCC, Don't Abolish It

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Yesterday, I responded to Declan McCullagh's die, FCC, die rant (Why the FCC should die) by saying that the FCC shouldn't be eliminated but re-chartered to promote open spectrum (Mend the FCC, Don't Abolish It).

Perhaps I am wrong as it seems that two economist bloggers support McCullagh's reasoning. Marginal Revolution simply agrees (Abolish the FCC). Winterspeak reiterates the point that spectrum should be privatized and auctioned off (Can the FCC). Neither considers the open spectrum model.

On LawMeme, however, James Grimmelmann does, referencing four distinct but related articles (Four Stories About Spectrum).

One of the articles is by David Isenberg on Wireless Unleashed, who rather conclusively demonstrates why the property/fee simple model of spectrum regulation doesn't make a lot of sense (Abolish the FCC -- but for a different reason).

Moore's Lore: That's Another Fine Mess (Interesting idea - worth thinking about, though probably not a winner - move the FCC into the judicial branch).

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Broadcatching as Political Reform

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Prof. Michael Froomkin had a neat little post last week about the use of highly-partisan movies to skirt campaign finance laws (Movies as a Campaign Finance Law End-Run). The basic idea is to make a partisan movie, such as Michael Moore's virulently anti-Bush film Farenheit 9/11, and then advertise the heck out of it prior to an election. The 30-sec trailers for the movie could be as effective as campaign commercials as anything the candidates and the campaigns "officially" run. As Froomkin notes, this will be a "loophole it will be next to impossible to close."

It is funny, you know. The advent of campaign finance laws have tracked closely with the advent of traditional broadcast mass media. The money is raised for massive television ad buys, not print ad buys or billboards or a whole bunch of other things. I don't think the Democrats lose sleep over the fact that the Republicans can out spend them with regard to Washington Times page buys. But what is the common solution to the television ad problem? All sorts of arcane, loophole-ridden, cynicism-increasing, lack of respect for law fomenting, First Amendment-threatening regulation of how money is to be raised and spent (basically for television advertisements).

I look at this and I'm baffled. If the problem is the need to raise lots of money to run an expensive television-ad based election campaign, maybe the problem isn't campaign finance but the durn fool way we've regulated our broadcast medium. Rather than see the problem as one of campaign finance, why don't we see the problem as one of television regulation? If the major networks weren't bottlenecks and gatekeepers for the most popular medium of all, I don't think we'd have 1/10 the problem with campaign ad buys (and the money raised) that we have now. Read on...

In a system of broadcatching, campaigns could release commercials and video playlists would incorporate the commercials based on desire, rather than exchange of money. If I saw a campaign commercial it would be because my trusted social network recommended it to me, not because somebody paid them to distribute it. Sure, politicians would pay to have their commercials associated with particular programming, but it would be a snap for someone else to add a playlist that included the countercommercial as well. In such a case it would be difficult to outspend the opposition. For every commercial they pay to place, the opposition can match with unpaid commercial placements. It would be a battle of the playlists, not a battle of buying network time.

If there were no longer channels or networks to speak of, if we watched the television smorgasboard we wanted from an essentially unlimited variety of sources, then each individual program would have more say over its editorial position with regard to commercials. No one can force the New York Times to run a political ad, let alone run a political ad at favorable rates, unlike television networks, which are required to run campaign advertising at favorable rates. The justification for such video regulation doesn't exist in a broadcatching world.

I imagine that we would have relatively politically neutral video playlists from groups like the League of Women Voters that would feature ads from both parties. Lots of organizations, some partisan, others not, would also promote their video playlists. The landscape would be much different and I don't think that massive television advertising budgets would give near the same advantage to well-financed politicians that they do now.

Reform television regulation, not campaign finance!

June 08, 2004

Mend the FCC, Don't Abolish It

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C|Net News runs yet another hyper-libertarian/quasi-anarchist rant from Declan McCullagh, this time about getting rid of the FCC (Why the FCC should die). Don't get me wrong, few people despise the FCC's current incarnation more than me. Even fewer government agencies suffer as much cognitive dissonance as the FCC; worshipping free markets where there is market failure and embracing censorious paternalism where people can make their own choices. However, McCullagh is also suffering a serious bout of cognitive dissonance when it comes to his solution.

For example, the article complains about the FCC enforcing the broadcast flag. Would private spectrum be any different? After all, software is mostly free of government regulation, but every major media software option provided incorporates DRM that is frequently worse than the broadcast flag. The FCC isn't requiring (yet) WMA and iTunes to incorporate DRM, but they do anyway. Private ownership doesn't protect against market structure created by other aspects of law.

Gee, think about how the DMCA will work with regard to private spectrum. Only authorized devices will be permitted to connect to the network. Hmmm ... sort of sounds like when the FCC banned homeowners from owning their own non-Bell phones, except the decisions this time will be made by a corporatist oligarchy.

Now, in his free market worship, McCullagh thinks that spectrum is more valuable if it is excludable - that is the "owner" can keep others from using the same spectrum. He doesn't even consider the possibility that spectrum could be free to use, as long as everyone obeys certain rules.

The FCC shouldn't be abolished, it should be re-chartered. We'd be better off if the point of the FCC was to attempt to enforce the end-to-end principle and make spectrum as dumb and free as possible.

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May 26, 2004

Violence is the New Profanity?

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This news item from Broadcasting & Cable is nearly a week old, but it shows that the FCC wants to extend its control over free speech beyond sex (FCC Will Look at Violence). Interestingly, the study will focus on "the impact of TV violence on children." Note, the study won't be about the impact of broadcast TV violence, but TV violence alone, which leaves a lot of leeway for taking a look at a bunch of things like cable and etc.

via Lost Remote

May 25, 2004

FCC Requests Comments on a la Carte Cable Subscriptions

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Today, the FCC issued a request for comments regarding a la carte cable programming pricing (Comment Requested on a la Carte and Themed Tier Programming and Pricing Options for Programming Distribution on Cable Television and Direct Broadcast Satellite Systems [PDF]). This is an issue that has gotten much press recently, mostly due to consumer group pressure as well as conservatives who don't like the idea that some of their money might be supporting indecent cable programming.

Most of the articles that address this issue, however, deal solely with the question of whether consumers should have to pay for something they have no interest in. In contrast, a passle of economists argue persuasively that, in fact, cable bundling can be a good thing in aggregate. See, among others, Marginal Revolution: Why can't you choose your cable channels?. The basic idea is that "when demands are scattered [hard to tell who likes sports and who like cartoons] and the marginal cost of additional service is low," bundling makes sense.

However, this doesn't address the bundling that concerns me - the bundling of programming from content producer (think Disney) to cable company. If a cable company wants Disney's ESPN, they're going to have to take some of Disney's less popular channels as well. Read on...

You might wonder why, if bundling makes sense for consumers, why it doesn't also make sense for cable companies. But the assumptions for both cases are different. In the case of consumers, an assumption is that the cable company can gauge the aggregate demand for a channel but not the specific demand. In other words, the cable company knows that 50% of its customers want ESPN, they just have a hard time identifying which 50%. Of course, the cable company could go through a process of interviewing and negotiating with each individual consumer to determine their specific demand, but the transaction costs are too high. On the other hand, since cable companies and content producers already engage in expensive negotiations for channels, the transaction costs would seem to be reasonable. A content producer should be able to negotiate and determine a cable company's specific demand for a particular channel.

As with any bundling scheme, one also has to ask to why the seller would want to bundle, since that generally decreases the price they can get from negotiating two separate prices. In this case, among other reasons, bundling content has the effect of increasing the barriers to entry for producers of cable channels. If Comcast has to take a food channel from Disney as part of the ESPN deal, it will be more difficult for me to get Comcast to buy and provide good channel space for my food channel. The increased barrier to entry more than offsets Disney's lost revenue from bundling.

Of course, one might argue that the content creators want to bundle through the cable companies to the consumer. But we have a middleman here for a reason, don't we? Shouldn't the cable company buy programming channels a la carte and then decide on what bundling to consumers makes sense? If we want to turn the cable companies into common carriers for content, fine. But, if not, then let them decide what bundling makes sense, since they are closer to the consumers.

Thus, I am happy that the FCC is actually addressing the content producer bundling issue. Some of the questions the request for comment proposes are:

Do MVPDs ["Multichannel Video Programming Distributors" - FCC-speak for cable and satellite companies] currently have the option to purchase channels from programmers on a stand-alone basis, such that they could, if they chose, offer programming to consumers on an a la carte or themed-tier basis? What are the limitations, if any, on their flexibility to do so? What statutory or regulatory action would be needed to remove any such limitations?
What would the impact be on retail rates to consumers if programmers were required to offer their programming to MVPDs exclusively on a stand-alone basis, and could not also offer programming on a bundled basis for free or at a discounted rate?

This next question is a very good one considering the "must carry" rule that allows broadcast networks to be especially extortionary.

How have broadcast networks and affiliate groups used the retransmission consent process to expand carriage of affiliated programming? How has this affected rates for MVPD offerings for consumers?

The next three questions make me think of the doctrine of "copyright misuse" for some reason.

What, if any, Constitutional or other legal questions are raised by programmers' ability to bundle services through retransmission consent, regional sports contracts, and national programming contracts for marquee programming?
What, if any, Constitutional or other legal questions would be raised if Congress required programmers to offer their channels to MVPDs on a stand-alone basis and prohibited them from requiring carriage of their programming on particular tiers?
What, if any, Constitutional or other legal questions would be raised if, in addition to currently offered packages, Congress required programmers to allow MVPDs to voluntarily offer their channels on an a la carte or themed-tier basis?

If any economists would like to work with me on some comments to the FCC, let me know. Comments are due July 8th.

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April 13, 2004

The FCC and Idiotic Idiot Box "Innovation"

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Public Knowledge's President, Gigi Sohn, has an op-ed in C|Net News today on the FCC's digital media/broadcast flag powergrab (FCC is taking wrong turn on digital media). She points out a couple of the dumb things the FCC plans to do with their claimed power to regulate digital media. However, if the FCC gets away with the broadcast flag, imagine all the dumb ideas content providers will try to foist upon us.

Read on...

For example, Engadget notes that a company called MyDTV has gotten $7 million in financing to provide pop-up ads on television programming (Pop-ups coming to digital TV?). From the company's website:

A Mel Gibson fan is watching a news program. An on-screen message recommends the viewer watch "Mad Max Beyond Thunderdome," which will air on a PPV channel in one minute. The viewer may then choose to click on the alert to tune to the movie. The viewer is happy because he saw a recommendation to see his favorite actor and is willing to pay the $3.95 to watch the movie as a result.


Let's say a Jennifer Aniston fan is watching a news program. An on-screen promotion alerts that viewer that Jennifer will be interviewed on your channel in one minute. The viewer may click on the promotion to tune to the interview. The viewer is happy because he saw his favorite TV star, and your ratings improve as a result.

Just what we need. Pop-ups for television. Now, this isn't necessarily a bad idea, but to have it imposed by the gatekeeper distributer is a bad idea. I would be interested in such a service, if it were based on open standards and I could subscribe only to those notification services that I trusted, just as I subscribe to the RSS feeds I am interested in. Will the FCC allow such a system to be built on top of the broadcast flag? Unlikely, especially when the broadcasters undoubtedly complain and threaten to withold valuable content.

