[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]
NET NEUTRALITY AND FREE SPEECH
ON THE INTERNET
=======================================================================
HEARING
BEFORE THE
TASK FORCE ON COMPETITION POLICY
AND ANTITRUST LAWS
OF THE
COMMITTEE ON THE JUDICIARY
HOUSE OF REPRESENTATIVES
ONE HUNDRED TENTH CONGRESS
SECOND SESSION
__________
MARCH 11, 2008
__________
Serial No. 110-95
__________
Printed for the use of the Committee on the Judiciary
Available via the World Wide Web: http://judiciary.house.gov
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COMMITTEE ON THE JUDICIARY
JOHN CONYERS, Jr., Michigan, Chairman
HOWARD L. BERMAN, California LAMAR SMITH, Texas
RICK BOUCHER, Virginia F. JAMES SENSENBRENNER, Jr.,
JERROLD NADLER, New York Wisconsin
ROBERT C. ``BOBBY'' SCOTT, Virginia HOWARD COBLE, North Carolina
MELVIN L. WATT, North Carolina ELTON GALLEGLY, California
ZOE LOFGREN, California BOB GOODLATTE, Virginia
SHEILA JACKSON LEE, Texas STEVE CHABOT, Ohio
MAXINE WATERS, California DANIEL E. LUNGREN, California
WILLIAM D. DELAHUNT, Massachusetts CHRIS CANNON, Utah
ROBERT WEXLER, Florida RIC KELLER, Florida
LINDA T. SANCHEZ, California DARRELL ISSA, California
STEVE COHEN, Tennessee MIKE PENCE, Indiana
HANK JOHNSON, Georgia J. RANDY FORBES, Virginia
BETTY SUTTON, Ohio STEVE KING, Iowa
LUIS V. GUTIERREZ, Illinois TOM FEENEY, Florida
BRAD SHERMAN, California TRENT FRANKS, Arizona
TAMMY BALDWIN, Wisconsin LOUIE GOHMERT, Texas
ANTHONY D. WEINER, New York JIM JORDAN, Ohio
ADAM B. SCHIFF, California
ARTUR DAVIS, Alabama
DEBBIE WASSERMAN SCHULTZ, Florida
KEITH ELLISON, Minnesota
Perry Apelbaum, Staff Director and Chief Counsel
Sean McLaughlin, Minority Chief of Staff and General Counsel
------
Task Force on Competition Policy and Antitrust Laws
JOHN CONYERS, Jr., Michigan, Chairman
RICK BOUCHER, Virginia STEVE CHABOT, Ohio
ZOE LOFGREN, California RIC KELLER, Florida
SHEILA JACKSON LEE, Texas F. JAMES SENSENBRENNER, JR.,
MAXINE WATERS, California Wisconsin
STEVE COHEN, Tennessee BOB GOODLATTE, Virginia
BETTY SUTTON, Ohio CHRIS CANNON, Utah
ANTHONY D. WEINER, New York DARRELL ISSA, California
DEBBIE WASSERMAN SCHULTZ, Florida TOM FEENEY, Florida
LAMAR SMITH, Texas, Ex Officio
Perry Apelbaum, Staff Director and Chief Counsel
Sean McLaughlin, Minority Chief of Staff and General Counsel
C O N T E N T S
----------
MARCH 11, 2008
Page
OPENING STATEMENTS
The Honorable John Conyers, Jr., a Representative in Congress
from the State of Michigan, and Chairman, Task Force on
Competition Policy and Antitrust Laws.......................... 1
The Honorable Steve Chabot, a Representative in Congress from the
State of Florida, and Ranking Member, Task Force on Competition
Policy and Antitrust Laws...................................... 3
The Honorable F. James Sensenbrenner, Jr., a Representative in
Congress from the State of Wisconsin, and Member, Task Force on
Competition Policy and Antitrust Laws.......................... 5
The Honorable Tom Feeney, a Representative in Congress from the
State of Florida, and Member, Task Force on Competition Policy
and Antitrust Laws............................................. 6
WITNESSES
Mr. Damian Kulash, Lead Vocalist and Guitarist, OK Go
Oral Testimony................................................. 6
Prepared Statement............................................. 9
Ms. Michele Combs, Vice President of Communications, Christian
Coalition of America
Oral Testimony................................................. 15
Prepared Statement............................................. 17
Mr. Rick Carnes, President, Songwriters Guild of America
Oral Testimony................................................. 21
Prepared Statement............................................. 23
Ms. Caroline Fredrickson, Director, Washington Legislative
Office, American Civil Liberties Union (ACLU)
Oral Testimony................................................. 27
Prepared Statement............................................. 29
Mr. Christopher S. Yoo, Professor of Law and Communication and
Director, Center for Technology, Innovation, and Competition,
University of Pennsylvania Law School
Oral Testimony................................................. 53
Prepared Statement............................................. 56
Ms. Susan P. Crawford, Visiting Associate Professor of Law, Yale
Law School
Oral Testimony................................................. 64
Prepared Statement............................................. 66
LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING
Prepared Statement of the Honorable John Conyers, Jr., a
Representative in Congress from the State of Michigan, and
Chairman, Task Force on Competition Policy and Antitrust Laws.. 2
Prepared Statement of the Honorable Lamar Smith, a Representative
in Congress from the State of Texas, and Ranking Member,
Committee on the Judiciary..................................... 4
APPENDIX
Material Submitted for the Hearing Record
Prepared Statement of the Honorable Sheila Jackson Lee, a
Representative in Congress from the State of Texas, and Member,
Task Force on Competition Policy and Antitrust Laws............ 95
Response by Rick Carnes, President, Songwriters Guild of America,
to Question from Congressman Bob Goodlatte..................... 96
Response to Post-Hearing Questions from Christopher S. Yoo,
Professor of Law and Communication and Director, Center for
Technology, Innovation, and Competition, University of
Pennsylvania Law School........................................ 98
Response to Post-Hearing Questions from Susan P. Crawford,
Visiting Associate Professor of Law, Yale Law School........... 100
Letter from Leslee J. Unruh, Founder and President, Abstinence
Clearinghouse, et al. to Members of Congress, dated March 10,
2008........................................................... 103
NET NEUTRALITY AND FREE SPEECH
ON THE INTERNET
----------
TUESDAY, MARCH 11, 2008
House of Representatives,
Task Force on Competition Policy
and Antitrust Laws
Committee on the Judiciary,
Washington, DC.
The Task Force met, pursuant to notice, at 2:04 p.m., in
Room 2141, Rayburn House Office Building, the Honorable John
Conyers, Jr., (Chairman of the Task Force) presiding.
Present: Representatives Conyers, Lofgren, Jackson Lee,
Waters, Cohen, Wasserman Schultz, Smith, Sensenbrenner,
Goodlatte, Chabot, Keller, and Feeney.
Staff Present: Stacey Dansky, Majority Antitrust Counsel;
Benjamin Staub, Professional Staff Member; and Stuart Jeffries,
Minority Antitrust Counsel.
Mr. Conyers. The Task Force on Antitrust will come to
order. I am happy to see so many of our friends here. I know
that Jack and Jill, Incorporated's national board is here for
the annual legislative event and so is its President,
Jacqueline Moore Bowles. We welcome all of you. Would you just
stand up for 1 second? Thank you. Very good to see you all.
Ladies and gentlemen, over the last 10 years, the Internet has
gone from its infancy through a period of exponential growth.
Today, over 1\1/3\ billion people use the Internet, which is
approximately 20 percent of the world's population. In the last
7 years alone, worldwide use has jumped 265 percent. The
Internet has become the dominant venue for the expression of
ideas and public discourse. From social networking to get-out-
the-vote drives, the Internet is now a leading tool for speech
and action.
Web sites like Facebook, MySpace, LinkedIn, and Monster
have changed the way people of all ages connect socially and
professionally. Political candidates raise more money online
with each election cycle. Newspaper Web sites and independent
blogs have revolutionized the ways in which news and media are
disseminated and consumed. And the Internet has opened up new
performance venues to emerging artists and entertainers. In
these and other ways, the technological innovation and
communication made possible by Internet has made it among the
most powerful outlets for creativity and for free speech.
So when it comes to the Internet, we should proceed
cautiously. Unless we have clearly documented the existence of
a significant problem that needs regulating, I do not believe
Congress should regulate. And even in those instances, we
should tread lightly. Today the open architecture of the
Internet is under siege. On today's Internet, a blogger can
compete on a level playing field with news giants like CNN or
The New York Times; an independent musician can stand equal
with a record label; and citizen advocates can have as loud a
voice as politicians themselves.
However, some of the Internet service providers, which
control 96 percent of the residential market for high speed
Internet access, are either monopolies or duopolies in the most
of the areas of the country. There are either one company or
two companies controlling it, and they have proposed now to
give favored treatment to some Internet content and disfavored
treatment to others. Under these proposed business models, what
treatment you get will be determined by how much you pay or
potentially whether the Internet service provider approves of
the content that you are sending if you are sending it over
their pipes. Or perhaps the Internet service provider may have
a financial interest. The problem is that many of the
innovations we have enjoyed on the Internet would never have
occurred under this proposed regime. We never would have had a
Google search engine or YouTube videos or Daily Kos blogs if
paid to play had been our national policy. To be sure, if we go
in this direction it will stifle future innovation on the
Internet. And so I am concerned that if Congress stands by and
does nothing, we will soon find ourselves living in a world
where those who pay can play but those who don't are simply out
of luck, where politicians will be able to stifle the voices of
citizen activists through deals with Internet service
providers, where an increasingly consolidated entertainment
industry might be able to prevent independent artists and
filmmakers from being heard.
Now, if Congress acts, it will not be because we have
decided to regulate. It will be because the Internet service
providers have imposed their own new regulation on the Internet
and are interfering with its healthy growth. I believe that
antitrust law is the most appropriate way to deal with this
problem, and antitrust law is not regulation. It exists to
correct distortions of the free market where monopolies or
cartels have cornered the market and competition is not being
allowed to work. The antitrust laws can help maintain a free
and open market place
So Congress should help maintain a free and open Internet.
So this is a very interesting subject and I would recognize our
Ranking minority Member, Steve Chabot of Ohio, for his opening
comments.
[The prepared statement of Mr. Conyers follows:]
Prepared Statement of the Honorable John Conyers, Jr., a Representative
in Congress from the State of Michigan, and Chairman, Task Force on
Competition Policy and Antitrust Laws
Over the last ten years, the Internet has gone from its infancy
through a period of exponential growth. Today, it is estimated that
over 1.3 billion people use the Internet--that is almost twenty percent
of the world's population.
In the last seven years alone, the worldwide use of the Internet
has jumped 265 percent.
(1) The Internet is speech
The Internet has become the dominant venue for the expression of
ideas and public discourse. From social networking to get-out-the-vote
drives, the Internet is now a leading tool for speech and action.
Web sites like Facebook, MySpace, LinkedIn, and Monster have
changed the way people of all ages connect socially and professionally.
Political candidates raise more money online with each election
cycle.
Newspaper web sites and independent blogs have revolutionized the
ways in which news and media are disseminated and consumed.
And the Internet has opened up new performance venues to emerging
artists and entertainers.
In these and other ways, the technological innovation in
communication made possible by the Internet has made it among the most
powerful outlets for creativity and free speech.
So when it comes to the Internet, we should always proceed
cautiously. Unless we have clearly documented the existence of a
significant problem that needs regulating, I do not believe Congress
should regulate. And even in those instances, we should tread lightly.
(2) Today, the open architecture of the Internet is under siege
On today's Internet, a blogger can compete on a level playing field
with news giants like CNN or the New York Times. An independent
musician can stand equal with a record label. And citizen advocates can
have as loud a voice as politicians.
However, some of the Internet Service Providers, which control 96%
of the residential market for high-speed Internet access, and are
either monopolies or duopolies in most areas of the country, have
proposed to give favored treatment to some Internet content and
disfavored treatment to other content.
Under these proposed business models, what treatment you get will
be determined by how much you pay or, potentially, whether the Internet
Service Provider approves of the content you are sending over their
pipes or, perhaps, has a financial interest.
The problem is that many of the innovations we have enjoyed on the
Internet would never have occurred under this proposed regime.
We would never have had a Google search engine, or You Tube videos,
or Daily Kos blogs, if ``pay to play'' had been our national policy.
