Captive Audience: The Telecom Industry and Monopoly Power in the New Gilded Age

by Susan P. Crawford J. D.

  29. Josh Sanburn, “Why Verizon Dropped Its Unlimited Data Plan (And What You Can Do About It),” Time.com, June 23, 2011, http://moneyland.time.com/2011/06/23/why-verizon-dropped-its-unlimited-data-plan/.

  30. Jamie Sturgeon, “Taking Fire, Bell Insists Internet Caps Suitable for ‘Vast Majority,’” Financial Post, January 31, 2011, available at http://business.financialpost.com/2011/01/31/taking-fire-bell-insists-internet-caps-suitable-for-vast-majority/.

  31. Etan Viessing, “Bell Canada to End Internet Traffic Throttling,” Hollywood Reporter, December 20, 2011, available at http://www.hollywoodreporter.com/news/bell-canada-end-internet-traffic-275721.

  32. Michael Geist, “Unpacking the Policy Issues Behind Bandwidth Caps & Usage Based Billing,” MichaelGeist (blog), February 1, 2011, http://www.michaelgeist.ca/content/view/5611/125/.

  33. Cory Doctorow, “Canadian ISPs Admit That Their Pricing Is Structured to Discourage Internet Use,” Boingboing.net, March 29, 2011, http://www.boingboing.net/2011/03/29/canadian-isps-admit.html.

  34. “CRTC Rejects Plan for Wholesale Internet Billing,” CTV.ca, November 15, 2011, http://www.ctv.ca/CTVNews/SciTech/20111115/crtc-decision-independent-internet-providers-111115/.

  35. Michael Lewis, “Bell Backs off on Internet Billing,” Moneyville.ca, March 28, 2011, http://www.moneyville.ca/article/963044—bell-backs-off-on-internet-billing?bn=1.

  36. Neil Hunt, “Netflix Lowers Data Usage by 2/3 for Members in Canada,” Netflix, US & Canada (blog), March 28, 2011, http://blog.netflix.com/2011/03/netflix-lowers-data-usage-by-23-for.html.

  37. Geist, “Unpacking the Policy Issues.”

  38. Jesse Brown, “Bell Toots an Extinguisher on UBB, Netflix Pours Gasoline,” Macleans.ca, March 29, 2011, http://www2.macleans.ca/2011/03/29/bell-toots-an-extinguisher-on-ubb-netflix-pours-gasoline/.

  39. Devendra T. Kumar, counsel for Netflix, Inc., to Federal Communications Commission, WC Docket No. 07-52, May 10, 2011, 6.

  40. Michael Geist, “Door Opens for Internet Providers to Truly Compete,” Toronto Star, November 19, 2011, available at http://www.thestar.com/article/1089576—door-opens-for-internet-providers-to-truly-compete.

  41. Todd Spangler, “Time Warner Cable Postpones Internet-Billing Trials,” Multichannel News, April 16, 2009, http://www.multichannel.com/article/196377-Time_Warner_Cable_Postpones_Internet_Billing_Trials.php.

  42. Julius Genachowski, “Remarks on Preserving Internet Freedom and Openness,” Federal Communications Commission, December 1, 2010, available at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-303136A1.pdf.

  43. Todd Shields, “AT&T Gains FCC's Ear as Regulators Near Decision on Net Neutrality Rules,” Bloomberg, November 30, 2010, http://www.bloomberg.com/news/2010-11-30/at-t-gains-fcc-s-ear-as-regulators-near-decision-on-net-neutrality-rules.html.

  44. Applications of Comcast Corporation, General Electric Company and NBC Universal, Inc. for Consent to Assign Licenses and Transfer Control of Licensees, Federal Communications Commission, MB Docket No. 10-56, January 18, 2011, 38.

  45. Karl Bode, “Exclusive: AT&T To Impose Caps, Overages,” DSLReports.com, March 13, 2011, http://www.dslreports.com/shownews/Exclusive-ATT-Will-Soon-Impose-150GB-DSL-Cap-Overages-113149.