PVRblog reports on cable operators struggling to promote Video-on-Demand (VoD) in the face satellite TV's major PVR push (PVRs: satellite vs. cable). According to Television Week, "only 38 percent of cable subscribers are aware that they can get DVR service from their cable operators, compared with 78 percent of satellite customers" (Cablers Start a Fire Under VOD Plans). So what is the response from cable operators? Are they promoting their PVR services more? No, that would empower consumers too much. Instead cable operators are (in PVRblog's helpful summary):

  • boosting video-on-demand (VOD) by working with the film distributors so that movies are available on VOD as soon as they are released to movie rental stores
  • video-on-demand double features (essentially a two-movies-for-one-movie-price on a theme)
  • "video magazines on niche topics such as yoga, cars and bird watching" (huh?!)
  • promotions on the TV Guide Interactive channel

I had to read the last sentence of the TV Week article twice. "'If we do our job [by providing VoD niche magazines] ..., people will think twice about leaving for satellite,' he [a regional VP with Mediacom] said." I originally thought the quote said "If we do our job ... people won't think twice about leaving for satellite."

Video on Demand is, apparently, the sort of innovation the FCC supports, as they are doing their best to cripple DVRs.

April 07, 2004

The Broadcast Flag Treaty - Draft Available

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Well, technically, the treaty is called the WIPO Treaty for the Protection of Broadcasting Organizations, cuz heaven knows they're all faced with extinction. The draft treaty will be discussed June 7-9 by WIPO's Standing Committee on Copyright and Related Rights (SCCR), which will then "decide whether to recommend to the WIPO General Assembly in 2004 that a Diplomatic Conference be convened." A diplomatic conference can adopt a treaty. The treaty will not go into effect, however, until a certain number of countries have acceded to it. The draft of the treaty is available here: Consolidated Text for a Treaty on the Protection of Broadcasting Organizations [PDF].

This treaty is really a nasty bit of work. It will give broadcasters, not copyright holders but broadcasters, a number of exclusive rights in their broadcasts, such as fixation, reproduction and distribution, whether or not the broadcast is of a public domain work. Moreover, the treaty would require signatories to prevent circumvention of those rights.

Oh yeah, the treaty would also apply to "cablecasters" and the United States (all alone on this one, apparently) wants the treaty extended to cover "webcasters." What exactly constitutes a webcaster isn't entirely clear, perhaps only streaming, perhaps HTTP. While the US is not a signatory to the previous treaty on broadcast, our efforts on negotiating this one indicate we are likely to sign on.

Read on for a look at this monstrosity...


EFF's Consensus at Lawyerpoint, an anti-broadcast flag blog, reported on the origins of this treaty back in August 2002 (Europeans push WIPO Broadcast Treaty to create "fixation rights"). Last October James Love, director of the Consumer Project on Technology, wrote (with comments and suggestions from EFF's Cory Doctorow) an excellent analysis of an earlier draft of the treaty ([DMCA-Activists] On the Proposed WIPO XCasting Treaty). CPTech maintains a website tracking the treaty (The proposed WIPO Treaty for the Protection of the Rights of Broadcasting, Cablecasting and Webcasting Organizations).

Sui Generis Copyright-like Protection for Broadcasts

The treaty would give (among others) the following rights to broadcasters, cablecasters and, if the US has its way, webcasters: fixation, reproduction and distribution. Of course, there is no limit on what is covered by the treaty, as long as it is "broadcast" and consists of "sounds or of images or of images and sounds" (although why they couldn't just say "images and/or sounds" is beyond me). In other words, broadcast of public domain works like Dawn of the Dead would be covered along with works for which the broadcaster owns the copyright. Heck, you could start a radio station that exclusively broadcast Creative Commons-licensed freely distributable works and keep anyone from recording your broadcast.

Why bother with copyright? Simply "broadcast," or in the US's version, "webcast" all your material. Instead of connecting to an FTP server to get video or music you would connect to an ongoing "webcast" of the media, so that way, the broadcaster can keep control of the media even if it isn't copyrightable.

Article 8
Right of Fixation
Broadcasting organizations shall enjoy the exclusive right of authorizing the fixation of their broadcasts.

No more VCR, DVD-R or TiVo for you. So much for time shifting. Goodbye Sony v. Universal, it was nice knowing you.

This is the mandated broadcast flag. If the broadcaster doesn't want you recording it, you don't have a right to.

Article 9

Right of Reproduction

Alternative N

Broadcasting organizations shall enjoy the exclusive right of authorizing the direct or indirect reproduction, in any manner or form, of fixations of their broadcasts.

Alternative O

(1) Broadcasting organizations shall have the right to prohibit the reproduction of fixations of their broadcasts.

(2) Broadcasting organizations shall enjoy the exclusive right of authorizing the reproduction of their broadcasts from fixations made pursuant to Article 14 when such reproduction would not be permitted by that Article or otherwise made without their authorization.

More broadcast flag goodness. Even if you are allowed to record it, the broadcaster can control how you can reproduce it. That way, if you want to shift the latest Sopranos from the TiVo in the living room to your laptop to watch on the plane, the broadcaster can stop you.

The US and, for some reason, Egypt support alternative "O", which protects broadcasters from reproductions of unauthorized fixations.

Article 10

Right of Distribution

Alternative P

(1) Broadcasting organizations shall enjoy the exclusive right of authorizing the making available to the public of the original and copies of fixations of their broadcasts, through sale or other transfer of ownership.

(2) Nothing in this Treaty shall affect the freedom of Contracting Parties to determine the conditions, if any, under which the exhaustion of the right in paragraph (1) applies after the first sale or other transfer of ownership of the original or a copy of the fixation of the broadcast with the authorization of the broadcasting organization.

Alternative Q

Broadcasting organizations shall have the right to prohibit the distribution to the public and importation of reproductions of unauthorized fixations of their broadcasts.

In other words, no filesharing of broadcasts. Don't you dare make the fixation you made of ABC's broadcast of the President's State of the Union address (SotU) available on KaZaA.

Article 11

Right of Transmission following Fixation

Broadcasting organizations shall have the exclusive right of authorizing the transmission of their broadcasts following fixation of such broadcasts.

Don't webcast what you've saved previously. Not only can't you put your fixation of the SotU on KaZaA, you won't be able to webcast it either.

Now, governments can make the same exceptions to these broadcasting rights as they "provide for, in their national legislation, in connection with the protection of copyright in literary and artistic works." But they don't have to. Nor is it clear to me, under recent copyright decisions, that the Constitution requires the US to do so.

Term of Protection and Formalities

Article 15
Term of Protection
The term of protection to be granted to broadcasting organizations under this Treaty shall last, at least, until the end of a period of 50 years computed from the end of the year in which thebroadcasting took place.

Great. Copyright isn't long enough we have to provide protection for the broadcasts for fifty years in addition? So, forty years from now, when your grandchildren want to use a clip from television today to illustrate a report on the popular culture of their grandparent's era, they'll have to clear permissions with the television station that broadcast the clip (assuming we still have television stations then).

The previous treaty had a length of twenty years and, as we all know, broadcasters in countries that signed the treaty have suffered greatly from this length.

Article 18


The enjoyment and exercise of the rights provided for in this Treaty shall not be subject to any formality.

No pesky registration requirements or anything. That way it is very difficult for people to know who owns the rights to what decades from now.

DMCA for Broadcast Flag

Article 16
Obligations concerning Technological Measures
(1) Contracting Parties shall provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by broadcasting organizations in connection with the exercise of their rights under this Treaty and that restrict acts, in respect of their broadcasts, that are not authorized or are prohibited by the broadcasting organizations concerned or permitted by law.
Alternative V
(2) In particular, effective legal remedies shall be provided against those who:
(i) decrypt an encrypted program-carrying signal;
(ii) receive and distribute or communicate to the public an encrypted program-carrying signal that has been decrypted without the express authorization
of the broadcasting organization that emitted it;
(iii) participate in the manufacture, importation, sale or any other act that makes available a device or system capable of decrypting or helping to decrypt an encrypted program-carrying signal.
Alternative W
(2) [No such provision]

This is the equivalent of the passage in the WIPO Performances and Phonograms Treaty (WPPT) that the US used as one of the justifications for the passage of the DMCA. So, not only does this treaty require a broadcast flag, it will be illegal to circumvent it.

Article 17
Obligations concerning Rights Management Information
(1) Contracting Parties shall provide adequate and effective legal remedies against any person knowingly performing any of the following acts knowing, or with respect to civil remedies having reasonable grounds to know, that it will induce, enable, facilitate or conceal an infringement of any right covered by this Treaty:
(i) to remove or alter any electronic rights management information without authority;
(ii) to distribute or import for distribution fixations of broadcasts, to retransmit or communicate to the public broadcasts, or to transmit or make available to the public fixed broadcasts, without authority, knowing that electronic rights management information has been without authority removed from or altered in the broadcast or the signal prior to broadcast.
(2) As used in this Article, “rights management information” means information which identifies the broadcasting organization, the broadcast, the owner of any right in the broadcast, or information about the terms and conditions of use of the broadcast, and any numbers or codes that represent such information, when any of these items of information is attached to or associated with 1) the broadcast or the signal prior to broadcast, 2) the retransmission, 3) transmission following fixation of the broadcast, 4) the making available of a fixed broadcast, or 5) a copy of a fixed broadcast being distributed to the public.

And don't try to make your copy of the broadcast of the State of the Union look like a legal, unbroadcast version.

Article 21

Provisions on Enforcement of Rights

(1) Contracting Parties undertake to adopt, in accordance with their legal systems, the measures necessary to ensure the application of this Treaty.

(2) Contracting Parties shall ensure that enforcement procedures are available under their law so as to permit effective action against any act of infringement of rights or violation of any prohibition covered by this Treaty, including expeditious remedies to prevent infringements and remedies which constitute a deterrent to further infringements.

Many people argued that the WPPT didn't require the US to pass the DMCA, as Congress concluded, because the US already adequately protected the rights of copyright owners. As the US doesn't protect any "broadcast" rights (other than some "theft of service" stuff), this provision would pretty much require a US Broadcast Flag DMCA law to be passed.


This is bad, bad, bad. What more can I really say?

April 05, 2004

A Fond Look Back at the Television Code of 1951

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Jeff Jarvis is doing an excellent job following the FCC's attack on free speech for broadcast. His latest "Daily Stern" report points out the inconsistencies between FCC Chairman Michael Powell's previous statements on broadcast speech regulation and his current stance (The Daily Stern: Sayings of Chairman Powell).

More interestingly, however, Jeff is ripping apart the old, voluntary US Code of Practices for Television Broadcasters (The Daily Stern: The Code). The "Code" was the set of ethical guidelines established in the early days of television for United States television broadcasters, but was abolished in the 1980s. The reason Jeff brings it up again is because the FCC is now pushing broadcasters (and if Commissioner Michael Copps has his way, cable and satellite channels) to adopt a brand new set of "voluntary" guidelines. Many aspects of the old code seem laughable now, but which will broadcasters readopt if pushed hard enough by political pressure? Fifty years from now, which aspects of a new code will look laughably quaint? Some examples of the old code with Jeff's comments:

Attacks on religion and religous faiths are not allowed. Reverence is to mark any mention of the name of God, His attributes and powers.... [Clergy] portrayed in their callings are vested with the dignity of their office and under no circumstances are to be held up to ridicule.
So The Code is explicitly trying to proselytize the nation. And it won't allow us to make fun of, oh, Jerry Falwell, Jimmy Swaggart, Jim Bakker, or hundreds of kiddie-diddling priests.
Exhibitions of fortune-telling, astrology, phrenology, palm-reading, and numerology are acceptable only when required by a plot...
So much for Crossing Over with John Edward.
Law enforcement shall be upheld, and the officers of the law are to be portrayed with respect and dignity.
Unless they rob, steal, or beat up people for no reason. OK, destroy the Rodney King tape.
It is the responsibility of a television broadcaster to make available to the community as part of a well-balanced program schedule adequate opportunity for religious presentations....A charge for television time to churches and religous bodies is not recommended.
'Nuff said.

