Skip Navigation

Federal Communications Commission

English Display Options

Commission Document

Commissioner McDowell FCC Oversight Hearing Statement

Download Options

Released: March 12, 2013
image01-00.jpg612x792

STATEMENT

OF

COMMISSIONER ROBERT M. MCDOWELL

FEDERAL COMMUNICATIONS COMMISSION

BEFORE THE

UNITED STATES SENATE

COMMITTEE ON

COMMERCE, SCIENCE, AND TRANSPORTATION

OVERSIGHT

OF THE

FEDERAL COMMUNICATIONS COMMISSION

MARCH 12, 2013

image02-00.jpg612x792

INTRODUCTION

Thank you, Chairman Rockefeller, Ranking Member Thune and Members of the

Committee for inviting me to join you today. It has been an honor working with you over the

years, and I am pleased to be back before you. As always, I look forward to answering any

questions you may have.

Although the bulk of my testimony focuses on my serious concerns regarding increased

international regulation of the Internet, I am hopeful that the Federal Communications

Commission adopts some sensible policies in other areas this year.

TODAYS POLICY PRIORITIES

I.

The FCC Should Adopt Pragmatic Policies for the Upcoming Incentive Auction.

The most important priority for the Commission this year is to implement the

congressionally-mandated incentive auction. We should do so by:

Ensuring that the rulemaking and incentive auction processes are transparent and the

final rules are intuitive so that all stakeholders – no matter their technology

preference or size – have a meaningful opportunity to understand and participate;

Avoiding imposing anything that functions as a spectrum cap;

Refraining, for now, from reserving airwaves to create a “nationwide unlicensed

spectrum band” within the new 600 MHz Band;

Pragmatically balancing the tension between flexible-use spectrum policies and

adequate interference protections to account for the technological improvements that

will undoubtedly develop while the proceeding is underway and after the rules are

implemented; and

Steering clear of encumbrances that scare away bidders and lead directly to

unintended harmful consequences.

II.

The Executive Branch Must Liberate More Spectrum for Exclusive Use Licenses

Awarded Through Auctions.

In addition to creating a constructive environment for an incentive auction, the Executive

Branch must do more to liberate spectrum occupied by the federal government and send it to

auction for exclusive use licenses. The federal government occupies a majority of the most

useful spectrum. Without a doubt, much of it is used for important purposes such as national

defense, air traffic control and law enforcement. But does anyone believe that all federal

spectrum is being used efficiently? We don’t have clear answers to these questions because the

current structure is opaque and discourages the government from relinquishing spectrum. Ill-

defined policies to promote spectrum “sharing” in lieu of auctions for exclusive use licenses are

image03-00.jpg612x792

insufficient to meet America’s spectrum needs. This scenario must be rectified or the U.S.

wireless industry risks losing the global lead in wireless it has always enjoyed.

III.

The FCC Should Modernize America’s Obsolete Media Ownership Rules.

As is required by Section 202(h) of the Communications Act, the FCC must modernize

its media ownership rules to reflect the current economic realities of the marketplace and

eliminate any and all unnecessary mandates.1 Not only should the Commission look to

deregulate the traditional media sector in the face of competition from new media, it should

avoid adding new and unnecessary rules. For example, due to today’s competitive media

landscape, the Commission should resist proposals that would restrict broadcasters from entering

into some forms of contracts, such as joint sales, shared service and local news service

agreements, that could provide efficiencies ultimately benefiting consumers. Unfortunately, new

draft rules in this regard are pending before the Commission. If adopted, they would reduce the

amount of news and information available to smaller communities.

Additionally, evidence continues to mount that the 1975 newspaper-broadcast cross-

ownership ban should be largely eliminated. Although the Commission proposed a relaxation of

the ban on newspaper-television ownership for the largest markets and considered eliminating

restrictions on newspaper-radio combinations, these proposals are anemic and do not reflect

marketplace realities. Over the past decade, broadcast stations and daily newspapers have

grappled with falling audience and circulation numbers, diminishing advertising revenues and

resulting staff reductions,2 as online sources gain in popularity.3 This trend has led many

1 Section 202(h) of the Telecommunications Act of 1996 states that:

The Commission shall review its rules adopted pursuant to this section and all of

its ownership rules quadrennially . . . and shall determine whether any of such

rules are necessary in the public interest as the result of competition. The

Commission shall repeal or modify any regulation it determines to be no longer

in the public interest.

Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56, 111-12 § 202(h) (1996); Consolidated

Appropriations Act, 2004, Pub. L. No. 108-199, § 629, 118 Stat. 3, 99-100 (2004) (amending Section 202(h) of the

1996 Act). I concurred in the December 2011 notice of proposed rulemaking, because the Commission appears to

be prepared to accept a regulatory status quo while I think major changes are necessary and required by Section

202(h).