To be sure, if we go in this direction, it will stifle future
innovation on the Internet.
(3) Congress should act to preserve Net Neutrality
I am concerned that if Congress stands by and does nothing, we will
soon find ourselves living in a world where those who pay can play, but
those who don't are simply out of luck.
Where politicians will be able to stifle the voices of citizen
activists through deals with Internet Service Providers.
Where an increasingly consolidated entertainment industry will be
able to prevent independent artists and filmmakers from being heard.
Let's not get confused. If Congress acts, it will not be because we
have decided to regulate. It will be because the Internet Service
Providers have imposed their own new regulation on the Internet, and
are interfering with its healthy growth.
I believe that antitrust law is the most appropriate way to deal
with this problem--and antitrust law is not regulation. It exists to
correct distortions of the free market, where monopolies or cartels
have cornered the market, and competition is not being allowed to work.
The antitrust laws can help maintain a free and open Internet.
I look forward to hearing from our witnesses today, and to a
meaningful discussion of the various perspectives on this important
topic.
Mr. Chabot. Thank you, Mr. Chairman. I would like to thank
Chairman Conyers for holding this hearing today. I would also
like to thank our witnesses for taking the time to discuss this
important issue. Net Neutrality is not a new issue to this
Committee or to Congress. And debate in the past has been,
quite frankly, very passionate. I think we can all agree,
though, that the Internet has changed the way that we
communicate, learn, and do business. It has changed the way we
access and use information and technology. The Internet has
flourished in a relatively regulation free environment. For
example, the Internet tax moratorium first enacted back in
1998, that was recently extended for an additional 7 years will
continue to allow greater public access benefiting everyone
from consumers to teachers and students, to the corporate
sector and rural and urban areas alike. And it is a free market
that will continue to allow the best possible service at the
best possible price.
Too often Congress sees a problem that it believes it can
fix. But legislation is not always the right answer.
Competition is. Competition drives the market to become as
efficient and effective as possible. Providing consumers with
the right quantity at the right price. It has worked in the
past and I believe that it will continue to work in the future,
particularly as it relates to the Internet. Unbeknownst to many
of us, there is an entire network structure that manages data
traffic, enabling anyone to access virtually anything at any
time. It is necessary to ensure that the most effective network
infrastructure is in place to connect consumers to content. I
am concerned that the heavy hand of government could deter
investment and innovation and technology that will enable
networks to advance in the future.
Burdensome regulations, particularly in this case, may
actually slow the development of bandwidth, reducing the
efficiency and effectiveness of the Internet, ultimately
harming consumers. I look forward to addressing these concerns
with our panel of experts today, and again, I want to thank the
Chairman for this important hearing and I yield back the
balance of my time.
Mr. Conyers. Thank you. You are welcome. Mr. Smith, the
Ranking Member of the full Committee, do you have a comment?
Mr. Smith. Thank you, Mr. Chairman. Like you, I welcome all
witnesses here today. I do have an opening statement, but I
would like to ask unanimous consent that it simply be made part
of the record.
Mr. Conyers. Without objection.
Mr. Smith. And I yield back, Mr. Chairman.
[The prepared statement of Mr. Smith follows:]
Prepared Statement of the Honorable Lamar Smith, a Representative in
Congress from the State of Texas, and Ranking Member, Committee on the
Judiciary
Mr. Chairman, thank you for calling this hearing on net neutrality
and free speech on the Internet.
Our Committee has always played a vital role in ensuring fair
competition in the telecommunications industry. We must continue to be
vigilant of our jurisdiction in the constantly evolving environment of
the Internet.
What has happened in the almost two years since the Judiciary
Committee last considered this issue?
Proponents of Net Neutrality point to three episodes in 2007
involving Internet service providers AT&T, Verizon Wireless, and
Comcast.
Without going into the details of every case, it seems clear that
each company was taking these actions to serve a broader public good.
In the case of AT&T's vendor, there was an effort to make the broadcast
more family friendly. For Verizon, it was to block spam text messages.
For Comcast, it was to manage their broadband network to provide the
best experience for all of its users.
In every case, there was an acknowledgment that the problem could
have been handled better or should have not happened at all.
But the companies took corrective action, issued apologies, and had
to accept public criticism. The question is whether these limited
examples provide a basis for Congress to broadly regulate the Internet.
Experience suggests not. Both the Department of Justice's Antitrust
Division and the Federal Trade Commission have issued reports in the
last year urging Congress and the Federal Communications Commission to
be wary of enacting regulation affecting the Internet.
DOJ and the FTC point out that competition in consumer broadband is
strong and growing.
For example, in each of the markets where AT&T, Verizon Wireless,
and Comcast compete, they undoubtedly lost some customers to other
broadband providers who were unhappy with the company's conduct.
They also note that network management is an essential function for
any Internet service provider and that net neutrality regulation could
have many unintended consequences.
Proponents of Net Neutrality are now casting this as a First
Amendment issue. But that argument ignores the fact that not all speech
is created equal.
For example, Congress has protected certain speech--in the form of
copyrights--to preserve individual's intellectual property rights.
As NBC observed in its official comments to the FCC, ``The record .
. . confirms that fewer than five percent of Internet users consume at
least 60 to 70 percent of broadband network capacity through peer-to-
peer file-sharing and that some 90 percent of this traffic consists of
illegal, pirated content.''
Congress attempted to address these concerns with the Digital
Millennium Copyright Act of 1998. We should not be undercutting those
efforts by implementing new laws and regulations that prevent ISPs from
utilizing new technologies to deter this illegal downloading of pirated
materials.
Similarly, Congress has long recognized that certain pornographic
materials--particularly those that exploit children--should be off
limits entirely. To that end, the Christian Coalition, among others,
filed comments with the FCC expressing concern that the proposed net
neutrality rules ``might make it more difficult for [ISPs] to monitor
and filter the use of . . . [P2P] networks to facilitate crimes against
children. . . .''
These examples highlight how very difficult it is to write rules
for how the Internet should grow. Instead of writing restrictive rules
to solve this problem, I think it would be better to focus our efforts
on preserving the application of current antitrust laws to safeguard
against anticompetitive practices on the Internet.
This approach preserves the jurisdiction of this Committee and
ensures that we don't put a straightjacket on this important sector of
the economy.
Mr. Conyers. Jim Sensenbrenner, Chairman Emeritus, have you
a comment?
Mr. Sensenbrenner. A little bit, Mr. Chairman. Thank you
very much. In the last Congress, when I was Chairman of the
Committee, I joined with then-Ranking Member Conyers to
introduce legislation. And the purpose was based on two
principles. One is that the antitrust law should apply to the
telecommunications industry. That remains my position. And the
second was that I believe that it was important that this
Committee exercise its jurisdiction in this area because
antitrust laws are not regulations in that some Federal agency
tells you what you can do and what you can't do. But if
somebody is aggrieved they can file a lawsuit. And if they are
able to prove anticompetitive action, then they can win triple
damages.
I would hope that the debate on Net Neutrality and what to
do about telecom and Internet regulation, or lack thereof, goes
on in this Congress. The current Chairman and Ranking Member at
all costs moved together to make sure that the Judiciary
Committee maintains its jurisdiction on this subject because if
we allow our jurisdiction to go to the Energy and Commerce
Committee, I think you'll see a regulatory structure over the
Internet that is not going to be good for the American public,
and it is not going to be good for artists and others that use
the Internet as an essential means of communication such as the
witnesses that we have here today. Thank you.
Mr. Conyers. Thank you, sir. Ric Keller, have you a
comment?
Mr. Keller. No, I don't, Mr. Chairman. But thanks for
asking. I just appreciate all the witnesses being here.
Mr. Conyers. Mr. Feeney, welcome.
Mr. Feeney. Thank you, Mr. Chairman. This is my first
hearing, and I am very anxious to hear the various issues
explored. I am somewhat familiar with the Internet and
intellectual property and even antitrust. I have heard of
horizontal monopolies. I have heard of vertical monopolies. I
guess when we are talking about wireless, I guess it is sort of
a ubiquitous monopoly. That is a new thing for me to
understand. With that I would yield back and listen very
carefully.
Mr. Conyers. Thank you. Our witnesses are Susan Crawford,
professor; Professor Christopher Yoo; our old friend, Director
of ACLU, Washington office, Caroline Fredrickson; Rick Carnes,
President of the Songwriters Guild of America; Michele Combs,
Vice President of Communications, Christian Coalition of
America; and, of course, our lead vocalist and guitarist, OK
Go, Damian Kulash. A vocalist and a musician, a native of our
capital, a graduate from Brown University, Kulash formed his
organization in 1999 with three others. His band released 2
albums and won a Grammy award for one of its music videos in
2007. They attribute their breakthrough in part to the
popularity of their videos, which the group has uploaded and
disseminated, or it looks like he is trying to play them here,
disseminated across the world on video Web sites like
YouTube.com. Welcome, Mr. Kulash. We would love to hear, see,
and listen to your remarks.
TESTIMONY OF DAMIAN KULASH, LEAD VOCALIST
AND GUITARIST, OK Go
Mr. Kulash. Thank you, Mr. Chairman. Mr. Chairman, Ranking
Members--I am sorry--Mr. Ranking Member and Members of the
Committee, it is a real honor to be here. I am a rock singer,
so I have some experience getting up in front of a microphone,
but to put it this way, you are not my usual crowd. I am here
today because my band, OK Go, is among the first to have truly
found success on the Internet. I don't know if I need to tell
all of you guys my story or not. I am getting the sense that
maybe you guys are the ``Cool Rep 2000'' and ``Chairman Rock''
that we already see on our message boards every day.
But just in case, I am going to tell you a little bit about
our story and the videos that we put on the Internet, and I
want to show you a couple of those videos today. Our band
started out the way that every band did 10 years ago. The
traditional music industry was still very much in full swing,
and it served a real purpose which was to connect musicians who
wanted to get their music out there in the world, and there
were people all over the world that wanted to hear that music.
So a big industry grew to connect those dots. We worked in
that system. We started out playing shows in Chicago, at local
clubs where we started. We plastered our posters all over town.
We took as much time off from our day jobs as we could to go
touring and eventually we developed a big enough fan base that
we landed that rare prize, the major label record deal. Our
first record, which we put out in 2002, did moderately well. We
got to about 100 on the billboard charts and just barely broke
into the top 20 of the modern rock radio charts which is
something of a feat.
And to translate these numbers, we basically were in the
middle of the pack. We were doing much better than most
musicians, felt very, very lucky to be doing what we love for a
living, but we were still struggling for every fan we could
find and frankly struggling to pay our bills as well. So we put
out a second record, and this time we thought maybe we would
add our own promotional ideas into the mix a little bit.
We still did everything that our record label asked us to
do, and everything that every band would do, you know, the free
shows for radio stations, the nonstop touring, we would go to
the Fox morning news studios and play an acoustic song for the
people of Houston. But we also decided we would start our own
online campaign. So If you don't mind, I will show you the
first video here that we put on line. Uh-oh. Well, I thought I
would play it. There we go. I don't know if you can hear the
song here. But that is us dancing in my backyard. My sister
helped us choreograph this pretty ludicrous routine as
basically as something--let me turn this down. This was
something we were going to do on stage. It was just planned as
sort of a way to surprise our fans. There is really nothing
more exciting than seeing a rock band in the middle of a show
just drop their instruments and break into dance.
All we really wanted was to see, you know, was 500 or a
1,000 jaws on the floor at the end of the show. So we came up
with this routine and we were practicing it in my backyard and
we shot this videotape. And the clip itself, there is just
something really compelling about it. And when we saw it, we
realized we have got to put this out for our fans. So we put it
on the Internet thinking, you know, just our most hard core
fans, you know, the dedicated few would see it. And within a
month, it had been streamed and downloaded, viewed several
hundred thousand times. So we realized that more people had
actually clicked through to this video than had purchased our
first record after 18 months of touring.
So then what was really pretty crazy is--let me go to the
next video here. The next thing that started happening was our
fans started posting their own versions of the video. Our fans
would go and learn the choreography and then tape it themselves
and post it on the Internet. What I am about to show you, it is
pretty crazy. This is--a fan of ours found hundreds of these
homemade videos on line and compiled several of them together,
and it is sort of a composite video. So here are some of them.
