Massa Introduces Broadband Internet Fairness Act

by: robert.harding

Fri Jun 19, 2009 at 07:39:23 AM EDT

The bill is known as the Broadband Internet Fairness Act (H.R. 2902) and was inspired by what happened in the Rochester area with Time Warner Cable in April. In April, Time Warner Cable was set to begin "consumption based billing" trials in the Rochester area, as well as a handful of other regions across the country. After hearing from constituents and their outrage with this proposal by Time Warner Cable, Massa took on Time Warner Cable and after a lot of pressure was applied, Time Warner Cable eventually halted the trials.

But that did not stop Massa. He promised at the time that he would introduce legislation to address this issue and that's exactly what he did on Wednesday.

This is a summary from Massa that details what the Broadband Internet Fairness Act would do:

The Broadband Internet Fairness Act will prevent the monopolistic rate increases of broadband companies by promoting the interests of broadband customers. Specifically the bill:

- Requires internet service providers (ISPs) to submit plans to the Federal Trade Commission (FTC), in consultation with the FCC if they plan to move to a usage-based plan;

- Prohibits volume usage plans if the FTC determines that these plans are imposing rates, terms, and conditions that are unreasonable or discriminatory;

- Sets up public hearings for plans submitted to the FTC for public review and input;

- Only affects internet providers with 2 million or more subscribers;

- Imposes penalties for broadband ISPs that ignore these rules.

Time Warner Cable's consumption based billing would have charges customers who use the Internet frequently up to $150 a month for Internet usage. In that $150 a month is $75 a month for the "turbo" package that Time Warner Cable would have set up, which would give 100 GB of usage per month. But if you go over that, the overage fees max out at $75. Meaning, if you use your 100 GB for that month and go over the max amount, your Internet will cost you $150 for that month.

That is where Massa came in and decided that legislation was necessary to address this important issue.

"Access to the internet has become a critical part of our economy and we can't let corporate giants limit the public's access to this important tool," said Congressman Eric Massa. "The Broadband Internet Fairness Act is all about protecting consumers from outrageous internet overcharges and giving the public a voice in this process. I have taken lots of time to work on this bill and have consulted with my constituents and industry experts. Now the hard work of passing this bill begins."

"Cable providers want to stifle the internet so they can rake in advertiser dollars by keeping consumers from watching video on the Internet.  But so long as Americans can't choose which cable channels they want to pay for, I don't think cable operators should be able to determine consumers' monthly internet usage. Additionally, charging based on a bandwidth usage is a flawed model when the cost of usage is totally out of line with the price. Consumers are much better served by plans based on the speed of the connection rather than amount of bandwidth used. Competition is crucial to our economy and I refuse to let monopolistic corporations dominate the market and gouge my constituents."

This bill is important, considering Time Warner Cable apparently hasn't given up on consumption based billing and similar plans could be utilized by other ISPs in the future. Glenn Britt, CEO of Time Warner Cable, said this at the time: "It is clear from the public response over the last two weeks that there is a great deal of misunderstanding about our plans to roll out additional tests on Consumption Based Billing. As a result, we will not proceed with implementation of additional tests until further consultation with our customers and other interested parties, ensuring that community needs are being met. While we continue to believe that Consumption Based Billing may be the best pricing plan for consumers, we want to do everything we can to inform our customers of our plans and have the benefit of their views as part of our testing process."

That was April 16. Nothing further can be found regarding consumption based billing on Time Warner Cable's website, which used to display information (at least in April) about consumption based billing prominently on its website.  

Congressman Massa To Introduce Broadband Internet Fairness Act

by: robert.harding

Fri Apr 10, 2009 at 16:17:45 PM EDT

Congressman Massa has heard from his constituents who are outraged at this move by Time Warner. He has received letters and e-mails from people who are angry at this proposal. In response to the outpouring of correspondence he has received, Massa said today he will introduce legislation to address the broadband caps called the Broadband Internet Fairness Act.

(Note: The act isn't finished yet, but will be soon. As soon as the bill is finished, we will have access to it.)

Today Congressman Eric Massa (D-NY) announced officially that he is drafting legislation designed to prevent job killing broadband internet downloading caps. The Massa Broadband Internet Fairness Act would prohibit unfair tiered price structures from internet providers. The bill will also address the importance of helping broadband providers create jobs and increase their bandwidth while increasing competition in areas currently served by only one provider.

"I am taking a leadership position on this issue because of all the phone calls, emails and faxes I've received from my district and all over the country," said Congressman Eric Massa. "Time Warner has announced an ill-conceived plan to charge residential and business broadband fees based on the amount of data they download. They have yet to explain how increased internet usage increases their costs."

Massa also added this in response to Time Warner, who issued a statement regarding this proposal yesterday. I have included Time Warner's full proposal below the fold.

"Time Warner's decision has the potential to more than triple customers' current rates and I think most families will find this to be too taxing to afford. Time Warner believes they can do this in Rochester NY, Greensboro NC, Austin TX and San Antonio TX, and it's almost certainly just a matter of time before they attempt to overcharge all of their customers. And while I favor a business's right to maximize their profit potential, I believe safeguards must be put in place when a business has a monopoly on a specific region."

"At a time when millions of Americans have lost their jobs and businesses are struggling, I am compelled to fight against additional, unnecessary burdens placed on my constituents."

In the past week, there has been a significant uproar in the Rochester, NY area regarding Time Warner's announcement that they will "test market" a plan to charge customers based on how much they download. The initial proposal was to introduce a 5, 10, 20, or 40 gb/month downloading cap. If customers went over the cap, they would start mounting additional fees.

Then today Time Warner announced a new tiered plan similar to the previous one. However, for a consumer to receive the same unlimited internet that they currently do for around $40 per month, they would be billed $150 per month under the new plan.

In addition to this excessive and disproportionate charge, as internet usage increases by an average of 50% per year, companies setting caps sets a horrible, long-term, precedent. At a time when Americans need to utilize all available assets to improve the economy, limiting internet usage, which this plan would do, handicaps our ability to compete on the global stage. Furthermore, it will have significant stifling effects on start ups and small businesses.

This would also have significant impacts on the agricultural, medical, and educational communities. Farmers are increasingly dependent upon constant exchanges of GPS information to control all aspects of their operations. Medical professionals are increasing their data transfer rates, and patients rely on their ability to continue doing so unimpeded. Finally, educational institutions use more bandwidth every year. In Western New York, students at RIT's School for the Deaf, who use video transfer software to communicate, would be greatly disadvantaged by Time Warner's proposal.

It is also worth mentioning that Time Warner had four executives attend Congressman Massa's town hall meeting last night and engaged Congressman Massa on this issue. This reportedly led to an angry crowd and a tense debate about broadband caps. This isn't a popular decision Time Warner is making. That is very clear.