  46. Xfinity Network Management Policy, “Announcement Regarding an Amendment to Our Acceptable Use Policy,” Xfinity.comcast.net, http://xfinity.comcast.net/terms/network/amendment/.

  47. Karl Bode, “AT&T to Kill Grandfathered Unlimited if You Tether Unofficially,” DSLReports.com, August 4, 2011, http://www.dslreports.com/shownews/ATT-to-Kill-Grandfathered-Unlimited-If-You-Tether-Unofficially-115528.

  48. Federal Communications Commission, “Public Notice: FCC Enforcement Bureau and Office of General Counsel Issue Advisory Guidance for Compliance with Open Internet Transparency Rule,” news release, June 30, 2011, available at http://transition.fcc.gov/Daily_Releases/Daily_Business/2011/db0630/DA-11-1148A1.pdf.

  49. John Eggerton, “Top Op's Top Washington Exec Has ‘High Hopes’ for Commission Under Genachowski,” Multichannel News, July 30, 2009.

  50. Cisco's John Chapman presented a paper at the National Cable & Telecommunications Association Cable Show in Boston in May 2012, written jointly by CISCO, ARRIS, and MOTO, claiming that the next-generation DOCSIS cable platforms could achieve a capacity of ten gigabits per second (download) and two gigabits per second (upload). See Jeff Baumgartner, “Does Docsis have a 10-Gig Future?” Light Reading Cable, May 23, 2012, http://www.lightreading.com/document.asp?doc_id=221264&site=lr_cable.

  51. Ken Florence, “Netflix Performance on Top ISP Networks.” Netflix, Tech (blog), January 27, 2011, http://techblog.netflix.com/2011/01/netflix-performance-on-top-isp-networks.html.

  52. “Comcast's CEO Discusses Q1 2012 Results—Earnings Call Transcript,” Seeking Alpha, May 2, 2012, available at http://finance.yahoo.com/news/comcasts-ceo-discusses-q1-2012-163011159.html (“High-Speed Internet revenue was a large contributor to Cable revenue growth in the first quarter [0f 2012]. HSI revenue increased 10.3%, reflecting rate adjustments, continued growth in our customer base and an increasing number of our customers taking higher-speed services. Today, 26% of our Residential HSI customers take a higher-speed tier above our primary service.”).

  53. Stacey Higginbotham, “FCC Opens the Door for Metered Broadband,” GigaOM, December 1, 2010, http://gigaom.com/2010/12/01/fcc-opens-the-door-for-metered-web-access/.

  54. Martin A. Brown, Alin Popescu and Earl Zmijewski, Peering Wars: Lessons Learned from the Cogen-Telia De-peering, Renesys Corporation, June 2008, 13, available at http://www.renesys.com/tech/presentations/pdf/nanog43-peeringwars.pdf.

  55. Bradley D. Bopp, NationalNet; Adam Davenport, Choopa, LLC; Randy Epstein, BroadbandONE; Anton Kapela, Five Nines Data, et al., to Hon. Julius Genachowski et al., Re: Peering Representations by Comcast (NASDAQ: CMCSA); Comcast and NBC Universal Merger, MB Docket No. 10-56; Open Internet Broadband Industry Practices (GN Docket No. 09–191), December 20, 2010.

  56. TR Daily, “Comcast-Level 3 Dispute over Content Delivery Fees Cited in Net Neutrality, NBCU Venture Policy Debates,” Telecommunications Reports International, December 15, 2010; Earl Zmijewski, “A Baker's Dozen, 2011 Edition,” Renesys (blog), February 8, 2012, http://www.renesys.com/blog/2012/02/a-bakers-dozen-2011-edition.shtml.

  57. Evelyn M. Rusli, “Level 3's Bid for Global Crossing Could Lead to More Deals,” New York Times, April 11, 2011, available at http://dealbook.nytimes.com/2011/04/11/in-level-3-takeover-an-opportunity-for-more-deals/.

  58. Stacey Higginbotham, “Google's Fiber Network Could Foil ISPs and Fuel Innovation.” GigaOM, February 10, 2010, http://gigaom.com/2010/02/10/google-fiber/.

