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Leaked Document: Copyright Industry Wants a Great Firewall of Britain

Drew Wilson — Thu, 23 Jun 2011 03:50:36 +0000

Website blocking has certainly been discussed in the US with the PROTECT IP act first propsed last month. While the senate has approved the bill, it seems that the US isn't going to be the only country debating the prospects of filtering the internet.

A document labelled confidential was recently sent to James Firth's blog and ultimately posted on Open Rights Group detailing a proposal by some industry interests to pressure British ISPs to participate in a "voluntary" site blocking system. The documents describe this system as an "approach to inhibiting access to websites that are substantially focused upon infringement of copyright." There's plenty of reason to be concerned and one of the main reason to be concerned is that public policy is being decided behind closed doors. This isn't too dissimilar to when copyright organizations tried pushing for many controversial provisions in the Anti-counterfeiting Trade Agreement. Everything about it was being planned behind closed doors. The only reason anyone heard about it early on was because Wikileaks blew the lid off of the secrecy surrounding ACTA back in 2008. This led to a major outcry from individuals and human rights groups alike to question the bill. It seems this "voluntary" Great Firewall of Britain won't be any different. Many of the criticisms directed at ACTA could be directed at this proposal including, "Was the proposal so bad that they had to hide it to avoid any kind of scrutiny?" There are other reasons to be concerned besides the questionable action of keeping this secret. Firth provided the following quote and response:

"Evidence should also be submitted to show the urgency with which the measures are sought to inform any balance that needs to be struck by the expert body and the Court between the need for swift action and the need for sufficient evidence."
This is very worrying indeed. Whilst the document talks about evidence gathering, "prior notification and liberty;" it also talks about a turn-around time quick enough for "live events" and a balance between swift action and evidence. The language used reads like copyright protection is being sold as more important than due process under law. In any case, I can't imagine a technical solution that would allow ISPs to implement an effective block within the time scale of a "live event", irrespective of the time it takes a court to act. So it's not surprising that digital rights champions the Open Rights Group were locked out, despite hearing of the meeting in advance and putting in a request to attend

The Open Rights Group also expressed deep concern for this proposal:

The documents, sent to James Firth's blog, set out a dangerous voluntary scheme that would involve 'expedited court procedures' and a 'balance' between evidence and speed of action. Definitions of what content is to be judged blockable is scarce. References to exactly how such blocking would work, and the consequences, are non-existent. The case for blocking is left unmade, with no analysis about the effects of such measures. There is cursory reference to the rule of law and proper oversight. The proposal, if it is the genuine proposal, adds up to a dangerous revocation of the rule of law where lobby groups would decide what you are allowed to see and read.

The Open Rights Group then referenced a recent Rapporteur which sounded an "alarm" over such measures. They also encouraged British citizens to contact their MP to get them to "sign EDM 1913, which calls for the government to take on board what the UN have said and reconsider the Digital Economy Act and its many proposed website blocking schemes." The full document is currently being hosted by the Open Rights Group for those interested in reading the proposal. I doubt that an ISP could ever prevent every user from accessing a blocked website. All it really takes it the right proxy to access it. Do you think website blocking will ever be fully possible or is it a bad idea? Have a tip? Want to contact the author? You can do so by sending a PM via the forums or via e-mail at drew@zeropaid.com.

School Porn Filter Defeated by Third Grade Students

Drew Wilson — Fri, 15 Apr 2011 07:03:58 +0000

Net filtering has been brought up a lot in recent months. But how effective are different kinds of filtering technology? As one school found out the hard way, such technology can be surprisingly easy to defeat.

If you've been following some of the copyright debate, you might have come across a few articles discussing the idea of filtering technology to stop copyright infringement. Recently, there was a an opinion by Advocate General Cruz Villalón in Europe who said that ISPs shouldn't be forced by national courts to filter the internet. In the US, there is a similar debate with the more recent news commenting on how the US is decrying other countries over net filters while trying to implement their own - namely the Combating Online Infringement & Counterfeits Act (COICA). Multi-national corporations such as top members of the RIAA and MPAA might argue that content filtering at, say, the ISP level, might be an option to supposedly stop copyright infringement. COICA is a bill which demands ISPs implement a blacklist filter which, among other things, sets out to block domain names at the request of rights holders. A lot of arguments have flown over the years over such technology be it an infringement on civil rights, false positives, protecting jobs, etc. One point that sometimes crops up is whether or not such technology is even effective at all. Most who are familiar with technology, outside of people selling such technology, would likely say that filtering technology is not all that effective at deterring whatever said filters set out to block all of the time. That's certainly what made a recent news story surrounding a school and its porn filter all the more interesting. A school porn filter differs from a nation-wide porn filter in several ways. From a security standpoint, it's a smaller audience on a smaller network which, conventional wisdom would suggest, would be easier to manage. How did the filter fare? Not so well evidently. According to the New York Daily News a group of third grade students from a Queens elementary school were caught and suspended for looking up elicit material on school computers. The students were suspended, City technicians were then called in. They wiped the computers and installed filtering technology on the computers. When the students returned, the filter was easily bi-passed when they Googled "Hot girls". What ensued wasn't all that surprising:

"The concern here is that a Department of Education filter shouldn't fail the [test of] 'Are you smarter than a third-grader?'" said City Councilman Peter Vallone Jr. (D-Astoria), who is looking into the matter. "As a parent, I hope that something like this never happens again," he added. PS 85 Principal Ann Gordon-Chang said it was an "isolated" incident.

