On Internet Fight, Follow the Money to Keep the Scorecard

comcast-money-640x365Edinburgh     The problem of transactional versus transformational organizing is nowhere clearer than in the lines being drawn around the issues of net neutrality and the internet as a public utility between old line civil rights groups and reformers. Some are trying to make much of seeing groups like the NAACP, LULAC, PUSH, and old lions like Rev. Jesse Jackson trek into the offices of the FCC and its chair, Tom Wheeler, to ask the commission to let the companies do whatever they can to whomever they can to make their money.

It’s a sad and embarrassing commentary on the state of the institutional apparatus of reform. It is also a display of the real grease that smooths the engines of our movement rather than the direction we all know we need to travel on the highway.

Comcast, AT&T, Times-Warner and others have paid the pipers. For years they have underwritten conventions, conferences, partnerships, projects, ad books, awards, and scholarships for the old-line outfits. The big companies maintain relationship specialists with various names whose job description is in fact managing these relationships, providing the grease, pressing the flesh, solving little problems, and showing up at big events. This is soft power that tries to avoid the direct expression that a quid pro quo is involved; even when everyone involved realizes that there will come a time when the chits are called in. Most smoothly expressed, these big companies, and most others like banks for example, would maintain that at the most they are getting access and have the right rolodex to be able to present their best cases to the decision makers in these organizations.

I’m not saying that the organizations shouldn’t take the money. Times are hard for organizations. At the same time they have to be able to walk away and maintain their credibility or it’s all over. Look at the tragic farce that has become Andrew Young’s legacy from civil rights to politics and diplomacy, and now as corporate shill from Walmart to whoever makes the next contribution and pays the next plane fare. These are cautionary case studies. We saw this over and over when ACORN was in fights with the banks and other lenders for example. I’ve often told the story of the settlement with HSBC, where we insisted ACORN’s share for remediation had to be double the annual level of what they had paid an old line, Beltway civil rights organization to saddle up to defend them. In fact we saw it with Comcast when they refused to listen to our demands for outreach to our communities on internet access, and instead wanted to accuse us of a shakedown. They thought, and still think, it’s all transactional. In the arrogance of corporate power, many of these big whoops start to believe that everyone can be bought, even when they must know only some are really for sale.

There’s a reason that politicians and others are left scratching in the face of modern protests and turmoil around police brutality and racial discrimination. They don’t have anyone to call on their speed dials that has credibility on the streets and in communities. They are calling the old lions, but they are a long way from the action because in fact they are in the lobby waiting to come up the elevator for a chat now.

Reportedly Rev. Jackson argued to the FCC’s Wheeler that he needed to protect the big company’s monopolies so that they would make investments in minority communities. Given the tragedy of sorry access and utilization in our communities from these companies as well as the exorbitant pricing which creates the divide and maintains their millions, it is just a matter of time before everyone asks Rev. Jackson and others, “What investment?” And, that is a question to be feared, if the answer is only an investment in some this and that with these organizations, rather than in the communities that are so desperately demanding change.

Transactions are invariably temporary. Transformation is always permanent. When change is coming, and it is coming, it’s best to be on the right side of the line.

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Surprise! Comcast Doesn’t Own Obama

20110101_ldd001New Orleans    Well, another country heard from! President Obama seems to be shaking off the midterms by stepping up his game. He came out forcefully for “net neutrality.” That’s not really news, he’s always said that he was for net neutrality, but this time he finally came out foursquare for the internet being classified as a public utility. Furthermore, he was against the fast and slow lanes for the internet that has been proposed by big cable and internet companies to further monopolize their cash machine, while denying net neutrality. 

Of course all of this was the President joining the rest of us in heaving a rock at the windows of the Federal Communications Commission (FCC). Admittedly, four million people have now weighed in on this question of the FCC holding hearings and determining the future status of the internet, the vast majority arguing decidedly for net neutrality and for full utility classification like electricity, telephones, and the like, but still his rock has a lot of weight. Unfortunately, the FCC is more beholding to Congress than the President once they are appointed for both their budget and legal implementation, and more than just me are still scratching our heads at why he named a corporate communications lobbyist and trade association executive as chair of the FCC, so it’s not like they are jumping to attention at his call.