See Jeff's post for many more gems, but here are a few more that Jeff didn't have time to go through:

Sex crimes and abnormalities are generally unacceptable as program material.

Goodbye, Law & Order: SVU. Adios, Guinness Book of World Records television series.

The use of gambling devices or scenes necessary to the development of plot or as appropriate background is acceptable only when presented with discretion and in moderation, and in a manner which would not excite interest in, or foster, betting nor be instructional in nature

Well, the World Series of Poker is right out. I'm not so sure about Las Vegas, either.

I wonder if the new guidelines will take as much care with commercials as the old ones do:

Advertising messages should be presented with courtesy and good taste; disturbing or annoying material should be avoided...


The advertising of beer and wines is acceptable only when presented in the best of good taste and discretion, and is acceptable subject to federal and local laws.

How many beer commercials are in good taste? How many of the funniest, best remembered beer commercials are in good taste?

The advertising of fortune-telling, occultism, spiritualism, astrology, phrenology, palm-reading, numerology, mind-reading or character-reading is not acceptable.

Miss Cleo, this means you.

The advertising of tip sheets, race track publications, or organizations seeking to advertise for the purpose of giving odds or promoting betting or lotteries is unacceptable.


The Speech Powell Should Have Given on Indecency

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Last week, I wrote an annotated version of two recent speeches, one by FCC Chairman Michael Powell and the other by Commissioner Michael Copps, in which they addressed (behind closed doors) the National Association of Broadcasters regarding indecency regulation (FCC Commissioners - No Free Speech Please, We're Americans). Frequent commentator Cypherpunk thinks that I was overly harsh with regard to Michael Powell, who formerly was a strong defender of freedom of speech in broadcasting (Too Rough on Powell).

Rather than simply rebut Cypherpunk, I've adapted Powell's speech to give my version of what he should have said at the NAB meeting.

The original speech is here:
Remarks of FCC Chairman Michael Powell at the NAB Summit on Responsible Programming, The Renaissance Hotel, Washington D.C., March 31, 2004 [PDF].

Read on for my revised version.

Remarks that
FCC Chairman Michael Powell
Should Have Given
(According to Ernie Miller)
At the
NAB Summit on Responsible Programming
The Renaissance Hotel
Washington D.C.
March 31, 2004

Good Afternoon. Thank you Eddie for that kind introduction. I applaud you and your members for holding this summit and candidly exploring these issues that have lit up Washington - - - and indeed America - - - as of late.

These are challenging times for the broadcast industry.

For one, we are coming off an explosive debate about media ownership. The heated rhetoric often far exceeded the facts, but in any event, it created a very hostile climate for the media industry that will likely have lasting consequences. Of particular significance, and concern, is that the debate re-energized the previously fading debate about the role of government in content—whether it be restricting offensive content, or promoting favored content and viewpoints. I am greatly concerned that many have expressed increased comfort with governmental content intrusion in the furious debate about broadcast indecency and excessive violence.

While the broadcast medium does not today enjoy the full breadth of the First Amendment privilege, we should never be comfortable with content intrusion by the government.

In addition, the competitive pressures from other media sources continue to dramatically fragment audiences while the growing convergence of technology is evaporating any meaningful distinctions among distribution mediums. Competition continues to grow stronger from cable and satellite, but we are also seeing the use of advanced technology to create many other platforms that folks turn to for entertainment, information and news --- and the distinctions between these mediums and broadcast will grow increasingly blurred. Perhaps more importantly, competition is coming not only from traditional and not-so-traditional media sources, but also from what have naively been called “consumers,” who are increasingly becoming creators and participants in “citizens’ media.”

The rise of satellite radio, the Internet, video gaming, TiVo, and, of course, citizens’ media, all have combined to present sharp threats to traditional broadcasting, but also new opportunities for broadcast innovation, promoting free expression, and citizen empowerment.

But this competitive pressure also has unfortunate consequences as well. Indeed, I am of the view that it is this competitive pressure, much more than consolidation, which accounts for much of the programming that tests the limits of indecency and violence. As audience continues to fragment and the number of choices multiplies, it is harder and harder to grab and hold a viewer or listener, so the less innovative and creative resort to programming meant to gain attention through shock and titillation.

But it would be a mistake to think that all programming that tested the limits of indecency was merely meant to shock and titillate. Our history is replete with works, once thought beyond the bounds of decency, which have ultimately been recognized as important works of merit.

It is for this reason that the indecency laws, which are not new, periodically create a furor as each generation revisits their enforcement. For 77 years, Congress has had a statute that prohibits any obscene, indecent, or profane utterance over the airwaves. Yet, seventy-seven years later, what is seen as commonplace today would certainly have shocked the conscience of the Congress that originally passed the statute.

The FCC has always enforced these laws with varying success, in great part due to the ever-changing standards upon which we must base our judgments. In some periods, the FCC has been fairly light in its enforcement and in other years comparably heavy. I have seen both. I have argued passionately that we should have no such laws out of respect for the First Amendment, and others have argued with equal gumption that we should draw even more stringent limits. Such forces have always buffeted the FCC’s enforcement efforts --- or content intrusion generally for that matter --- and they always will.

These are always very difficult decisions. It is very hard to balance and reconcile our shifting moral and cultural values on one hand, and the enormous value we place on speech free from government intrusion on the other. At the margins this is quite difficult and the FCC has, in view of the emphatically narrow scope of our censorious power, generally been cautious.

However, as in every periodic furor, we are talking about speech or conduct that many Americans believe has clearly crossed that margin and has set off the current powder keg in the country. We see increasing - - - I might even say escalating - - - complaints from many Americans because increasingly it seems to these citizens that the media is not playing close to the line, but is outright leaping past the line and in fact daring the audience and daring the government to do anything about it.

Some of the transcripts I have been forced to read reveal content that is pure trash, plain and simple. But I always remind myself that the history of free expression in this country is one of vindication involving speech that many citizens have found shabby, offensive, and pure trash, plain and simple.

I think it is important, moreover, to understand what many Americans are actually upset about. The Super Bowl incident and the debate it unleashed is not really about a bare breast. It is not whether our society can accept public displays of the human body. It can. What really upset some people was the shock and amazement that such material would appear on that program at that time.

In other words, the debate is not best understood as one about what you can do or cannot do on radio or television. Rather, it is more about whether consumers can rely on reasonable expectations about the range of what they will see on a given program at a given time.

It is not Janet’s nudity that is decried. It is the fact that “it was the Super Bowl!” the largest prime television event of the year. It was promoted as an event for friends and family, but clearly much of the material was inappropriate for many Americans. Moreover, it was not simply Janet’s performance that was classless, crass and deplorable. Many of the commercial advertisements were just as crude, if not more so.

I cannot say that people would necessarily have been any less shocked with the supposedly family friendly Super Bowl had it been available only on cable rather than broadcast. But I do know that people do not like the sense that they have no safe expectation of what they might see or hear during a given program, whether broadcast, cable or DVD.

Like other media, people rely on a program’s or a network’s reputation to determine whether future programs will be appropriate for themselves or their family. This past Super Bowl CBS and the NFL broke faith with many in their audience in terms of expectations. Consequently, many responsible viewers will no longer view or permit their children to view CBS’ sportscasts of NFL games. Like any publishers who have betrayed their audience’s expectations, it will be CBS’ and the NFL’s tasks to earn back their viewer’s trust.

A station broadcasts a variety of fare during the day, and is limited by day parts. Over time, consumers came to expect and arrange their viewing choices around programming at certain times --- the morning shows, afternoon soaps and talk shows, primetime, and late night have had special meaning in broadcasting, unlike in other media. But these expectations are changing. Citizens, no longer simply consumers, are using devices such as TiVo to arrange their viewing choices to suit their convenience. They may watch their soaps in the evening and late night programming in the morning before work.

In the past, given the free over the air nature of the medium and limited viewing choices --- not least limited by the FCC itself --- consumers did not have the opportunity to express much in the way of prior consent to receive certain sounds and images. But today, with a wide range of viewing options, from cable to satellite, from DVD to DivX, consumers are expressing more and greater prior consent than ever before. As I’ve said before, most Americans are willing to bring TVs into their living rooms with no illusion as to what they will get when they turn them on.

The First Amendment is cherished, but it bends only for you among media services. The Supreme Court and countless legal decisions create a special exception that allows government to demand more from broadcasting.

However, due to many of the changes I have already spoken of, the justifications for that exception are under increasing attack. Eventually, the time will come when we will have a single standard of First Amendment analysis that recognizes the reality of the media marketplace and respects the intelligence of American citizens. We must prepare for that eventuality by giving citizens greater ability to take on the responsibilities this will entail.

Consequently, I am announcing a new program that will put increased power to make informed choices into the hands of citizens and parents. I am going to strongly encourage broadcasters to freely provide much more electronic metadata about their programming in order for citizens to be able to make better-informed choices.

I am not talking about the V-Chip and a ratings system, which are limited in their usefulness. I am speaking merely of robust information from broadcasters that will clearly identify their programming and its origins.

With such rich information in electronic format, third parties will be able to easily create the tools for parents and citizens to receive only those sounds and images they feel appropriate. Parents will be able to download annotated and sanctioned programming guides from groups they trust and, for example, program their TiVo accordingly. Even for those without TiVo, third-party systems could easily control access to television with much finer distinctions than the V-Chip, channel blockers, or FCC rulings are capable of making. For example, parents would be able to allow their children to watch sporting events, such as football, without having to worry about their children being exposed to alcohol ads.

It must be recalled that the FCC’s ability to regulate only extends as far as the patently or grossly offensive to community standards for the broadcast medium. We cannot levy fines against that which is only mildly offensive, or offensive only to one community’s standards. Furthermore, the FCC can only act long after the fact, as the process for determining fines is an extended one, not least because we must carefully balance important values.

But the availability of robust electronic metadata and programming guides will give citizens the ability to give their informed consent prior to receiving broadcast images and sounds. The viewers, as in any other medium, will discipline broadcasters who violate this trust. Both broadcaster and citizen will benefit. Citizens will benefit from being able to exclude that which offends them, while broadcasters will know that those viewing programs do so willingly.

This industry has always had a proud tradition of serving the public interest and has always relished that honor --- wearing it right out on your sleeve. This is a public-spirited medium that prides itself on delivering the news, weather, traffic, and critical information in an emergency, such as the Amber Alert and the countless contributions you make to your local community. Robust electronic metadata is just one more step in providing timely information in your communities’ interest.

In this vein, I want to strongly encourage you to develop and adopt a voluntary and robust metadata standard that will empower your viewers, the American people, to make informed decisions as to the content they view. I believe you can create such a standard and that you and your audience would benefit from you doing so.

The FCC will continue to enforce prohibitions on broadcasting obscene, indecent and profane material, not least because the law says so. But such enforcement alone will not be enough to meet the increased expectations of citizens to protect themselves and their family from inappropriate material. That is why I have proposed a program to give them even greater power to deny or permit broadcast programs into their homes.