2 Although some sectors of the news industry have experienced a slight resurgence, newspapers continue to face

decline with both advertising and circulation revenues continuing on a downward path. In 2011, network and local

news viewership increased for the first time in years; however, local TV station advertising revenues still

experienced a decline. See PEW RESEARCH CTRS PROJECT FOR EXCELLENCE IN JOURNALISM, THE STATE OF THE

NEWS MEDIA 2012, KEY FINDINGS, http://stateofthemedia.org/2012/overview-4/key-findings/ (last visited March 8,

2013) (“THE STATE OF THE NEWS MEDIA 2012”); THE STATE OF THE NEWS MEDIA 2012, LOCAL TV,

http://stateofthemedia.org/2012/overview-4/key-findings/ (explaining that some of this loss is due to a reduction of

political and automotive advertising from 2010 and that these revenues will rebound during a busy election cycle).

3 In fact, the White House’s Council of Economic Advisors has found that newspapers are one of America’s fastest-

shrinking industries losing approximately 28.4 percent of its workforce between 2007 and 2011. Online publishing

job growth, on the other hand, increased by more that 20 percent in the same time period. See, e.g., ECONOMIC

2

image04-00.jpg612x792

prominent daily newspapers to declare bankruptcy or go out of business altogether. Over the

past five years, an average of 15 daily papers, or about one percent of the industry, have

shuttered their doors each year.4 The newspaper-broadcast cross-ownership ban could be

exacerbating this situation, according to evidence compiled in the FCC’s record over the years.5

Not only is such a rule unnecessary, it appears to be harming the public interest. Keeping the

ban on the FCC’s rulebooks is contrary to Congress’s mandate under section 202(h).

The Commission recently indicated that it would accept new evidence for the record to

help determine whether cross-ownership has a harmful effect on diversity.6 Once that review is

complete, along with proper public comment, we should waste no time in completing this

proceeding, which is nearly three years overdue.

IV.

The FCC Should Repeal Outdated Analog Regulations in The New IP World.

The Commission should prioritize its reform efforts to focus on the market’s transition

from telecom networks that were built for analog voice services to state-of-the-art data networks

that convey an infinite slurry of ones and zeros (the “IP transition”). Comments filed at the FCC

indicate that within at least the 22 states where AT&T operates, for instance, 70 percent of the

residential customers with access to plain old telephone service over aging copper networks are

projected to have chosen a competitive alternative by the end of 2012.7 As in so many cases,

while our statute and rules stay firmly rooted in the 20th century, the market is whizzing past us.

We are overdue for a fresh look at how our laws may be hindering – rather than helping – such

REPORT OF THE PRESIDENT TOGETHER WITH THE ANNUAL REPORT OF THE COUNCIL OF ECONOMIC ADVISORS 188

(February 2012) (citing a LinkedIn study), available at

http://www.whitehouse.gov/sites/default/files/docs/erp_2012_complete.pdf; Matt Rosoff, Newspapers Are The

Fastest Shrinking Industry In The U.S., BUSINESS INSIDER (Mar. 8, 2012), http://articles.businessinsider.com/2012-

03-08/tech/31135175_1_linkedin-job-growth-newspapers#ixzz1us0z9Urf.

4 THE STATE OF THE NEWS MEDIA 2012, MAJOR TRENDS, http://stateofthemedia.org/2012/overview-4/major-trends/.

5 See, e.g., Comments of the Newspaper Association of America, 2010 Quadrennial Review – Review of the

Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant to Section 202 of the

Telecommunications Act of 1996, MB Docket No. 09-182 (Mar. 5, 2012); Comments of A.H. Belo Corporation,

2010 Quadrennial Review – Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted

Pursuant to Section 202 of the Telecommunications Act of 1996, MB Docket No. 09-182 (Mar. 5, 2012); Joint

Comments of Bonneville International Corporation and the Scranton Times, L.P., 2010 Quadrennial Review –

Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant to Section 202 of the

Telecommunications Act of 1996, MB Docket No. 09-182 (Mar. 5, 2012); Comments of Cox Media Group, 2010

Quadrennial Review – Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant

to Section 202 of the Telecommunications Act of 1996, MB Docket No. 09-182 (Mar. 5, 2012); Comments of

Tribune Company, Debtor-in-Possession, 2010 Quadrennial Review – Review of the Commission’s Broadcast

Ownership Rules and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996, MB

Docket No. 09-182 (Mar. 5, 2012).

6 Statement from FCC Chairman Julius Genachowski on the Status of the Media Ownership Proceeding, News

Release (Feb. 26, 2013), https://transition.fcc.gov/Daily_Releases/Daily_Business/2013/db0226/DOC-319131A1.pdf.

7 See Comments of AT&T, In the Matter of Connect America Fund, WC Docket No. 10-90 (Feb. 24, 2012).

3

image05-00.jpg612x792

market evolutions. At a minimum, we could learn a great deal from sensibly structured test bed

programs.