Since then, new filtering technology was installed. The case is eerily similar to the infamous case in Australia that no doubt continually haunts pro-filtering advocates. In 2007, a 16 year old Australian cracked a government mandated country-wide $84 million porn filter in 30 minutes. This does raise some interesting questions. Are younger kids becoming more tech savvy? Is filtering technology flawed? More importantly, if filtering technology can't keep a handful of third grade students from surfing for porn on school computers, how can filtering technology be used to stop a whole nation of people from committing acts of copyright infringement? I think that the idea of filtering for the purpose of stopping copyright infringement, even in this day and age, is a deeply flawed concept. Rights holders will not gain what they hope to gain and a lot of people stand to lose a lot when it comes to basic things such as free speech. This story alone is just another example of why the former part of this argument is true. [Hat Tip] Have a tip? Want to contact the author? You can do so by sending a PM via the forums or via e-mail at drew@zeropaid.com.

French Surveillance Legislation LOPPSI 2 Debated in Senate

Drew Wilson — Wed, 08 Sep 2010 05:40:40 +0000

Is it right that police upload malware to users merely suspected of a crime without their consent, knowledge, or a court order? That might be what supporters of this controversial piece of legislation might think. The surveillance legislation known as LOPPSI 2 has made its way to the senate.

A little over a year ago, we broke the news in English that France was gearing up for a rather unprecedented piece of surveillance legislation. The legislation would allow police to upload malware including tracking cookies, Trojan horses and keyloggers to unsuspecting users without any need to explain why they did this for a period of four months. The intended target is basically people who are suspected of a general crime, although this would include file-sharers as well. A month later, the matter was being heavily debated and a cyber expert in France discussed the proposed law. Since then, things more or less died down thanks to HADOPI soaking up all of the attention as it precariously moved through the legal process enough times to finally be permitted to pass. Implementation, to this day, is still being worked out. All that has changed because the LOPPSI 2 legislation is back in the headlines once again. The legislation has, according to 01net, has moved to the senate where it is currently being debated. The translated headline pretty much said it all with "Loppsi filtering, cookies and CCTV in Senate debate" The crazy thing about the timing of this is the fact that it was just the other day, we were reporting how internet filtering in Australia has effectively died thanks, in part, due to all the human rights and free speech concerns. My question is, when it comes to technology related law at all, why does it seem like politicians around the world are racing to come up and pass the worst laws around? Have a tip? Want to contact the author? You can do so by sending a PM via the forums or via e-mail at drew@zeropaid.com.

Indonesia Orders ISPs to Block All Porn Sites

Jared Moya — Mon, 02 Aug 2010 08:02:08 +0000

Information and Communications Minister Tifatul Sembiring orders the country's ISPs to block all porn sites before the start of Ramadhan next week, but (surprise, surprise) one of the heads of the Indonesian Internet Service Provider Association, Valens Riyadi is finding it an "impossible task" that may filter 50% if they're lucky.

Last month Information and Communications Minister Tifatul Sembiring announced the govt was ordering the country's ISPs to block all online porn sites before the start of Ramadhan which begins next week, August 11th, and the job is proving as impossible as one would think it would be. “Insya Allah [God willing] we will finish the job before Ramadhan so as not to affect [Muslims] from executing their religious obligation,” Tifatul told reporters at the time. He cited the country's pornography law, its obligation to protect citizens from its negative affects, and reminded people that it's illegal to distribute pornographic material. When asked about Internet users savvy enough to bypass porn filters he said that it wasn't a problem because they are "limited in number." That "limited number" may be much more than he thinks as one of the heads of the Indonesian Internet Service Provider Association, Valens Riyadi, now readily admits the filter is a "hard thing to do in technical terms" that for him is "almost an impossible task.” Part of the problem he says is that Valens hasn't told Indonesia's nearly 230 ISPs exactly what sites are to be blocked, how they will be monitored and who will pay for maintaining any porn site filtering regime they put in place. Riyadi said ISPs could perhaps cobble together a list of the more famous (or infamous) sites that would cover perhaps 10% of the total, but that they could only hope to block at most 50% sometime in the next few months "if they were lucky." Tifatul maintains the govt does have a plan and that it will work. He said recently that ISPs would be required to adopt the same keyword filtering system being used by the govt on its computer network known as "Trust Positif." “Not all of the sites, all of the pornographic content, will be gone from the Internet,” he said. “But step by step, we’re trying to filter pornographic content.” In a sign of trouble ahead he added that the list would eventually be expanded to include sites with other objectionable content. Stay tuned. jared@zeropaid.com [Hat Tip]

