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The FTC takes aim at Amazon, the Net Neutrality debate rages on, and Congress gets closer to finally protecting Americans’ privacy from warrantless snooping.

FTC Reform

The FTC is stepping up enforcement against tech companies. Check out the highlights from our 7/31 event to find out what this means for consumers.

DontBreakThe.Net

We recently launched a grassroots petition campaign to stop the FCC from regulating the Internet like a 1930s utility. Find out more on the dangers of Title II and tell the FCC: #DontBreakTheNet.

Coalition Warns FCC Chairman about FCC’s Increasing Politicization

In a letter sent today to Federal Communications Commission Chairman Tom Wheeler, a coalition of groups expressed concerns over the agency’s  loss of objectivity and impartiality in recent proceedings, especially the FCC’s ongoing Open Internet rulemaking. The letter urges the Commission to keep partisan politics out of its decision-making process, to avoid spinning media coverage, and to focus on substance, not the total number of comments filed in controversial proceedings.

The letter follows a Washington Post story last week, which reported that the FCC worked exclusively with pro-Title II activists in an “unusual collaboration” ahead of the September 15th Net Neutrality reply comment filing deadline. This had the clear effect of promoting a false media narrative that the flood of comments coming into the FCC overwhelmingly favored stringent, 1930’s-era phone regulations for the Internet.  In fact, nearly a million comments filed during this time opposed Title II regulations, more than were collected by the leading pro-Title II site. But this fact was disclosed by the Commission to neither the public nor media outlets, including the Washington Post, which made no reference of it in its report.

“It is deeply disturbing that FCC staff appear to be disregarding arguments that do not fit a preconceived agenda,” said Phil Kerpen, President of American Commitment, which organized over 800,000 comments against Title II.  “As an independent, expert agency, the FCC has an obligation to weigh arguments and evidence evenly before making decisions. However, the FCC’s recent process failures threaten one of the greatest assets of any independent agency: its perceived objectivity.”

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A Third Way on Muni Broadband

Governments Must Remove Barriers to Private Broadband Deployment

TechFreedom and the International Center for Law & Economics (ICLE) have proposed a “third way” on muni broadband: refocusing government at all levels on making private broadband deployment easier. In reply comments on petitions filed in July by Chattanooga, TN and Wilson, NC asking the FCC to preempt state laws restricting the expansion of their municipal broadband networks, the two think tanks explained that these and other state laws are not, in fact, “bans” on muni broadband. Moreover, the FCC lacks the legal authority to preempt such laws regardless of how they are crafted.

Rather, the TF-ICLE reply comments call on the FCC to issue a Notice of Inquiry on ways that Congress could craft legislation to promote the laudable goal of Section 706: “encourag[ing] the deployment on a reasonable and timely basis of advanced telecommunications capability to all Americans.”

“Referring to the laws in TN and NC as ‘bans’ is misleading and has sparked a false media narrative,” said Berin Szoka, President of TechFreedom. The laws specifically authorize municipal broadband, but impose reasonable fiscal and procedural safeguards to assure that the taxpayers, who are ultimately on the hook if the projects fail, retain control. “Municipalities, as creatures of the states, may do only those things that states authorize. States are well within their historical roles when they bar municipalities from granting special competitive advantage over private networks or protect taxpayers from the risk of expanding service beyond municipal borders.”

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The Anti-Consumer Origins of Anti-Trust Law

Historian Jim Powell explains, in FDR’s Folly: How Roosevelt and His New Deal Prolonged the Great Depression:

Considering how passionately New Dealers condemned monop­olies, it’s curious that FDR didn’t mount a major assault against the Smoot-Hawley tariff that Hoover had signed into law back in June 1930. … Tariffs were long viewed as “the mother of trusts” because they limited choices for consumers and enabled domestic companies to charge prices above world market levels.

Ironically, the Sherman Antitrust Act (1890), the New Dealers’ favorite remedy for fighting monopoly, was originally enacted to provide political cover for the McKinley tariff (1890), which raised tariffs to higher levels. New York attorney Franklin Pierce explained the game in his 1913 book The Tariff and the Trusts: “We legalize conditions [high tariffs] out of which an evil arises and then attempt to suppress the evil by penal statutes. We provide for high duties upon foreign imports for the protection of home industries, and when a monopoly controlling the home market results therefrom, then pass penal laws punishing the monopoly. In this way our politi­cians prove to the great combinations who furnish campaign disbursements for political parties their fidelity to monopolistic interests, while, by the penal statute, they assure the people that they are against trusts.”