We got these videos from all over the world. We have gotten
them now from 5 or 6 continents.
We have seen them performed at people's weddings, in the
middle of Wal-Mart. That right there, that is my backyard. They
blue screen themselves into my backyard. We have--we saw them
in churches, we saw them in local firehouses. Thousands of
people were involved in sending us these videos and it really
is something that never could have happened 5 years ago. I
mean, this is a connection to our fans that simply was
unthinkable before. You are usually held at arm's length from
your fans, but here we were connected directly to them and them
to us. And that is, you know, a really amazing feeling for
someone making music.
But not to be outdone by our fans, of course, we decided we
needed to post another video. And so we went to my sister's
house and we made this one. Once again, of course, this is just
a home video that we made and it is just one long shot again.
As you can see, we are dancing again but this time on moving
treadmills.
For the record, I would like to say that we assume no
medical liability for any of our fans that may try to duplicate
this one. This video we figured--we put it on line, it would
probably do about what the first one had. We thought we had
basically done as well as anyone can do on line with a video.
We had already broken all sorts of records. And in the first 2
days, we put this on line, we posted it to YouTube, we had 1
million views. As you may have seen in the full screen view
there, this video now has been--this single posting of this
video has now been viewed 31 million times.
Let me stop this. Sorry. So, you know, this video, of
course, 31 million views--I mean, this has taken us all over
the world and it has been incredible for our band. We can now
play in countries to thousands of people where our records are
not even commercially released. And what is most impressive is
that we are actually making money for our standard model record
label as well. We now license music all over the place and we
sell real records, and it is clear that our creativity has
actually been a success for everyone. No matter how you slice
it, we are a successful band now.
So people are wondering if the music industry will benefit
from Net Neutrality. I don't think they need to look any
farther than us. We are musicians and we are part of the music
industry. I don't think there is really anyone out there who
wants to see this business flourish more than we do. I am here
today representing Future Music--excuse me--the Future of
Music's Coalition to Rock the Net campaign. There are 800 other
bands who have signed up with us in the last year, and 125
labels who are on board.
There really is some consensus here that Net Neutrality is
good for music and good for musicians. It has allowed us to
innovate and to create in ways that just were never possible
before. Keep in mind, all of us are businessmen, too. We want
to get paid. I mean, everybody wants their hard work to be
recognized. And what we really need is a legitimate digital
marketplace for music. The only way that is going to happen is
if we build on a level playing field. So Members of the
Committee, Mr. Chairman, I am here to ask you today to preserve
Net Neutrality and the openness of the Internet. I believe it
is critical to the future of music.
Mr. Conyers. Mr. Kulash, I don't know how to break this to
you, but there are a number of people up here that think that
we could do that too. And it may be better than some of the
ones that you have seen.
Mr. Kulash. I don't doubt it, sir.
Mr. Conyers. Would you be willing to accept a Judiciary
Committee video showing our steps?
Mr. Kulash. It will have to be submitted by the same means
as everyone else, sir, but, yes.
[The prepared statement of Mr. Kulash follows:]
Prepared Statement of Damian Kulash
Mr. Conyers. Well, I was for Net Neutrality when we started
this hearing. Michele Combs, Christian coalition of America. We
welcome you. You started in South Carolina as Executive
Director of America 2000, the Educational Service Corporation,
a special events company you started in 1992, managed functions
for both the Republican National Convention and the Democratic
National Convention. Hopefully not at the same time. And you
did something for the late Senator Strom Thurmond. We will find
out what that--oh, and President George Bush's inauguration.
Which one?
Ms. Combs. 2001.
Mr. Conyers. All right. We welcome you. And we have your
written statement. All statements will be introduced into the
record. We are anxious to learn more about your position on
this subject. Welcome.
TESTIMONY OF MICHELE COMBS, VICE PRESIDENT OF COMMUNICATIONS,
CHRISTIAN COALITION OF AMERICA
Ms. Combs. Thank you. Thank you, Chairman Conyers and
distinguished Members of the Committee on the Judiciary. My
name is Michele Combs, and like Chairman Conyers said, I am the
Vice President of Communications for the Christian Coalition of
America. And thank you for inviting me to testify on this very
important issue of Net Neutrality. The Christian Coalition of
America is the largest and the most active grassroots political
organization in the country. We offer people of faith a vehicle
to be involved in shaping their government.
Christian Coalition is a conservative political
organization, which is made up of pro-family Americans who care
deeply about becoming active citizens for the purpose of
guaranteeing that government acts in ways that strengthen
rather than threaten families. Use of the Internet has allowed
the Christian Coalition to engage Americans in a way that has
revolutionized their ability to be heard and to engage in the
political process. The Christian Coalition Web site is visited
by millions of Americans every year and in addition, we send
out e-mail alerts every week to hundreds of thousands of
supporters. And have available our voter guides, as many of you
know, every election cycle.
Our State chapters also have their own Web sites and many
of our supporters would not be able to keep up with legislation
and the legislative process if they were not able to access
these Web sites on a daily basis. The reason the Christian
Coalition is for Net Neutrality is simple. Because we believe
in freedom of speech on the Internet. Organizations such as
ours should not be--should be able to continue the use of the
Internet to communicate with our members and with the worldwide
audience without a phone or a cable company snooping into our
communications and deciding whether to allow a particular
communication to proceed, slow it down, or offer to speed it up
only if the author pays extra to be on the fast lane. Free
speech should not stop when you turn on your computer or pick
up your cell phone.
The Christian Coalition testified some time ago on this
issue, and many Members of Congress promised to act if network
operators blocked political speech. We are here to say the time
has come. Recent actions by the Nation's biggest phone and
cable companies should be of grave concern to all those who
care about public participation in our democracy.
Consider these recent examples: Last fall, Verizon Wireless
censored text messages sent out by NARAL. When NARAL protested,
Verizon Wireless said not to worry, because the company would
also block the speech of pro-life advocates such as the
Christian Coalition. Now, let me show you--the Christian
Coalition and NARAL agree on almost nothing here in Washington,
D.C., but we do agree that Verizon censorship of political
speech was wrong. Verizon claims it has changed its policy.
I ask you, should the company have the right to make the
decision in the first place? In August of 2007, AT&T censored a
Web cast of a concert by the rock band Pearl Jam, just as the
lead singer started talking about politics. Also in October of
2007, the Associated Press reported that Comcast was blocking
consumer's ability to download the King James Bible using a
popular file sharing technology. And it is also pointed out
that Comcast's discriminatory content just so happens to block
access to video distribution applications that compete with
Comcast's own programming.
I ask the Committee, if Comcast created a Christian family
channel, would Congress allow it to block access to a competing
product from the Christian Coalition? If phone companies cannot
tell Americans what to say on a phone call, why should they be
able to control content or tell us what to say or send a text
message or an e-mail?
The Christian Coalition of America does not seek burdensome
regulations as we prefer less government to more, and we do not
believe that government should censor speech. But right now the
telephone and cable companies are invested in the same kind of
censorship and content discrimination technologies that are
being used today by the Chinese government to block the
Christian Coalition from reaching Chinese citizens.
Finally, faith based groups are turning to the Internet to
promote their political rights, to engage in what Ronald Reagan
called the hard work of freedom. We should not let the phone
and cable companies interfere with that work in getting our
message out to the millions of Americans who want to make this
country a better place for their children and grandchildren.
Mr. Conyers. Thank you very much.
[The prepared statement of Ms. Combs follows:]
Prepared Statement of Michele Combs
Mr. Conyers. Songwriters Guild of America, Mr. Rick Carnes.
President of Songwriters Guild of America. Twenty-one million
records have been produced from songs that he has written. Dean
Martin, Trisha Yearwood, Garth Brooks and Reba McEntire. And it
goes on and on. Under Mr. Carnes' leadership, the Songwriter's
Guild has become a leading advocate on creative and artistic
issues. We welcome you to the Committee, sir.
TESTIMONY OF RICK CARNES, PRESIDENT,
SONGWRITERS GUILD OF AMERICA
Mr. Carnes. Thank you, Mr. Chairman, and Ranking Member
Smith, and Members of the Committee. Thank you for this
invitation to discuss the songwriter's perspective on Net
Neutrality proposals and antitrust laws. My name is Rick
Carnes, and I am President of the Songwriters Guild of America,
and this year marks my 30th year as a professional songwriter.
No issue is more important to songwriters who have seen their
livelihoods and professional futures devastated by Internet
piracy. Today, the songwriting profession is like a person
drowning in quicksand. Some of us barely have our heads above
the surface, but we are up to our armpits, and there is a
chance that new technologies to detect and deter illegal file
sharing might save us.
But I am concerned that pending regulatory and legislative
proposals could discourage the development of those
technologies and therefore cause my colleagues in my profession
to drown. Chairman Conyers and Congressman Smith, over the
years there have been no greater advocate for songwriters than
you and your colleagues on this Committee. We truly appreciate
the responsiveness of this Committee to the copyright and
technology challenges we have faced together over the past 15
years. As the Committee considers the competition aspects of
the Net Neutrality debate, I wanted to provide you with our
perspective on how authors, writers, and composers are affected
by potential regulation of the Internet.
As I have testified before this Committee, Internet piracy
is damaging the music industry and killing off the songwriting
profession. As a matter of fact, my own publisher had 12
songwriters on staff in 1998, and they have one on staff in
2008. The devastation is almost total now. Recent studies
indicate that 70 percent of the volume of the traffic on
broadband networks is P2P traffic relating to 5 percent of the
users, and easily 90 percent of that traffic is unlawful. That
is the real bottleneck in the Internet now.
A 2008 U.K. study by the Wiggin Group found that 70 percent
of those surveyed said they'd stop illegal file sharing if
their ISP notified them in some way that it had detected their
practice. In other words, the problem of illegal file sharing
is unacceptable and the misconduct committed by a small group
of people is causing the problem, many of whom would stop if
there were technology to warn them to stop or to make them
stop. Some network operators such as AT&T are now considering
technological means to identify and filter illegal content over
the Internet. Technology has hurt our profession, but at last
some more technology might finally save it. As a songwriter, I
can tell you that my choice is to have my works distributed by
someone who is invested in trying to stop the digital theft of
intellectual property.
Indeed, I would believe it would be to the economic
advantage of broadband operators to take such steps because the
quality of content they distribute would increase and many
consumers would prefer their service. In other words, there is
evidence that the marketplace might finally be working here to
reduce Internet piracy, so it is with great concern that I read
the proposals that would prevent ISPs from managing their
networks in order to relieve congestion when that congestion is
largely caused by illegal file sharing.
Some proposals by the Commerce Committee and the FCC would
prevent ISPs from taking necessary management actions, and I
believe those proposals are without justification. But so too
should this Committee proceed with very great caution on
antitrust proposals that would expand the current laws to
protect consumers against unfair competition on the Internet.
Antitrust legislation in the prior Congress, HR 5417, would
have created a presumption that broadband operators were acting
unlawfully unless they could show that their network management
or antipiracy actions were nondiscriminatory or fit into
certain narrow exceptions.
I am confident that this legislation did not intend to
discourage the developing technologies that could counteract
the digital piracy epidemic, but I am concerned that that might
have been the result. The last Congress' antitrust bill could
have prevented ISPs from discouraging illegal content practices
and would have prohibited the ISPs from encouraging their
customers to patronize sites that adopt lawful copyright
practices.
I strongly urge the Committee to think this issue through
further because that result would be very harmful to
songwriters. Here is one final thought on legislation and
regulation on Net Neutrality. It strikes me as odd that the
problem of broadband network congestion largely caused by
illegal file sharing has been addressed by proposing that the
ISPs be denied the ability to manage that very congestion. The
market appears to be addressing the problem now, but if
regulation or legislation is deemed necessary, then I recommend
that Congress consider the heart of the problem first, and that
is illegal file sharing. Illegal file sharing is the problem,
Mr. Chairman. And I encourage you and your colleagues to factor
that issue into your further deliberations. Thank you very much
for this opportunity to express my views.
Mr. Conyers. Thanks so much.