Prof – 4Chan Trolls Reason Enough For Mandatory Australian ISP Filter

Drew Wilson — Tue, 20 Jul 2010 18:28:33 +0000

The story of Jessi Slaughter is reaching Australia, perhaps, for all the wrong reasons. A professor has taken the story and is arguing for internet censorship, saying, "You simply can't have free access to the internet"

Things must be looking pretty desperate for those who support mandatory ISP internet filtering. It all started with a US girl by the name of Jessi Slaughter. According to US reports, she apparently posted videos on YouTube of herself saying she was better than others. The videos spread to other sites including 4Chan where a number of internet trolls decided to cyber bully her. After personally identifiable information of Slaughter was posted, she started receiving prank phone calls among other things. Her father got involved with a video response attacking those who were responsible of the trolling which only made matters worse. Ultimately, she wound up in a police safe house and an investigation is under way. For many, this was simply an object lesson that says that parents need to keep an eye on their children's activity online. Evidently, there's a slightly different perspective in Australia as far as one professor is concerned. According to news.com.au, this was actually a perfect reason for mandatory online filtering as well as far as one professor is concerned. While arguing for a mandatory ISP level filtering system, Matt Warren, the head of Deakin University's School of Information Systems said, "It has to be controlled, censored and people have to be held accountable for their actions on it." Warren said, "We punish people who drink, we punish people who speed and we have to implement laws to that effect when it comes to the internet." He argued that children - even 11 year olds - aren't ethically aware of what they are doing. He also said that parents aren't able to train their children about proper uses of the internet since they don't understand it themselves. As long as those two ideas exist, then the government has to intervene according to Warren. Since internet filtering is such a hot button issue, political parties have, for now, shelved internet filtering plans, but Warren argued that this was an oversight. Last year, another professor made the argument that an unfiltered internet had no place in a democracy and that those, including the Electronic Frontier Australia, are a bunch of extremists for arguing the contrary. What is amazing is that it almost doesn't seem like it had ever occurred to Warren that if, say, Slaughter were to go around the actual school yard and tell everyone how much better she was, that she wouldn't provoke a negative response. Should we force schools to separate each and ever individual child in the school because there could be a conflict between some of them? Obviously, parents - and supervisors for that matter - can't keep an eye on them 24/7. Why don't we lock every child in to isolation chambers until they are 21 while we are at it? That'll make sure they will never get bullied online or offline. What was the original intent of the internet filtering anyway? Wasn't it to stop child pornography and other "objectionable" material in the first place? How is ISP level filtering suppose to stop people from behaving badly online anyway? What's incredible is how much supporters of internet filtering stretch their arguments these days until it reaches levels of absurdity. Here's hoping this is all just because of something in the water. Have a tip? Want to contact the author? You can do so by sending a PM via the forums or via e-mail at drew@zeropaid.com.

AT&T Denies Arstechnica 3 Strikes Allegation

Drew Wilson — Mon, 03 May 2010 18:09:04 +0000

Over the weekend, we noted a rather surprising article from Arstechnica that claimed AT&T was calling for a three strikes law. We spoke to an AT&T spokesperson who effectively denied they wanted a three strikes law in the first place.

There were a number of wild stories being reported over the weekend and one of the wildest one was from Arstechnica that claimed the following:

But that doesn't mean AT&T is opposed to various forms of "three strikes" or "graduated response" programs meant to deter online copyright infringement; it just wants someone else to implement them. If the government wants to get into the enforcement business, AT&T would be fine with that. Actually, the company would be more than fine with the proposal—it suggests that the government get into the business of adjudicating such cases and dishing out penalties.

In short, Arstechnica suggested that AT&T wanted a three strikes regime. It was a particularly concerning issue, so we spoke to AT&T spokesperson Michael Balmoris who responded saying, "No." His response was brief, but he forwarded us a link to a blog posting which definitely shows where the article originated. ZeroPaid did try looking for the source of Arstechnica's article at the time of the original report, but quotes from the blog posting failed to turn up AT&Ts blog posting. After reading the blog posting, we couldn't read in to the posting that AT&T wanted a three strikes tribunal, regime or a US three strikes policy at all. "It is important to remember that these notices are allegations of infringement," AT&T wrote, "not conclusive proof nor a judgment from a court. Therefore, we’ve resisted calls to go further and unilaterally impose sanctions on our customers, such as termination of service, for those customers who may receive more than one notice. Ultimately, we believe that an enduring system to enforce our nation’s laws should remain in the hands of the government and that it isn’t in any stakeholder’s interest for ISPs to sit in the role of judge, jury and police." A three strikes regime does, in fact, mandate termination of users accounts. In this particular paragraph, AT&T is saying that they are against terminating users accounts. Reading a little further in to the posting, we get the following when AT&T says they have two recommendations:

The content industry has rightfully noted that the existing legal system is too slow, too cumbersome, too expensive and requires that they seek remedies that are disproportionate to their legitimate goal of simply changing behavior. At the same time, the public interest community and others have rightfully pointed out that due process must be preserved in order for such a system to be fair and trusted. Therefore, we propose the creation of a kind of federal “small claims court for copyright.” The second idea is focused on the criminal side of the equation. We believe that there should be more focused federal law enforcement efforts on the baddest actors out there – those that are willfully trafficking in high volumes of stolen content. For those sites that the government can’t shut down because they are hosted in other countries, we’ve suggested that the government work to identify a “most wanted” list, provide an open process to ensure the validity of those findings, and then set up a expedited process to require ISPs to deny access.