As I once concluded a speech on the First Amendment several years ago: “We should think twice before allowing the government the discretion to filter information to us as they see fit, for the King always takes his ransom.” Let us, instead, give citizens the power to filter information as they see fit.

Thank you.

March 26, 2004

TiVo's Quasi-New Extended Commercial Model

- Posted by

A few days ago C|Net News reported that TiVo is planning on rolling out a quasi-new advertising model this fall (TiVo looks to tune in to advertisers). The new system is described thus:

Known as Video-to-Video, the idea is to let viewers click a button on their remote control to immediately watch a 3-minute video describing products and services that might appeal to them. The marketing clips are promoted through small icons that appear on the TV screen as viewers fast-forward past regular ads.

This is a perfect example of TiVo forgetting what made it successful in the first place. Remember those cool, early commercials for TiVo in which a couple of guys charged into a television network's offices and tossed a programming exec out the window? While the commercials might not have been terribly effective (many people still don't "get" TiVo), they did get to the heart of what makes TiVo successful: empowering viewers. With TiVo you no longer had to watch programs when and how the network execs (or advertisers) chose.

The problem with this new advertising system is that it is an attempt to get a limited amount of control back into the hands of the networks and advertisers. Consumers can have neat, new functionality, so long as that functionality suits the corporate interests. Sure, it would be nice to see commercials on TiVo for things tailored to my interests, but that doesn't give me enough control. I want links to content that isn't from the major advertisers. I do like checking out the extended previews for movies I'm interested in and the special preview of the new Ford GT had me drooling, but I also want to see links to some of the absurd stuff coming out of Japan.

Just as it is great to get The Simpsons on Sunday at 8pm, it is much better to watch The Simpsons whenever it is convenient. It may be great to get additional content for some of the commercials the networks want me to see, but it is better to get additional content that I've chosen to be receptive to. Why should I only get the commercials that major broadcasters or TiVo want me to watch?

These restrictions become more obvious as you see the reaction of TiVo's partners:

"TiVo's making money off ads that run over our air space--What's in it for ABC?," said Rick Mandler, ABC's general manager for enhanced television. "We're not going to pass those triggers through without a business relationship in place," he said.

This is precisely why we need to empower viewers. If viewers were truly empowered by this system, TiVo could simply ignore ABC. Once the programming is on TiVo's hard drive, it is no longer ABC's air space and ABC shouldn't have any say over the matter.

What we need is an open standards based system, like something built on RSS. To heck with ABC, people don't want ABC to be making the decisions about the sorts of enhanced content we can get. If ABC won't get out of the way, I'm sure other networks would be willing to take advantage by giving viewers what they want. And if no networks take advantage, then some internet startup will.

If TiVo dies, it will be at least partly due to the fact that they were willing to empower viewers only so much and no more. Having increased viewer expectations substantially, TiVo now wants to throttle such empowerment. Of course, they are doing it in a highly unimaginative way.

The long-term vision for TV advertising invokes a concept known as "telescoping," in which the lines between advertising and programming may blur beyond recognition.
For example, if a viewer is watching "The Apprentice" and likes the new BMW a young executive is driving, he could click on the car with the remote to get an informational video on the car and schedule a test drive with a dealer. He could then go back to watching the show at the exact point where he left off.

Yawn. Ahem. Allow me to clarify. YAWN.

I've been hearing this vision of television "interactivity" from brain dead marketing drones for-seemingly-ever. Yeah, sometimes extended commercials are cool, but if your imagination ends there, pathetic. It is sort of like imagining email and the only use you can think of is opt-in spam. I've got some interesting ideas, such as annotated shows (I'd watch B:tVS with a Buffy fan feed), but my imagination is also limited. Open the standards, let people come up with clever uses. I doubt IM was imagined when the IP protocol was developed. Chances are, many of the bottom up ideas for enhanced television could be commercialized eventually, and not one would have been imagined by a marketroid.

Let 1,000 broadcatching flowers bloom. Broadcatching Now!

There has been a number of other commentaries on this article:

The Slashdot community discussed TiVo's plans and there were actually a number of insightful comments (Tivo Plans Commercials On Demand).

Techdirt provides brief history and analysis (TiVo Still Trying Creative Approaches For Advertising).

PVRblog is, I think overly, concerned about the future if advertising and content blur too much (Tivo advertising)

If we end up with a future such as is described, maybe we will wistfully long for the 20th century, and relatively well-defined lines between advertising and content.

Tadspot's headline is obviously skeptical (Yup, Tivo Is Doomed).

March 23, 2004

Howard Stern Should Ask FCC: What is Profane?

- Posted by

Last Friday I wrote about the FCC's decision last Thursday to begin enforcing their power to regulate "profane" language, something they have not done before (FCC Revives Notion of the Profane). See also this followup by Constitutional law guru Jack Balkin: Hate Speech Codes For Broadcasting?. Jeff "BuzzMachine" Jarvis has been, well, a machine when it comes to posting on this issue. Start with today's "Daily Stern" and just follow the links to previous posts for all the news fit to blog.

Despite all this discussion, however, I am still in the dark as to what "profane" means as the FCC interprets it.

Warning: Highly offensive language used as examples below.

The FCC has updated its policy page for "Obscene, Profane & Indecent Broadcasts," which declares briefly that:

Profane Broadcasts Restricted to 10 P.M. - 6 A.M.
The FCC has defined profanity as “including language that denot[es] certain of those personally reviling epithets naturally tending to provoke violent resentment or denoting language so grossly offensive to members of the public who actually hear it as to amount to a nuisance.” See Complaints Against Various Broadcast Licensees Regarding Their Airing of the Golden Globe Awards Program, FCC 04-43 (released: March 18 2004) (“ Golden Globe Awards”). In announcing the latter part of this definition, the FCC ruled that the single use of the “F-word” in the context of a live awards program was profane. The FCC further stated that it, “depending on the context, will also consider under the definition of profanity the “F-Word” and those words (or variants thereof) that are as highly offensive as the “F-Word,” to the extent such language is broadcast between 6 a.m. to 10 p.m. We will analyze other potentially profane words or phrases on a case-by-case basis.” [emphasis, hyperlink in original]

Hmmm ... that definition clears things up ... not. So, confused, I called the FCC's Enforcement Bureau's Investigations & Hearings Division (the number is usefully posted on their page). Unfortunately, they could provide me no more guidance than what was on their webpage and what was in the recent decision. I asked if they had any plans to provide guidance, as they do with regard to indecency (In the Matter of Industry Guidance On the Commission's Case Law Interpreting 18 U.S.C. § 1464 and Enforcement Policies Regarding Broadcast Indecency), though I expect the indecency guidelines will need some major revision. The answer I received was, "that is up to the Commission."

Since the FCC seems too busy to let people know what their definition means, or at least provide some examples and guidance, I suggest that, as a public service, Howard Stern test the limits of the new definition of "profane." Howard can do this either by broadcasting content that is arguably "profane" or by gathering examples from other broadcasters of the arguably "profane" cough*Oprah*cough. Below, I list several particular areas of the FCC's definition that can be challenged.

But first, in order to test the limits of the "profane," any examples should be free of indecency. Thus, any test-worthy "profane" content should not depict or describe "sexual or excretory organs or activities." The Seven Dirty Words and closely related terms are right out. Phrases like "shit-eating nigger" don't count because "shit-eating" obviously refers to excretory activities. Phrases like "dumb, stupid nigger," however, might make appropriate test cases.


Traditionally, the "profane" has been closely related to blasphemy, which the FCC acknowledges. The FCC now claims that the "profane" encompasses more than blasphemy, however, the FCC does not say that the "profane" does not still include the blasphemous:

We recognize that the Commission’s limited case law on profane speech has focused on what is profane in the context of blasphemy, but nothing in those cases suggests either that the statutory definition of profane is limited to blasphemy, or that the Commission could not also apply the definition articulated by the Seventh Circuit. Broadcasters are on notice that the Commission in the future will not limit its definition of profane speech to only those words and phrases that contain an element of blasphemy or divine imprecation... [footnotes omitted]

The FCC could have declared that not only is "profane" not limited to blasphemy but that it does not include it. What possible reason for not restricting the definition could they have had except that they are angling to come down hard on those who "sin against the virtue of religion"? While the Supreme Court has said one may not censor films for being "sacrilegious" (Burstyn v. Wilson, 343 U.S. 495 (1952)), apparently the Commission believes it still retains some authority over blasphemy. Someone should test that theory.

John Lennon once claimed the Beatles were "bigger than Jesus," which resulted in a rather large backlash (lots of people were quite offended) but a phrase so mild would be unlikely to work. Precedents hold that phrases like "god damn it" are not profane. However, if we go a little further back, say 70 years, we find a case in which profane speech was upheld (Duncan v. United States, 48 F.2d 128 (9th Cir. 1931)):

I'll put on the mantle of the Lord and call down the curse of God on you, that's what I'll do. You infamous harlot, you arch criminal, the people should tar and feather you and yours,

Perhaps Howard Stern could start his tests with that little speech addressed towards Michael Powell, for example. Using the words "by God" multiple times and in conjunction with irreverent speech has also been found to be profane, by God.

Perhaps there could be a contest on Howard Stern's show in which listeners are invited to profane the name of God (without being indecent). The real question is what would it take to get a blasphemy ruling from the FCC?

Hate Speech

Likely, hate speech is a much richer vein to mine when it comes to testing the FCC's new "profane" language ruling. Speaking of mines, the following was once found to be profane: "I can whip any damn Groover of the name." Seriously, when we think of "grossly offensive" language that is not "indecent," hate speech has to be at the top of the list. It would be easy enough to let loose with a racist diatribe (just be sure to avoid sexual or excretory words) and grossly offend people.

"Grossly offensive" does not necessarily require an out-and-out racist diatribe, however. The New York Daily News reports that WWPR fired a DJ for racially insensitive remarks (DJ fired for race remark). According to the article, the DJ spoke out against interracial relationships. Subsequently, "The station received many E-mails, phone calls and messages from listeners who were displeased and felt alienated as a result of her actions." As the DJ said, "I am being censored not for sexual indecency, but racial indecency." Sounds about right to me; the FCC ought to do something about it.

In any case, we should find out what some of the boundaries are. How far does "grossly offensive" extend?

Who Must be Offended?

According to the FCC, in order to be indecent, a broadcast must be "patently offensive as measured by contemporary community standards for the broadcast medium." For this, the FCC provides a little more clarification, "The determination as to whether certain programming is patently offensive is not a local one and does not encompass any particular geographic area. Rather, the standard is that of an average broadcast viewer or listener and not the sensibilities of any individual complainant."

The "contemporary community standards" test is fairly standard for naughty bits, but the FCC did not adopt that test for profane language. Instead, the FCC declared that profane language must be "grossly offensive to members of the public who actually hear it as to amount to a nuisance." Hmmm ... "members of the public." Could it be that two offended members of the public would be enough to trigger a fine? If a broadcast is a nuisance to two members of the public is that enough?

The FCC does, sort of, provide a definition for "nuisance":

Nuisance has been defined as including “a condition of things which is prejudicial to the . . . sense of decency or morals of the citizens at large . . . .” Ballentine’s Law Dictionary (3d ed. 1969).

Nice use of the passive tense. Sure, nuisance has been defined that way. Nuisance has been defined lots of ways, but the FCC doesn't say which definition of "nuisance" they are adopting. And why does the FCC have to reach back to a legal definition more than 40 years old? Is the government so poor they can't afford more recent legal dictionaries?