[The prepared statement of Mr. Carnes follows:]
Prepared Statement of Rick Carnes
Mr. Conyers. Caroline Fredrickson, Esquire, American Civil
Liberties Union. You have been before the Committee numerous
times, you have been General Counsel and Chief Operating
Officer for NARAL Pro-Choice America, a Chief of Staff to
Senator Maria Cantwell, a deputy chief to former Senate
minority leader Tom Daschle, a lawyer from Columbia University,
and before that, Yale. We are happy to have you. We have got
your statement. And now we will hear from you.
TESTIMONY OF CAROLINE FREDRICKSON, DIRECTOR, WASHINGTON
LEGISLATIVE OFFICE, AMERICAN CIVIL LIBERTIES UNION (ACLU)
Ms. Fredrickson. Thank you very much, Chairman Conyers,
Ranking Member Chabot, Members of the Task Force. It is a
pleasure to be here to talk to you about Net Neutrality and
free speech on the Internet. The Supreme Court's ruling in
Brand X, and FCC inaction in addressing increasing censorship
by broadband Internet service providers or ISPs are key factors
in today's threat to on line free speech. This hearing marks an
important step toward ensuring that the marketplace of ideas
for the 21st century, the Internet, remains the bastion of
freedom that it has been since its creation. The Internet's
marketplace enhances speech through its decentralized, neutral,
nondiscriminatory pipe that carries data from origin to
destination without interference. Neutrality promotes open
discourse; consumers, not gatekeepers, decide what sites to
access among millions of choices. The Internet structure
facilitates free speech, innovations and competition on a
global scale, providing access to a mass audience at little or
no cost. No one owns the Internet. Instead the Internet belongs
to everyone who uses it.
The Internet has become the leading 21st century
marketplace of ideas because of neutrality rules promoting
nondiscriminatory speech, association, and content. The
Internet was born and flourished under well-established,
nondiscrimination protections derived from title 2 of the
Communications Act of 1934, which grants the FCC the authority
to regulate telephone companies as common carriers. As early as
1966, the FCC required that data transmissions going over the
phone lines be provided on a nondiscriminatory basis. The
Internet blossomed under that protection.
Today three-quarters of all adults in the United States,
147 million people, use the Internet. And two-thirds of
American adults do so daily. Neutrality rules have made this
dynamic growth possible. ISPs ignore this history by wrongly
suggesting that nondiscrimination would regulate the Internet.
The opposite is true. Nondiscrimination ensures that lawful
activity on the Internet remains free from regulation by both
the government and network providers. And ISP's first amendment
rights are not violated by neutrality rules that would bar an
ISP from censoring its customers.
Aside from the Internet content that they create, edit and
maintain, which would not be restricted under neutrality
principles, ISPs are not speakers. They are merely providing
the wires through which each of their paying customers accesses
the Internet in the same manner as telephone companies do for
our phone lines. That is why the FCC was allowed to regulate
ISPs as common carriers until 2005 when the Supreme Court ruled
in Brand X that they, instead, may be regulated as information
services. But ISPs exist to provide customer access to the
Internet and the expressive and associational activities found
there free of censorship, akin to the role of telephone
companies in providing communication services.
We would not tolerate a telephone company restricting our
calls to certain numbers based on the content of the call and
we should not tolerate that type of censorship from ISPs. A
vibrant marketplace of ideas on the Internet cannot function
with corporate censors any more than it can with government
censors. Without neutrality rules, ISPs are engaging in more
and more online censorship. Ms. Combs has already done a very
fine job of outlining the variety of censorship activities that
have happened just in the last year or 2. So I won't restate
those.
But the ISPs have established, through their very own
actions, that Internet censorship is a growing reality and not
the speculative hypothetical they claim it to be. Restoration
of meaningful neutrality rules would simply return us to where
we were before the Brand X decision in 2005 by prohibiting ISPs
from picking and choosing which users can access what lawful
content through the gateways they provide.
Congress must pass legislation that enforces the four
freedoms established by the FCC in its 2005 policy statement,
including access to lawful Internet content and running
applications and services of one's choice with penalties for
violations of those freedoms. Otherwise, the Internet will be
transformed from the shining oasis of speech to a desert of
discrimination that serves to promote only the ISP's commercial
products, and so much would be lost from that change. Thank you
very much for your attention.
Mr. Conyers. Thank you for being on time, which you always
are.
[The prepared statement of Ms. Fredrickson follows:]
Prepared Statement of Caroline Frederickson
Mr. Conyers. I am pleased now to turn to Professor
Christopher Yoo, University of Pennsylvania, who teaches
telecommunications and intellectual property law, directs the
University Center For Technology, and prior to his appointment,
taught at Vanderbilt University Law School. He has published
prolifically and has a new book coming out this year entitled
Networks in Telecommunications: Economics and Law. He clerked
with Supreme Court Justice Anthony Kennedy, and is a graduate
from Harvard Law School, and I am pleased to welcome him at
this time.
TESTIMONY OF CHRISTOPHER S. YOO, PROFESSOR OF LAW AND
COMMUNICATION AND DIRECTOR, CENTER FOR TECHNOLOGY, INNOVATION,
AND COMPETITION, UNIVERSITY OF PENNSYLVANIA LAW SCHOOL
Mr. Yoo. Thank you, Mr. Chairman, Members of the Committee
and the Task Force. I am grateful for the opportunity to be
here today. The Internet is, perhaps, the first major
technological development of the 21st Century. A network that
began as a platform for e-mail and Web browsing now supports a
dazzling array of new services. Perhaps the most important of
these new services for policymakers is the emergence of
Internet video technologies, such as YouTube and Vuze.
These new applications are placing increasingly intense and
varied demands on the network and have made network planning
considerably more uncertain. For the past 5 years, Internet
traffic has grown at a rapid but steady rate of roughly 50 to
60 percent each year. Some experts estimate that Internet video
will cause that growth rate to double to 90 percent to 100
percent each year as occurred during the first 6 years of the
Internet and is reportedly occurring in Japan. If these
estimates are correct, network providers must increase their
capital investments by over 100 billion dollars or else the
Internet will slow to a crawl by 2010. The key reason that the
Internet is--the problems posed by the Internet is that it is
subject to congestion.
In other words, the speed you receive depends not only on
how many network resources you are using, but also how many
other people are on the system at the same time. Internet
technologies vary widely in their susceptibility to congestion.
For example, cable-based technologies are more vulnerable to
congestion at the neighborhood level than are telephone-based
technologies. Cable modem service will degrade if as few as 15
of the 300 users in the same neighborhood are running
BitTorrent. Wireless broadband technologies are even more
vulnerable to congestion.
In some respects, Internet congestion arises in much the
same way as congestion arises on our Nation's road system. Like
on the Internet, the speeds that you can attain on the roads
depend not only on your decisions, but also on how many other
drivers choose to hit the road at the same time. In addition,
like the Internet, congestion on the road system varies from
location to location. Therefore, any solution must be tailored
to increases in volume that vary in time and space.
There are typically two solutions to congestion. One
solution is to build more lanes to make sure there is always
enough capacity to prevent delays when traffic peaks. The
problem is that building excess capacity is expensive.
Maintaining extra resources that are only used a few minutes
out of every day is typically a bad deal for consumers. The
increase in capital costs threatens to slow the buildout of
broadband services for all Americans. And the additional cost
will raise the number of subscribers that a broadband network
will need to break even, which means that the burden would fall
especially hard on rural Americans.
In addition, no matter how hard they try, planners'
predictions of how much and where to add additional capacity
will occasionally be wrong. Adding more lanes takes time. So
when planners make mistakes, adding capacity is not always
available as an option. Even more importantly, adding lanes
often simply stimulates development at the ends of the roads
until the new lanes become congested as well. There is a real
danger that demand will expand to fill all available capacity
no matter how many lanes are added.
The alternative approach to adding capacity is engaging in
some type of network management. By limiting access to the
interstates during rush hour, reserving lanes for high
occupancy vehicles and buses and giving ambulances and other
high value traffic priority over other traffic. Each of these
approaches involves a degree of nonneutrality, and yet each is
regarded as uncontroversial.
I do not mean to push the analogy between the road system
and the Internet too far. There are some critical differences
between them. For example, Internet traffic is extremely
bursty, in that long periods of inactivity are punctuated with
extremely brief but intense periods of heavy bandwidth usage.
This makes network management considerably more complex and
calls for different tools.
Perhaps the most important difference between the road
system and the Internet is the presence of bandwidth hogs. In
the road system, each driver cause roughly the same amount of
congestion. On the Internet, the situation is quite different.
Network providers estimate that as few as 5 percent of end
users represent between 50 and 80 percent of the networks total
usage and many applications are designed to increase the usage
as long as capacity is available.
The question in such a world is not whether congestion will
occur. The question is whether the cost of that congestion will
be borne by all users or only by those responsible for causing
it in the first place. Good economics and simple fairness favor
placing the lion's share of those costs on those responsible
for creating them. Any other system would, in effect, require
low bandwidth users to cross-subsidize the network usage of a
handful of bandwidth hogs.
It is for this reason that every panelist that testified at
the FCC's February 26 hearing on network management agreed that
some degree of network management is inevitable. The problem is
that the reasonableness of any particular approach to network
management varies from technology to technology and within any
particular technology varies across time and from location to
location. The problem is complicated still further by the fact
that technology underlying the Internet is undergoing constant
and rapid change. At the same time, the current debate has
failed to take into account the proper analog to the Internet
is not the one-to-one communications that characterize the
telephone system, but rather the one-to-many communications
that characterizes the Internet.
The flood of Internet content--in short, Internet users
face an avalanche of content every day and depend on search
engines, bloggers and other intermediaries to help sift through
it. Consumers also depend on them to protect them from
undesirable content such as spam, viruses and pornography. The
question is thus not whether there will be an intermediary. The
question is who will serve as that intermediary. And, in fact,
there are a great deal of problems as the Christian Coalition's
position in this--before the FCC makes clear, we do depend on
network operators to screen us against pornography, ring tones
with racial slurs, and profanity and other forms; and we must
be careful that in asking companies to serve as intermediaries
that we do not stop their ability to do that.
The precise details of which agency and whether agencies or
courts should enforce are less important than the substance of
the law. I would urge this Committee not to rule any particular
solution off the table. Leaving network providers free to
experiment with new solutions is the best way to ensure that
consumers enjoy the full range of the Internet's tremendous
potential in the future. Thank you.
Mr. Conyers. Thanks so much.
[The prepared statement of Mr. Yoo follows:]
Prepared Statement of Chrisopher S. Yoo
Mr. Conyers. Professor Susan Crawford, Yale Law School.
Also has taught at Cardoza School of Law in New York,
Georgetown University Law Center, Michigan University, a policy
fellow at Center for Democracy and Technology, and sits on the
board at the Internet Corporation for Assigned Names and
Numbers. We welcome you to the Committee.
TESTIMONY OF SUSAN P. CRAWFORD, VISITING ASSOCIATE PROFESSOR OF
LAW, YALE LAW SCHOOL
Ms. Crawford. Thank you so much, Chairman Conyers, Ranking
Member Chabot and Members of the Committee. It is an honor for
me to be here today and talk to you. I want to leave you with
just three key points. First is that the stakes are
extraordinarily high for this discussion because the Internet
is becoming the general purpose communications network on which
all Americans rely for both business and personal reasons. And
second, that there are clearly insufficient protections in
place for both speech and innovation on line. As the Chairman
pointed out, we have an unregulated duopoly in place providing
Americans with Internet access at the moment. And they have
enormous market power and every incentive to discriminate
against speech and new products and new services that they
believe are undermining their business plans. Third,
congressional action is needed to ensure in advance that we
have an open, neutral Internet to which all of us can have
nondiscriminatory access. Just a few words about the context
here. We make a deal over and over again with the providers of
general purpose communications networks. Here is the deal.
In exchange for limiting your liability for the content of
the communications that pass over your network, we make them
provide nondiscriminatory assistance to all customers who are
willing to pay. We have done this for the telegraph, we have
done this for the telephone. This is not a new obligation. It
has allowed us to put our general communication systems in the
hands of private, for-profit companies without worrying about
discrimination and censorship.
We are at a constitutive moment in communications history,
a real turning point. This is like the moment of the arrival of
the telegraph and the telephone. Now it is the Internet. The
Internet is the first global, electronic, general purpose
communications network. It is triggering economic growth and
new ways of making a living all around the world. The Internet
is not the same thing as Comcast cables or Verizon's wires or
even a wireless connection. These companies are merely
providing one set of connections that allow users and
businesses to connect to the dynamic interaction that the
Internet protocol facilitates.