The first recommendation does verify that AT&T is calling for a more streamlined court system, but the key was that it would be a sort of "small claims" court. The reasoning is that rights holders are required to charge multi-million dollar fines as seen in the Tenenbaum and Thomas case. Both were cases that made international headlines and created a very legitimate argument against tightening copyright laws because the fines were far to extreme and disproportionate for a civil manner. The second recommendation also confirms that AT&T does call for a blacklist. Unfortunately, the paragraph is a little vague because it starts off saying that it's going to be targeting criminal cases - that would be things like child pornography for instance. Then, later on in the paragraph, it says its targetting "stolen" material which could be taken as a blacklist that would include civil related issues such as copyright infringement. It could mean sites that sell infringing material, it could mean sites like The Pirate Bay, or it could mean both. Overall, this is a much more tamed down version of the story. If Arstechnica recognized some code language that meant three strikes, then they're better at reading in to comments better than we are because we've read through the posting now and couldn't find "we want three strikes" anywhere. As we suggested in the previous article, AT&T calling for a three strikes regime does seem out of character and now having the ability to verify the story, AT&T doesn't seem to be acting out of character from a year ago. All in all, this may be simply a confusing case that only time will tell what's really going on. Have a tip? Want to contact the author? You can do so by sending a PM via the forums or via e-mail at drew@zeropaid.com.

Scrutiny Over 1.5 Million US Job Losses Due to Net Neutrality Mounts

Drew Wilson — Sat, 01 May 2010 05:01:47 +0000

While the European Union is dealing with a filtering debate that appears to be a threat to the internet as we know it, the internet as we know it isn't exactly safe in the US either with the heated network neutrality debate at the FCC.

While Comcast was able to win its case over throttling practises in the US earlier this month, that didn't mean that the debate was over. Far from it and the battle rages on at the FCC. Just a few days ago, we highlighted a suspicious report that claims that network neutrality would negatively impact 1.5 million jobs. We looked deeper in to the report and were able to find quite a few flaws in the report that puts in to question the validity of the claims. Unfortunately, I don't have the benefit of being a US citizen to know how everything works to the fine detail, but others, it seems, have looked at the report and found similar flaws and were able to flush out some more details on why the findings were flawed. Robert X Cringely of info world is also aware of the report and he had a few similar concerns about the validity of the report. "Who paid for this report?" Cringely asked, "A telecom lobbying firm called Mobile Future, which sports a weird hodgepodge of member organizations, including Alligator Planet, Climate Cartoons, Goomzee, and the League of United Latin American Citizens. But the most recognizable name on the list is AT&T. Color me surprised." So there was a definite connection to the telecom industry after all. So while on first glance, it appears more neutral, apparently deeper in to the origins report reveals what some would consider a conflict of interest. Cringely did, however, come to a few conclusions we were able to come to. For instance, the calculated losses didn't really appear to have very strong basis to draw such conclusions. Another similar conclusion was that one cannot base the market experience of DSL vs. cable of the early to mid 2000s and use that as a lesson on regulation. We only needed to look at reported price points of both years to debunk it. Cringely took a different approach by noting the quality of service instead:

Delivering DSL over copper lines involves more variables and more barriers -- including a customer's proximity to a central office, the quality of their phone service, the amount of non-DSL-compatible fiber in the ground, and the Baby Bells' own bureaucratic intransigence. This process was widely known as "DSL hell," and it's why the DSL Reports site was created and continues to flourish.

We were aware of the potential issue of quality of service, but chose to use a simpler method because the amount of time it took to go through the paper (3 days). Cringely did note something else that was interesting that originally came from Brett Glass which comments, "Net neutrality rules as currently written are not actually neutral. They benefit Google in particular because it owns its own backbone and, thus, can prioritize and manage its own traffic at will, free from any government constraint." This clearly shows, ultimately, that the report was fatally flawed when drawing up these numbers and there are other observers who will agree. Like Cringely, we were running in to the problem of how thorough should we go in finding holes in the report? I would argue you could fill an encyclopedia of all the ways you can find flaws in the report. The question is, what angle do you look at this paper and what information is immediately available in your memory do you use against this paper? Bottom line is that you can't trust the findings of this report because there is too many pieces of evidence that would argue against some of its assumptions that pretty much kills the validity of the core argument. In short, the paper should be junked when considering network neutrality. We do know one thing though, its a high stakes fight and there has already been sparring matches over what roll the FCC plays in the network neutrality debate. The internet is changing, the question is, will it serve the same people as it once did? Have a tip? Want to contact the author? You can do so by sending a PM via the forums or via e-mail at drew@zeropaid.com.