Read more of Pierce’s 1913 book here.

Federal Intrusion - Too Many Apps for That: TF’s Geoffrey Manne in WSJ

Who’s better suited to design an app store? Google, or the Federal Trade Commission (FTC)? The answer seems obvious, but recent enforcement actions by the FTC suggest otherwise. Google recently agreed to pay $19 million to settle FTC charges that the company had made it too easy for children to make unauthorized purchases in the Android app store. Apple settled a similar case earlier this year, and Amazon has also come under fire for its in-app purchasing design (Amazon refused to settle and its case is being litigated in federal court).

Despite ample parental controls and password protections, there will always be a handful of compelling anecdotes of children who run up obscene tabs on their parents’ appstore accounts. And, generally every time, tech companies are happy to refund the error. But the FTC’s actions miss the point: this is not about protecting kids; it’s about protecting parents from their own carelessness. Should the FTC really be playing national nanny to parents?

For the FTC to bring enforcement actions, the Commission, by law, must show that the consumer harm outweighs the app store designs’ countervailing benefits. As TF’s Geoffrey Manne explains in an op-ed for the Wall Street Journal:

In the case of the Google and Apple settlements, the FTC did not balance the harms of the small number of unauthorized purchases against the widespread benefits of the user interface design in question…As the FTC morphs into the Federal Technology Commission it is becoming a top-down regulator rather than the law-enforcement agency it was created to be. Consigning several of the world’s most innovative companies to 20 years of bureaucratic oversight won’t serve anyone.

See the full op-ed here, and our other work on FTC Reform, especially:

  • Highlights from TF and ICLE’s Luncheon on the FTC’s Use of Economics

  • Geoffrey Manne’s oral remarks and written Congressional testimony on the the FTC@100

  • Op-ed by Berin Szoka and Geoffrey Manney, “The Second Century of the Federal Trade Commission”

Congress Must Protect Our Data From Warrantless Searches

Have the Internet and the way we store data changed since 1986? Of course they have, but our laws haven’t kept pace with technological advancement, leaving our cloud storage vulnerable to warrantless searches by police officers. Recently, TechFreedom, and a diverse coalition of tech and liberty-minded groups, wrote to Congressional leaders urging them to bring important privacy reforms up for a vote.

Specifically the bipartisan bills would update the laughably outdated Electronic Privacy Communications Act (ECPA), written in 1986, which says that data stored in the cloud should be afforded less protection than data stored locally. We say:

Removing uncertainty about the standards for government access to data stored online will encourage consumers and companies, including those outside the U.S., to utilize these services.

See the full text of the coalition letter here, and our other work on ECPA, privacy, and surveillance, especially:

Title II Isn’t the Answer on Net Neutrality

TechFreedom and ICLE Urge FCC to Maintain Bipartisan Consensus Against Title II

In reply comments on the FCC’s proposed Internet rules, TechFreedom and the International Center for Law and Economics (ICLE) urged the Commission to not impose common carrier regulations on the Internet through Title II of the 1996 Telecommunications Act. The comments debunk three key myths about Title II and call for the FCC to base any new rules it issues under Section 706 of the Act. The organizations also urge the FCC to ask Congress to provide clearer, narrower legislative authority over Net Neutrality, and call for a multistakeholder process to address the issue, regardless of what the FCC or Congress does.

The filing echoes the sentiments of a diverse coalition of web entrepreneurs, investors, telecom and antitrust experts, and policy organizations who wrote yesterday to FCC Chairman Tom Wheeler urging him to not invoke Title II.

“Title II is a wolf in sheep’s clothing,” said Berin Szoka, President of TechFreedom. “A radical fringe has dressed up a government takeover of the Internet as ‘Net Neutrality.’ Google, Facebook, and the NAACP haven’t jumped on the Title II bandwagon, because they know better. Imposing public utility regulations on the Internet won’t create Net Neutrality, but the heavy hand of government will crush innovation and investment in broadband.”

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The FCC Must Reject the Title II Delusion

Coalition Urges FCC Chairman to Maintain Bipartisan Consensus Against Title II

Today, a diverse coalition of web entrepreneurs, investors, telecom and antitrust experts, and policy organizations wrote to FCC Chairman Thomas Wheeler urging him not to impose common carrier or public utility-style regulations on the Internet through Title II of the Communications Act. The letter also presents to the FCC a grassroots petition hosted at DontBreakThe.Net.