PROTECTING INTERNET FREEDOM

Ladies and gentlemen, we are losing the fight for Internet freedom. Any doubts about

this proposition should now be dispelled.

The Internet is no longer at a crossroads – with

freedom and prosperity down one avenue, and command and control government domination

down the other. The course of the Internet’s fate was dramatically altered for the worse during a

treaty negotiation in Dubai last December. As a result, this freedom-enhancing and borderless

network of networks – the greatest deregulatory success story of all time – is quickly being

absorbed into an intergovernmental structure that uses centralized, top-down choke points.

Unless defenders of Internet freedom and prosperity act quickly, boldly and imaginatively, this

tragic trajectory will become irreversible.

My testimony on this important matter can be summed up in four main points:

1)

Last year’s World Conference on International Telecommunications (“WCIT”)

dramatically ended the era of international consensus to keep intergovernmental hands

off of the Internet;

2)

Defenders of Internet freedom must act quickly to turn the threat of increased

intergovernmental control of the Internet into an opportunity to reverse course through

liberalization of markets that will spark competition, investment and innovation;

3)

We must offer other nations, especially those in the developing world that feel

disenfranchised from Internet governance processes, an alternative to international

regulation by improving and enhancing multi-stakeholder entities, such as the Internet

Governance Forum (“IGF”); and

4)

Congress can and should continue to play a constructive role by amplifying the call for

more Internet freedom.

I.

Last year’s WCIT dramatically ended the era of international consensus to keep

intergovernmental hands off of the Internet.

Since becoming commercialized in the mid 1990s, the Internet migrated further away

from governmental control. As a result of deregulation, the number of people using the Net

world-wide grew from a mere 16 million in 1995 to over 2.4 billion today.8 Net access,

especially through increasingly powerful and affordable mobile devices, is improving the human

condition more quickly and fundamentally than any other technology in history. Nowhere is this

phenomenon more apparent than in the developing world where unfettered Internet technologies

8 Internet Growth Statistics, INTERNET WORLD STATS, http://www.internetworldstats.com/emarketing.htm (last

visited March 7, 2013).

4

image06-00.jpg612x792

are expanding economies and raising living standards. These innovations also empower

individuals with information that they have never had before, thus threatening authoritarian

regimes that rule closed societies. As a result, these regimes, and their client states, have been

pushing for more international Internet regulation in lieu of the non-governmental “multi-

stakeholder” model for Internet governance. At a minimum, a new international regulatory

overlay provides authoritarian governments political “cover” and international legal “legitimacy”

for restricting Internet communications in their own countries.

For many years, the global consensus regarding Internet policy centered on market

opening liberalization and competition. Internet governance was left to non-governmental

private sector groups that not only have a perfect track record of keeping the Internet open and

working, but helping it thrive as well. This hands-off approach is what has produced tremendous

investment and innovation that has made the Internet ecosystem flourish.

Starting a few years ago, however, countries such as Russia, China, Saudi Arabia and

others diligently and patiently worked to change that structure incrementally. Among their many

proposals were draft rules that would have the force and effect of international law calling for:

Changing basic definitions contained in treaty text so the International

Telecommunication Union (“ITU”) would have unrestricted jurisdiction over the

Internet;9

Allowing foreign phone companies to charge global content and application providers

internationally mandated fees (ultimately to be paid by all Internet consumers) with

the goal of generating revenue for foreign government treasuries;10

9 See, e.g., Arab States Common Proposals for the Work of the Conference, Algeria (People’s Democratic Republic

of), Bahrain (Kingdom of), Comoros (Union of the), Djibouti (Republic of), Egypt (Arab Republic of), Iraq

(Republic of), Jordan (Hashemite Kingdom of), Kuwait (State of), Lebanon, Libya, Mauritania (Islamic Republic

of), Morocco (Kingdom of), Oman (Sultanate of), Qatar (State of), Saudi Arabia (Kingdom of), Somali (Democratic

Republic of), Sudan (Republic of the), Tunisia, United Arab Emirates and Yemen (Republic of), Contribution 7, at

Art. 2 (Oct. 24, 2012), http://www.itu.int/md/S12-WCIT12-C-0007/en (“Arab States Contribution 7”); African

Common Proposals for the Work of the Conference, African Telecommunication Union Administrations,

Contribution 19, at Art. 2 (Nov. 2, 2012), http://www.itu.int/md/S12-WCIT12-C-0019/en (“Africa Contribution

19”); Proposals for the Work of the Conference, India (Republic of), Contribution 21, at Art. 2 (Nov. 3, 2012),

http://www.itu.int/md/S12-WCIT12-C-0021/en (“India Contribution 21”); Proposals for the Work of the

Conference, Russian Federation, Contribution 27, at Art. 2 (Nov. 17, 2012), http://www.itu.int/md/S12-WCIT12-C-

0027/en (“Russia Contribution 27”); Proposals for the Work of the Conference, Algeria, Saudi Arabia, Bahrain,

China, United Arab Emirates, Russian Federation, Iraq, Sudan, Contribution 47, at Art. 2 (Dec. 11, 2012),

http://www.itu.int/md/S12-WCIT12-C-0047/en (“Algeria, Saudi Arabia, Bahrain, China, United Arab Emirates,

Russian Federation, Iraq, Sudan Contribution 47”).