In Pacifica, the "nuisance rationale" isn't about nuisances per se, but rather nuisance "law generally speaks to channeling behavior more than actually prohibiting it." Well, grossly offended members of the public are likely to want to channel offensive language, rather than prohibit it. Alternatively, "nuisance may be merely a right thing in the wrong place, - like a pig in the parlor instead of the barnyard." Whatever that means.

Indeed, whatever "nuisance" means. Obviously, "nuisance" is not the same thing as violating "contemporary community standards," otherwise the FCC would have used that language. Unfortunately, the FCC hasn't seen fit to provide guidance on what the distinctions might be. Is there anyone at the FCC who bothers to read the decisions they issue?

Probably the best way to test this aspect of the decision is for those people issuing complaints to declare that, while they don't believe the offending statements violate contemporary community standards they are definitely a nuisance.


The FCC's new "profane" language doctrine is a mess just waiting to be challenged. The opportunity to embarrass the FCC is there. Which broadcast personality will accept the challenge?

RSSTV Emergency Broadcatching System

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On Saturday, Andrew Grumet announced the release of RssReader 0.4d (RssReader 0.4d). In Andrew's words, "RssReader is TiVo-resident software that displays the contents of an RSS feed on your television." Of course, who the heck really wants to read RSS feeds on television? Sounds like one of those dotcom-era WebTV-like monstrosities. Instead, Andrew notes that "More interestingly, RssReader can schedule recordings from syndication feeds containing RSSTV extensions. This means you can subscribe your TiVo to a community-evolved ToDo list, such as the feed generated by Program My TiVo!" Absolutely, and something I think has amazing potential (RSS for TV, Music).

However, I also think that there is not only a desire for at least some RssReader functionality on television, but important reasons to make it happen. Indeed, perhaps a grant from Homeland Security to Grumet would be in order.

Imagine an RSS feed that would scroll at the bottom of your television display while you watched any other channel, a news ticker if you will. It would be just like the scrolling feeds on the news and financial networks, but would be overlayed on top of whatever you are currently watching. Most importantly, the content would come from an RSS feed.

Emergency Broadcatching System

When I lived on the East Coast, the television was a major source for breaking emergency local news such as school closings, traffic conditions and weather alerts. Turn on the local morning news after a snow storm and there would be a scroll of the business and school closings and delays. Major accidents on I-95 would initiate traffic tickers and you would also see listings of various counties under blizzard alert or where snow emergencies had been declared.

There are a couple of problems with this system. First, you have to be watching a live, local station. What about those gentle souls who like to start their morning with a relaxing gardening show on Home and Garden TV while they sip a nice cup of herbal tea? Thanks to TiVo, what about those early-risers who want to watch David Letterman's top ten from the night before in the morning just before heading to the home office?

Second, these scrolls are not necessarily the most efficient way of getting information to the audience. The alphabetical listings of businesses and schools seem to get longer and longer every year. Currently, you have to wait like 10 minutes for the darn thing to scroll through the entire listing in New Haven (and Yale never closes anyway). And you know something? I couldn't have cared less about the storm alerts in Windham County; I was in New Haven County, darn it.

Seriously, wouldn't it make a lot more sense to have an RSS feed for such emergency announcements? I want my employer or my school district to let me know when I should come in late or not come at all, and I want to know whether or not I'm watching a live, local news show. As TiVo (and broadcatching) become more popular it becomes less and less likely that people will be watching live broadcasts or the major networks. If you are the state or county government and need to let everyone know that there is a snow emergency or get other information out to citizens, who have dozens or hundreds of television channels to choose from, you can't simply hope that your citizens are watching the local ABC, CBS, NBC, PBS or FOX affiliate. Heck, if for some reason the television broadcast is out (terrorists attack transmitters, for example), you might still be able to get information to people through their televisions.

Cable companies could probably do something like this at government request, but not everyone wants to be constantly bombarded with this information on all channels. Okay, I know my school is closed today and now I just want to watch Spongebob Squarepants in peace. I'm not sure what capability satellite companies would have to do this on non-local channels. In any case, people may want information from sources other than the government and I doubt cable or satellite companies will run tickers for them.

People should be able to subscribe to particular feeds for their specific needs and you should be able to turn feeds on and off. There should also probably be a flag that would could be set to permit interruptions (automatically making the feed visible on the screen) and allow you to turn the feed off after you've got the information (only to reappear if there is an update, for example).

Other RSS Applications

Of course, once this system is in place, there would likely be a number of businesses that could be created to take advantage of such scrolls. Obvious applications include stock tickers and sports scores. Why not keep up with the stocks you follow while watching The Simpsons instead of CNNfn? Watch your favorite basketball game and keep closer tabs on the other teams you are interested in, rather than all the other scores and other sports the station's tickers usually have. News junkies can have news tickers running even while watching other entertainment.

Personalization would be great. Who wouldn't want to wake up in the morning with a personalized ticker that would include local weather and local traffic? In Southern California, wouldn't it be great if you could subscribe to the 5 Freeway/Orange County feed, or the 605 & 10 Freeways Los Angeles County feeds? Watch a national news show, but get a local news ticker? News could be even more specific. For us Copyfight junkies, why not Michael Geist's Internet Law News as an RSS feed you could read while watching Good Morning America? Sure, there wouldn't be a lot of content that could be sent in such a format, but it would alert you to stories you should probably check out later (or sooner, as the case may be).

If your feed is good enough, you might be able to get a minimum of advertising into the feed, or draw people to your website. I think the first news companies that jump on making this happen will make quite the splash. How embarrasing would it be for NBC News to know that that those watching the Today Show are getting a CNN news and weather RSS feed scrolling at the bottom of their screen?

Making RSSTV, RSS + BitTorrent and Broadcatching Real

Of course, once such a system is built out, it would be very natural and easy to add RSSTV ability to the mix. Once you can subscribe to an RSS news ticker feed, how much more difficult would it be to subscribe to "channel" feeds that tell your TiVo to record particular programs?

After that, the next obvious step is RSS + BitTorrent broadcatching. Heck, Homeland Security might want to have such a capability built into a "Emergency Broadcatching System." For example, it might be necessary to quickly disseminate multimedia that the local TiVo stores and records whether or not the television is receiving (or television stations are broadcasting). You never know when such a capability might come in handy.

Of course, once you have broadcatching built into every TiVo, ReplayTV and whatever it is that the Dish Network uses, whole new possibilities open up...

March 19, 2004

FCC Revives Notion of the Profane

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In a decision released yesterday, the FCC announced a new doctrine of fining "profane" broadcasts. Although 18 USC 1464 has always given the FCC jurisdiction over "obscene, indecent or profane language," the FCC has never based any fine on "profane" language, preferring to rely on indecency rulings. Given the newness of this interpretation of the law and the vagaries of the definition of "profane," this might be the most far reaching of the FCC's recent assaults on freedom of expression. Could the FCC be getting into the business of regulating hate speech?

Caveat: This decision is in a really vague area of First Amendment law and I've written my thoughts within hours of the decision's release, so my analysis is preliminary.


Back in October, the FCC ruled that the use of the word "fucking" as an adjective was not indecent (Bono Says 'Fucking' on TV; FCC Says 'OK'). Following Janet Jackson's wardrobe malfunction, the FCC decided to revisit that decision. Unsurprisingly, it was overturned and the use of the word "fucking," as in "this is really, really fucking brilliant," was found to be indecent. Read the press release: FCC Finds That Broadcast of "F-Word" During Golden Globe Awards Was Indecent and Profane [PDF]. Read the decision: In the Matter of: Complaints Against Various Broadcast Licensees Regarding Their Airing of the "Golden Globe Awards" Program [PDF].

The first thing that struck me, however, was not that the use of "fucking" as an adjective was found to be indecent. I understand the FCC thing about indecency. I don't agree, but I understand it. What struck me and what I don't really understand is this whole "profane" thing. Isn't "profane" something like blasphemy or contempt for the sacred? Well, it used to be. Used to be, as in people are seldom prosecuted or fined for it anymore, and the FCC never used it.

Turns out, where most anti-indecency folks would have been happy with overturning the original "fucking" decision, the FCC decided to go one big step further and has decided to basically create a doctrine of the profane. Why they would want to do this I have no idea. Nevertheless, this renewed doctrine seems to have the strong support of every commissioner:

Chairman Michael Powell

For the first time, the Commission has applied the profanity section of the statute for the broadcast of this highly offensive word, an application I fully support.

Commissioner Kathleen Abernathy

Although I support applying the definition of “profane” as discussed in Tallman to this particular incident, this too is a new finding by the Commission. The courts never applied the standard in Tallman to an isolated broadcast of the fword and the FCC has never used this definition in any analysis of “profane” content, let alone the use of expletives. Rather, “profane language” has historically been interpreted in a legal sense to mean blasphemy. Moreover, the Mass Media Bureau in a document entitled “The Public and Broadcasting” stated that “[p]rofanity that does not fall under one of the above two categories [indecency or obscenity] is fully protected by the First Amendment and cannot be regulated.” [footnotes omitted]

Commissioner Michael Copps

I support the decision to find the utterance of the f-word on NBC’s broadcast of the “Golden Globe Awards” to be both indecent and profane. I found ludicrous the Enforcement Bureau’s decision that a word that might otherwise be indecent is not indecent or profane merely because it is used as an adjective or expletive.

Commissioner Kevin Martin

I am pleased that the Commission finally is making clear that the use of the “F-word” during this prime-time broadcast was both indecent and profane, regardless of whether used as an adjective, adverb, or gerund. I am particularly pleased that, at long last, the Commission is enforcing the statutory prohibition against the broadcast of profanity. Better late than never.
Even more troubling is the conclusion that we cannot issue a fine for the use of profanity. The majority argues that there is no notice. How ironic that the majority relies on the Commission’s own failure to enforce its statutory mandate as the basis for NBC not knowing that the F-word is prohibited profanity. Taking a step back, I can’t help but think NBC was “on notice” that the F-word was profane. [footnote omitted]

Commissioner Jonathan Adelstein

The same statute also proscribes broadcast profanity, and I am pleased that we apply a profanity definition endorsed by the courts to give meaning to our statutory directive. While we have historically interpreted “profane” to mean blasphemy, I support our application of the statute to the F-word, a highly offensive and commonly understood “profanity.” [footnote omitted]

Analysis of the Decision

Despite the fact that this is, essentially, a brand new doctrine, the decision gives this new interpretation of the law relatively short shrift, though it has the potential to be incredibly far reaching. Only two of nineteen paragraphs are devoted to expounding the new doctrine of fines for "profane" broadcasts. I'll go through these paragraphs line by line.

13. We also find, as an independent ground, that the use of the phrase at issue here in the context and at the time of day here constitutes “profane” language under 18 U.S.C. § 1464.

Independent ground. Even if the courts throw out our interpretation of law with regard to the "profane", we still have the count of indecency (and vice versa). The context and time is language meant to meet the burdens of FCC v. Pacifica (aka Seven Dirty Words case), which upheld the FCC's ability to regulate indecent broadcasts. As in Pacifica, the Commission is relying on a "nuisance rationale under which context is all-important."

The term “profanity” is commonly defined as “vulgar, irreverent, or coarse language.”34
34 Black’s Law Dictionary 1210 (6th ed. 1990) (citing 18 U.S.C. § 1464). See also American Heritage College Dictionary 1112 (4th ed. 2002) (definition of profane includes “[v]ulgar, coarse.”)