The stakes for this conversation could not be higher. The
difference between a phone, a cable system and television, they
are all dissolving. The Internet is taking over the functions
of all of these communications networks we used to use. Each of
the vertically integrated network access providers in this
country sees this change as a threat. Telcos want to offer
their own premium television services, music services and
premium Web content, cable cos want to offer more channels of
cable content. Cable companies limit their Internet access
services to a very small amount of bandwidth.
In fact, the real bandwidth hog here is Comcast in many
ways. Internet access is a tiny portion of their overall
bandwidth. The rest is devoted to cable content. The open
Internet could become the greatest competitor these companies
have ever seen. Again, it is not one competitor, but a general
purpose vehicle for thousands of entrepreneurs across the
country offering innovative new products. Each of these
dominant network access providers, as you have heard from
Professor Yoo's testimony, wants to act as an editor, an editor
or a gatekeeper of Internet access for their own commercial
purposes. They want to call these edited services Internet
access, but it is not really that. It is much more like more
cable content. These guys don't want to be gravel pits. They
don't want to provide commodity transport.
We have a choice right now. Should we have a general
purpose network available for all Americans to use in a
nondiscriminatory fashion, like a road from a rural center to a
big city, or should we have a series of special purpose
networks that are much more like rides at Disneyland, carefully
managed. The whole consumer experience is one that is tailored
to the competitive needs of the network access provider. The
stakes are very high. This is about the future of
communications itself.
Second, there are clearly insufficient protections for
speech on line. As the Chairman clearly outlined, we do not
have a functioning competitive market for Internet access in
this country. Instead we have regional duopolies, offering
either DSL service or cable modem service to 96 percent of the
country. A third of Americans have, at most, one choice of
high-speed Internet access provider. This lack of competition
provides the opportunity for discrimination with respect to
Internet access services and that discrimination, in turn,
serves the goal of these large carriers. It is so easy to come
up for explanations for discrimination after the fact.
Arbitrariness by itself is enormously threatening to speech,
and innovation and has the potential for suppressing particular
points of view as the Christian Coalition points out.
So congressional action is needed. That is my final point.
All of these Internet access related questions are being dealt
with under the SEC's assertion of ancillary jurisdiction. There
is simply no express congressional mandate for how to deal with
Internet access. We should not allow a key source of America's
economic growth to be subjected to such ad hoc authority.
Congressional oversight, particularly from this Committee, is
needed. Thank you very much.
Mr. Conyers. Thank you.
[The prepared statement of Ms. Crawford follows:]
Prepared Statement of Susan P. Crawford
Mr. Conyers. Professor Yoo, you are in a tough place here.
Because you are between two female lawyers. Steve Chabot and I
are wondering what would happen if we left you, you know, to
your own devices and see what would happen. Now, over here, we
have got two songwriters. And is this new school versus old
school on this situation?
Mr. Kulash. No, it is not, sir.
Mr. Conyers. Oh, it isn't?
Mr. Carnes. He is the Future of Music Coalition. I guess
that makes me the past.
Mr. Conyers. And then Attorney Fredrickson and Ms. Combs
have rarely agreed on anything, and they come together in
harmony this afternoon. Isn't that amazing? So your Chairman
wonders what would you say, Mr. Kulash, to Mr. Carnes and what
would our two lawyers say to Professor Yoo?
Mr. Kulash. I will take the Kulash question. There is no
reason that the law shouldn't apply on the Internet. What we
are looking for is a vibrant, realistic digital market place
for music and I think that can only happen if we let the
innovators come up with the system instead of deciding right
now that one of the two companies existing can make that system
happen.
Mr. Carnes. To which I would reply, when you say Net
Neutrality, the Internet is not neutral now. It is set up for
the benefit of the 5 percent of bandwidth hogs that are using
70 percent of the bandwidth, 90 percent of which is illegal
content. In terms of freedom of speech, I would like to remind
you that this copyrighted--it is all copyrighted material that
is being stolen and the Supreme Court has said that copyright
is the engine of freedom of free expression.
Mr. Conyers. Well, you know, this Committee has just put
out a pro IP bill with all kinds of additional protection.
Mr. Carnes. And we appreciate that. But they also removed
the civil enforcement from the bill by the FBI, which is in the
Senate version but it is not in the House version, which is
really critical for us.
Mr. Conyers. Are you a lawyer, as well?
Mr. Carnes. You know, I am not----
Mr. Conyers. I am just inquiring. Now, Professor Yoo, do
you have any last comments before we leave you to the people on
your immediate right and left?
Mr. Yoo. Thank you for allowing me that, Mr. Chairman.
Mr. Conyers. It is like making your last statement before
you are executed.
Mr. Yoo. I guess if I were to leave--make one point at this
point is that I do believe that the competitive market can work
here in ways that are unappreciated. The Chairman--you
mentioned that there is a duopoly. There is actually tremendous
opportunity for a much more competitive environment. From
having zero subscribers in 2004, wireless broadband by the end
of 2006 signed up 21 million subscribers. And by the end of
2007, they estimate it will have doubled again to 45 million
subscribers. What we find from the record in the FCC
proceedings is things like network management, which we regard
as nonneutrality, are critical for wireless subscribers to
survive to introduce the very competition that the antitrust
task force recognizes as essential for a long-term solution.
And, in fact, one of the points made by a very small rural
wireless carrier named LARIAT run by a gentleman named Brent
Glass says that he has got such limited bandwidth and his cost
margins are so tight that the only way he can survive is by
cutting down on a handful of BitTorrent users on the moments
that the volume peaks. And the reality for him is if we do not
allow him to manage the network in that way, the kind of
competition which we are saying is the goal will not occur.
Mr. Conyers. Well, what do you say, ladies?
Ms. Fredrickson. Well, I think from our perspective, the
essential factor here is free speech and the ability to
communicate. And whether or not the ISPs need to engage in some
kind of network management I think is a question for
technologists more than it is for those of us on this panel,
except to the extent that it is nondiscriminatory that should
be the major focus of this Committee and of legislation to
ensure that whatever network management, as Professor Crawford
has noted, not be used as an after-the-fact justification for
discrimination.
So that is why I think it is critical that the Committee
consider legislation that would set up neutral rules from the
beginning to ensure that no discrimination takes place and
network management not be used as cover to eliminate certain
types of content.
Ms. Crawford. And just a follow-up on Ms. Fredrickson's
remarks. We did this successfully in the '60's. We kept the
phone business out of the business of data processing. They
were quarantined out of that business. And that was a very
successful way of not having to get engineers into writing
legislation but just keeping an old industry from controlling a
new one. And that is the risk we are facing here. Now, a lot of
this is talking about money. I understand that for about a
dollar per subscriber per month, a cable system could roll a
neutral network. It saves them, I understand, Comcast something
like 10 cents per subscriber per month to do the kind of
traffic shaving they are doing. This is not about that. This is
about, from their perspective, the risk of a precedence that
they be treated like a general communications carrier when it
comes to Internet access. They should upgrade their networks.
Ms. Lofgren. [Presiding.] Ms. Combs, are all of the ladies
on this panel in agreement this afternoon?
Ms. Combs. Yes, we are.
Ms. Lofgren. I thought so. Well, on that note, we will take
a brief recess for a vote, and we will be right back and
recognize Steve Chabot.
[Recess.]
Ms. Lofgren. The hearing may resume. We are now at the part
of our agenda where we will ask Mr. Chabot to begin his
questions.
Mr. Chabot. Thank you very much, Madam Chair.
This question is to any or to all of the witnesses, whoever
would like to respond.
The relationship between the Internet Service Providers and
content providers, isn't it mutually beneficial--and
practically speaking, consumers cannot access content without a
network, and a network serves no purpose without content to
distribute and consumer demand. How does government involvement
help this already quite successful relationship? How would the
consumer be impacted by changes in that dynamic at this time?
Yes, Professor.
Ms. Crawford. It is an interesting question. You would
think that the two would be mutually helpful to each other.
Actually, there is economic evidence by our colleagues Barbara
Van Shelich and Brett Frischmann, a joint paper, making clear
that network access providers have every incentive actually to
discriminate against content, not their own, in order to
further their own business plans. Again, the idea is you have
got an incumbent with an existing powerful business that it
wants to protect at almost any cost even if it might be better
for the network as a whole if they collaborated with content
providers.
A second point is that the Internet is not just content
being passively sent to subscribers. The greatness of the
Internet is that this is an interactive, often user-generated
network that allows for a lot of other communications that
cannot be described as content.
Mr. Chabot. Okay. Thank you. Professor Yoo.
Mr. Yoo. They are mutually beneficial for the most part. It
is one of these things that is actually reflected in Supreme
Court precedent going back to the vertical integration between
networks and content providers, all the way back. The Supreme
Court used to be extremely hostile toward the idea and were
thinking, oh, this would be big--having the network own the
content could lead to all of these harms. Well, what is
happening in the Supreme Court doctrine with regard to vertical
integration and vertical restraints is it has become much more
permissive. Why? Because this is often extremely efficient
behavior. Particularly with the Internet, sometimes a very
tight integration between the content and the network can
actually increase the functionality of the network.
The best example I know of is the wireless industry. One of
the things--if I were walking across this room, I would pass
through hot spots and cold spots as I walk through depending on
the bandwidth I get. What the wireless industry will often do
is to give me my voice communications constantly all the way
through as I walk through the room. If I am at a cold spot, it
will hold my e-mail. Why? I cannot stand my voice traffic being
interrupted for even a third or a quarter of a second, or else
I will not use it. Now, when I get to a hot spot, they will
dump me all of my e-mail at once. Is that neutral? No. Does it
require a very tight integration between the content, the
device, and the application of the network? Absolutely. It is a
way to yield real benefits to consumers in ways that are very
concrete.
You see this in an empirical study that is fascinating.
They have done two large studies by the FTC staff as to when
that kind of tight integration yields benefits. One looked at
17 full studies that always increased consumer welfare. In the
other study, 16 out of 17 times it increased consumer welfare.
If you look over the last 2\1/2\ years, the FCC has examined it
and has said this is not a problem despite the filings in every
single case in five major regulatory matters. Is there a small
theoretical possibility of some harm? Yes. It depends on very
specific empirical conditions, which is why I think a case by--
I have always supported a case-by-case analysis instead of
saying this is not a problem and it should go away, but we
should make sure that the circumstances for that
anticompetitive conduct exists before we stop these kinds of
practices which can yield real benefits to consumers.
Mr. Chabot. Thank you.
Does anybody else want to touch on it or should I go to
another question? I will go to another question.
How do networks deal with innovation? How would technology
be impacted by additional government involvement? Would
consumers benefit from more regulation? Anybody is welcome to
it.
Ms. Fredrickson.
Ms. Fredrickson. Well, I think our perspective is that Net
Neutrality rules are less regulation. They allow the Internet
to flourish in a very free fashion, but you have to set some
basic, nondiscriminatory policy to so that those ISPs cannot
control and limit the content.
I think Ms. Combs, as I said earlier, has already laid out
numerous examples of where there has already been
discrimination undertaken by ISPs. So I would differ with
Professor Yoo and say that it is not theoretical. It is not
hypothetical. It actually exists. Therefore, we need to ensure
that the Internet remains unconstrained and free and foments
innovation and competitiveness rather than limits it by
allowing ISPs to shut down competing services and content that
they might disfavor.
Mr. Chabot. Thank you.
Professor Yoo and Professor Crawford, if you could, answer
very quickly because my time is over.
Ms. Crawford. Just very quickly, we are talking about telco
incumbents. One of their last great innovations was call
waiting. We have not seen a lot of innovation coming from the
network providers. What has been happening is an explosion of
innovation at the edge, and it is that innovation that Net
Neutrality furthers.
Mr. Chabot. Thank you. Professor Yoo.
Mr. Yoo. As to the story that Ms. Fredrickson told about
the early days of the Internet, I assume you are talking about
the Computer Inquiries and the first generation of regulation.