EU Web Filtering Debate Heats Up With IT Group Denouncing It

Drew Wilson — Fri, 30 Apr 2010 08:10:50 +0000

There's already been a lot of talk about a possible web filter in the EU and now the Computer & Communications Industry Association (CCIA), a group representing a number of IT related companies, have come out against it.

There's been a lot of discussion in Europe about the possibility of an EU-wide filter. Such topics such as a mandatory blacklist have been in discussions for some time amongst EU nations and the consensus amongst those who know a thing or two about the internet for the most part has remained that such a filter would never work in the long run. Now that there is word of a potential EU-wide filter, the discussion can only escalate from here. Proponents argue that it's suppose to stop child abuse and child pornography. If websites were blocked, then access cannot be gained and therefore it would stem such illegal content. It sounds very simple, particularly if you don't know exactly how the internet works. "There is a real danger that this proposal will have unintended consequences," Ed Black, president of the CCIA said in an interview. "We oppose this idea partly because it is an inefficient way to combat online child abuse, but also because it builds on efforts by governments around the world to block what they don't like on the Net," he said. Computer World is already reporting that the European Commission has already poured €300,000 to lobby in favour of proposed laws that would put an EU-wide filter in place. Whether Black knows it or not, there are already unintended consequences happening. During a talk in Sweden, an anti-piracy organization made a very disturbing comment that "child pornography is great" while hoping to incorporate copyrighted material in to the filter. Believe it or not, there is already precedent on a mass scale filtering system. Every filter has essentially ended in disaster one way or another. For instance, and perhaps the most famous example, the Great Firewall of China. While China has been trying to crack down for some time on what is being discussed on the internet in their own country with, ironically enough, aid from technology sold by US firms, the filter has yet to be completely successful with dissenting voices still making it out of China through programs like Adopt a Blog and heavy encryption. The US government has been a vocal critic on China's human rights record. In Australia, there's been numerous attempts to filter the internet. The last time Australia's government successfully put in place a filter to filter out porn, it ended in total disaster. It sparked one of the most a very famous headline, "Teen cracks AU $84 million porn filter in 30 minutes". Since then, the idea of an Australian wide filter which would capture way more than child abuse (as advocates for the filter so often claimed) has been fiercely debated. In 2009 amidst a renewed effort to implement such a filter, the Australian blacklist leaked with definite evidence that abuse had occurred when sites as innocent as a dental clinic wound up on that blacklist. Thailand also had it's attempt to filter the internet. You'd think that a filter might be more successful in a country like Thailand considering how much governmental control there is. That sense of power came crashing down in 2008 when the entire Thailand blacklist leaked in 2008. The reasons why web filtering will never work became very apparent when it was debated in Australia. The scope, as one filtering company found, was particularly difficult. It may be possible to get some form of success on internet sites through direct keywords, but throw in any other protocol such as p2p traffic or even some messaging systems and the filter runs in to serious trouble trying to catch and block everything. Throw in a little encryption and it's pretty much game over for the filter. From a technical aspect, it's pretty much impossible to filter anything online because there will always be a way to circumvent it one way or another. The internet was initially designed to be a communication system that would survive a nuclear strike. It's unlikely, unless every ISP in the world were to shut down, to significantly change the ability to transfer data from one point to another. It's also politically bad news. If child abuse can be filtered, what about political speech? That was an issue for debate in every known web filtering case. Someone from the Electronic Frontier Australia once pointed out that even if the current government wouldn't do anything wrong with the filtering, what about the next government or the government after? Do you really trust every single subsequent government that they would be ethical with a web filtering system if it was ever possible to construct an effective one? It's the duty of the government to protect its citizens for both today and for the future - even from future potentially worse governments. It is bad for business as well. What would happen if it was possible for one business to ruin another business through the filtering? It doesn't necessarily require government interference, but rather a shady employee with a willingness to profit. It is socially unsound because it places an overwhelming amount of trust onto a set of individuals. It's impossible to really find anyone or any group that can be completely trusted. The British population in 2007 found the issue of trust to be in the spotlight when the tax arm of the British government lost the identities of nearly half the population of Britain. To say the least, there was horror and anger over that fiasco. It's impossible to find any entity that can be trusted with such a large burden of responsibility. The bottom line, in every angle you look at this, if you think carefully on it enough, such a system fails whether it's philosophically, practically or technically for instance. The only real good thing an internet filtering system is for is probably political suicide. Have a tip? Want to contact the author? You can do so by sending a PM via the forums or via e-mail at drew@zeropaid.com.

US Study Claims Network Neutrality Would Negatively Impact 1.5 Million Jobs

Drew Wilson — Tue, 27 Apr 2010 04:15:45 +0000

Another day, another doom and gloom study. This time, Coleman Bazelon of The Brattle Group claims that if network neutrality were put in place, nearly 1.5 Million jobs would be in jeopardy by the year 2020.