It is odd that they have to cite back to the 6th edition of Black's Law Dictionary. I don't think the 7th edition has the term "profanity" in it. Odd also that they define "profanity" instead of the term actually used in the statute: "profane." According to Black's Law Dictionary (7th ed. 1999):

profane, adj. (Of speech or conduct) irreverent to something held sacred.

I'm not really sure how common their definition of profane is, since the online version of the American Heritage Dictionary has three other definitions ahead of the one the FCC chooses (profane):

1. Marked by contempt or irreverence for what is sacred. 2. Nonreligious in subject matter, form, or use; secular: sacred and profane music. 3. Not admitted into a body of secret knowledge or ritual; uninitiated. 4. Vulgar; coarse.

Sounds like a variation on blasphemy to me.

The Seventh Circuit, in its most recent decision defining “profane” under section 1464, stated that the term is “construable as denoting certain of those personally reviling epithets naturally tending to provoke violent resentment or denoting language so grossly offensive to members of the public who actually hear it as to amount to a nuisance.”35
35 Tallman v. United States, 465 F.2d 282, 286 (7th Cir. 1972). In United States v Simpson, 561 F.2d 53 (7th Cir. 1977), the court called into question the nuisance rationale for the regulation of offensive speech set forth in Tallman, suggesting that it might not survive cases such as Cohen v California, 403 U.S. 15 (1971). Id. at 58 & n.7. But the Supreme Court's Pacifica decision subsequently upheld an indecency finding that "rested entirely on a nuisance rationale." 438 U.S. at 750. See also 12 Am. Jur. 2d Blasphemy and Profanity 9 (citing Tallman standard in connection with section 1464).

This is the crux of the new doctrine. There is a lot going on here, so bear with me.

First, "most recent decision" in this case means 1972. Thirty-two years is a long time without revisiting the doctrine of what constitutes the "profane." Second, we only have the interpretation of a single circuit. Look at some of the other circuit's "most recent definitions" and you'll find things that would definitely not withstand scrutiny today. Third, it isn't clear that the Seventh Circuit's definition is valid today for several reasons.

The first half of the definition doesn't really matter, as it deals with "fighting words," and isn't relevant to this particular case. I doubt the still valid but weakened "fighting words" doctrine is relevant to nearly any broadcast case (though I suppose one might be able to come up with a highly imaginative hypothetical where it was relevant).

The second half of the definition is really what is of interest. My first question in regards to this is, what is the difference between "grossly offensive" and "patently offensive"? There is no distinction in law between the two that I am aware of. Generally, the two terms have been used interchangeably, though "grossly offensive" is rarely used outside the military courts (which use it as part of their definition of indecent). So I will use them interchangeably.

If this is the case, then Pacifica has some interesting relevant quirks. For example, in Pacifica, the Commission had determined that George Carlin's language was "patently offensive." The Pacifica Foundation did not dispute this, they disputed whether or not Carlin's language was not only "patently offensive" but also indecent: "Specifically, Pacifica does not quarrel with the conclusion that this afternoon broadcast was patently offensive."

This is a serious problem for the FCC's (and Seventh Circuit's) definition of profane since, in Pacifica, the broadcast would be admittedly "profane" under the FCC's (and Seventh Circuit's) definition. If the FCC's definition is valid, Pacifica should never have been decided the way it was. Rather than determine whether or not Carlin's Seven Dirty Words were indecent and thus subject to FCC regulation, the Court could have simply declared that Pacifica was subject to FCC regulation under the definition of "profane" and would not have had to go on to analyze whether or not the speech was indecent.

For the FCC, a finding that something is "patently offensive" should terminate any further inquiry as to whether the speech can be regulated. Under the FCC's definition, once you have determined that something is "patently offensive," it is profane and you can regulate it. The FCC will never have to make a further inquiry as to whether that particular speech is indecent.

Interestingly, in Manual Enterprises v. Day, the terms indecency and patent offensiveness were used interchangeably: "These magazines cannot be deemed so offensive on their face as to affront current community standards of decency - a quality that we shall hereafter refer to as 'patent offensiveness' or 'indecency.'" Pacifica, seems to reiterate this definition of indecency:

Prurient appeal is an element of the obscene, but the normal definition of "indecent" merely refers to nonconformance with accepted standards of morality.14
14. Webster defines the term as "a: altogether unbecoming: contrary to what the nature of things or what circumstances would dictate as right or expected or appropriate: hardly suitable: UNSEEMLY . . . b: not conforming to generally accepted standards of morality: . . . ." Webster's Third New International Dictionary (1966).

Consequently, Pacifica may also cause another problem for the FCC's proposed definition for "profane". Pacifica holds that "The words 'obscene, indecent, or profane' are written in the disjunctive, implying that each has a separate meaning." If "patently offensive" is synonymous with "indecent" then it cannot also be synonymous with "profane." The FCC may argue that they define indecency as relating to sexual acts, organs and excretion. However, just because the FCC chooses not to regulate indecency to the extent permitted, does not mean that indecency is not what is "patently offensive." By this logic, "profane" must mean something other than simply "grossly offensive."

Finally, it is not at all clear from Pacifica that the Court would not find the FCC's definition of "profane" vague and/or overbroad. Following the logic of Reno v. ACLU, there are a number of ways in which the court could distinguish Pacifica's permissible regulation of indecency from regulation of the profane, even though they regulate the same broadcasting medium. For example, in Pacifica it was conceded that the language was "patently offensive." I hardly think the same concession would be made in a case challenging this decision. The FCC's own internal fighting over whether profane language could be regulated would also be a factor in distinguishing Pacifica. But let us move on.

We find that the broadcast of the phrase at issue here in the context and at the time of day qualifies as “profane” under the Seventh Circuit nuisance rationale.36
36 Nuisance has been defined as including “a condition of things which is prejudicial to the . . . sense of decency or morals of the citizens at large . . . .” Ballentine’s Law Dictionary (3d ed. 1969).

Once again the FCC claims that the specific context justifies a finding of profane language. However, this once again raises the question of how you distinguish the definition of "profane" from the definition of "indecent." Moveover, this is rather conclusory, with very little argument as to why this particular context makes this language "profane" as well as "indecent."

Use of the “F-Word” in the context at issue here is also clearly the kind of vulgar and coarse language that is commonly understood to fall within the definition of “profanity.”

Yes, but the statute discusses "profane" language, not profanity. They are related terms to be sure, but they are not synonymous - we still need a definition of "profane" that is not identical to "indecent." Furthermore, by emphasizing a definition of "vulgar and coarse" language, the FCC seems to be emphasizing a highly vague and overbroad standard. After all, not all vulgar and coarse language is indecent or "profane." For example, "Check out that hot momma!" is vulgar and coarse, but it is hardly indecent or profane. The American Heritage Dictionary claims that "kick butt" is vulgar slang. Well, maybe, but I hardly think it is profane or indecent in nearly any context. Indeed, "fuck" is always a profanity, but it is not necessarily "profane" to say it, for example as part of a bona fide news cast. So, although "fucking" might be "patently offensive" in this context, we still haven't gotten any closer to an idea about what "profane" means.

14. We recognize that the Commission’s limited case law on profane speech has focused on what is profane in the context of blasphemy,37 but nothing in those cases suggests either that the statutory definition of profane is limited to blasphemy, or that the Commission could not also apply the definition articulated by the Seventh Circuit.38
37 See, e.g., Raycom, Inc, 18 FCC Rcd 4186 (2003) (referring to God as a “sonofabitch” not profane under section 1464) (citing Gagliardo v. United States, 366 F.2d 720, 725 (9th Cir. 1966) (“God damn it” not profane under section 1464) and Warren B. Appleton, 28 FCC 2d 36 (B’cast Bur. 1971) (“damn” not profane under section 1464) (also citing Gagliardo). See also Duncan v. United States, 48 F.2d 128, 134 (9th Cir. 1931) (conviction under section 1464 for using profane language upheld where “the defendant . . . referred to an individual as ‘damned,’ . . . used the expression ‘By God’ irreverently, and . . . announced his intention to call down the curse of God upon certain individuals”).
38 In this regard, the Supreme Court noted in Pacifica that “[t]he words ‘obscene, indecent, or profane’ are written in the disjunctive, implying that each has a separate meaning.” 438 U.S. at 739-40.

Good to see that the Commission isn't necessarily using a definition of blasphemy as the baseline for the profane. Of course, they really don't have much of a choice. I highly doubt the court would countenance such a definition under both freedom of religion and freedom of speech grounds. I've dealt with the Seventh Circuit's pseudo-definition above. However, this does emphasize that the profane has had a lot to do with blasphemy. Consequently, it seems likely to me that shifting the definition away from earlier definitions would require something a little less vague than "grossly offensive."

Broadcasters are on notice that the Commission in the future will not limit its definition of profane speech to only those words and phrases that contain an element of blasphemy or divine imprecation, but, depending on the context, will also consider under the definition of “profanity” the “F-Word” and those words (or variants thereof) that are as highly offensive as the “F-Word,” to the extent such language is broadcast between 6 a.m. and 10 p.m.39
39 See Pacifica, 438 U.S. at 749-750.

Speaking of vagueness, it is interesting that the FCC doesn't rule out using a definition of the profane based on blasphemy. Time to get more concrete about the profane FCC, if you really intend to run with it. Heck, based on this, I think there are many a judge who would throw out the whole "profane" definition if the FCC insisted on holding onto the blasphemy elements.

We will analyze other potentially profane words or phrases on a case-by-case basis.

I'm not really sure how the FCC will really get to this point with a definition of "profane" that isn't distinct from "indecent." But let's pretend that the FCC's definition of profane is distinct from indecent. What, then, is the difference? Well, it would seem to be that indecency "describe[s] or depict[s] sexual or excretory organs or activities." Well, that pretty much covers the seven dirty words. What words would generally be considered patently or grossly offensive, but don't deal with sex and excretion? Hmmm ... well, the only ones I can think of (perhaps my imagination is limited) are racial and sexual epithets. Nigger, Bitch, Kike, Fag, Guido, I could go on, but you get the picture.

"Profane" can't be about blasphemy, that would raise all sorts of freedom of religion issues, but it has to be distinct from "indecent." I think that leaves hate speech. Seems to me the FCC has decided that it wants to regulate the broadcast of hate speech.

I will end this quick analysis with the words of Chairman Powell:

Going forward, as instructed by the Supreme Court, we must use our enforcement tools cautiously. As I have said since becoming a Commissioner, government action in this area can have a potential chilling effect on free speech. We guard against this by ruling when a clear line has been crossed and the government has no choice but to act.

Yeah, right.

March 10, 2004

FCC Indecency Rulings Politically Determined?

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If you care about freedom of expression, go read the latest Jeff Jarvis on the whole FCC/indecency mess (The daily Stern - March 10, 2004). This especially ticks me off:

Howard Stern's source in the FCC tells him today that there have been meetings at a high-level in the agency strategizing when to fine Stern based on the impact it would have on the election of George Bush. Some argue that fining him now will make him a martyr and help him rally voters against Bush; others say not fining him will make him look like a boy who cried wolf; others say they should get rid of Stern now because, to their surprise, much of his audience does vote. and he can have an impact on the election.
If that is true, that that could not be a clearer violation of the First Amendment: an agency of government using fines for political ends to affect political speech.
If that is true, if any such discussion occurred in the agency, then they should be hauled before Congress or courts right now.


There is much, much more from Jarvis. Read it all.