What is fascinating is we did have nondiscrimination rules, but
the telcos, when they had a new development, constantly had to
come asking for waivers. For example, in shifting from analog
transmission to digital transmission, you had to change the
network, and all of a sudden the things that were digital did
not communicate with the things that were analog anymore. When
we had a restrictive rule in place that defined
nondiscrimination in a very particular way, any time a network
needed to innovate they had to come get a waiver and get a
special dispensation. Call waiting was retarded by the fact
that they had to get a special waiver because call waiting is
provided by the computer processing in the switch. That is the
cheapest way to do it. Well, that was nonneutral because the
telephone company had an advantage, but it was a natural
advantage in the technology. We had these battles under that
rule where they were constantly fighting over what was
permitted under the rules until finally we shifted the regime
to saying the FCC said we should get out of this. The real
solution here is competition.
Mr. Chabot. Thank you very much.
My time has expired, and I yield back the balance of my
time.
Ms. Lofgren. The gentleman yields back.
I have, really, a question. I was interested--I am sorry. I
ran over to vote, and I did not get to hear your testimony, but
I did read the testimony, Professor Crawford. I have a concern
with Comcast's recent issues with BitTorrent. I was just
thinking. Where does this lead if you regulate uploads or
charge for uploads? You know, what does that do to the
innovation that we are finding on the Internet? Does that pose,
in your judgment, pretty severe first amendment issues?
Ms. Crawford. Thank you, Congresswoman. It is a wonderful
question because the great value add of the Internet comes from
the ability to upload, not just to be passive consumers of
content for all of us without asking permission to create our
own movies, our own new applications, our own new ways of
making a living. Having an asymmetric network like the one that
Comcast has intentionally built is very destructive to that
kind of innovation. I will note that in Japan and in France and
all over the world they are building symmetric networks that
are moving for uploads at 100 times the speed we have available
in the United States. So, just as a matter of national pride as
well as innovation, we should care about our ability to upload.
Ms. Lofgren. All right. Professor Yoo, do you disagree?
Mr. Yoo. Well, I do think it is important, but what is
fascinating about the Comcast example is that it is not just
about uploads. I mean consider OK Go's success on YouTube.
YouTube is not a peer-to-peer technology. It is a classic
server technology where it is all hosted in one place. So, in a
way, what Comcast is not trying to do is to go against user-
generated content. What they created was a very nicely crafted
world in which they did not block it across any application
across the whole network. They found a handful of nodes at
certain times where they were bogging down with congestion and
found a way to slow down the uploads when there was no human
being on the other end. The beauty of BitTorrent is that it
probably did not even hurt the people who were attempting to
download at the same time because the genius of BitTorrent is
it will go get those bits someplace else. So it was actually
potentially a very finely crafted idea.
I agree with Professor Crawford that the user-generated
content world is very exciting, but in many ways, things like
what Comcast did to BitTorrent is essential to preserving the
YouTube style of file server user-generated content and in
making sure that the peer-to-peer style does not congest the
entire Internet.
Ms. Lofgren. You know, this Net Neutrality debate is not a
new one for the Congress. Last year, we went through this. As a
matter of fact, I was telling my staff that I sort of toyed
with the idea of playing the ``Ask a Ninja: Net Neutrality
video'' rather than actually asking the questions, but I was
discouraged from doing so.
I do have a concern that if you start allowing the pipes to
really decide who gets to see what, you end up sort of
cablizing the Internet in a way that is not the way we have had
the Internet. I met with Vint Cerf last week out at Google. You
know, the Internet is to be free. It has always been that way,
and it has only been threatened recently.
Do you think the concern about turning the Internet into
cable is overblown, Professor?
Ms. Crawford. No, I do not, Congresswoman. As I said, I
think we really stand at a turning point. A visual picture I
often use is that it is as if the sidewalk has gotten tired of
being a sidewalk and wants to rise up and take a little ``ca-
ching'' and monetize the conversations we are having, if they
are particularly valuable or if they think they can price
discriminate with respect to that sidewalk.
As a society, we need basic infrastructure. We need to
invest in it. We need to move forward as a country with this
basic infrastructure. Communications policy should be part of
our industrial policy and move us forward as a country. Net
Neutrality is a central part. This is a Sputnik moment for us,
and I think Vint Cerf would agree that. Just as the fear of
what was going on with the Russians drove us to create the
Internet, we have now got an internal Sputnik development which
is our own market, powerful ISPs controlling innovation on the
Internet.
Ms. Lofgren. I will just close by thanking all of the
witnesses. It was fun to talk to Mr. Kulash.
I did not get a chance to talk to you, Mr. Carnes. I
appreciate your coming all this way.
I also wanted to say something, Ms. Combs, to you because I
respect that a conservative person such as yourself would say
that you agree with somebody with whom you completely disagree
on the issues to stand up for free speech. Doubtless, there are
many things on which we do not agree, but I really do respect
that you are here standing up for the first amendment here
today. It is a very honorable thing that you are doing. Thank
you very much.
Mr. Keller.
Mr. Keller. Thank you, Madam Chairwoman. Let's see.
Professor Crawford, you made the analogy about having one
road rather than the many-tiered system like at Disneyland, and
you caught my attention there since I represent Disney World in
Orlando. So let me ask you a pretty basic question.
One of the concerns that has been raised is that ISPs want
to provide tiered service to consumers that utilize higher
amounts of bandwidth, and the DOJ in its comments to the FCC
said--and I will just quote it--mandating a single uniform
level of service for all content could limit the quality and
variety of services that are available to consumers and
discourage investment and new facilities, close quote.
Are you in favor of a tiered service or do you feel that a
single tier is always the best for consumers?
Ms. Crawford. Let's be clear about our terms here,
Congressman. I think that no one would disagree on the Net
Neutrality side that it makes sense to charge consumers for use
of bandwidth and that discriminating against consumers in that
way seems appropriate. If you are using more, charge more. It
is that business model that our current ISPs do not want to
move towards. What I am against is the idea of discriminating
against particular applications because of what they do or
particular sources or the content of packets. I am also
personally concerned about trying to draw categories of
applications and say, you know, with your video, you go at X
speed; all video goes at that speed. Here is the problem with
drawing those categories.
The ISP is in the position of being the line drawer and
will have all kinds of new things that will appear in the
world. We do not want to give these very consolidated entities
the power to decide who falls in what category.
Mr. Keller. All right. Professor Yoo, let me follow up with
you. You were at Vanderbilt at the same time I was at
Vanderbilt, I see, and you gave me a ``C'' in antitrust, and
now I have some questions for you. No. Just kidding. I did not
take your classes when I was there. They were too hard of
classes. Let me begin with you, Professor Yoo.
If a broadband provider chooses to degrade certain content,
do consumers have other options to turn to for their broadband
service?
Mr. Yoo. I think the wireless option tells us yes. We have
a world in which that is a real possibility for the first time,
and there is wonderful data coming out of Europe and OECD that
is looking at the impact that nondiscrimination and access
requirements have on building out new networks, which is the
real goal. We discovered that it is retarding it actually. If
you look, it is correlated when you have those sorts of access
requirements. You get less new broadband extended to new areas,
and that is an enormous problem.
If I may, the one reaction I had to what Professor Crawford
said is that it is often said that the bloggers will be hurt by
the fast lane and the slow lane. What is fascinating to me is I
actually think that has it backwards. Creating a fast lane and
a slow lane is a way to protect the bloggers. Why? People who
are just sending text do not need the fast lane. It is the
video that needs the fast lane. If right now we are charging
all a certain price, if we are going to upgrade the network at
all, we can either charge everyone a higher price for the
upgrade or we can create a tiered service where the bloggers
can still keep the price they are getting and only charge the
people who need the faster service for video for what they are
getting because this is a way to keep people like the bloggers
online, not to hurt them.
Mr. Keller. Let me get back with you, but let me touch on
the piracy issue just a little bit, and then we will give both
of our artists a chance.
Mr. Carnes, what is the relationship between online piracy
and network congestion?
Mr. Carnes. Well, I said previously that 5 percent of the
users on the Internet are using up 70 percent of the broadband
network, and 90 percent of that is illegal P2P, so congestion
is actually piracy. You know, piracy is the disease, and
network congestion is just a symptom of that disease.
Mr. Keller. All right. Mr. Kulash, I know that you got your
big break from the video that you showed, from the famous
treadmill video. Let me ask you:
Did you get that video on the first take or did that take a
while?
Mr. Kulash. Take 13, sir.
Mr. Keller. Take 13. All right.
Tell me, since you are an artist who--obviously, I know you
get your revenue from at least some performance royalties. Do
you have concerns about preventing online piracy?
Mr. Kulash. Absolutely. You know, I believe, as every
songwriter believes and as, I think, everyone believes, that
musicians should be paid for their work. I am certainly not
advocating anything that I think will lead to piracy. The
question is who is going to build that new system for music
distribution, for how we listen to music, for how we get to
make music. It seems to me that the telcos are not the people I
want building that system.
Mr. Keller. Okay. Professor Crawford, you wanted to
respond.
Ms. Crawford. Just very briefly with a couple of empirical
points.
When we talk about competition from the wireless sector in
this country, we should remember that those companies are owned
by the same companies that control DSL access. Then we have a
very highly concentrated market when it comes to Internet
access as a whole. The same actors.
Also, on the video point, we need a larger principle moving
forward for this entire discussion. We cannot focus ourselves
on what is going on with Internet video right now. We have got
100 years ahead of us for Internet history, and we have to set
the terms now.
Also, finally on the filtering point here, I think it will
be, as Mr. Kulash has said, inappropriate for the ISP to be the
level where filtering takes place. The content application
providers can do this. They will have some knowledge of who
they are having license arrangements with, and they can respond
to notices and take-down procedures under the DMCA. We have set
up this structure, and it can work.
Thanks.
Ms. Lofgren. The gentlelady from Florida.
Ms. Wasserman Schultz. Thank you, Madam Chair. I want to
thank all of you for being here today and for helping us to
tackle this very thorny issue.
Obviously, everybody is concerned about the Internet and
its ever evolving status, and we want to continue to see it be
a source of innovation and a strength for our economy, which is
a little bit shaky right now. I supported network neutrality in
the 109th Congress because I was really concerned that there
was not enough competition in the marketplace to start
cornering off sections of the Internet and adding a premium to
the price of that section. I mean, to me it made sense to do
that, to prevent that from happening through network neutrality
so that you do not have ISPs striking up deals in favor of one
set of providers over another and limiting the competition and
making choices for consumers, because that is counterintuitive
to what the Internet is supposed to be.
You know, we are Members of this Antitrust Task Force, but
we are also Members of the Judiciary Committee, and we deal
with legislation related to crime as well. The concern that I
have about network neutrality is that you would never want to
force ISPs to actively ignore conduct that is unlawful or
speech that they know is unprotected. What I mean by that is
piracy or child pornography.
I mean, I sponsored legislation that some of you may be
familiar with that would address the 500,000 known individuals
in the United States who are trading and trafficking in child
pornography on the Internet. We are talking about images of
young children being raped and victimized. These are crime
scene photos. Those are being shared through peer-to-peer file
sharing all over the country every single day, and law
enforcement knows who they are, knows where they could find
them, but they are just overwhelmed and outnumbered.
The legislation that I sponsored and that was adopted
unanimously out of this Committee--excuse me, out of the
Congress, not unanimously. It was with two ``no'' votes. Let me
be accurate. It was designed to make sure that we could get
those resources into the system and go after people who are
breaking the law and who are going well beyond the bounds of
speech. So the question that I have--you know, we want to
include socially responsible behavior from Internet Service
Providers, but we want to make sure that they manage their
networks in such a way that they can eliminate piracy and the
spread of child pornography over peer-to-peer networks.
So that is a long preface to my question, and I would like
any of you to answer it.
How do we fashion principles that will continue Internet
innovation but also will not prohibit corporations from
addressing this kind of unlawful activity or unprotected
speech? Because I want ISPs to be able to corner off access to
that kind of peer-to-peer file sharing. When they identify
where these people are and can shut off their access, I do not
want network neutrality to prevent them from being able to do
that.
Ms. Crawford. Congresswoman, if I could respond briefly,
the creation of child pornography is the most heinous behavior
we know of around the world. It is incredibly destructive. The
closest thing we have, actually, to a global norm is an
abhorrence of child pornography. We need to remember, though,
that we are addressing two different things--behavior on the
one hand and technology on the other. The behavior of child
porn creators we always prosecute, and we make sure we go after
them. Fashioning technology in advance to look for a particular
flesh tone or for a particular action in a packet crossing an
ISP network is going to be both incredibly difficult and
probably destructive to some sense of innovation. So here is my
response to you.