10 See, e.g., Arab States Contribution 7 at Arts. 6.0.5, 6.0.6; Africa Contribution 19 at Arts. 6.0.1-6.0.6; Algeria,

Saudi Arabia, Bahrain, China, United Arab Emirates, Russian Federation, Iraq, Sudan Contribution 47 at Arts.

6.0.3, 6.0.4; Revisions of the International Telecommunications Regulations – Proposals for High Level Principles

to be Introduced in the ITRs, ETNO, CWG-WCIT12 Contribution 109, at 2 (June 7, 2012),

http://www.itu.int/md/T09-CWG.WCIT12-C-0109/en.

5

image07-00.jpg612x792

Subjecting cyber security and data privacy to international control, including the

creation of an international “registry” of Internet addresses that could track every

Internet-connected device in the world;11

Imposing unprecedented economic regulations of rates, terms and conditions for

currently unregulated Internet traffic swapping agreements known as “peering;”12

Establishing ITU dominion over important non-profit, private sector, multi-

stakeholder functions, such as administering domain names like the .org and .com

Web addresses of the world;13

Subsuming into the ITU the functions of multi-stakeholder Internet engineering

groups that set technical standards to allow the Net to work;14

Centralizing under international regulation Internet content under the guise of

controlling “congestion,” or other false pretexts; and many more.15

In fact, then-Russian Prime Minister Vladimir Putin plainly stated in 2011 that it was his

goal, and that of his allies, to establish “international control over the Internet” through the

ITU.16 Last December in Dubai, they succeeded in establishing an insidious foothold in their

11 See, e.g., Letter dated 12 September 2011 from the Permanent Representatives of China, the Russian Federation,

Tajikistan, and Uzbekistan to the United Nations addressed to the Secretary-General, Item 93 of the provisional

agenda - Developments in the field of information and telecommunications in the context of international security,

66th Session of the United Nations General Assembly, Annex (Sep. 14, 2011),

http://www.cs.brown.edu/courses/csci1800/sources/2012_UN_Russia_and_China_Code_o_Conduct.pdf (last visited

March 8, 2013); Arab States Contribution 7 at Art. 5A; Proposals for the Work of the Conference, Cameroon

(Republic of), Contribution 15, at Art. 5A (Oct. 2, 2012), http://www.itu.int/md/S12-WCIT12-C-0015/en

(“Cameroon Contribution 15”); Africa Contribution 19 at Art. 5A; India Contribution 21 at Art. 5A; Common

Proposals for the Work of the Conference, ITU Member States, Members of the Regional Commonwealth in the

Field of Communications (RCC), Contribution 14, at Art. 5A (Oct. 1, 2012), http://www.itu.int/md/S12-WCIT12-C-

0014/en (“RCC Contribution 14”); Algeria, Saudi Arabia, Bahrain, China, United Arab Emirates, Russian

Federation, Iraq, Sudan Contribution 47 at Art. 3C.

12 See, e.g., Arab States Contribution 7 at Art. 6.0.4; India Contribution 21 at Art. 6.0.4; Internet Society

Background Paper, International Telecommunications Regulations, available at

http://www.internetsociety.org/sites/default/files/Internet%20Society%20Background%20Paper-

%20International%20Telecommunication%20Regulations%281%29.pdf (last visited March 8, 2013).

13 See, e.g., Arab States Contribution 7 at Art. 3.5; Russia Contribution 27 at Art. 3A.2; Algeria, Saudi Arabia,

Bahrain,China, United Arab Emirates, Russian Federation, Iraq, Sudan Contribution 47 at Art. 3B.

14 See, e.g., Africa Contribution 19 at Art. 3.4A; Russia Contribution 27 at Art. 3A; Algeria, Saudi Arabia,

Bahrain,China, United Arab Emirates, Russian Federation, Iraq, Sudan Contribution 47 at Arts. 1.6, 3.1, 4.2, 4.3.

15 See, e.g., Arab States Contribution 7 at Art. 5A; Africa Contribution 19 at Art. 5B.

Some member states also

called for requiring network operators to disclose to the government identification information about every

communication carried over their networks or to give the governments control of the routing of those

communications. Arab States Contribution 7 at Arts.3.3, 3.6; Africa Contribution 19 at Arts. 3.3, 3.4B; RCC

Contribution 14 at Art. 3.3; Algeria, Saudi Arabia, Bahrain, China, United Arab Emirates, Russian Federation,

Iraq, Sudan Contribution 47 at Arts. 3.3, 3B.3; Cameroon Contribution 15 at Art. 3.6.