March 09, 2004

Telecomm Regulation Encourages Media Consolidation

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The Street has an article on what is becoming an increasingly common occurence: disputes between content creators and cable/satellite distributors that result in loss of signal for consumers (EchoStar Tiff Tarnishes Content's Crown). In this case, content provider Viacom (home of CBS, Comedy Central, MTV, Nickelodeon and others) is facing off with satellite distributor EchoStar. The issue isn't so much about price apparently, as about whether EchoStar will be forced to carry Viacom's less popular channels in order to distribute Viacom's more popular channels.

The balance of power in this case is probably with Viacom, according to analysts. Viacom has enough power through its collection of popular channels that it can essentially force EchoStar to take the unpopular channels, otherwise Viacom will withhold the popular channels and viewers will be upset with EchoStar.

The logic of this situation for content creators is to merge, merge and merge, so that they have similar negotiating power with regard to distributors. The logic of this situation for distributors is to buy content creators so that they have the power over other content creators. In other words, both sides are put under pressure to achieve more media consolidation.

One way out of this vicious circle is to structure telecomm regulation so that distributors such as cable companies, satellite and broadcast are regulated as common carriers. Viacom would not be able to force unpopular channels on the distributor, rather, bandwidth would be allocated based on neutral, transparent rules. This would certainly decrease the content creators' incentives to consolidate and remove the distributor's incentives entirely.

The problem isn't an irrational desire for consolidation, the problem is a regulatory scheme that encourages consolidation.

via Techdirt

March 05, 2004

VoIP Hits Retail - Walmart Next?

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USA Today reports that consumer electronics retailer Circuit City will begin selling Vonage VoIP phones in all 600 locations come Monday (Circuit City to offer Vonage Internet phone service):

Those who sign up at the electronics giant will save $100. An adapter from Circuit City costs $100, but Vonage will offer the first two months of service free — a $70 savings — and waive the $30 activation fee.

Most people still have no idea what VoIP is. Moves likes this will likely increase consumer awareness of the possibilities of escaping POTS. This alone will not cause a major shift, but it is definitely a sign that VoIP is going mainstream. The next step? Vonage at Walmart, I'm thinking.

Telepocalypse uses the occasion to note that "plain vanilla" VoIP services like Vonage don't make any sense (I don't get it). He is right, but only in the long term (which might not be that long). I also think that Vonage and many of the other VoIP start-ups realize this as well.

As Telepocalypse notes, the appropriate unit price for such services should be zero. Which makes it a great business for Walmart to use as a loss leader.

Ultimately, there is going to have to be significant VoIP penetration and consumer awareness before non-plain vanilla services can take off. Heck, I'm not sure anyone knows which services will turn out to be the most valuable and we won't be able to find out until there is a significant number of people using them. Best way to get people to use it? Sell it at Walmart.

Posted at 06:35 PM | Permalink | Comments (0) & TrackBacks (0) | Email this entry | Category: Telecomm

February 27, 2004

What Part of the First Amendment Don't You Understand?

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I'm talking to you, FCC Commissioner Kevin J. Martin.

According to a Reuters wirestory posted on Infoshop, Martin wants the FCC to consider regulating indecency on satellite and cable (FCC's Martin ponders indecency on pay TV, radio).

Let me think about that ... um, no.

"Cable companies need some way to empower parents and families to have more choice," Martin said. "I think that it has the potential to be a problem when they are receiving things they object to and have to pay for that."

It's called stop paying for cable, Martin. It's called a lockbox, Martin. Its called the First Amendment, Martin.

What a maroon.

February 03, 2004

Issue Ads and Responsibility

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John Palfrey takes an interesting and brief look at CBS's decision to air non-controversial issue ads, but not controversial ones, such as the anti-Bush contest winner (Is anti-smoking not an issue?). Palfrey's intutition seems to be that there is something wrong with CBS's decision, though under existing law it is clearly constitutional. For example, Palfrey points to Marsh v. Alabama, a company-town case. Although it isn't legally on point, Palfrey seems to be making an analogy to the Super Bowl because of the game's incredible popularity. Just as it is bad policy for a company-town to restrict the pamphleteer, so it is bad policy for CBS to restrict its television commercial sales for the extremely popular Super Bowl (though Palfrey is not claiming it is unconstitutional).

I agree with Palfrey's intutition that what CBS is doing is wrong. However, I don't think the problem has anything to do with the Super Bowl (should speech be more subject to regulation because it is popular?), but with our telecommunications regulatory scheme in general. Broadcasters, cable and satellite networks have the power to discriminate because the government has given them that power. Speakers, of course, should have the right to discriminate, that is what freedom of expression is all about. However, broadcasters, cable and satellite networks are not merely speakers but distributors as well. Of critical importance is that these networks are the creation of government regulation.

As I've argued previously, creating and maintaining such distribution monopolies is precisely one of the things the First Amendment was meant to prohibit (It's Freedom of the Press, Stupid). Letting broadcasters descriminate in what they will broadcast is like letting Chevrolet build a bridge on public land and then decide what cars get to cross it, or having railroads built using eminent (I almost wrote, "public") domain and then deciding who gets to transport goods via train. Interestingly, a similar analogy is used in Marsh v. Alabama, noted above:

Thus, the owners of privately held bridges, ferries, turnpikes and railroads may not operate them as freely as a farmer does his farm. Since these facilities are built and operated primarily to benefit the public and since their operation is essentially a public function, it is subject to state regulation. And, though the issue is not directly analogous to the one before us we do want to point out by way of illustration that such regulation may not result in an operation of these facilities, even by privately owned companies, which unconstitutionally interferes with and discriminates against interstate commerce. [emphasis added]

Palfrey ends his post with this:

But, leaving the Constitutionality question aside, and thinking hard about the relevant policy questions, I'm still unconvinced that CBS is wholly in the right on this one.

Palfrey is right. CBS is wrong. However, CBS is not simply wrong on "this one" but the very existence of government telecomm-regulation-created CBS is wrong in general (not to mention unconstitutional).

November 20, 2003

It's All About the Distribution, Stupid

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O'Reilly Network writer Andy Oram, inspired by Dave Winer's piece on candidates taking stands on internet regulation, makes a plea for a global approach towards information law (Time for a data transmission summit). I couldn't agree more with Oram that we should view many of the issues involved with regard to cyberlaw as an interconnected whole. It is interesting that Oram frames this issue as one of "data transmission." This echoes my viewpoint. As I am wont to say, "It's all about the distribution."

For example, when we discuss copyright reform, it is almost always in the context of existing telecommunications regulation. However, what if existing telecom regulations are part of the copyright problem? If, for example, there is a near monopoly on the primary means of music distribution, such as radio, won't that seriously distort the market that copyright is supposed to create?

Really, isn't telecom about the distribution of information (subject to the First Amendment, as I note here: It's Freedom of the Press, Stupid). Isn't copyright really about how copyrighted information is distributed? An argument that I make here: Taking the Copy Out of Copyright [PDF].

Of course, I'm completely onboard with a summit dealing with issues of "data transmission" taken from a broad point of view. However, I'm not sure if a summit is a good idea right now, since there isn't really a consensus yet that all these elements are actually related and what the nature of that relationship is. My concepts may be wrong, but I am convinced that there is a relationship among these issues. Perhaps the nature of that relationship is what a summit should address.

November 11, 2003

Phone Number Portability for All Ordered by FCC

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Although it hasn't gotten much attention, this is a pretty major story - the FCC is requiring wireline phone providers to let customers take their landline numbers to a cellular phone. Read the press release: FCC Clears Way for Local Number Portability between Wireline and Wireless Carriers [PDF].

Commissioners' statements [PDF]:

You can also read: C|Net News - FCC: Number-switching rules apply to all and the New York Times (reg. req.) - F.C.C. Backs Phone Number Portability.

Of course, this order does not require the opposite, that you can take your cellphone number and transfer it to your landline (the, perhaps valid, excuse is the expense of updating old telco tech). However, the convenience of such portability is not to be underestimated. Increasingly, customers will be abandoning landlines and using cellular as their primary voice device. This is bad news for the traditional telcos as Kevin Werbach points out (Number portability and the telco death spiral).

Of course, VoIP can be inherently portable. For example, I can take my Vonage router and connect it (via ethernet) to any broadband connection and phone calls to my assigned number are routed there.

The recording industry thinks that new technology threatens their existence ... the telcos are dead men walking.

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November 08, 2003

WW2 Metaphors for the Future of Telecom

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Telepocalypse paints an ugly picture for the future of telecom as he postulates that the major players will fight to control one of their last remaining bulwarks - the voice directory (OPINION://RIAA, MPAA, CTIA?). In particular, he thinks that VoIP will trigger a battle that will pit telco vs. customers:

Expect directory access to be the Normandy landing of the IP revolution....The final march to Berlin will be around whether you or your telco controls inbound connection requests to your own devices.

Provocative stuff, with perhaps more than a grain of truth.

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October 30, 2003

The Future of Voicemail

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Telepocalypse speculates about what voicemail might look like in a non-PSTN world (Voicemail: don't phone home). For example:

You should be able to listen to voicemails on your plane journey home. You should be able to reply to them on a store-and-forward basis, even when you’re not connected to the network. And most of all, you shouldn’t have to use a clunky telephony user interface to navigate a message queue. And you shouldn’t be restricted to one device for accessing your own data.

Absolutely right, of course. I actually have some of that capability right now with my Vonage service. For example, Vonage emails me whenever I get a voicemail message. I am also able to access voicemails via a browser interface, downloading them as MP3s. This is a pretty handy function when I am away from my Cisco VoIP router.

In any case and more importantly, Telepocalypse is making a larger point about how voice services do not have to be tied solely to a telephone paradigm in the future. We need to reconsider all voice or telephone services from this broader perspective.

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October 28, 2003

The VoIP Regulatory Debate Revealed

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Jeff Pulver notes on his blog that the FCC has an interesting collection of reply comments dealing with the issue of VoIP regulation (Vonage FCC Petition: Update).

All of the reply comments, can be read by visiting: and entering: 03-211 in the Proceeding Box. [link and emphasis in original]

There are 40 comments in PDF format. Seems like just about every organization with an interest had something to say. Reading them will provide a good look at the various arguments regarding regulation of VoIP.

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October 25, 2003

GAO - Capitalism Good for Cable Companies

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The Washington Post publishes an article on a recent General Accounting Office report on competition in the cable industry (GAO Suggests Competition Good for Cable). The report can be found here (Telecommunications: Issues Related to Competition and Subscriber Rates in the Cable Television Industry [PDF]). Read the highlights [PDF].

The report found, unsurprisingly, that where there is a choice of two cable companies (only 2% of markets) consumers benefit with cable prices approximately 15% lower than those markets without competition. Where direct broadcast satellite providers can provide local channels cable companies respond by offering better service. Also, unsurprisingly, networks with a cable affiliation are more likely to be available than those networks without a cable affiliation.

October 24, 2003

California VoIP Regulation Update

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The Mercury News has a great article updating the process going on in California regarding regulation of VoIP services (Internet phone firms protest regulation bid). The California Public Utilities Commission has ordered six VoIP companies to register as phone companies by last Wednesday. None have, but they have registered their objections. The Commission will probably look at the issue mid-November.

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Your Friendly Neighborhood Electric IP Company

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Jeff Pulver provides a short update on the progress of broadband power line communications (PCL) (Current Technologies: Wi-Fi Coming soon to a Telephone Pole Near You). The news is that there has been progress in developing the technology that will permit broadband access via powerlines. Instead of connecting to the internet via DSL and your phone company or via the same cable that brings you the Sopranos, you'll get broadband via your powerlines. This would be a great way of producing additional competition for connectivity. I hope Jeff is right in his optimism.

