roundtable: telecom piece, part one

roundtable: telecom piece, part one

telecom piece, part one

Jwshenk@aol.com
Fri, 26 May 1995 15:46:53 -0400 

Date: Fri, 26 May 1995 15:46:53 -0400
From: Jwshenk@aol.com
Message-Id: <950526154651_13369547@aol.com>
To: roundtable@cni.org
Subject: telecom piece, part one


Fellow Tablers,

I'm posting my piece on common carriage and the info highway. Hope 
anyone who is interested will read it. And by all means pass it 
along to whomever you like.

Best,

Josh Shenk
<jwshenk@aol.com>



The Robber Barons of the Information Highway
Telecommunications companies promise the digital kingdom of heaven. Don't
count on it

By Joshua Wolf Shenk
**************

Six American kids on a basketball court. They run hard, weaving in and out of
one another, and slashing to the basket. "Tres bien," one says to another.
"Tres bien."

"Some kids are practicing French outside the classroom," intones the voice of
James Earl Jones, "thanks to Bell Atlantic's interactive video distance
learning." The ad cuts to a classroom, where a teacher calls out from a
television screen at the head of the class: "David! Le chapeau si vous
plais!" David, fresh from the basketball court, looks up from his desk
confused. "Your hat," says the kid behind him loudly, and they laugh. The
teacher's stern visage gives way to a smile. "Merci."

In living, breathing reality, this commercial shows the true potential of
"the information superhighway." Maybe those four students live in a rural
district. Maybe their school can't afford a full-time teacher's salary. In
the world to come, the commercial says, deserving kids will have an easier
time finding good teachers. Another Bell Atlantic spot shows doctors 
working from remote locations-"telemedicine." Still another shows a tiny 
community on isolated Tangier Island, Virginia. A fisherman talks 
face-to-face with people in Norfolk ("I can let you have 25 bushels of 
number-one hog crabs.") In Tangier, too, the kids learn from a teacher on 
a TV screen:

TEACHER: When you understand the culture, you understand the what? James?
JAMES: You understand the people.
TEACHER: Good. And what does that help us do? Cara.
CARA: Understand each other. 

Technology that brings people together and brings out their best: that is the
future promised by companies like Bell Atlantic, AT&T, and Time Warner. Their
promises matter because it is private investors, not the government, who will
finance and build the coaxial cable and fiber-optic "roads" that will make up
the superhighway network.

But when I looked for signs of dedication to learning and civic improvement
at Bell Atlantic's interactive demonstration project in Arlington, I was
disappointed. I was shown a computer screen with the image of a small city,
with an elegant town hall, a school, and a hospital. But point and click and
x not much happens. The real action is in the virtual shopping mall--with
dozens of catalogues and video games. "Ultimately," insists spokesperson Joan
Rasmussen, "there will be communication from house to house and education and
all that."

Yet as Congress works on the first major telecommunications bill since 1934,
Ramussen's words ring hollow. Telecom reform does have its pitched turf
wars-long distance companies like AT&T and MCI, for example, want to keep the
Baby Bells out of the long distance business for as long as possible. But the
real story is where industry is firmly united: against the two basic concepts
that would ensure that the public, not a few huge info-conglomerates, can
decide what will be on the information superhighway. The first, known as
"common carriage," would require companies to serve everyone for the same
price, preventing them from forcing folks they don't like off the roads by
spiking prices. The second is known as "open architecture," and it would
prevent the private builders from running all the roads through a central hub
that they control. 

Industry has a very different vision in mind. As Bell Atlantic's
demonstration center indicates, the money isn't in schools or health care,
but home shopping, movies, and video games. Interactive TV, Bell Atlantic
chairman Raymond Smith has said, "will turn us from a nation of couch
potatoes into wheeling, dealing video-jocks. Click! Order a pizza. Click!
Order a Cindy Crawford video."

And, with thousands of lobbyists on Capitol Hill, industry is winning the
argument. Their extraordinary financial clout-telecommunications companies
gave Congress $50 million in PAC money from 1984 to 1993, according to Common
Cause-combined with poor leadership has pushed the important issues to the
side.

"The public interest vision-the potential of this network-has been driven out
as a subject for legitimate policy debate," says Andrew Blau, chairman of the
Benton Foundation, which works with non-profit groups on telecommunications
technology. "The conversation is structured as a horse race between various
businesses. There's a hand-waving that goes on, 'Oh, don't worry about that.
Benefits will flow to everyone.' But there's no evidence that that's the case
here." 

One of the industry lobbyists' greatest assets is that the public understands
so little about what is at stake. American communications has historically
been divided up by mediums, each with its monopolies. AT&T ("Ma Bell")
controlled all phone service practically from the beginning, until federal
courts split the company into a long distance company and smaller "Baby
Bells" to provide local service. Cable television is a series of monopolies
regulated by local commissions. Cellular communications has two providers in
each market. 

Recently, though, advances in technology have blurred distinctions among
these mediums. With increasing ease, television can be transmitted digitally
through telephone wires, telephone service can be delivered by satellites or
cable, and so on. Telecommunications law, based on the assumption that each
separate industry should have its own regulated monopoly, is outdated. That's
why Congress is planning to pass a major telecommunications bill this year:
The industry needs to be reregulated.The logical response to the crumbling
walls that once separated industries is to phase out the monopolies
altogether and usher in an era of competition. Instead of one choice for
local telephone service, for example, we'd have two or three-or six.

