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27 August 2008

Comcast FCC war may need lawyers to resolve entrenched positions

There is always one legal action that is a defining moment in almost all changes to the accepted order within digital media. There is the famous “Betamax case” where the US Supreme Court ruled that making individual copies of TV shows to watch later didn’t constitute copyright abuse, but fair use. Then there was the Supreme Court clarification on its position on ‘encouraging’ copyright abuse, which sunk the P2P industry.

The creation of the Digital Millenium Copyright Act and its global implementation via the World Copyright Treaty is another such landmark legal move.

Now the battle between the FCC and Comcast over just what it is allowed to do with internet traffic promises to be yet another huge decision, which will have global implications for Net Neutrality.

It was AT&T, back when it was just plain old SBC, that complained longest and loudest about having to allow companies like Google to offer services over its network, and wanting to charge not only the customer, but the services carried to the customer, for use of its broadband lines. Someone must be sniggering up their sleeve at AT&T now that it is in fact its worst enemy, in the form of the largest US cable operator Comcast, which is in fact testing the principle in law of what’s reasonable in terms of traffic shaping for internet traffic.

With server based activities, it is fairly easy for an ISP to decide that a particular server destination can only have a limited amount bandwidth, but with P2P based services, where the files or streams can come from anywhere on the internet, detection and delay of a service has only become possible since the invention of super fast packet inspection chips that can peek at every packet and decide what is a BitTorrent video packet and what is not, based on what it finds inside.

Interestingly it is that same old issue about P2P that’s causing all the fuss. The Supreme Court spent years thinking about, and months delivering a verdict, on just how to stop illegal file sharing. But it is the residue of the BitTorrent file share software, not where it is used, as it is today, for legal file sharing, but where it continues to be used without the blessing of its author and his company, to continue video piracy, which is causing all the problems.

Suddenly the FCC is on the side of the consumer, and not on the side of the ISP and has kicked the entire problem onto Comcast’s head with its decision this week to go ahead and force the cable operator to stop blocking BitTorrent traffic.

In fact FCC Chairman Kevin Martin went further and said that Comcast’s existing practices for blocking traffic were actually anticompetitive because potentially legal BitTorrent could offer services to compete with Comcast.

In the past the US government has stopped short of making a law on Net Neutrality, after several attempts, and the FCC felt sure that no new law was needed because it had the power to legislate in the area.

But its order to Comcast is that it must stop what it is doing now, and then try something else, and explain what the something else is. So in other worlds poor Comcast has to stop blocking BitTorrent, a move that will automatically flood its BRAS’ (broadband remote access servers) and its backhaul, and then put in place something that will lighten the traffic enough that it doesn’t lose all of its customers.

In effect the FCC thinks it is saying, do like all the other ISPs in the US do, which is spend more money on more hardware to cope with the problems , but in actual fact even if temporarily that’s what Comcast does, that’s no solution for any of the ISPs, and we are probably at a point where a traffic cap will have to be placed on most ISP customers. The US has tried this, specifically at Time Warner Cable this June, when the company said it would adopt an approach that is in wide use in Europe and Canada to meter new subscribers and charge them $1 per gigabyte for usage above a monthly allowance. Its test began in Beaumont, Texas.

The trick to these services is to offer a discounted subscription to people that are prepared to accept the cap, except largely it doesn’t work. If it is voluntary, the BitTorrent users stay on the more expensive tariff and have uncapped service, while the non-BitTorrent users just end up paying less. Result – same problem but with less revenue.

The Comcast stab at this will be to try its own experiment where it will slow speeds for all ‘heavy’ online users for 10 to 20 minutes. This is also similar to practice which is common in Europe, where ISPs go so far as to cut off the connection and asking the customer to reboot the browser or other software in order to re-establish a connection. This is aimed at BitTorrent users which often run 10 or 20 hour sessions when they are out at work away from the machine, downloading 100s of GBs of video data. When they get home they find that their session was cut short and only half the file has come down so they have to set it running again. This won’t have much of a bad effect on a user sat at the PC all the time, because they can just reboot the software when asked and re-initiate the torrent.

While this may work, this is the first time that this practice will come under the scrutiny of someone like the FCC and if it is really keen to stop the major ISPs blocking video over the internet because it is anti-competitive, then it will not accept that either.

There is probably a technical solution in here somewhere, perhaps the ISPs selling multiple tiers of service and then enforcing them, with one level being video capable and supporting QoS, and costing quite a bit more, and others lumping video with everything else and not caring if video packets arrive on time or not. And of course data capped services at the lowest level.

Otherwise the FCC will be getting dangerous close to ruling that ‘all you can eat schemes’ must be maintained and must support P2P traffic regardless of whether or not it is piracy or a new service innovation, and that position is untenable for an ISP.

If Comcast finds a position that is acceptable to the FCC, this could easily become enshrined in the US legal system and then proliferated to the rest of the world, which currently is a lot less consumer friendly than the US regime, allowing service blocking and anti-trust at ISPs which are controlled by monopolies ‘ even in consumer conscious Europe, which has yet to get to grips with this problem.

But the likely outcome is that the two sides will continue NOT seeing eye to eye, and that Comcast will mount a legal challenge to the FCC power, and this will struggle step by step over the next few years towards another Supreme Court stab at fixing digital media.