16 Prime Minister Vladimir Putin meets with Secretary General of the International Telecommunication Union

HamadounTouré, GOVT OF THE RUSSIAN FEDN, http://government.ru/eng/docs/15601/print/ (last visited March 8,

2013) (“The International Telecommunication Union is one of the oldest international organisations; it’s twice as old

as the United Nations. Russia was one of its co-founders and intends to be an active member. We are thankful to you

for the ideas that you have proposed for discussion. One of them is establishing international control over the

6

image08-00.jpg612x792

patient and incremental quest to "control” the operations, content and economics of the Net. In

short, Mr. Putin largely achieved the first stage of his goal. We allowed this to happen even

though we were explicitly forewarned.

Hindsight allows us to see with great clarity that not only were defenders of Internet

freedom too slow to take these efforts seriously, but they all too easily fell victim to a disciplined

campaign of deception. For instance, before the WCIT, ITU leadership made three key

promises:

1)

No votes would be taken at the WCIT;

2)

A new treaty would be adopted only through “unanimous consensus;” and

3)

Any new treaty would not touch the Internet.17

All three promises were promptly broken18 in Dubai in the name of making the Internet

more “democratic” through near-perfect Orwellian cynicism. ITU leadership and pro-regulation

member states succeeded in co-opting arguments for preserving a freedom-enhancing, flat and

Internet using the monitoring and supervisory capabilities of the International Telecommunication Union (ITU). If

we are going to talk about the democratisation of international relations, I think a critical sphere is information

exchange and global control over such exchange. This is certainly a priority on the international agenda.”).

17 WCIT-12: Clarification Needed During Open Letter Session, ITUBLOG (Nov. 15, 2012),

http://itu4u.wordpress.com/2012/11/15/wcit-12-clarification-needed-during-open-letter-season/ (last visited March

8, 2013) (“Internet Control is simply not in the ITU mandate and ITU will continue to fully support the

multistakeholder approach which it initiated some ten years ago for the World Summit of the Information Society.”);

Hamadoun I. Touré, U.N. We Seek to Bring Internet to All, WIRED.COM (Nov. 7, 2012) ,

http://www.wired.com/opinion/2012/11/head-of-itu-un-should-internet-regulation-effort/ (last visited March 8,

2013) (stating “[n]o proposal will be accepted if it is not agreed upon by all participants through consensus.”);

Hamadoun I. Touré, Global Media Briefing on WCIT, ITU (June 22, 2012),

http://www.itu.int/en/osg/speeches/Pages/2012-06-22.aspx (last visited March 8, 2013) (“We all know that, in the

true tradition of the ITU, we will not vote on any issues– just like in January, at the World Radiocommunication

Conference, where in four weeks we did not vote once, but came to consensus on every issue.”); Speech by ITU

Secretary-General Touré, The Challenges of Extending the Benefits of Mobile, ITU (May 1, 2012),

http://www.itu.int/en/osg/speeches/Pages/2012-05-01.aspx (last visited March 8, 2013) (“You will, I am sure, have

seen and read various media articles talking about the UN or the ITU trying to take over the Internet. Let me say

quite plainly and clearly: This is simply ridiculous.”); David McAuley, WCIT ‘Internet Governance’ Hype Distracts

Attention From Serious Issues, ITU Head Says, BLOOMBERG, Sept. 11, 2012, http://www.bna.com/itus-toure-wcit-

b17179869586/ (last visited March 8, 2013) (quoting ITU Secretary-General Touré that WCIT “has nothing to do

with [Internet] Governance.”).

18 Remarks by Assistant Secretary Strickling at the PLI/FCBA Telecommunications Policy & Regulation Institute

(Dec. 14, 2012), http://www.ntia.doc.gov/Remarks_by_Assistant_Secretary_Strickling_at_PLI/FCBA (last visited

March 8, 2013) (“The International Telecommunication Union had made two important promises in advance of the

conference. First, that it would operate by consensus and second, that Internet issues would not be appropriate for

inclusion in the ITRs.

As it turned out, the ITU could not deliver on either of these promises.

When around 40

percent of the participating countries do not sign the final documents of the conference, it is obvious that the ITU did

not achieve the consensus it had promised.”).

7

image09-00.jpg612x792

multi-stakeholder driven Internet governance structure while turning the logic of these arguments

on its head to justify their egregious power grab.19

At the end of the negotiation, 89 countries had signed on to the new treaty language, 55

did not sign and 49 did not attend the WCIT. The “vote count” did not end last December,

however. Member states have until 2015 to sign the treaty and many more are expected to do so.

Among those at risk of signing are otherwise close allies, such as many European nations. If we

do not act quickly, the number of signatories to the treaty will increase rapidly.

In short, the U.S. experienced a rude awakening regarding the stark reality of the

situation: when push comes to shove, even countries that purport to cherish Internet freedom are

willing to succumb to the clever and deceptive tactics of regulatory incrementalists. Our

experience in Dubai is a chilling foreshadow of how international Internet regulation could grow

insidiously and at an accelerating pace.