The ISPs cooperate quite closely with law enforcement all
the time, and it is in facilitating that cooperation that we go
after the behavior without punishing the technology that makes
so much else that is good and positive in the world----
Ms. Wasserman Schultz. I can understand pursuing the
behavior. We cannot just leave it to punishing the behavior
here. We have to make sure that you limit the market. If you
limit access to the market, the market will shrink, and the
reduction in the competitive exchange will cause less need for
the market to be fed by more crime.
Ms. Crawford. I agree with you. I think it is just a
question of timing. I am saying that ISPs cooperate with law
enforcement, hear about what is going on and then act and then
act to either take off subscribers----
Ms. Wasserman Schultz. But a child has already been
victimized when you do it that way. We are talking about
children who are being raped----
Ms. Crawford. Right.
Ms. Wasserman Schultz [continuing]. Children who are being
victimized. So waiting until after that has happened hurts
children.
Ms. Crawford. How could we do it before? How would you know
where the file was before this happened?
Ms. Wasserman Schultz. Well, they already have the
technology to know where the file is, to know the servers that
are on there. I mean, if we have the resources, they can go and
find--I do not know--the digital fingerprints. From what I
understand, they have the technology to lift those now and find
them, and it is only due to the lack of resources. Like I said,
I am a proponent of network neutrality, but I certainly am not
a proponent of network neutrality's benefiting the promotion of
illegal activity, and after the fact is not okay when it comes
to harming children.
Mr. Carnes. Congresswoman, basically--I mean I am certainly
in total agreement that the illegal activity that is going on
on the Internet needs to have some cap, some control in some
way. In terms of Net Neutrality, they are talking about like
having a level playing field. That sounds really nice, but what
we have got now is not a level playing field. We have got a
playing field that is tilted just like you are saying. These
people are overwhelmed. They cannot begin to control 500,000
different cases. The network is set up right now tilted in
favor of----
Ms. Lofgren. The gentlelady's time has expired. I will turn
now to the former Chairman of the Judiciary Committee, Mr.
Sensenbrenner, for 5 minutes.
Mr. Sensenbrenner. Thank you very much.
Ms. Combs, I was interested in your comments about the
blocking of a political message during a performance that was
streamed over the Internet and the analogy to the same type of
blocking of religious messages by the thought police in the
People's Republic of China.
Could you amplify a little bit more about how these actions
were similar?
Ms. Combs. Do you mean the Pearl Jam concert?
Mr. Sensenbrenner. Yes. Please turn your mike on or bring
it a little closer.
Ms. Combs. Oh, sorry.
I just think they are both examples of discriminatory
behavior on the Internet because even though we as an
organization do not agree probably with what Pearl Jam was
saying in their concert----
Mr. Sensenbrenner. Neither do I.
Ms. Combs. No, but it is just an example of discriminatory
behavior in that they did try to stop the concert, and we
believe it is the exact same discriminatory behavior that is
being used by the Chinese Government to block our message to
getting to the Chinese citizens who would like to see and hear
some of our messages that we are trying to put out. We just do
not want that to happen. We are constantly sending out e-mail
blasts. We are constantly getting our message out to our
thousands of supporters across the country, and we do not want
Comcast or Verizon or one of the large companies to do that to
our organization.
Mr. Sensenbrenner. Well, as you know from my opening
remarks, my interest in Internet neutrality has been more
focused on the antitrust and on the monopolistic aspects of
nonneutrality than the content that has been intercepted,
jammed, blocked or whatever, because a free market economy, in
my opinion, is based upon healthy competition. America was the
first country in the world to pass antitrust laws, largely
aimed at busting up the Standard Oil trust. Those antitrust
laws, I think, have worked fairly well to protect consumers in
the United States, contrasted to antitrust laws in Europe and
elsewhere that are designed to protect competition.
That said, what do you think Congress should do to protect
consumers such as those who wish to receive your message,
whether they be in the People's Republic of China or elsewhere,
or somebody who wishes to get a brief political message from
Pearl Jam?
Ms. Combs. We just believe that every organization out
there, whether they be NARAL or the Christian Coalition or the
ACLU--we do not believe that Comcast and Verizon and these
companies should have the ability to block our message.
Mr. Sensenbrenner. Now, do you think that a better way to
police that principle is through having the FCC or another
Federal agency regulate content on the Internet or by giving
you or other aggrieved parties the right to sue the ISP for
treble damages if they are engaging in monopolistic practices
that prevent the people who wish to receive your message from
getting it?
Ms. Combs. We just believe that there should be a free and
open Internet to all consumers and that they should have the
right to receive any e-mails coming from any organization.
Mr. Sensenbrenner. My question, with all due respect, Ms.
Combs, is what is the best way to do it, because that is what
the debate is here in the Congress, whether we should be
utilizing the antitrust laws, which will get you some money if
you end up being aggrieved upon or having to go to the Federal
Communications Commission or to another agency to try to get
them to say that somebody broke the regulations.
Ms. Combs. Right. I am not familiar with all of those laws.
Is it okay if Professor Crawford answers this question?
Mr. Sensenbrenner. Okay. This is now a 50-yard punt.
Ms. Fredrickson.
Ms. Fredrickson. I think, with all due respect, Mr.
Sensenbrenner--well, first off, I would also like to say that
Ms. Combs and I--the ACLU and the Christian Coalition--have
worked together on many issues, not simply on Net Neutrality,
so I wanted to set the record straight on that. I think the
issue here is--the concern is that with all the many small
players on the Internet, the variety of content producers who
are filming videos in their backyard or who are putting up
their own Web sites or who are doing things that are very small
in scale but that can reach a very wide audience, I think that
the burden of trying to sue is a heavy one to bear and that
there should be--whatever the framework is, there should be
some neutrality principles that govern from the beginning, from
the outset, that ensure that there is some level playing field.
Mr. Sensenbrenner. Okay. Thank you. My time has expired.
Ms. Lofgren. The gentleman yields back.
The gentlelady from Texas is recognized for 5 minutes.
Mr. Jackson Lee. I thank you very much, and I thank the
presiding Chair, and I thank Mr. Conyers as well for this
ongoing series of important discussions and debates about the
utilization of this technology and this question that is before
us. Let me start.
First of all, I find it fascinating--and I think you are
absolutely right, Ms. Fredrickson--that I have seen the
Christian Coalition and the ACLU work together, and I think it
is important to note that the ACLU is known for finding the
most prickly of adversaries and for working with them. You are
to be commended for it, seriously, that you circle the wagons
around issues and not around the views of others.
Ms. Combs, I am not suggesting in any way that you are
prickly. I do not want the record to reflect that, and it
should not, because I appreciate the advocacy for which you
stand.
I am going to probe Professor Yoo to give him a fighting
chance to try to understand because the one thing I like about
this task force is that we try to strike a reasoned balance. I
am moved, however, by the words of Professor Crawford in that
the perspective that she might take would foster more
competition. You are arguing that you could promote competition
by, in essence, having this managed care system on the
Internet. Help me understand that.
Mr. Yoo. There are new technologies out there that do not
operate like the old Internet technologies. We are used to
thinking of the Internet's growing up in a telephone world. A
person I had mentioned earlier in this hearing, who was here
during the vote, is here. He is doing wireless broadband. His
name is Brett Glass. He represents a company called LARIAT from
Laramie, Wyoming. He is not one of the big existing players.
Even among the big existing players, there are four wireless
players. They depend on being really smart about how they route
their traffic so that, one, they can provide the kind of
services that consumers----
Mr. Jackson Lee. Let me stop you for a moment.
What you are suggesting is that a jammed-up system means
nobody can get on to a certain extent?
Mr. Yoo. Correct.
Ms. Jackson Lee. So competition goes down because those who
you voice cannot manage access or content. It is overloaded?
Mr. Yoo. It is a system that is overloaded. No one will use
it, and you will go out of business. You will lose your
subscribers, and you will go out of business. Being able to
provide a quality service that people will actually pay for
instead of buying from one of the existing options is what they
need to survive.
Part of the way that wireless players are doing it is by
figuring out which applications are extremely time sensitive
and by giving them priority over the stuff where, if it waits
for a second or two, it will not be----
Mr. Jackson Lee. Give me an example which is time
sensitive. What would that be?
Mr. Yoo. Voice or streaming video. If there is a hiccup in
the video, you will stop watching it. If your voice service has
a delay of a third of a second, the studies show you will stop
using it.
Mr. Jackson Lee. That means a telephone by cable.
Mr. Yoo. Yes, an Internet telephone, the IP telephony.
There are other examples. Virtual worlds like Second Life.
Video online games.
Mr. Jackson Lee. So, Mr. Kulash, you consider him as having
the ability to wait?
Mr. Yoo. It is interesting. What he is doing is a streaming
technology that is actually--you can buffer it, and it is less
sensitive than realtime applications. In other words, when you
launch YouTube to download Mr. Kulash's video, it is running
ahead of where you are watching, and it is actually storing it,
and it tends not to be extremely sensitive. The things that are
very sensitive are games where you make a move or if you are
talking----
Mr. Jackson Lee. And you need a response. That is what I am
saying. Mr. Kulash, in your view, could function and have a
success if he waited?
Mr. Yoo. No. I am saying that the network is smart enough
to make sure that download applications like YouTube do not
have to wait in general. In fact, there are certain
applications which can use other situations to get around the
waiting problem whether by storing it locally or by giving it
different means, but the networks really----
Mr. Jackson Lee. I think I have got you. I see my time
going. Let me get right to the first amendment.
Is Professor Yoo pulling the wool over our eyes by what he
is suggesting? Because I think we should entertain the question
of competitiveness. How does Professor Yoo's reasonable
perspective interfere with the first amendment?
Professor Crawford and then Ms. Fredrickson and Mr. Kulash.
Ms. Crawford. Just very briefly, Congresswoman, given the
highly concentrated market we have right now for high-speed
Internet access, these gatekeepers are in the position of
choosing speech, of choosing winners and losers and of backing
up. That is the principle that we are worried about.
Ms. Lofgren. Very quickly. The time has expired.
Ms. Fredrickson. Yes. In some ways, I was going to say that
there is a little bit of apples and oranges because I think, as
Professor Crawford has already suggested, limiting access based
on bandwidth or on other nondiscriminatory means could be
considered as a way of managing a network, but what really
cannot be allowed is doing so based on content.
Ms. Lofgren. The gentlelady's time has expired.
The gentleman from Utah is recognized for 5 minutes.
Mr. Cannon. Thank you, Madam Chair.
Mr. Carnes, you said earlier that 5 percent of the users
are using 70 percent of the bandwidth and are downloading peer-
to-peer material. My sense is--and I do not know this, but I do
a lot of YouTube. I mean there is just some really interesting
stuff on there. We put up YouTube in my office. My sense is
that those numbers have changed. I ask that question because
what I am really going at is that it seems to me that the
Internet and the nature of what we are doing on the Internet
has been changing very rapidly and that the rate of change is
going to increase.
So when were those numbers validated that you gave us, and
are they current or are they a couple of years old?
Mr. Carnes. Those are the most recent numbers I have.
Mr. Cannon. Was it like a couple of years ago or a year
ago, do you know?
Mr. Carnes. You know, I could not tell you exactly.
Mr. Cannon. Does anybody know? My sense is that there has
been a huge transformation as to how bandwidth is used.
Mr. Yoo.
Mr. Yoo. Those numbers have been validated within the last
6 months from at least 5 sources. They vary, obviously. I have
seen 50 to 80 percent. The most extreme number is 5 percent in
70 or 80, maybe as much as 1 percent in 50. If you take an even
smaller slice of it, it might be even more intense.
Mr. Cannon. Great. Is that all peer to peer and mostly
pirating or is the mix changing?
Mr. Yoo. That number that we are talking about, 5 percent
and 80, is peer to peer. The mix of peer to peer is 90 percent
piracy. So the vast majority--you can do the math. 70-ish
percent is piracy.
Mr. Cannon. Yes. Ms. Crawford, please.
Ms. Crawford. Those uses are also changing, Congressman. We
are seeing a lot of use of BitTorrent for sending around
security patches for laptops. A lot of use of BitTorrent is for
making sure that developers stay in sync. It is a very
efficient way of using the network so that you are not
depending on central servers and on one piece of bandwidth.