But, let’s celebrate the good news where we find it, even as we acknowledge that the struggle is still fierce. The stock market understood the message well enough and pulled down the stocks and value of Comcast and the like by 4% in the wake of the President’s remarks, because they get the fact that big, bad, bully Comcast is not going to be happy with even a compromise on this issue since they want it all, all of the time. Comcast likely overstepped again and over-estimated the buddy-buddy relationship they were claiming for their executive vice-president David Cohen with the President and thinking that his living room fundraisers with Obama allowed them to stake a quiet claim to his silence on this issue, which he has maintained over recent years. The President’s remarks made it clear they may have made some down payments, but they don’t own his farm.

No matter how many times Comcast and others want to claim that they need a monopoly machine to keep the tech wave rolling, their loud roar can’t seem to drown out the voices of Netflix and others saying, “nay!” Reports of a meeting between Vimeo, Kickstarter, and other internet upstart darlings begging the White House and Obama advisers to ride hard with the rest of us against the bullies and earlier meetings with Facebook, Google, and others, make it impossible for Comcast and the like to claim that they speak for Silicon Valley and innovation.

These days we have to be honest with ourselves. We’re never going to win this hands’ down. Whatever emerges will be a sloppy compromise with dreams dragging and lawyers rushing into court, but at least the Comcast con has been called, and more and more of our allies are stepping into the fight so we’re not going to get bulldozed.

Now if we could just get the same support in bridging the digital divide….

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The Digital Divide is a Class Divide

google-fiber-620x426New Orleans     The Pew Research Center says that only 43% of households nationally with annual incomes of less than $25,000 have access to the internet compared to 70% nationally with broadband. Only 55% of African-Americans have broadband internet. Why? Well, not surprisingly, surveys conducted by independent sources, including pollsters hired by the Wall Street Journal to look at the results of Google’s super-fast Fiber service in Kansas City find that cost is increasingly the mountain creating the great divide in this area between rich and poor.

The Journal looked closely at the impact of Google Fiber’s entry into Kansas City in 2012, including its claim that its effort in KC was not just about fast service but also about bridging the digital divide. Their surveys found that in six low-income neighborhoods only 10% of residents were subscribing to Google Fiber with another 5% buying into a Google service for a slower speed that was free for seven years but required a $300 installation fee paid out at $25 per month. Some residents when interviewed found all of the Google pitch confusing to say the least.

ACORN in Canada and with our partners in the US in Pennsylvania and elsewhere and with Local 100 in Arkansas, Louisiana, and Texas has advocated to Comcast, Cox, Time Warner and others that low cost $10 per month plans would work if there were serious and aggressive outreach. To date, Comcast particularly has viewed real outreach into lower income neighborhoods as superfluous to their real interest in creating little more than a public relations and marketing campaign. Google to its credit seems to have taken some half-steps to try and get the job done, and reportedly went door-to-door with its employees in some of Kansas City neighborhoods and, according to the Journal “teamed up with community groups to spread the word,” as well as supporting some “nonprofit groups that offer classes on using the Internet and sell cheap refurbished computer.”

The Journal’s work was specific to Kansas City, so we don’t know what the penetration of Comcast’s service is in Little Rock or Houston on our lower income neighborhoods, except through our own doorknocking and the aggregate numbers which we have forced Comcast to report. As miserable as the 10% Google figure is, it overwhelms the miniscule participation in Comcast’s FCC-ordered $10 per month plan, which certainly bests $25 a month, and Comcast claims, though seldom delivered, a cheaply available, refurbished computer.

The surveys found that 21% of the folks that declined service in lower income, largely minority neighborhoods in Kansas City cited cost as the key factor. Others cited access to cheaper access through smartphones, which though less useful in handling applications still, is also where use is soaring in Africa and India.

By all accounts, Comcast was still going to make money at $10 per month, and Google was definitely not going to lose money even with its so-called “free” service on the slower, lower end in Kansas City. Nonetheless, it is unavoidable, and the FCC needs to take careful note of this, to conclude that if we want to lower the digital divide we are going to have to recognize that it is a class divide over affordability, and until we regulate some of the gross profit margins out of internet access and treat it as the vital public utility it is, this situation will only get worse and be more harmful to lower and moderate income families as costs continue to rise.

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Wow! We’re Not Alone in Seeing Comcast as a Bully!