First portion of the paper

There's been quite a lot of wild studies being published lately. Today, theres a study (PDF) that appears to be against network neutrality in the US saying that close to 1.5 million jobs would be impacted thanks to network neutrality by the year 2020. It's an interesting finding, so we looked at the paper to find exactly how the jobs would be lost. As we went through the paper, there were even more stranger claims such as this:

The employment losses associated with those reductions is found to be significant—14,217 direct broadband sector jobs lost in 2011 growing to 342,065 jobs lost by 2020; and economy-wide, affecting 65,404 jobs in 2011 growing to 1,452,943 by 2020. These additional jobs include both employment in sectors that feed into the broadband sector, such as equipment manufacturers, as well as employment created from the increased broadband sector income—everything from jobs in dry cleaners to retail and manufacturing.

It seemed a bit of a stretch to say that network neutrality would cost a local dry cleaner their jobs, but nevertheless, we continue on through the paper. We did, in section two, get to the point about money which states, "End-user service revenues for 2008 were almost $52 billion." It's an interesting note because it's not like there isn't revenue going to the ISPs in the first place. So where exactly does these job losses come from? The paper says, "The 2008 revenues are projected out to 2020. The point of this projection is not to predict exactly where the broadband market will be in 10 years, but rather to estimate the economic impact of network neutrality regulations on that market development." While it is always a pain to have guesswork, nevertheless, in this case, we are looking in to the crystal ball here, so, of course, guesstimation is much more forgivable because no one truly knows exactly what the future holds. The paper then says, "Overall, broadband sector revenue is projected to have grown at a 23% annual rate in 2009, with that growth rate decreasing to 10% per year in 2016 and staying at that level through 2020."

The network neutrality issue

The paper then says, "Proponents of network neutrality regulation are concerned that broadband providers will increase the share of revenue they extract from this sector by imposing variable pricing and other discriminatory practises on content providers. Although revenues from sales to content providers would be expected to increase in any event with the growth of the content sector, the sustained high growth rates compared to end-user service revenues reflected in the baseline incorporates the assumption that the broadband providers will likely find new ways to charge content providers." This is accompanied by the footnote: "Sales to content providers have experienced higher growth rates in recent years compared with sales to end-users." That's the part that is puzzling. The content sector will be making money and will be growing anyway, so who cares if their content is discriminated against because the sales would be made anyway? If users can't stream legal content because the ISP provider is discriminating against their traffic, then the end user can't use that given commercial service to begin with - thus a loss in revenue for the content provider. Users will more likely go to services that are faster, thus making ISPs gate keepers of which business survives and which does not. Why can't the free market work itself out? I'd call that argument a bit ambiguous to say the least. The fourth section had this interesting point, "The academic literature on possible effects of network neutrality regulation does not provide a consensus view on whether such regulations should be expected to help or harm the broadband sector, although several economists have concluded that such regulation would be harmful." It's a bit strange to say in passing that academics have debated this and move on to say that there are economists who don't like network neutrality. Isn't that like watching a basketball game and the teams are tied, then asking someone in the audience who do they think should win and declaring a winner based on the answer given? The paper provided examples of why network neutrality is bad and offers this odd example as one of a number of examples:

In Europe, several studies have attempted to examine the impact of open access regulation on investment in broadband. Typically such studies focus on service penetration, assessing the impact of open access regulations on measures such as broadband subscribers per 100 inhabitants. These studies find that facilities-based competition based on competing networks, as opposed to access-based competition based on regulatory opening of private networks, drives broadband penetration.

Maybe this is a little beyond us, but how is acknowledging the positives of competition in Europe's ISP sector relevant to network neutrality in the US when a US customer is more then likely to experience either a monopoly in a given area or a comfortable duopoly in a given area? Isn't talking about ISP competition in Europe in general a bit of a leap from network neutrality in the US?

Core argument: DSL vs. Cable argument

So, as a more direct comparison, the author used the difference of DSL connections and cable modem connections (as one was regulated and the other wasn't and used projections based on that. The description:

A study by Thomas Hazlett and Anil Caliskan of George Mason University estimates the effect of deregulation on DSL service. At the end of 2002, unregulated cable modem subscriptions outnumbered regulated DSL subscriptions by two-to-one. By 2006, 4 years after deregulation began, DSL lagged behind cable modem service by less than 15%.

Can one blame regulations on the situation exclusively? We looked at an article on prices of both and the closest we found was in 2003 which had the following:

DirecTV Broadband had a reputation for providing fast, reliable service at a bargain price. The company charged $50 per month for DSL, slightly below the industry average of $51.36, according to research firm ARS.

The monthly price for cable modem service averaged $45.31 per month as of June 2002

The price of DSL at the time? $51.36 on average. The price of cable at the time? $45.31 on average. Stunningly, price point was not mentioned in the report even though it was a far simpler explanation on why subscriptions were the way they were. It's strange that the paper doesn't talk about price point at all to say the least since that is a huge factor for consumer purchasing habits. Surely there are a number of factors related to cost that doesn't have anything to do with regulation. We looked at prices in 2005 and found this on CNET:

Verizon gives the monthly customers the $29.95 rate only if they subscribe to the company's unlimited local and long-distance phone plan--$44.95 to $59.95 per month, depending on the state--or the unlimited local package, ranging from $21.95 to $32.95.