  59. Cathy Avgiris, “Extreme 105: Powering Digital Families,” Comcast Voices (blog), April 14, 2011, http://blog.comcast.com/2011/04/extreme-105-powering-digital-families.html; Dwight Silverman, “The Woodlands Gets Comcast's Extreme 105 First,” Houston Chronicle, Tech (blog), April 19, 2011, http://blog.chron.com/techblog/2011/04/the-woodlands-gets-comcasts-extreme-105-first/.

  60. Tim Beyers, “Give It Up, Comcast,” Motley Fool, April 15, 2011, http://www.fool.com/investing/general/2011/04/15/give-it-up-comcast.aspx?source=isesitlnk0000001&mrr=1.00.

  61. Avgiris, “Extreme 105” Susan P. Crawford, “The New Digital Divide,” New York Times, December 3, 2011, available at http://www.nytimes.com/2011/12/04/opinion/sunday/internet-access-and-the-new-divide.html?pagewanted=all.

  62. In the Matter of Inquiry Concerning the Deployment of Advanced Telecommunications Capability to All Americans in a Reasonable and Timely Fashion, 26 F.C.C.R. 8008, 8009, 8099 (Seventh Broadband Progress Report and Order on Reconsideration).

  63. Federal Communications Commission, “FCC & ‘Connect to Compete’ Tackle Barriers to Broadband Adoption” news release, March 8, 2012, available at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-310924A1.pdf.

  64. In the Matter of Inquiry Concerning the Deployment of Advanced Telecommunications Capability, 2
6 F.C.C.R. 8008, 8042–43.

  65. Mark McDonald, “Home Internet May Get Even Faster in South Korea,” New York Times, February 21, 2011, available at http://www.nytimes.com/2011/02/22/technology/22iht-broadband22.html.

  66. Cecilia Kang, “FCC Chairman Supports Broadband Data Caps amid Netflix Protests,” Washington Post, Post Tech (blog), May 22, 2012, http://www.washingtonpost.com/blogs/post-tech/post/fcc-chairman-supports-broadband-data-caps-amid-netflix-protests/2012/05/22/gIQAfdN9hU_blog.html?wprss=rss_technology.

  67. Representative Ed Markey, interview with the author, January 1, 2011.

  Chapter 10. Comcast's Marathon

  1. “The Comcast/NBC Universal Merger: What Does the Future Hold for Competition and Consumers?”: Hearing Before the Subcomm. on Antitrust, Competition Policy and Consumer Rights of the S. Comm. on the Judiciary, 111th Cong. 12 (2010) (Opening Statement of Senator Herb Kohl).

  2. Applications and Public Interest Statement of Comcast Corporation, General Electric Company, and NBC Universal, Inc., In the Matter of Applications for Consent to the Transfer of Control of Licenses, Federal Communications Commission, May 4, 2010, 134.

  3. Ibid., 39.

  4. Ibid., 46, 47; Common Sense Media, “Common Sense Media Honors Innovators in Media, Public Policy and Technology–PHOTO,” news release, February 26, 2010, http://www.reuters.com/article/2010/02/26/idUS219181+26-Feb-2010+BW20100226.

  5. “I want to thank my friends, Gary Knell and Jim Steyer,” Julius Genachowski, remarks presented at the National Museum of American History, Washington, D.C., March 12, 2010.

  6. “Commitment # 12. To enhance localism and strengthen educational and governmental access programming, Comcast will also develop a platform to host PEG content On Demand and On Demand Online within three years of closing” (Applications and Public Interest Statement). “Commitment # 16. The combined entity will continue the policy of journalistic independence with respect to the news programming organizations of all NBCU networks and stations, and will extend these policies to the potential influence of each of the owners. To ensure such independence, the combined entity will continue in effect the position and authority of the NBC News ombudsman to address any issues that may arise” (ibid.).