London      I hit the ground in London around noon their time. Ok, that overstates it. After flying overnight from Houston, it would be more accurate to say that I stumbled out of the plane like the rest of my flying comrades to an overcast and raining day, totally different than the weather I had convinced myself that I would find. Two hours later I was in a Starbucks waiting for the ACORN London organizers and their volunteers on the doorknocking push before their first meeting.

And, here’s where it got good! The esteemed and influential media columnist for the New York Times, came out powerfully with our position that Comcast had finally showed its true self as a bully extraordinaire. Better, Carr argued, as we had, that this will encourage the FCC to look at them more closely. As the old saying goes, “hubris comes before the fall,” and finally Comcast has tripped on its own arrogance and contempt for the pubic and its customers, putting their monopolistic ambitions in the crosshairs finally. Stopping them is still dicey, but there’s real hope for serious scrutiny and the chance of victory.

But, I don’t want to go all David Cohen and start gloating or suffering from premature certainty. Let the Times’ Carr make the better case instead:

Growling by Comcast May Bring Tighter Leash

SEPT. 28, 2014

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A demonstration in Philadelphia, across from the Comcast Center, against Comcast’s bid to buy Time Warner Cable. Credit Matt Rourke/Associated Press

Comcast has a long corporate tradition of smiling and wearing beige no matter what kind of criticisms are hurled at it. That public posture is in keeping with the low-key approach favored by Brian L. Roberts, the company’s chief executive, as he seeks to take over the world. It’s worked very well so far.

But in a filing submitted to the Federal Communications Commission last week in defense of its proposed merger with Time Warner Cable, the company lashed out uncharacteristically at its critics. And David L. Cohen, Comcast’s chief lobbyist, continued the salvo in comments to reporters and in his written remarks.

Watching Comcast’s ballistic response to opponents of its $45 billion takeover bid was a bit like watching a campaign debate go off the rails. The front-runner, ahead by 20 points, is besieged by ankle-biters who suggest he is a lout and a bully. He finally loses it and goes off on his opponents in a fury, generally acting like, well, a bully.

That’s one way to make a big lead go away.

In baring its teeth, Comcast sought to show that the companies now opposing the deal were using public interest arguments to advance private business agendas. It said these companies had privately sought $5 billion in concessions from Comcast before going public with their opposition.

In a thick document bristling with arguments on its own behalf, Comcast used quite a bit of ink and hot rhetoric on those who would lay it low, saying in part: “The significance of this extortion lies in not just the sheer audacity of some of the demands, but also the fact that each of the entities making the ‘ask’ has all but conceded that if its individual business interests are met, then it has no concern whatsoever about the state of the industry, supposed market power going forward, or harm to consumers, competitors, or new entrants.”

Gee, Comcast, don’t sugarcoat it. Say what you really mean.

The word extortion is usually applied to guys with names like Nicky who wear bad suits and crack their knuckles a lot. If this is how the company acts in the wooing stage, imagine how charming it will be once it actually gets what it wants.

The company named names, plenty of them: Netflix, for complaining about interconnection plans it freely negotiated with Comcast; Discovery, for asking for sweetheart carriage deals before its current contract is even up; and Dish, for whining about enhanced competition.

Its opponents were surprised by Comcast’s ferocity — and overjoyed. An air of inevitability has been hanging over the merger since it was announced in February — Comcast has a legion of allies in Washington, and a formidable advocate in Mr. Cohen — but the opposition that has built up in the ensuing months seems to have driven the company around the bend.

Comcast executives are offended. They genuinely believe that it will take a company of its scale and growing technological innovation to deliver the next generation of programming and data services.

Opponents of the merger are convinced that granting a beefed-up Comcast dominion over much of the country’s broadband would stifle innovation and tilt the field in unhealthy ways.

Both sides believe they hold the key to a consumer-friendly, high-functioning Internet.

Right.

What is actually going on is both more basic and more interesting. Programmers are worried that if Comcast takes over Time Warner Cable, it will have the leverage to dictate prices. Web-based services like Netflix foresee a giant that will extract significant fees for providing high-speed performance.

Comcast, which agreed to all manner of regulation to complete its acquisition of NBCUniversal in 2011, does not want to hand out so many bonbons to other players that the proposed merger becomes noneconomic. There is no breakup fee on the deal and Comcast could still walk, especially if it feels that a merger would lead to the regulation of broadband access as if it were a public utility.