Everybody is sharing the bandwidth in the storage.
Mr. Carnes. But you know, in the Grokster case--I think it
was in 2005--the figure is almost exactly the same. It was
still 90 percent illegal. So they may be doing more, but
apparently the illegal is growing, too. The ratio is still the
same.
Mr. Yoo. If I may, it brings up a wonderful question,
though, which is what is the future going to be? For the last 4
years until the last year, peer to peer was outstripping
downloads every year, and it looked like that was the shape of
things to come. Last year, because of YouTube, downloads made a
comeback, and they have now passed peer to peer. The entire
industry is staring at this. Should we design our entire
networks because peer to peer is the answer or is YouTube the
new thing? Even if we redesign it today, what is the next thing
coming down? It is important to understand that it is extremely
uncertain what you have to do right now. There is more than
$100 billion at stake. They are going to have to make a gamble,
and that is what they are paid to do.
Mr. Cannon. Just following up, when you say that they need
to make a gamble, you have got very different architectures out
there, and the gamble is gambling future investments in
architectures that are dissimilar. What is the effect of a
mandate from government on those decisions about what
architecture to choose?
Mr. Yoo. In a free market economy you let business people
take chances. Some of them will work guaranteed; some of them
will not. Our normal system is to allow individual consumers
through their individual buying decisions to determine the
winners and the losers and not to have a centralized authority,
whether government or private business, decide what that
architecture is going to be.
Mr. Cannon. Yes, Ms. Crawford.
Ms. Crawford. Just very briefly, the follow-up to that is
that it would be good if we had a functioning free market in
Internet access, but we really do not in this country.
Mr. Cannon. Yes. One of the things I would like to see
happen is that we stimulate the possibilities of what that
infrastructure will be rather than our limiting the
possibilities, because we have seen an increase in the
availability of bandwidth.
Yes, Mr. Carnes.
Mr. Carnes. From the songwriter's perspective, we have had
10 years of dumb pipes as the Internet, and it has hurt us. We
are just hoping that an intelligent network can help us.
Mr. Cannon. One of the things I am hoping is that we can
prosecute people who steal and then bring down the price enough
so that people are incented to do other things. Time Magazine
had an editorial on its last page about Rob Reid's doing an
experiment with Rhapsody where he charges 25 cents per song.
Instead of getting four songs, in other words, being equal, he
got six songs sold for the same. So the 25 cents per song
resulted in a 50 percent increase in revenues, and I am hoping
that people who have content will sort of look at that model
and will realize that by bringing the price down two things
happen. One is you get more revenue. Two is why would you steal
if you can pay a reasonably low price?
Along the lines of how we have a system that actually
accommodates more movement, we have what I call the Super Bowl
syndrome. If everybody downloads the Super Bowl over the same
pipes--and in a neighborhood, you have got 300 households
sucking the Super Bowl independently through the same pipe--you
are going to have a problem with speed. If you use a model like
Comcast and distribute that locally, then the backbone is not
totally wiped out. In that environment, how we use the radio
frequency, another spectrum, seems to be very important to me.
Are any of you familiar with the M2Z project? Does that
give us an opportunity to see how we can use bandwidth a little
more effectively?
Mr. Yoo. There are a number of fascinating projects
underway, and we have no idea which are going to work. There is
a P4P project that is going on. All of these different
solutions are brewing out there, and technology is going so
fast that we do not ultimately know which one is going to win.
I would love to see a wonderful battle between these different
technologies unfold. The only way we can allow that is if we
give them breathing room to experiment with new ways of doing
business.
Mr. Cannon. Madam Chair, I recognize that my time has
passed, but I actually intended that question for Ms. Crawford.
I thought that she would have an answer. If she could have the
time to answer----
Ms. Lofgren. With unanimous consent, the gentleman is given
another minute so Ms. Crawford may respond.
Ms. Crawford. Here is the point. Here is the point. We need
a playing field for innovation. That is the point of Network
Neutrality. Keeping the conduit players as conduits does not
limit our opportunities as a Nation for the future. All it is
going to do is to make sure that developers can attract
investment because they can predict the kind of Internet on
which they will be able to run their new applications. Right
now we have uncertainty, which is clouding innovation, making
it difficult to invest. Yes, we have to weigh benefits and
burdens to different populations. As a society, social welfare
will be served by a neutral Internet in a way that it will not
be served by making sure that these very few private companies
are able to monetize the Internet in the way they would like.
Ms. Lofgren. The gentleman's time has expired.
As you have noticed, we have been called for a vote on the
floor of the House, and we are out of questions for Members. So
we will be adjourning this hearing, with terrific thanks to
each one of you. A lot of people do not realize that our
witnesses are volunteers and that you are here just to help us
do the right thing and to make sure that our country's future
is protected. So we do very much appreciate your participation
in this hearing.
This hearing is now adjourned.
[Whereupon, at 4:04 p.m., the task force was adjourned.]
A P P E N D I X
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Material Submitted for the Hearing Record
Prepared Statement of the Honorable Sheila Jackson Lee, a
Representative in Congress from the State of Texas, and Member, Task
Force on Competition Policy and Antitrust Laws
Thank you, Mr. Chairman, for your leadership in convening today's
very important hearing on net neutrality and free speech on the
internet. I would also like to thank the ranking member, the Honorable
Steve Chabot, and welcome our panelists. I look forward to their
testimony.
This hearing could not be more timely, Mr. Chairman. Over the past
few years, the internet has become a dominant venue for the expression
of ideas and public discourse. The internet provides a powerful medium
for its users to use their First Amendment rights. From social
networking to get-out-the vote drives, the internet is a powerful tool
for speech. Technological innovation on the internet has made it among
the most powerful outlets for creativity and free speech.
The internet's importance in promoting free speech has caused
proponents of net neutrality to raise concerns that a lack of
competition among broadband access provides allows providers to stifle
and censor speech. In this hearing, the Judiciary Committee's Task
Force on Competition Policy and Antitrust Laws will explore how network
neutrality principles, government enforcement of policies, and private
business practices currently protect and inhibit the freedom of speech.
The term ``network neutrality'' is the term used to describe the
concept of keeping the internet open to all lawful content,
information, applications, and equipment. It refers to the fundamental
architecture of the internet that allows for user-to-user
communications that are uninhibited and are not regulated based upon
content. All network content is to be treated equally under ``network
neutrality.''
The debate over net neutrality has arisen as broadband network
providers became increasingly vertically integrated. For example, cable
companies began to expand in the areas of television services, land-
line phone lines, wire-less phone services, and high-speed internet
services. Questions arose over how the stratified communications legal
regime would apply to new, conglomerated companies offering services
that traversed the regulatory law spectrum.
The concept of net neutrality has been supported by entertainment
companies, providers of internet-based applications, software
companies, content providers, and device manufacturers. These groups
advocate argue that net neutrality fosters technology and innovation.
These groups also argue that network providers have a clear incentive
to discriminate.
On the other hand, network service providers, i.e., the cable or
telephone companies, claim that statutory mandated net neutrality
undermines their ability to effectively manage their networks. Net
neutrality has arisen as an issue for this Congress to address for
several reasons.
First, there have been instances of broadband access providers
blocking certain content.
Second, Subcommittee Chairman Markey has introduced a net
neutrality bill, H.R. 5353, the ``Internet Freedom Preservation Act of
2008,'' which would require the FCC conduct proceedings to assess
whether broadband providers violate net neutrality principles. H.R.
5353, also requires the FCC to hold eight public broadband summits to
assess competition, consumer protection, and choice related to
broadband.
Third, the FCC has begun considering complaints from entities
claiming that the broadband service providers have been violating the
FCC net neutrality principles. The FCC held its first public hearing on
the issue in Boston on February 25, 2008. The FCC indicated that it was
``ready, willing, and able'' to take action against ``improper
practices.''
The internet has also allowed its users to have access to billions
of people. The internet can be used for communication or commerce. It
is available to anyone with access to the internet.
The internet has been used to get people to vote and as a means of
communication between organizations and their supporters. The internet
is increasingly used for the proliferation of mass media content to
millions of people. As the internet becomes increasingly more
accessible and important in the global marketplace, questions arise
regarding the role the communication carriers and the internet service
providers should play in shaping the content they deliver to consumers.
Increasingly, there have been reports that internet service
providers are limiting various groups from accessing the internet based
upon the content of the communication. One such example of abuse
occurred with Verizon Wireless.
On September 27, 2007, the Associated Press broke the story that
Verizon Wireless rejected requests from NARAL Pro-Choice America to use
Verizon's mobile network for text-messaging. Verizon temporarily barred
NARAL from using a service known as ``short code.'' Consumers generally
receive text-messages on cellular telephones with traditional ten-digit
phone numbers. When organizations transmit messages to their users'
ten-digit numbers, they rent shorter five and six digit numbers, called
``short codes,'' from which to send and receive messages. Verizon
denied NARAL access to a short code that would have enable NARAL to
contact its supporters with Verizon phones.
In its denial to NARAL, Verizon asserted that it did not accept
text-messages from any group seeking ``to promote an agenda or
distribute content that, in its discretion may be seen as controversial
or unsavory to any of our users.'' Amid mounting pressure against
censorship from activist groups, Verizon discontinued its activities
within days of the initial news report. This was not the first time
that Verizon has engaged in such conduct; there are other instances of
content based blockages.
An abuse such as this would ordinarily correct itself in a typical,
competitive marketplace because users dissatisfied with their service
would switch providers. However, in a non-competitive marketplace,
there are few options for change. Broadband controls 96 percent of the
U.S. residential market for high-speed internet access. Most consumers
have very limited choice in which company provides service. Net
neutrality advocate that without competition, providers will have both
the power and the influence to determine whether speech will happen.
The providers argue that net neutrality regulations would limit
innovation and technological advances because the presence of emerging
technologies thwart discriminatory behavior. The providers argue that
where censorship has occurred, like that between Verizon and NARAL,
those instances of censorship are quickly resolved without government
intervention.
The providers also assert that the FCC already has jurisdiction to
regulate the internet and that the FCC has not intervened. The network
providers argue that net neutrality statutes would impede efficient
network management strategies because the regulations will further
complicate how the companies distribute their limited amounts of
bandwith among their different customers. The network providers argue
that new regulation would negate the advancement and development of new
technologies and consumer technologies.
I welcome the panelists' insight on this very time subject. Thank
you, Mr. Chairman; I yield the remainder of my time.
Response by Rick Carnes, President, Songwriters Guild of America, to
Question from Congressman Bob Goodlatte
The Songwriters Guild certainly welcomes your concern about the
theft of billions of copies of songwriter creations on the Internet
each year. For the past six years, I have come to Congress on numerous
occasions to testify and meet with Members on that very issue, and on
the financial devastation that has occurred in the songwriting
community due to music piracy. It is the sad truth, however, that,
despite widespread recognition of the problem, the piracy situation has
only gotten worse. In fact, we have now lost over half of the
professional songwriters in America; Internet theft has simply made it
impossible for many of us to earn a living practicing our craft.
It is against this backdrop that SGA has been speaking out against
enshrining the often lawless structure that currently exists on the
Internet. The Internet now is in no way ``neutral,'' at least insofar
as songwriters are concerned. In many cases it has become no more than
a playground for intellectual property thieves. In my view it will
remain so if no one is allowed to manage the networks in a way that
identifies and filters pirated content.
With respect to Mr. Kulash's concerns, I would emphasize that SGA
is far more concerned at the moment with illegal content on the
Internet and in encouraging efforts and technological advances to
alleviate that. If any ISP wants to filter illegal files from its
network in order to make that network safe for legal music, obviously
we strongly support that. However, we also do not object to sensible
regulation that would prevent discrimination between types of legal
content, to the extent that such discrimination is not already barred
by current law.
Response to Post-Hearing Questions from Christopher S. Yoo, Professor
of Law and Communication and Director, Center for Technology,
Innovation, and Competition, University of Pennsylvania Law School
Response to Post-Hearing Questions from Susan P. Crawford, Visiting
Associate Professor of Law, Yale Law School
Letter from Leslee J. Unruh, Founder and President, Abstinence
Clearinghouse, et al. to Members of Congress, dated March 10, 2008