Specifically, the explicit terms of the new treaty language give the ITU policing powers

over “SPAM,” and attempt to legitimize under international law foreign government inspections

of the content of Internet communications to assess whether they should be censored by

governments under flagrantly transparent pretexts such as “network congestion.”20 The bottom

line, however, is that the ITU has now claimed jurisdiction over the Internet’s operations and

content.

More fundamentally, pro-regulation forces succeeded in upending decades of consensus

that maintained that Internet service providers, as well as Internet content and application

providers, should be insulated from intergovernmental control. They accomplished this feat with

simple changes in the definitions of crucial treaty terms.21 Their audacity doesn’t stop there,

19 Notably, at the end of the WCIT, a “resolution to foster the greater growth of the Internet” was adopted “resolving

to instruct the Secretary-General to continue to take necessary steps for ITU to play an active and constructive role”

in Internet governance. This will serve to broaden the scope of the ITU’s rules to include the Internet, undermining

the highly successful, multi-stakeholder model of Internet governance, therefore stunting its growth, not fostering it.

20 INTERNATIONAL TELECOMMUNICATION UNION, FINAL ACTS: WORLD CONFERENCE ON INTERNATIONAL

TELECOMMUNICATIONS, at Art.5B (Dubai 2012) (“FINAL ACTS”).

The new ITRs provide signing nations with a

greater ability to regulate the blocking of “SPAM,” opening the door to the regulation of content on the Internet,

including possible blockage of political dissent or other forms of protected speech under the First Amendment of the

U.S. Constitution. See id.

21 FINAL ACTS at Art.1 abis).

For example, an early disagreement at the WCIT over the reach of the international

treaty’s application resulted in a vague, undefined new term that could have far-reaching consequences. Prior to the

WCIT, the ITRs applied only to “Recognized Operating Agencies” (ROAs), or telecommunications operators in

each country.

During the WCIT, some countries sought to change the term to “Operating Agencies,” expanding the

ITRs applicability.

This debate was resolved by the adoption of “Authorized Operating Agencies” (AOA),

undefined in the ITU Constitution. At present there is no definitive interpretation of which entities this provision

applies to, likely precipitating disputes between member states regarding which entities specifically qualify as

AOAs. Most assuredly, however, given current trends, key member states will push aggressively for definitions that

are as expansive as possible.

8

image10-00.jpg612x792

however. Many countries, in addition to the ITU itself,22 brazenly argued that the old treaty text

from 1988 gave the ITU broad jurisdiction over the Internet.23

If these aggressive regulatory expansionists are willing to conjure ITU authority where

clearly none existed before, their imaginations will see no limits to the ITU’s authority over the

Internet’s affairs under the new treaty language. Their appetite for multilateral regulatory

expansionism is insatiable as they envision the omniscience of intergovernmental regulators able

to replace the billions of daily decisions that allow the Internet to blossom and transform the

human condition.

At the same time, worldwide consumer demand is driving technological convergence. As

a result, companies such as Verizon, Google, AT&T, Amazon, Microsoft, Netflix, and many

more lesser-known enterprises in the U.S. and in other countries, are building across borders

thousands of miles of fiber optics to connect sophisticated servers and routers that bring voice,

video and data services more quickly to consumers tucked into every corner of the globe. From

an engineering perspective, the technical architecture and service offerings of these companies

look the same. Despite this wonderful convergence, an international movement is growing to

foist 19th Century regulations designed for railroads, telegraphs and analog voice phone

monopolies onto new market players that are fundamentally different from the monoliths of yore.

To be blunt, these dynamic new wonders of the early 21st Century are perilously close to

being smothered by innovation-crushing old rules designed for far different technologies which

operated in a much less competitive market long ago. The practical effect of expanded rules

would be to politicize engineering and business decisions inside sclerotic intergovernmental

bureaucracies. As a technical matter, a centralized, top-down “management” model for the

Internet defies its flat and democratic architecture and would cause a global engineering

22 The ITU can serve as a useful and constructive forum for the resolution of many important international

communications policy matters, such as harmonization of spectrum and the allocation of satellite orbital slots.

In

contexts such as these, reaching international consensus through the ITU can produce positive outcomes. The

danger, however, lies with unwarranted ITU “mission creep” into new spheres, such as the complex ecosystems of

the Internet.

Replicating the ITU’s antiquated telecommunications regulations for modern digital communications

technologies and services that do not operate like, or in any way resemble, traditional telecom services would be

highly counterproductive.

Although maintaining strong U.S. involvement in the pre-WCIT-12 ITU mission is vital,

on a going forward basis, we should reassess America’s support for new ITU actions we find harmful to freedom,

prosperity, our national interest, and the well-being of all nations, but especially the developing world.