Like its other Baby Bell cousins--SBC Communications, Qwest Communications International and BellSouth--Verizon has been offering low-priced broadband to catch up to cable's dominance in the business. Many of these deals are priced under $30 for more than 1mbps of speed.

So, these examples show the following in direct pricing: Cost for DSL: $32.95 Cost for cable: Under $30 While one example, it shows that there are cases where cable, again in 2005 which would account for what was seen when 2006 rolled around (because the paper explicitly said "by 2006") Isn't that an easier explanation as to why Cable modems were outselling DSL? Regardless of any actual reasons, the paper then concludes the reasoning with this:

The DSL experience should not be taken as determinative of what will happen under the proposed network neutrality regulations. Rather, it is suggestive of the general size of the impact such regulations can have.

The paper then takes the difference in sales and takes 15% away from total revenue of the ISPs projected revenue. The argument, in short, is DSL performed poorly compared to cable, DSL was regulated and cable was not, therefore regulation is bad for the industry. Since the author blames regulation exclusively for the differential in revenue, rather then other possible factors like price points as I have demonstrated as but one other possibility, then one can't really make a projection like this, so the argument fails. Since the projection in revenue is flawed, the argument about subsequent job losses cannot really be made as what the paper then proceeds to do concluding that, "In [2020], the $100 billion in reduced broadband sector revenues would have generated 342,065 broadband sector jobs and the $292 billion economy-wide impact would have supported 1,452,943 jobs."

Content sector argument

The paper discusses job growth in the content sector with the following:

Some proponents of more comprehensive network neutrality regulation proposals have suggested that job losses in the broadband sector might be offset by increased employment in the Internet content sector.

It then proceeds with the first part of the argument:

The Internet content sector comprises all of the websites and Internet based services that broadband end-users access over broadband connections. For the content sector, the effect of potential discrimination in pricing and services is ambiguous. Simply put, a regime of network neutrality regulation will likely have different content winners than a regime without network neutrality regulation

This is certainly an agreeable. If network neutrality were in place, the big players online would be different then if ISPs could control what packets have priority. There is, however, a very significant difference between the two outcomes. With network neutrality, the online marketplace can effectively sort itself out through competing services. It network neutrality were not imposed, then ISPs can decide which services are the winners and losers. Correct me if I'm wrong, but isn't a free market as seen in a neutral network how the automotive sector formed to what it is today in the first place?

Quantity of content argument

The paper then says this:

Larger commercial sites have the potential of doing better or worse under network neutrality regulations. On the one hand, potentially lower costs of access should benefit them; on the other hand, potentially less developed broadband infrastructure could harm their businesses. With some content winning and some content losing, there is no reason to believe that the total amount of content will be more or less (or more or less valued by Internet users) under one regime or the other. Some business models will do well under one regime, others under the other regime.

While it is difficult to gauge how much content is available in either a neutral or non-neutral scenario, it misses the point about network neutrality and that is which is the winner and which is the loser. If a company and not an overall marketplace decides what content is the winner and loser, then quality could very well be affected. Either way, this part of the argument has little to do with how the online content sector would perform and how it would impact jobs, so it is really simply off topic.

The dollar on the job argument

It's a very strange argument and this is how it is described (note: this part contains no footnotes):

This offsetting growth would require more than simply the content sector capturing the broadband sector’s losses—it would take almost $300 billion in content sector revenues to offset the employment impacts of a $100 billion loss in the broadband sector—because each dollar spent on content supports less employment than a dollar spent on broadband.

So by this own paper, the amount of revenue created by the content revenue is expected to be triple the amount projected to supposedly be lost by the ISPs (a flawed number as argued already) Yet, the author still argues that 3 times the revenue means fewer supportable jobs. What? When one looks at a commercial website that sells physical goods, there needs to be, at the very least, a network to process orders, companies to manufacture those goods, companies that store and redistribute those goods and subsequent people to ship those goods in the first place. Even if a content provider only sells digital content like movies, they need lawyers to negotiate rights (if they were to deal with organizations like the MPAA for instance), they need staff for server maintenance, they need staff to maintain the site itself, they need staff for troubleshooting and customer service and who knows what jobs like that would indirectly support in both digital and physical jobs. Why are jobs fewer in the content industry? The paper fails to explain that other then two tables with numbers based on flawed reasoning (as we discussed already). With a lack of further reasoning or explanation, the argument fails due to lack of sound evidence.

