shouting loudly

Yesterday, the American Consumer Institute inaccurately assailed network neutrality proponents for pretending to represent the voice of consumers while actually representing the voices of very large and powerful companies. The report’s author, who is no neutral observer, uses decontextualized economic data to obscure the political reality on the ground.

Dr. Larry F. Darby (Ph.D. in economics, Indiana, 1971) authored the report (pdf), which is two pages of interesting financial details of pro-neutrality companies such as Google and Microsoft, alongside those of anti-neutrality companies such as Time Warner and AT&T.

Dr. Darby purportedly seeks to clarify any confusion about the relative size and market share of the companies on each side of the debate. “Consumers following the debate in the press and assorted blogs might conclude that the battle is between big corporate ‘haves’ and an assortment of garage-dwelling, startups.”

I’m unpersuaded as to his motivation. Read his bio: Dr. Darby has run his own telecom consulting shop since 1989. He is a vocal advocate for telecom deregulation who makes claims like this beauty: “Technological and economic dynamism, measured in large and small ways, is the quintessential characteristic of telecom markets.” Really? Because Verizon’s landline/DSL customer service is still so bad I’d pay a fistful more if there was another realistic option to get better service. But why would an expert at a consumer group care about that?

Darby willfully mischaracterizes the pro-neutrality side in a way that obfuscates the glaring difference in popular support for the two policy positions. The media reform nonprofit FreePress, which runs SaveTheInternet.com, is actually the principle antagonist calling for network neutrality. Their website has over a million petition signatures, 15,000 blog links, and 17,000 MySpace friends, all inescapable signs that net neutrality is a hugely popular policy. (In contrast, somebody show me the popular hub of anti-neutrality advocacy; I don’t think there is one.)

All the same, Darby characterizes the major dotcoms as “the principal antagonists” on behalf of NN. That is simply untrue. The meat of the pro-NN lobby reads like an honor roll of the nonprofit and education sectors. FreePress employees such as Timothy Karr and Ben Scott, not to mention Lawrence Lessig, Tim Wu (pdf), Mark Cooper, Gigi Sohn (disclosure: my summer boss @ PK, where I was an unpaid intern), and a fistful of others have done more on this issue for a longer time than anyone in the private sector. Sergei Brin finally came to DC on a poorly organized lobbying trip in June, and he felt like a tourist.

Darby’s talk of stock valuations obscures the fact that cable & telco lobbyists are doing a way better job of old-fashioned, closed-room, big-money lobbying. Here’s just one very ugly sign: Stevens’ Senate telecom bill is untouchable before the election but may still pass this Congress.

The National Journal just had an awesome story (sorry; no link available) on how the telecom and cable companies have whipped the dotcoms on the hill. AT&T ($17.6m), the US Telecom Assn (16.8), and Verizon (11.8) EACH spent more on lobbying in 2005 than the $11.7m spent in TOTAL by Microsoft ($8.7m), eBay (1), Amazon ($920k), Yahoo! ($800k), and Google (just $260k). Total telco/cable vs. dotcom spending? $71.5m to $12.2.

Omit Microsoft and it’s a laughably imbalanced 20 to 1. Further, net neutrality is very tiny portion of Microsoft’s concerns. MS is certainly spending a great deal of its energies on antitrust and copyright issues, while bells & cable cos care almost exclusively about telecom regulation.

When I was on The Hill this summer, I saw droves of cable lobbyists marching into congressional offices. They were like an army, all proudly wearing nametags with the NCTA logo. In comparison, the dotcoms are newer companies with far newer lobbying operations, and they just weren’t ready to beat the cable & telco hardball lobbyist.

The network neutrality debate is an excellent illustration of what happens when a well-funded, well-organized lobby matches up against an under-funded lobby: the former usually wins, but massive public support for the latter can occasionally prevail.

The NN battle really is between “big corporate ‘haves’” and a group of underfunded nonprofits–plus the underfunded lobbying wings of companies that were recently garage startups.

Network neutrality is more than the brainchild of successful dotcoms; it’s pro-consumer, not to mention pro-democracy. If you want the input of a bona-fide consumer advocate, ask Consumers Union (publisher of Consumer Reports), which expressed concerns about broadband discrimination in 2000 and is a charter member of the SaveTheInternet Coalition.

If you want the input of a telecom consultant, pretending to speak on behalf of consumers, ask Dr. Darby.