  Copps, widely identified publicly as a Democrat, was a longtime outspoken critic of consolidation. See Joe Flint, “Michael Copps Frets over Media Landscape as He Prepares to Leave FCC,” Los Angeles Times, December 13, 2011, available at http://articles.latimes.com/2011/dec/13/business/la-fi-ct-copps-20111213. David Cohen of Comcast also publicly praised both Genachowski and Copps on CSPAN in August 2009. See “The Communicators: David Cohen, Comcast Corp.,” YouTube video, 1:10, from an interview televised by CSPAN, July 24, 2009, posted by “CSPAN,” August 2, 2009, http://www.youtube.com/watch?v=sIozcgvdehs.

  7. TR Daily, “Comcast Expects to Make FCC Public Interest Filing in 30–45 Days,” Telecommunications Reports International, December 4, 2009, available via Westlaw (www.westlaw.com) at 2009 WLNR 24519526.

  8. Commitment 1 addressed the continuing provision of free over-the-air television through owned and operated broadcast stations and local broadcast; commitment 16 addressed journalistic independence; commitment 6 promised expansion of “the availability of over-the-air programming to the Hispanic community utilizing a portion of the digital broadcast spectrum of Telemundo's O&Os (as well as offering it to Telemundo affiliates) to enhance the current programming of Telemundo and mun2” Comcast “represented that it will honor all of NBCU's collective bargaining agreements” Applications and Public Interest Statement, 40, 133, 48, 38 n. 69.

  9. Consumer Federation of America, Consumers Union and Free Press, Comcast's Hollow “Public Interest” Commitments, 2, accessed March 4, 2012, http://www.freepress.net/node/76419.

  10. Hill staffer, interview with the author, August 23, 2010. Cohen's compensation was valued at $9,839,379 in 2009, and $12,696,578 in 2010. See “David L. Cohen,” Forbes, accessed March 4, 2012, http://people.forbes.com/profile/david-l-cohen/21325; “David L. Cohen,” Bloomberg Businessweek, accessed March 4, 2012, http://investing.businessweek.com/research/stocks/people/person.asp?personId=1997632&ticker=CMCSA:US; Meg James, “NBCUniversal CEO Steve Burke Is Comcast's Most Highly Compensated Executive,” Los Angeles Times, April 2, 2011, available at http://articles.latimes.com/2011/apr/02/business/la-fi-ct-burke-20110402.

  11. Gail Shister, “Another Chair for a Man Who Just Can't Sit Still, For David Cohen, Penn a Passion Among Many,” Philadelphia Inquirer, December 5, 2008, available at http://articles.philly.com/2008-12-05/news/25244395_1_penn-greater-philadelphia-chamber-law-school.

  12. Robert Huber, “David L., Explained,” Philadelphia Magazine, November 2006, available at http://www.phillymag.com/health/articles/david_l_cohen_profile_david_l_explained/page1; Hill staffer, interview with the author, September 3, 2010.

  13. Huber, “David L., Explained.”

  14. Buzz Bissinger, A Prayer for the City (New York: Random House, 1999), xxiii.

  15. The Pennsylvania Report 18, Iss. 03-02 (Harrisburg: Capital Growth, 2003), 4.

  16. Thomas Fitzgerald, “Hoeffel, Castor Casting Shadows,” Philadelphia Inquirer, October 22, 2007, available at http://articles.philly.com/2007-10-22/news/25232443_1_marcel-groen-democrat-joe-hoeffel-damsker.

  17. Huber, “David L., Explained” Bissinger, Prayer for the City.

  18. Peter Nicholas, “For Rendell, GOP Convention Work Is Done: As Mayor, He Lobbied Hard to Bring the Gathering Here. As Head of the DNC, He Will Be Keeping His Distance,” Philadelphia Inquirer, July 7, 2000, available at http://articles.philly.com/2000-07-07/news/25609716_1_biggest-convention-ed-rendell-edward-g-rendell.

  19. Patricia Horn, “Cashing in On the GOP Convention Comcast Branded the Gathering in Every Way It Could,” Philadelphia Inquirer, August 6, 2000, available at http://articles.philly.com/2000-08-06/business/25594260_1_philadelphia-s-comcast-corp-comcast-executive-vice-president-comcast-country.

