Skype Journal Test

Wednesday, September 17, 2008

Skype asks FCC to support unfettered customer freedom

Skype called "liar, liar, pants on fire" [my phrasing] on the leading US mobile carriers and "we can't trust those guys" to the Federal Communications Commission. It was triggered by comments at last week's CTIA conference. For example:


"Unfettered access would be a pretty bad experiment." "There needs to be some stewardship or control."


— Robert Dobson, chairman and president of T-Mobile USA


"I think we have to be careful to not all run to one side of the ship"


— Lowell McAdam, CEO and president, Verizon Wireless


“The big Internet can be daunting ... There can be too much choice.”


— Sprint Nextel Corp. CEO Dan Hesse


Skype's Christopher Libertelli responded to these and other comments in a letter to the FCC's chairman on Friday. Let's sample the letter:


Instead of broadly carrying forward the Commission’s tremendous strides toward open networks, the word coming from the CTIA gathering is that open networks present a multitude of problems for the carriers, and that to protect consumers from too many choices, network operators must be the gatekeepers of the consumer experience. This is inconsistent with the Commission’s Broadband Policy Statement and a market structure that maximizes choice and innovation.


Let me parse this for you.


  • Instead of broadly carrying forward the Commission’s tremendous strides toward open networks,

    • reminder that you (the FCC) already support "open"
    • the mobile giants are lollygagging and poo-pooing the commission's mandate
  • the word coming from the CTIA gathering is that open networks present a multitude of problems for the carriers

    • they are whining and giving excuses
    • "too complex" is silly since open is simpler
    • despite they are usually slow moving behemoths overly concerned with internal operations
  • and that to protect consumers from too many choices,

    • they say voters are stupid babies, 
    • they want to deny citizens their consumer freedoms
  • network operators must be the gatekeepers of the consumer experience.

    • "we know best"
    • "control is our right"
  • This is inconsistent with the Commission’s Broadband Policy Statement and a market structure that maximizes choice and innovation.

    • market structure = anticompetitive duopoly (Verizon + AT&T)
    • duopolies don't compete fiercely
    • think "OPEC 2.0" power concentration
    • you say you want open networks
    • please verify the oligopoly is acting broadly, quickly, meaningfully
    • the public good is at risk

The letter continues in a similar fashion, full text below.


Skype is asking the FCC to check the carriers who promised open access to their networks.


Please.


Now.



 



 


September 12, 2008


ELECTRONIC FILING


Chairman Kevin J. Martin

Federal Communications Commission


445 12th Street, SW


Washington, DC 20554


Re: Ex Parte, RM-11361


Dear Chairman Martin:


Skype Communications S.A.R.L. (“Skype”) writes to respond to various statements made at CTIA’s Wireless I.T. & Entertainment conference in San Francisco. Attached to this letter is a Reuters report on what seems to be a wireless industry theme at the CTIA meeting. Instead of broadly carrying forward the Commission’s tremendous strides toward open networks, the word coming from the CTIA gathering is that open networks present a multitude of problems for the carriers, and that to protect consumers from too many choices, network operators must be the gatekeepers of the consumer experience. This is inconsistent with the Commission’s Broadband Policy Statement and a market structure that maximizes choice and innovation.


Skype disputes the need for wireless carriers to maintain their closed networks not only in the face of consumer preferences but contrary to their assurances to the Commission[1] that the industry had adopted a policy of openness such as to obviate the need for the relief that Skype sought in its Petition in the above-captioned proceeding (“Skype Petition”). [2] Apparently,these assurances of openness led some at the Commission to believe that there was no present need for Commission action. In this regard, the carriers’ apparent change of heart should be a cause for concern.


Despite the carriers’ assurances, when lip service to the goals of open networks is translated into their terms of service, they continue to require their subscribers to limit the applications and devices that can be used on their networks. The attitude of the wireless carriers was perhaps best summed up in Sprint Nextel Corp. CEO Dan Hesse’s recent comment: “The big Internet can be daunting ... There can be too much choice.”[3] This stands in stark contrast to the Commission’s wise policies designed to promote as much consumer choice as possible.