The jobs quantity argument

Section C is a little more vague and chooses to rely on predictions on how money would be spent on both sectors saying, "any transfers of wealth induced by network neutrality regulations—of a flow of revenue from broadband providers to content providers—would be expected to have a negative impact on employment" Still, this is basing predictions on a developing industry - the online content industry. In a non-neutral internet in the US, the jobs would effectively be moved out of the country to other countries that have a neutral network. There is the potential for innovation online to this day and who knows where the internet will go, but impeding traffic through ISP level interference as a non-neutral network would mean that the jobs in the online sector would vanish in the US. While the paper relies heavily on the idea that infrastructure investment is leading to job creation, it also has admitted that market saturation is also a possibility. If big ISPs choose not to lay down more lines (as there have been cases where ISPs refused to roll out things like FiOS in the past in the US), then those jobs that laying down new lines would require would never have been created in the first place. A non neutral network can lead to less use of the internet in the first place if fewer services are possible, thus relieving ISPs of obligations to upgrade their infrastructure, thus leading to fewer jobs anyway. Ultimately, the argument suggests that its best to put money in a market that is currently being saturated and possibly slowing then it is to put money in to a sector thats in a state of major growth with many areas that could be expanded. It's ultimately a bit senseless, really.

Conclusion of the paper

One thing that sticks out in the conclusion is the following, "If implemented, network neutrality rules could lead to a broadband sector that is almost 18% smaller than it would otherwise be by the end of the decade." Yet, earlier on page 11, the report states, "An increase of 18% translates into roughly 15% when measured as a decline in the growth rate." Since these are the only two places 18% is even mentioned in the paper, why not stick to the conservative value used to make so many calculations in the first place? Would this lead some to speculate that the number could be somewhat inflated to make a harder hitting conclusion? The report concludes, "Consequently, network neutrality regulations would be counterproductive to reaching the FCC’s goals of increased broadband connectivity and the associated economic benefits that connectivity would bring."

ZeroPaid's conclusion of this paper

I will give the author some credit over the fact that of all the papers I have gone over with a fine toothed comb, this isn't the worst out there that I've ever seen. A lot of papers I've read which tries to make really wild claims end up in the category of papers that are so full of errors, ambiguity and not thoroughly researched points, that one may as well just discuss the most glaring holes. This paper doesn't necessarily fall in to that category. Another positive thing to say about the paper was that researching the group and the author doesn't immediately turn up conflicts of interest where a number of papers in the past requires minimal research to determine whether there was a conflict of interest. An example of this would be a paper that argues that tougher copyright is needed and that the paper in question was done independently and in an unbiased manner, but the author in question is a registered lobbyist for the major record labels for instance. All that being said, going through the paper, going through the arguments and figuring out where the evidence is to back up the claims, I have to say, in critical parts of the paper, the evidence was either too weak or non-existent outside of identifying a given model to make a few general projections that don't have anything to do with what potential losses there could be in the industry with network neutrality. Almost all of the arguments used to support that 1.5 million jobs would be affected by network neutrality didn't have enough evidence to back itself up. One particular argument only required a few minutes of Googling to debunk. So, overall, the paper definitely fell short of proving its claims. Have a tip? Want to contact the author? You can do so by sending a PM via the forums or via e-mail at drew@zeropaid.com.

Kiwi Govt Internet Filter Up and Running

Jared Moya — Mon, 15 Mar 2010 15:28:20 +0000

ISPs Watchdog and Maxnet are the first to voluntarily begin filtering the Internet under the govt's Digital Child Exploitation Filtering System.

The New Zealand govt's Department of Internal Affairs (DIA) has apparently already managed to push live its controversial Digital Child Exploitation Filtering System. Operated in partnership with the country's ISPs, the system is intended to focus solely on websites "offering clearly objectionable images of child sexual abuse." Surely all Kiwis are against child porn, but critics point out that the filter will do little to stop determined criminals and fear the list won't be properly maintained. Tech Liberty, a New Zealand-based group dedicated to "defending civil liberties in the digital age," were surprised and dismayed to learn the filter was already up and running. "We’ve made a number of Official Information Act requests to the Department of Internal Affairs and the answer has always been “in the next couple of months," it says. "We now have new information from the Department that says that the filter is already running and that both Watchdog (since Feb 1st) and Maxnet (since Feb 26th) are already using it." Worse still is that both ISPs have not informed their customers that they're traffic is being diverted through a govt server. All of the problem really stems from the fact that the DIA hasn't even been charged with filtering the Internet in the first place. "It is not appropriate for the Department of Internal Affairs to implement this without appropriate laws being passed in Parliament in accordance with the normal democratic process," adds Tech Liberty. Because the filter routes, or intercepts, all Internet traffic Tech Liberty also believes the system is contrary to the New Zealand Bill of Rights which requires a warrant to do so. Also troubling is that the DIA refuses to make its blacklist public. The Films, Videos, and Publications Classification Act 1993 requires that all censorship decisions must be published each month. When it comes down to it, all people looking to access child porn have to do is switch to encrypted traffic (secure http, VPN), not to mention the other array of widely available tools on the Internet. Plus, what's not to prevent the DIA from adding other objectionable sites like gambling, P2P, legal porn, etc.. Stay tuned. jared@zeropaid