October 23, 2003

VoIP Update - Int'l Regs, McLaughlin, Wash Post Summary

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Once again, lots of news on the VoIP front. The Washington Post has a good article summarizing most of the recent events on the VoIP front, with a few new tidbits, such as noting that California isn't convinced that VoIP can't be regulated by the states (Identity Crisis).

Jeff Pulver notes on his blog that international regulators are keeping a close eye on VoIP as well (Pending threats of International VoIP Regulation). Unfortunately, Jeff doesn't provide much detail.

Andrew McLaughlin responds to Kevin Werbach's contention that the Vonage decision [PDF] will actually reduce pressure on the FCC to reform VoIP regulation (More VOIP: Query to Kevin Werbach). You can read Kevin's comments here (More on the Minnesota Vonage ruling) as well as mine (The Vonage Discussion Continues). Andrew basically argues that while the pressure on the FCC might have decreased, the pressure for comprehensive reform on the Congressional level has increased. I hope Andrew is right.


C|Net News questions whether VoIP will make geographic-based area codes obsolete (Geographic area codes on the way out?).

UPDATE 2 1600 PT

C|Net News reports on a partnership deal between Net2Phone and Puerto Rico cable company Liberty Cablevision that will permit Net2Phone to provide VoIP service to Liberty's customers (Net2Phone dials in Puerto Rico cable company). Small cable companies, such as Liberty, might find providing VoIP too expensive or too much outside their realm of experience. Partnerships such as this solve that problem, and encourage VoIP adoption.

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October 22, 2003

Georgia (Telephones) On My Mind

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So far this week I've had a number of posts on various issues regarding VoIP regulation. Well, the news about this industry continues to move at an extraordinary pace. C|Net News is reporting that Georgia residents no longer have to pay for a telephone line if they only want DSL (Internet phones peachy in Georgia?). Usually, when you get DSL you have to pay for a phone line whether you want one or not. Now, presumably, many of those who get DSL and would be happy to get rid of their traditional phone service will be able to switch to VoIP entirely and save significantly on the phone bill. For many who haven't gotten broadband yet, this might be the incentive they need. Very cool. The decision from the Georgia Public Service Commission does not seem to be available on the internet yet, but I'll be looking.

FCC Heading Down Wrong Path on VoIP Regulation?

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Telephony Online reports that, in the wake of the Vonage decision [PDF], both the Bells and the FCC are interested in looking at new regulations and regulatory structures for VoIP (Bells: FCC needs to take quick action on VoIP).

Kevin Werbach, on his Werblog, is concerned that the FCC will create another set of untenable set of definitions for VoIP regulation (Moving forward on VOIP). In particular, his initial thoughts are that the below distinction won't work:

Last week, Christopher Libertelli, senior legal advisor to FCC Chairman Michael Powell, speaking at the U.S. Telecom Association conference in Las Vegas, said the commission could develop three sets of rules based on the different methods of provisioning VoIP services: via private networks; over networks that touch the PSTN; and via evolving peer-to-peer networks.

Werbach should know, while at the FCC he was involved in developing the distinction used in the Vonage case between phone-to-phone and computer-to-computer calls.

In any case, I would have to agree that this initial stab at new definitions by the FCC doesn't seem at all promising. We need to start thinking about telecommunications regulation in whole new ways.


C|Net News is reporting that Time Warner is planning to expand its cable-based VoIP system from one to three or four cities by the end of the year (Net telephony grows on Time Warner).

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October 21, 2003

The Vonage Discussion Continues

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Berkman Senior Fellow Andrew McLaughlin has responded to my post on the Vonage decision (More on Vonage: Ernest Miller's Critique). In the end our disagreement is minor: whether or not the decision will be more or less likely to lead to telecomm reform, which we both agree is absolutely necessary and most likely inevitable. Former FCC lawyer Kevin Werbach thinks that the decision reduces some of the pressure for change (More on the Minnesota Vonage ruling). I agree. However, I think that change is inevitable. I don't believe the current system can continue indefinitely without some reform. The only questions I am worried about are when reform will come and what form that change will take (I doubt our current lobbying/regulatory system will get it right).

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Rep. DeGette Doesn't Get It

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Rep. Diana DeGette (D - CO), has penned an anti-open access commentary in C|Net News (The irony of 'network neutrality'). Her main complaint? Regulating access and regulating content and functionality are pretty much the same thing, they're both regulation and regulation is bad. Thus, we shouldn't regulate access. I had to double check that she was actually a Democrat. The commentary reads like talking points for a cable lobbyist. She even attacks the "stupid network" argument:

By effectively handcuffing broadband operators and restricting their rights to forge innovative relationships with other applications and content providers, the Microsoft crew is, in fact, seeking to dumb-down the heart of the network in order to strengthen the power of its own members.

I don't know about you, but I think that dumbing-down the heart of the network is a feature, not a bug.

October 20, 2003

Future of Digital TV Threatened By More Than Broadcast Flag

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The Broadcast Flag issue is incredibly important, see, among many others Copyfight (What's the Deal?). Then let your Reps, Senators and the FCC Commissioners know how you feel, either through EFF or

However, the Broadcast Flag isn't the only issue that puts the future of unrestricted digital television in doubt. Case in point, the New York Times (reg. req.) reports on what may be the coming death of stand alone personal media recorders, such as TiVo (Can Cable Fast-Forward Past TiVo?). A couple of quotes to consider:

"This really is the last stand for the stand-alone boxes; this is a dying product," Aditya Kishore, an analyst for the Yankee Group, a technology consulting research firm in Boston, said in a telephone interview. "This is the last Christmas for the stand-alone TiVo box, or any stand-alone DVR box. By next year, the DVR functionality will be widely available in a wide range of other devices, including the set-top boxes."
"We believe that over time, DVR technology is going to be the standard," said Mark W. Jackson, an EchoStar senior vice president. "Everyone is going to have it. It's just a question of when - and who they get it from, of course."

I certainly hope that the Yankee Group analyst is wrong, because otherwise the question asked by Mr. Jackson becomes much more important. What the NY Times is reporting is that the cable and satellite companies are bundling personal media recorder capabilities with their services and this will eliminate the market for independent devices. The problem with this is that it also gives the cable and satellite companies control over the function of such devices. Skipping commercials, recording anything you want, and networking the device with other devices will almost certainly be restricted. Sounds an awful lot like the broadcast flag.

October 18, 2003

Telecomm Regulation Madness and Vonage

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Berkman Center Senior Fellow Andrew McLaughlin has a new blog and one of his first posts is an interesting look at the recent Vonage v. Minnesota Public Utilities Commission [PDF] decision (Judge Davis Gets It: The Internet is Not a Telephone). I think that Andrew and I actually agree quite a bit, but merely differ as to emphasis.

While I sympathize with the outcome (who thinks that the Minnesota Public Utilities Commission should be regulating VoIP?), I don't find the reasoning of the decision particularly compelling and I don't think the decision inherently important. The problem isn't the judge's, but the entire regulatory scheme. The judge is simply making due with a confusing morass of regulation built through decades of industry-driven lobbying. His decision is important only to the extent that it highlights some of the internal contradictions of existing regulation; it doesn't provide a compelling alternative or solution (though that isn't the judge's job).

As Andrew points out, there are two important aspects of the decision but, really, only one is all that important.

Whether, under federal law, VOIP services are "information services" (not subject to state regulation) or "telecommunications services" (subject to state regulation).

This seems to me the crux of the issue. Why are "telecommunications services" subject to state regulation at all? This is the real problem. We can parse definitions of "information services" and "telecommunications services" all day long but, given that bits are cheap to produce and distribute, as long as some bits are subject to state and federal regulation and other bits are subject to federal regulation only, we are going to have issues.

As the judge noted in the decision, "Traditional telephone companies use circuit-switched technology." Emphasis on the word "traditional." How many circuit-switched phone calls did you make today? Vanishingly few, I imagine. How far does your traditional phone call go before it becomes packet-switched? Not far for most nowadays; most likely you're circuit-switched the last mile only - as Andrew notes.

Strangely, the basis of the decision is premised on this distinction between the last mile technology used. In statutory language, the distinction looks like this:

The term ‘telecommunications’ means the transmission, between or among points specified by the user, of information of the user’s choosing, without change in the form or content of the information as sent and received. 47 U.S.C. § 153(43).
“Telecommunications service” is “the offering of telecommunications for a fee directly to the public, or to such classes of users as to be effectively available directly to the public, regardless of the facilities used.” 47 U.S.C. § 153(46).
“Information service” is defined as “the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications, and includes electronic publishing, but does not include any use of any such capability for the management, control, or operation of a telecommunications system or the management of a telecommunications service.” 47 U.S.C. § 153(20).

Yeah, I know it says nothing about the last mile, but that turns out to be what the distinction is, according to Judge Davis. You see:

The process of transmitting customer calls over the Internet requires Vonage to “act on” the format and protocol of the information. 47 C.F.R. § 64.702(a). For calls originating with one of Vonage’s customers, calls in the VoIP format must be transformed into the format of the PSTN before a POTS user can receive the call. For calls originating from a POTS user, the process of acting on the format and protocol is reversed.

The problem, of course, is that precisely the same thing happens with most "traditional" calls, the only difference being where the change takes place (your home or one mile from your home). Judge Davis emphasizes this strange distinction when he claims that Vonage phone calls create a "net change in form and content" that "traditional" calls do not. The only "net change" is between whether the packet-switched transformation occurs in the home or at the local telephone switch. Is that really all that significant?

What Happens Next?

Assume that Judge Davis' decision and reasoning is widely adopted. What happens next? Very simple. The decision amounts to a huge (HUGE) subsidy for VoIP as opposed to "traditional" phone service. The response is obvious. Traditional phone companies begin a major rollout of VoIP technology. By simply having technicians emplace a VoIP router box on the customer's premises instead of the local switch, major telecommunications companies can easily shed tons of state and federal regulations. The telephone companies will have to split into VoIP and traditional. The traditional phone companies will be stuck providing service to the poorer neighborhoods where DSL isn't cost effective and still provide basic services (such as 911) to everyone (without many of the usual cross subsidies, however). The new VoIP telephone companies will cherry pick better neighborhoods and will be able to profit at the expensive of the traditional companies because they no longer bear a heavy burden of regulation and taxes. Rollout won't be that expensive, since the cost of the routers and installation, especially given mass production, will almost certainly be cheaper than the taxes thereby avoided over the period of a year or so. Additionally, VoIP companies avoid all that nasty "common carrier" regulation.

Is this the result we want?

Judge Davis summarily dismisses Minnesota's "quack like a duck" argument. But Minnesota has a point. Vonage is acting like a phone company. If we think that phone companies should be held to some regulatory standards (such as common carrier), then ultimately we will have to have some definitions of what can be regulated that includes Vonage.

Andrew states that,

Finally, the decision bolsters the notion that Internet services should not be forcibly shoehorned into decades-old telecommunications regulations. If VOIP is to be regulated, it should be approached in ways that respect the comprehensively different nature of packet-switched networks.

I disagree, but only to the extent that most of our existing telecommunications services should not be forcibly shoehorned into decades-old regulations either. We don't need more needle-threading judicial decisions. We need serious telecommunication reform.

via John Palfrey