Now, consider the quantum leaps information technology has been making:
Computers are getting faster, cheaper, and easier to use. New compression
techniques let us send more information over existing wire, and
higher-capacity wire is being laid all the time. Then, imagine marrying these
advances with the hypercompetitive environment that restructured
telecommunications regulations would create: The result would be businesses
vying to use this technology to offer more and better services. Soon, as
commonly as we pick up the telephone, we could send each other massive
computer files and talk by interactive video. That, in essence, is the
information superhighway.

Over the next 10 to 15 years, though, the only companies with the
infrastructure to build the "highway," and the range of interactive services
it promises, are the phone and cable companies which already have wires going
into every home and business in the country. The question for Congress is
this: How do you work against the forces of monopoly? Since technology is
always developing, it's a moving target.

It seems daunting, but we've faced similar challenges before. Each time a new
technology has emerged-telephones, radio, broadcast television,
cable-government has tried to balance profit and the public interest. Take
the American experience with railroads. For most of the nineteenth century,
the rails were controlled by a handful of rich men, such as Cornelius
Vanderbilt and Andrew Carnegie. Virtually unrestrained by government, they
formed monopolies and charged what they pleased. For example, Carnegie, also
a steel magnate, could charge his competitors stiff prices to ship their
steel, and keep the upper hand.

Eventually, the anger of farmers, merchants, and rail travelers rose to a
fever pitch and Congress stepped in to guarantee that everyone-from huge
conglomerates to small-time merchants to ordinary folks-could use the rails
at a non-discriminatory rate. Under common carriage, as it was called, owners
could still make large profits-and still had plenty of incentive to lay more
track-but the larger public interest was preserved as well. Railroads, after
all, were a vital public resource. 

As telephone technology emerged in the late nineteenth century, the common
carriage principle guided the construction of a national network. Again,
building two phone systems-so that competition could keep prices down and
preserve non-discriminatory access-would be expensive and wasteful. So we
settled for one regulated network.

Common carriage has been vital in the past, and it will be even more so in
the future. We are shifting to an economy where much more of our lives will
consist of transactions transmitted in digital form over electronic "roads."
When the day comes-and it's coming soon-that we send video and other data
over wires as commonly as we now use interstate highways, it will be crucial
to keep those wires open to everyone.

In addition to common carriage, there is another important principle that
ought to-but probably won't-guide the construction of these networks: "open
architecture." This means that any one point on the network can contact any
other point without having to go through a central server. Again, the phone
system is a model. You can pick up the phone and call anyone you like. You
don't need permission from a central operator. And the phone company doesn't
have any control over what you say on its lines.

The Internet works the same way-that's one reason the world is so in love
with the global computer network. There is no headquarters, no clearing house
through which everything must pass. Any one site can contact any other site.
Computers on the network do need a common language, or protocol, but besides
that it's anything goes. If the coming superhighway were constructed this
way, fancy video-on-demand and interactive shopping services planned by Bell
Atlantic and AT&T would be supplemented by alternative sites for work, play,
or just ordinary communication.

The Internet shows that the alternatives can stretch as far as the
imagination-from hundreds of Bruce Springsteen fans trading gossip and
bootlegs to physicists discussing the latest twist in subatomic string
theory. The "Thomas" server at the Library of Congress posts congressional
legislation, the Federal Register, and other public documents. The Internet,
as any of its 30 million users can attest, actually delivers on the language
of "empowerment" and "personal choice" used by telecommunications executives.

The Internet is also a remarkably dynamic marketplace, less a shopping mall
than a street bazaar. Anyone can set up shop and sell what they like.
Programmers sell their software; car magazines sell ads for their online
editions. America Online, which provides Internet access with a convenient,
easily understood interface, had 67,000 subscribers in 1987. Now it has 2.5
million. A friend of mine who three years ago hardly knew the difference
between a mouse and a modem is now editor-in-chief of a company called
Tripod. The service of news, information, and entertainment has created a
dozen jobs.

The open architecture of the Internet has also proven a boon for grassroots
organizing and charity work. One activist runs online town meetings and
Hispanic culture sites in Colorado's San Luis valley; an umbrella
organization called HandsNet links 3,500 volunteer and professional
organizations. There are dozens of "free-nets" providing easy access and
community information.

Juiced up with faster computers and software, and higher capacity wire, the
superhighway could easily provide teleconferencing, so a teacher in
Albuquerque could conduct a class in Harlem. Educational materials, which now
languish for lack of a proper distributor, could be picked up and zipped
around the country in a flash. Pick your favorite dream: a national
electronic Library of Congress, cross-cultural exchanges, interactive
literacy training.

Sounds good, right? This vision of the superhighway resonates with the hopes
that have been stirred by politicians, journalists, and industry. But while
telelearning makes for good public relations, telecommunications companies
have something else in mind. Instead of an easily accessed system of public
highways, industry would prefer it be a stratified cyber-world, a series of
toll-roads that head straight for the mall and the race track. Here's how
Paul Shumate, Jr., an executive at Bellcore, a Baby Bell research consortium,
described the potential of online gambling and video games to Macworld
magazine: "You suck 'em in cheap. Then, as they get to higher and higher
levels, increase the rate per minute."

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