Opponents are trying to enlarge the merger debate to include the broader issues of net neutrality and monopoly control, and there are signs that these efforts are gaining traction in significant places. On Sept. 4, Tom Wheeler, the chairman of the F.C.C., surprised many, including Comcast, when he said in a speech that in terms of broadband that can support streaming on multiple devices, 82 percent of Americans have only one choice in providers.

Regardless of motive, the issues raised in the filings are hugely important and won’t be brushed aside by bombast or counterattack.

From the start, Comcast has sought to frame the debate more narrowly, portraying it as the merger of two cable operators that do not compete, which is sort of true and sort of beside the point. The future, as anyone with a router could tell you, is all about broadband; a merged Time Warner Cable and Comcast would control more than 35 percent of the broadband market with easy access to far more households and would be the dominant presence in 16 of the 20 largest cities in the country.

Comcast is aggrieved that the people it has seen across the negotiating table — with their hands out — cocked a gun after they didn’t get what they wanted, but in terms of the public debate, Comcast is at a disadvantage.

From the consumer perspective, Netflix provides a wide array of programming for $8 a month, and Discovery delivers abundant reality programming along with lots of furry and furious animals. Comcast is the cable guy with the drooping pants, the one who collects money for everyone else by issuing big, fat monthly bills — and then sends much of it right back out the door to programmers.

A senior executive at Comcast agreed that its aggressive response was “uncharacteristic,” but said, “Enough was enough.” This executive spoke on the condition of anonymity to discuss internal strategy.

“The increases that these companies are looking for in exchange for not opposing the deal are exorbitant,” the executive said. “Programmers don’t expect to get called out on this stuff, but the industry is reaching a breaking point, and we needed to stand up for ourselves.”

It sounded sincere and very likely is, but going on the attack is probably not good strategy. Comcast has always combined its political might with restraint of tongue, a brutally effective combination that it has temporarily abandoned. In reminding the F.C.C. to scrutinize motives behind the arguments it will hear as it weighs whether to approve or challenge the deal, Comcast seemed defensive and frantic.

I remain unconvinced that giving Comcast a bigger footprint is good public policy, but I understand its frustration. No one, even big, powerful companies, likes being ganged up on by opponents whose own motives are open to suspicion, but their response could create more problems than it’s worth.

When I was young and stupid, my friends and I tried to cut through a yard full of turkeys just for the thrill of it. The turkeys surrounded us and immediately began hitting us with their wings, protesting the intrusion. My farm-raised pal cautioned me just to ignore it, but after a while I couldn’t stand it anymore and gave one a nice swift kick.

And that’s when the trouble really started.

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Comcast Monopoly Strategy: Be the Biggest Bully on the Block

Comcast_Public_Knowledge_Anti_TWC_Deal_WideNew Orleans         Sometimes you just have to scratch your head and admit that you are out of your pay grade. That’s where I’m heading in trying to figure out why the giant Comcast believes its best political and commercial strategy for achieving monopoly concentration in the cable and internet world is to be the biggest bully on the block. Yet, darned if that’s not the way David Cohen, Comcast’s executive vice-president, is calling the plays.

Not that I’m surprised, since that’s the way Cohen and Comcast chose to deal, or I guess I should more accurately say, not deal, with Local 100 United Labor Unions, Action United, and ACORN International in our demands and entreaties that they actually make their public relations internet program, Internet Essentials, really work. Shame on us for believing that because the $10 per month program was a requirement in the FCC order approving their last big merger with Universal that they would actually do something real to bridge the internet divide for lower income families rather than have their government relations people just wine and dine local politicians in their cities.

In the most recent bully boy schoolyard play, Cohen and Comcast dropped a 1000 pages on the FCC mainly whining that some of their business buddies and potential, oh my god can it be true, competitors, have opposed their monopoly play to acquire Times-Warner for selfish reasons about protecting their own businesses. I guess Comcast believes that they have some kind of monopoly on self-interest as well, or maybe it’s just the modern hubris of “what’s good for GM is good for the country” and their arrogance that they believe what is good for Comcast is therefore good for the American people.

Comcast’s main claim is that its buddies were involved in extortion. I do have to take this seriously, since Comcast has certainly proven that it probably knows more about everyday extortion than virtually any company working on the planet now. Netflix’s spokesperson replied tit for tat to that claim though by saying, “It is not extortion to demand that Comcast provide its own customers the broadband speeds they’ve paid for so that they can enjoy Netflix. It is extortion when Comcast fails to provide its own customers the broadband speed they’ve paid for unless Netflix also pays a ransom.” Boom! Now we’re talking trash that’s music to our ears!