  20. David Cohen's affiliations are detailed in his biography on the Comcast Web site: “Biography: David L. Cohen,” Comcast, accessed March 4, 2012, http://www.comcast.com/corporate/about/pressroom/corporateoverview/corporateexecutives/davidcohen.html?SCRedirect=true. PolitickerPA.com was shuttered in 2009, but the Pittsburgh Tribune-Review reported on PolitickerPA's ranking of David Cohen in “Manzo's Alleged Squeeze Is a Multitasker,” Pittsburgh Tribune-Review, July 20, 2008, http://www.pittsburghlive.com/x/pittsburghtrib/s_578353.html.

  21. Edmund Sanders, “Comcast Country Tough on Intruders,” Los Angeles Times, July 16, 2001, available at http://articles.latimes.com/2001/jul/16/business/fi-22884; Ken Dilanian and Wendy Tanaka, “RCN Pulls Cable TV Proposal: A Senior Company Official Blamed City Council Delays. Phila. Says the Company Left Because of Finances,” Philadelphia Inquirer, February 15, 2001, http://articles.philly.com/2001-02-15/news/25316899_1_rcn-city-council-delays-cable-tv-proposal; Patricia Horn and Ken Dilanian, “Where Connections Are Key to Connecting: RCN's Effort to Compete with Comcast Illustrates the City's Barriers to Business,” Philadelphia Inquirer, January 28, 2001, available at http://articles.philly.com/2001-01-28/news/25311516_1_rcn-corp-telephone-and-internet-services-cable. RCN discussed the episode in its 2002 filing with the FCC in opposition to Comcast Corporation's proposed acquisition of AT&T Comcast. See Petition of RCN Telecom Services, Inc., to Deny Applications or Condition Consent, In the Matter of Applications for Consent to the Transfer of Control of Licenses, Federal Communications Commission, April 29, 2002.

  22. “Cohen said the firm did not expect Rendell to do too much legal work during his first year on the job because he will be busy raising money for the Democratic Party and trying to help the Democrats hold onto the White House” (Cynthia Burton, “Rendell to Become Partner at Law Firm When He Leaves Office In January, He Will Join Ballard Spahr. He Has Strong Ties to the Firm,” Philadelphia Inquirer, December 23, 1999, available at http://articles.philly.com/1999-12-23/news/25479149_1_ed-rendell-ballard-spahr-firm.

/>   23. “Scrutiny Ahead for Comcast,” Pittsburgh Tribune-Review, December 4, 2009, available at http://www.pittsburghlive.com/x/pittsburghtrib/business/s_656133.html; Dan Gelston, “Pennsylvania Governor Trades Politics for Pigskin,” Spartanburg Herald-Journal, November 7, 2004, available at http://news.google.com/newspapers?nid=1876&dat=20041107&id=a-YoAAAAIBAJ&sjid=TNAEAAAAIBAJ&pg=5805,1649963.

  24. Kim Hart, “Comcast-NBC Deal Finds Campaign Cash Converging with Obama's Principles,” The Hill, Hillicon Valley (blog), December 5, 2009, http://thehill.com/blogs/hillicon-valley/technology/70767-comcast-nbc-deal-finds-campaign-cash-converging-with-obamas-principles; the White House, “Remarks by the President at Fundraising Event for Arlen Specter,” news release, September 15, 2009, available at http://www.whitehouse.gov/the-press-office/remarks-president-fundraising-event-senator-arlen-specter-philadelphia; Dan Gross, “Jon Bon Jovi to Perform at Private Obama Fundraiser,” Philadelphia Inquirer, September 29, 2008, available at http://www.philly.com/philly/blogs/phillygossip/Jon_Bon_Jovi_to_perform_at_private_Obama_fundraiser.html?jCount=2. David Cohen is a “member” of President Obama's “$500,000 bundling club,” according to Eric Lichtblau, “Obama Backers Tied to Lobbies Raise Millions,” New York Times, October 27, 2011, available at http://www.nytimes.com/2011/10/28/us/politics/obama-bundlers-have-ties-to-lobbying.html?pagewanted=all.