23 Speech by ITU Secretary-General Touré, WCIT-12 – Myths and Reality (Sept. 24, 2012),

http://www.itu.int/en/osg/speeches/Pages/2012-09-24.aspx (stating that “ITU’s day-to-day activities [] are already

fundamental to promoting Internet growth.”); WCIT-12 Myth Busting Presentation, ITU, Slides 24, 25,

http://www.itu.int/en/wcit-12/Pages/WCIT-backgroundbriefs.aspx (last visited March 8, 2013) (stating that “[m]any

consider that [the ITU definition of telecommunications] includes communications via the Internet, which runs on

telecom infrastructure” and that it is an incorrect “myth” that the “ITU’s scope does not include the Internet” and

that “WCIT is about the ITU or the UN extending their mandate so as to control the Internet.”).

9

image11-00.jpg612x792

nightmare. For example, how would a partitioned Internet work? How would entrepreneurs be

able to build and operate new cross-border technologies such as cloud computing?

More importantly, the effect of a stunted Internet ecosystem impaired by a new

international regulatory overlay could be devastating to efforts to improve the human condition

across the globe. If these trends continue, Internet growth would be most severely impaired in

the developing world where Web-connected mobile devices and their applications enable

worried parents to locate medicine for their sick children, villagers to find drinkable water and

farmers to learn prevailing market prices for their crops.24

Even in the U.S., brilliant and daring

technologists who are working to transform the world could be forced to seek bureaucratic

permission to innovate and invest. At a minimum, this scenario would create tremendous

uncertainty while driving up costs ultimately borne by all Net consumers.25

In sum, the dramatic encroachments on Internet freedom secured in Dubai will serve as a

stepping stone to more intergovernmental regulation of the Internet in the very near future. The

end result will be devastating to global prosperity and freedom.

II.

Defenders of Internet freedom must act quickly to turn the threat of increased

intergovernmental control of the Internet into an opportunity to reverse course

through liberalization of markets that will spark competition, investment and

innovation.

We must act quickly. While we debate what to do next, Internet freedom’s foes around

the globe are working hard to exploit a treaty negotiation that is far larger in significance than the

WCIT. In 2014, the ITU will convene in Busan, Korea and conduct what is literally a

24 See, e.g., Ken Banks, In African Agriculture, Information is Power, Nat’l Geographic (Sept. 5, 2011),

http://newswatch.nationalgeographic.com/2011/09/05/in-african-agriculture-information-is-power/.

25 A recent news article summed up the chaotic effects of a partitioned Internet.

Note the Russian official’s call for

the U.S. to agree to international regulation of the Net to avoid fragmentation – a clever and cynical maneuver to

turn arguments against Net regulation on their head.

The U.N. has no power to force the United States to adopt any Internet regulation, and the U.S.

refused to sign the December treaty, along with 55 others countries. But if a large number of

countries agree on regulations, the Internet could become fragmented, with very different rules

applying in different regions of the world. “That becomes an engineering nightmare,” McDowell

said. Russia has pushed hardest for international Internet regulation. “In the future we could

come to a fragmented Internet,” warned Andrey Mukhanov, one of Russia's representatives to the

U.N. conference, as the U.S. and many European countries declined to sign the treaty in

December. “[Fragmenting] would be negative for all, and I hope our American and European

colleagues come to a constructive position.” But by a “constructive position,” Mukhanov means

one with international web regulation….Technology groups and companies like Google say that

the regulations, while they often seem nice on the surface, give government the power to censor

content.

Maxim Lott, Internet Still Under Attack by UN, FCC Commissioner Says, FOXNEWS.COM (Feb. 13, 2013).

10

image12-00.jpg612x792

constitutional convention, called a “plenipotentiary” meeting, which will define the ITU’s

mission for years to come. Member states will rewrite the ITU constitution and elect a new

Secretary General. This scenario poses both a threat and an opportunity for Internet freedom.

The threat is obvious: more international Internet regulation. We have an opportunity, however,

to change the debate by finding arguments that are more compelling to the developing world.

We can start by reminding member states of the incredible benefits brought forth by policies that

promote open markets through liberalization and competition. These are the paths that have

proven to lead to investment, innovation, universal connectivity and global prosperity.

We can start by working to find new allies at the upcoming World Telecommunications

Policy/ICT Forum (“WTPF”), which convenes in Geneva this May. This conference will focus

squarely on Internet governance and will shape the 2014 Plenipotentiary. Accordingly, the

highest levels of the U.S. Government must make this cause a top priority and recruit allies in

civil society, the private sector and diplomatic circles around the world.26

Internet freedom’s allies simply cannot dither again. If we do, we will fail, and global

freedom and prosperity will suffer.

III.

We must offer other nations, especially those in the developing world that feel

disenfranchised from Internet governance processes, an alternative to

international regulation by improving and enhancing multi-stakeholder entities,

such as the Internet Governance Forum.