So I have to wonder, will trying to bully the FCC and point fingers at everyone else work, because if so, we need to modify our strategy in trying to push the FCC to do better in providing internet access for our people? One finger wagging reported in the New York Times, from a media analyst said, “Regulators are a sophisticated audience. They can assess the merits of the various arguments without having to be coached on what incentives might be behind why someone did or didn’t say what they did.”

Of course I’m not that sophisticated, but I do know some simple things. If Comcast can’t even pretend to play nice before they are allowed to become a monopoly, how can any of us or the FCC believe that letting them become an even bigger monopoly will be good for any of us? We all were schooled on the basics that in dealing with a bully, you need to slap them back hard. The Comcast purchase of Times-Warner must be stopped. It’s the only way to get a bully to listen.

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Internet Monopolies Walls are Going to Tumble

Telus better pack it up or get right!

Telus better pack it up or get right!

Dallas     At the ACORN Canada staff training and then the management meeting in Montreal, we spent a LOT of time assessing and strategizing about our next steps on our Digital Access to Opportunities campaign which, plainly stated, continues to be our effort to build bridges for lower income families across the digital divide.

In Canada the companies are even more closely held monopoly concerns with the big three Telus, Canada Bell, and Rogers than are found even in the United States, although Comcast with its proposed merger of Times-Warner clearly has its heart set on going the same way.  Despite some steps to accommodate us with a $10 per month plan in public housing in Tornoto, Rogers has not moved past that opening round and what they delivered has been less than promised.  Telus in a meeting in Vancouver had told us they were moving our way, but then have not gotten back to us, and Bell continues to be unabashedly arrogant and impervious to our concerns, having adopted what can only be seen as a Comcast head-in-the-stand, make-me-do-it, schoolyard bully approach to the problem, hoping it will disappear into the Ethernet or something.

Not clear what tea leaves their lobbyists are telling them to read, but they’ve got trouble on the horizon.  The regulators in Canada are preparing for a hearing this winter on declaring the internet a public utility, and the same thing has been promised in the US by the FCC.

ACORN is committed to participating in the Ottawa hearings, but we’re convinced the court of public opinion is where we will be able to be heard more clearly.   They may have invested in some infrastructure but surveys of our members and others reveal that people hate their cable and internet company the way they once hated the local tax man.  Furthermore their brands are ubiquitous and their tentacles stretch everywhere from their ownership to sports teams in Tornoto to the bicycle sharing program in Montreal.  That’s a big, wide butt ready for the kicking!  We’re convinced that to get them finally to take seriously the desperation of lower income families to have access to opportunities, we’re going to have to go big, go broad, and be as ubiquitous as they are.  Enough said for now.

Meanwhile the often clueless former industry lobbyist heading the FCC must have startled the big boys of the industry in the financial papers the other day by pretty graphically drawing a picture of all of the internet companies as being emperors with no clothes on.  He simply stated the obvious without stating the obvious.  He said there is little or no competition in most markets so that internet service costs too much and changing from one operator to another is prohibitively expensive.  All of which is another way of saying that the companies are anti-competitive and operating like Canadians, or what we used to call monopolies.  Chairmen Wheeler claimed 80% of Americans have access to high speed internet at 25 megbits per second, though he didn’t say at what price, but if he’s going to acknowledge as his statement indicated that the “F.C.C. planned to promote more choices and protect competition, because a lack of adequate consumer choice inhibits innovation, investment and economic benefits,” it’s hard to believe that they can’t get the message.  For a change it was even an indirect shot across Comcast’s bow, since their claim that they are not a monopoly through their purchase of Times-Warner is that they don’t often compete in the same markets.  Someone seems to have given Wheeler the memo that they are in different markets, because they don’t compete, and you can’t claim you are regulating them to assure competition when they are silently colluding to kept customers captive and control separate geographies.

Ok, yeah, maybe I’m dreaming about the FCC being something other than chattel for the companies, but maybe when they see what we have in store for the companies in Canada some of the chill will blow down from the north to cool some of the imperial monopoly dreams that are widening the digital divide.  Here’s hoping!

 

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