Led by TechFreedom and the International Center for Law & Economics, the coalition includes, among others, VoIP pioneer Jeff Pulver, venture capitalist Scott Banister, former FCC Commissioner Glen Robinson, leading legal scholar Richard Epstein, and a range of academics.

The coalition letter opens:

Attempting to retrofit the onerous set of regulations developed for the monopoly telephony network onto the Internet would be a disaster for Internet users everywhere. That’s why it has been rejected by four FCC Chairmen (of both parties), leading Democratic Senators as early as 1998, 74 House Democrats as late as 2010, all Congressional Republicans, and the entire broadband industry.


Government should be able to police any deals between broadband companies and content providers to make sure they don’t harm consumers or competition. But the FCC doesn’t need Title II to do that. The FCC has already claimed vast authority under Section 706, including the power to issue new net neutrality rules.

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WSJ’s Crovitz Blasts Title II Proponents, Points Readers to DontBreakThe.Net

John Oliver Makes People Dumb,” says Gordon Crovitz in his latest Wall Street Journal column. As Crovitz notes, the hundreds of comments inspired by the HBO comedian’s call-to-arms for net neutrality have been conned into endorsing something completely different, Title II of the Communications Act, which would “turn the Internet into a regulated utility, with bureaucrats setting prices and terms under rules written for railroads in the 19th century and the telephone monopoly in the 1930s.”

Crovitz notes the 159 pages of comments TechFreedom filed with the International Center for Law & Economics (highlights here). Among other things, our comments explain that:

  • Title II won’t actually allow the FCC to ban “paid prioritization” (whatever that actually means), so this isn’t really about net neutrality;
  • Title II’s effects won’t be limited to broadband, but will cover web services too;
  • Far from promoting competition, Title II would protect cable and telcos from competition; and
  • The FCC can’t simply edit down Title II’s most outdated regulations to craft a “Title II lite” that restores the bipartisan consensus against heavily regulating the Internet

Title II proponents don’t seem to care about the details of how Title II would actually work. As Crovitz concludes, in the real world, 

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The Truth Behind Title II

TechFreedom Releases Recording and Transcript of “Internet Slowdown” Reporter Briefing

On Wednesday, September 10, supporters of Title II regulation of the Internet engaged in an Internet slowdown to convince the public that, unless the FCC applies public utility-style regulation to broadband, the Internet will be slower. They’ve got it exactly backwards:  if anything’s going to slow down the Internet, it’s Title II, the mess of outdated and heavy-handed rules that have been conflated with net neutrality. Draconian as Title II is, it doesn’t even do the one thing that supposedly makes it necessary: allowing the FCC to ban “paid prioritization.”

On a call with reporters and bloggers on Wednesday, TechFreedom President Berin Szoka explained the dangers of regulating the Internet as a public utility and discussed TechFreedom’s “Don’t Break The Net” campaign against Title II.

A link to the recording can be found here, and a transcript of the call can be found here.

Szoka will also be hosting a Reddit Ask-Me-Anything (AMA) on Sunday at 4:00 pm ET (1:00 pm PT).

Click here for more information on the launch of DontBreakThe.Net. Questions? - Email media@techfreedom.org

See more of our work on Title II and the FCC, including:

About TechFreedom:

TechFreedom is a non-profit, non-partisan technology policy think tank. We work to chart a path forward for policymakers towards a bright future where technology enhances freedom, and freedom enhances technology.

 

Internet Slowdown? Not so fast.

On Wednesday, September 10, supporters of Title II regulation of the Internet will engage in an “Internet slowdown” to convince the public that, unless the FCC applies public utility-style regulation to broadband, the Internet will be slower. They’ve got it exactly backwards:  if anything’s going to slow down the Internet, it’s Title II, the mess of outdated and heavy-handed rules that have been conflated with net neutrality.

Join us Wednesday 9/10 at 11am ET (8am PT) for a call with reporters and bloggers. TechFreedom President Berin Szoka will explain the dangers of regulating the Internet as a public utility and discuss TechFreedom’s “Don’t Break The Net” campaign against Title II. Click here for more information on the launch of DontBreakThe.Net.

The call will begin with a brief introduction followed by Q&A.

When: 11 am - 12 pm

Dial-in info:

Call-in numbers: 785-424-1829 (or 866-952-7524 toll-free)  

Conference ID: TechFreedom

Questions? - Email media@techfreedom.org

See more of our work on Title II and the FCC, including:

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