Merely saying “no” to any changes to the multi-stakeholder model has proven to be a

losing proposition, as the outcome of the WCIT clearly illustrates. The Plenipotentiary meeting

in 2014, and the WTPF this coming May in Geneva, provide us with opportunities to amend and

enhance the current multi-stakeholder structure to include more meaningful participation by

developing world nations. Due to limited time and resources, many smaller countries simply

cannot attend the myriad Internet governance meetings that are held around the globe each year.

As a result, a disproportionate amount of aspiring nations feel left out of the decision making.

Such perceived disenfranchisement has fueled the drive to expand the legal authority of the ITU.

We should work to change this disparity as soon as possible.

The best avenue to amplify the voice of the developing world would be through

strengthening participation in the IGF. The IGF was chartered in 2005 in Tunis at the U.N.’s

World Summit on the Information Society. It first met in Athens in 2006. The IGF includes

among its participants civil society, the private sector, non-profits, governments and the ITU

itself. Its structure is classically multi-stakeholder in nature: it operates by consensus and no

26 The effort should start with the President immediately making appointments to fill crucial vacancies in our

diplomatic ranks. The recent departures of my distinguished friend, Ambassador Phil Verveer, his legendary deputy

Dick Beaird, as well as WCIT Ambassador Terry Kramer, have left a hole in the United States’ ability to advocate

for a constructive – rather than destructive – Plenipot.

11

image13-00.jpg612x792

government or other entity controls it. The IGF is a forum for decision making, but is not the

decision maker. In other words, it is a “wiki’ environment that operates in a flat, democratic and

bottom-up manner where the smallest of players can become empowered, much like the Internet

itself.

The international community, including the private sector, civil society, non-profits and

governments alike, should strive to find ways to increase meaningful participation in the IGF by

all interested stakeholders. As with many organizations, achieving this goal may be a matter of

raising adequate funds. We should not allow this challenge to act as an obstacle, however. If we

do not give developing nations a meaningful good faith role in shaping the evolution of the

Internet through a non-governmental multi-stakeholder entity, they will continue to vote in great

numbers to radically expand the ITU’s reach. Ironically, it is the developing world that stands to

gain the most from an unfettered Internet, and they will lose the most under centralized, top-

down control of the Internet’s operations, content and economics.

IV.

Congress can and should continue to play a constructive role by amplifying the

call for more Internet freedom.

As we make communications policy here in the United States, we tend to forget that

nearly every government and communications provider on the globe studies what we do.

Without a doubt, this hearing is streaming live in some countries and is being blocked by

government censors in others. Every detail of our actions is scrutinized while influencing

nations everywhere.

Furthermore, when Congress speaks, especially when it speaks with one loud and clear

voice as it did last year with the unanimous, bipartisan and bicameral resolutions concerning

Internet freedom, policymakers across the globe pause to think. Repeatedly, I have been told by

international officials that, despite the negative outcome of the WCIT, last year’s resolutions had

a positive effect.27

This year, Congress can help by speaking loudly and clearly to support policies that

promote Internet freedom and global prosperity as we head toward the ITU’s plenipotentiary

meeting in 2014.

27 Many other proposals that would threaten the Internet were defeated at the WCIT, such as “sender party pays,”

which would have required Web content providers to pay Internet service providers (ISPs) in other countries for the

traffic sent over those networks.

See also David Gross, Walking the Talk: The Role of U.S. Leadership in the Wake

of WCIT, BLOOMBERG, Jan. 17, 2013, http://www.wileyrein.com/resources/documents/Gross--BNA--1.17.13.pdf

(last visited March 8, 2013) (explaining that Congress’s clear message was heard at WCIT, “This action was

important not only because of the substance of Congress’s statements, but also because the world understood just

how extraordinary it is for our Congress to act with unanimity, especially in an era when Congress has immense

difficulty reaching consensus on almost anything. At the end of WCIT, I heard from many foreign officials that they

knew that the United States would not sign the revised treaty with its Internet-related provisions because Congress

had sent a clear and unequivocal message that such an agreement was unacceptable to the American people.”).

12

image14-00.jpg612x792

CONCLUSION

I ask each of you today to take bold and decisive action now. As we dine on our

Thanksgiving dinners in 2014, let us not look back at today and lament how we did not do

enough. We have but one chance. Let us be resolute and tell the world that all nations will

benefit if we stand strong together for Internet freedom.

Thank you for having me before you today. I look forward to your questions.

13

Note: We are currently transitioning our documents into web compatible formats for easier reading. We have done our best to supply this content to you in a presentable form, but there may be some formatting issues while we improve the technology. The original version of the document is available as a PDF, Word Document, or as plain text.

close
FCC

You are leaving the FCC website

You are about to leave the FCC website and visit a third-party, non-governmental website that the FCC does not maintain or control. The FCC does not endorse any product or service, and is not responsible for, nor can it guarantee the validity or timeliness of the content on the page you are about to visit. Additionally, the privacy policies of this third-party page may differ from those of the FCC.