July 22, 2007

Spectrum: Why Google is Right, and the Phone Companies are So Very Wrong

Update (July 31, 2007): As was widely expected by many observers, the FCC has now voted to accept its chairman's "lip service to openness" spectrum auction plan that the phone companies decided to support, thereby rejecting the much more consumer-friendly Google plan. Not exactly a shocker, huh? Please see this blog entry for more.

"And there's another thing that's going to come as a surprise to you. There are quite a few people who actually dislike The Phone Company!"

"Arlington Hewes" -- President of "TPC"
The President's Analyst (1967)

Greetings. My first real exposure to how The Phone Company manipulates information (that is, lies) to further its own ends came when I was around twenty years old or so, at the height of "Phone Phreaking" decades ago.

I found myself in a downtown L.A. conference room of the California Public Utilities Commission, defending the operations of the extremely popular free telephone entertainment (i.e. jokes and skits) line with which I was affiliated. (For telephone historians, this was "ZZZZZZ" -- at the time the last listing in the Los Angeles telephone directories.)

Two young colleagues and I faced off a similar number of AT&T representatives, who were attempting to convince the CPUC that "Z" was an imminent danger to the formidable Bell System, by virtue of "Z" receiving so many calls that it was supposedly saturating toll and local switching equipment around the country! AT&T had prepared a beautiful report explaining their collected data (complete with colorful graphs, reminiscent of Arlo Guthrie's "twenty-seven 8x10 color glossy photos" from Alice's Restaurant) to drive home their point.

AT&T apparently assumed that they could easily steamroll a few kids. They were wrong.

It only took a quick skimming of their report for me to realize that while their numbers were not unreasonable, their underlying assumptions and arguments were totally bogus. As I politely pointed this out, the AT&T reps looked at each other in apparent confusion, and the CPUC official in attendance seemed to have a grim look on her face.

The upshot was that she told AT&T that their case was not convincing and "Z" would not be shut down. There's more to the story but that doesn't really matter here.

Fast forward some three decades. Thanks to consolidation and collapse of most effective "last mile" telecom competition, the players look much the same. AT&T morphed into ... well, "The New AT&T," in much the same way that "It's not the same old line" General Telephone eventually mutated into Verizon.

Telecom control is still the name of the game, and whatever needs to be said, whatever promises can be made that can be ignored later, are still the modus operandi of choice for the telcos, especially now that wireless operations are such crucial parts of their spheres.

There is a common thread underlying telco arguments against both Google's support of Internet Net Neutrality and Google's Spectrum Auction proposals. That thread is fear -- fear of losing control, fear of real competition -- and the fear of sliding into gradual oblivion through a tactical error, much as Western Union made when they declined the opportunity to buy the basic telephone patents in 1876 at a budget price.

No fallacy or pressure is too small -- or large -- to be deployed by the phone companies in this battle. Younger readers will not remember a time when you couldn't legally buy your own telephones or other equipment to hook up to the public phone network, and when the telephone companies actively checked phone lines to determine how many phones were attached (could this surveillance be defeated? Yes.)

Nor do most people realize today that at one time, AT&T insisted that a simple privacy device that slipped over a telephone mouthpiece would cause grave disruption to telephone operations and so must be banned -- a position the FCC at the time supported (the infamous "Hush-a-Phone" case, decided against AT&T and the FCC in 1956).

The latest technique is to either state or imply that simply because a large, powerful company like Google supports a concept like Network Neutrality or "open access" to spectrum, it must be anti-consumer in some manner. But in reality, it's the traditional telephone companies and their positions, especially when considered alongside their sordid history of failing to live up to agreements, that is the anti-consumer side.

The Google positions on these matters could of course financially benefit Google greatly. So what? Both neutrality and open networks would also be of immense benefits to consumers generally, particularly if provisions were included to guarantee reasonable access for innovative, smaller firms as well as established, larger enterprises.

But the telcos are what the telcos always have been, and their basic playbook hasn't changed since the dawn of first voice and then data communications. Unfortunately, on the big issues such as we're dealing with now, they are simply not to be trusted, and their arguments can only be viewed through the prism of their past inequities.

I'm not an apologist for Google. I simply attempt to understand and explain these issues the best that I can. But as far as I'm concerned, even though the phone companies and Google are all major commercial, profit-making enterprises, I have no difficulty at all in suggesting that from both consumer and technological reality points of view, Google has the right approach in these areas, and the phone companies are, in actuality, indeed still giving us the same old tired and distorted anti-consumer lines.


Posted by Lauren at July 22, 2007 04:09 PM | Permalink
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