Skype respectfully submits that the wireless carriers continued opposition to open networks — including their restrictive terms of service — raises questions about whether the industry will faithfully implement the Commission’s rules and policies, including the standards set out in the Commission’s Broadband Policy Statement.[4] Skype is mindful of the challenges that wireless operators face moving from a closed model to an open, Internet-friendly business. As noted, despite some recent steps to modify terms of service toward openness, carriers continue to prohibit voice applications that compete with their core business.[5] Consumer choice, competition and free markets, not carriers acting to block competition, should win the day in wireless — now, not later. If the Commission believed that the transition to more open networks was going to proceed quickly, statements out of CTIA’s convention suggest just the opposite.


Skype repeats that the best way for the Commission to maintain the vigilance that is necessary to protect consumers’ interest in open wireless networks is to for the Commission to affirm that the Commission’s Broadband Policy Statement applies to wireless broadband networks. This would be a measured response to the dynamics of the wireless market and would send the correct message to an evasive wireless industry. It would also encourage those in the application development community, like Skype, who have reasonable expectations that applications will run as they were designed on wireless broadband platforms.[6]


Affirming that the Commission will enforce the Broadband Policy Statement and address any violations of the Policy Statement on a case-by-case basis is fully consistent with the Commission approach to constraining Comcast’s abusive practices.7 In this way, the Commission will maintain a policy environment that serves the interests of consumers, carriers and innovative providers of wireless devices and software applications.


Thank you for your continued vigilance in this matter. Please do not hesitate to contact me if you have any questions or concerns.


Respectfully submitted,


________________________


Christopher Libertelli

Senior Director, Government and Regulatory Affairs – North America


SKYPE COMMUNICATIONS S.A.R.L.


6e etage, 22/24 boulevard Royal, Luxembourg, L-2449 LUXEMBOURG


Footnotes:


  1. Ex Parte filing by CTIA — The Wireless Association, RM-11361, April 14, 2008, at 1 (“Wireless carriers, reacting to the demands of consumers in the competitive market, already have begun implementing a variety of openness initiatives designed to expand consumer access to new and innovative wireless devices and applications. . . . Because both Commission action and the wireless marketplace have addressed the concerns raised by Skype, the Petition should be dismissed.”).
  2. Skype Communications S.A.R.L., Petition to Confirm A Consumer’s Right To Use Internet Software and Attach Devices to Wireless Networks, RM-11361 (filed Feb. 20, 2007).
  3. Allie Winter, Embracing an Open Network, RCR Wireless News, Sep. 10, 2008.
  4. Appropriate Framework for Broadband Access to the Internet over Wireline Facilities, CC Docket No. 02-33, Appropriate Regulatory Treatment for Broadband Access to the Internet Over Cable Facilities, CS Docket No. 02-52, Policy Statement, FCC 05-151 (rel. Sep. 23, 2005) (“Broadband Policy Statement”).
  5. See Letter from Robert W. Quinn, Jr., Senior Vice President-Federal Regulatory, AT&T, to Commissioner Robert M. McDowell, WC Docket No. 07-52, July 25, 2008, at 1, n.1 (noting that all major wireless carriers do not permit the use of peer-to-peer VoIP applications like Skype).
  6. A wide array of industry and consumer groups agree that the Broadband Policy Statement should apply to wireless broadband networks. See, e.g., Comments of the Information Technology Industry Council, RM-11361, at 1 (Apr. 30, 2007); Comments of the Consumer Electronics Association, RM-11361, at 2 (Apr. 30, 2007); Comments of the VON Coalition, RM-11361, at 2 (Apr. 30, 2007); Comments of Mobile Industry Executives, RM-11361, at 6 (May 1, 2007); Comments of Consumers Union, Consumer Federation of America and Free Press, RM-11361 (Apr. 30, 2007); Comments of the Ad Hoc Public Interest Spectrum Coalition, RM-11361 (Apr. 30, 2007).
  7. Formal Complaint of Free Press and Public Knowledge Against Comcast Corporation for Secretly Degrading Peer-to-Peer Applications, Memorandum Opinion and Order, File No. EB-08-IH-1518, WC Docket No. 07-52, FCC 08-183 (rel. Aug. 20, 2008).

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