Andrew is the former general council of the Dept. of Commerce and now is a partner in Mayer, Brown, Rowe & Mawe.

[Pardon my brevity. This was a very good, short talk. But I’m pretty fried. Here’s a quick snippet:

The Internet is global. We had been successful on pushing our “don’t regulate the Internet” line, but with the World Summit on Information Services there’s a serious push for world regulation of the Net. Countries have inconsistent demands. To defeat pro-regulation forces, we hvae to take a decentralized approach. We have to defeat them all, not patch them up. The ITU will have exactly the opposite approach.

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John Morris, Center for Democacy and Technology
Mike Godwin, Public Knowledge
Geraldine Matise, FCC
Christopher Murray, Vonage
John Morris,
Douglas McCollum, Fiducianet
Timothy Wu, Columbia Law School
David Young, Verizon

Matise: CALEA allows law enforcement agencies to get information in close to real time. And it requires the information to be put into a standardized format. The Justice Dept. would like the FCC to assume more of an enforcement role, which the FCC is reluctant to do.

Morris: The substantial replacement language is applicable to email. If we go down the road the FCC is going down, CALEA will apply to it.

Godwin: We need to do cost-benefit analyses as the limiting principle because there’s no limiting principle built in.

Morris: Most of the mainstream public interest groups accept that there’s going to be some interception [= wiretaps]. The problem is with CALEA.

Wu: How hard are these rules making it for new businesses to get started? The FCC is most successful when it allows something to develop free of government permission and requires it to comply with regulatory stories once it has gotten established.

Murray: It has to run at the physical layer or we miss Skype.

Young: At the physical layer, you can’t provide things like call-to, call-from, call times, etc. All you see at the physical layer are IP addresses.

Murray: Vonage will be CALEA compliant. Not because we’re an information provider but because we made a business choice. [The choice not to fight an expensive losing fight]

Wu: Email really should be more subject to CALEA than VoIP. For one thing, email is well-established and won’t fail to take root because of CALEA’s impositions. If you were taking a mainstream approach, that’s where you’d start. The fledgling technologies shouldn’t be subject to it initially.

Morris: In April, the FBI was talking to people about CALEA. During that period I had an hour-long conversation with two FBI engineers. They are so stuck in the old way of doing things. They understand telephones. They don’t understand all that SIP stuff. At the end of the day, there will be sophisticated criminals who can circumvent the FBI, if CALEA goes the way it’s going. The FBI cries, “Terrorist! Terrorist!” but they’re not going to get them. They’re going to get the common criminal. That’s a bad reason to impose telephony regulation on a new media application.

Morris: CALEA was originally conceived as being of narrow scope. Louis Freeh went to Congress and said we’re giving up on the Internet in order to focus on digital telephony (not IP-based). Law enforcement has bamboozled the FCC by repeatedly saying that it needs this. There’s no public record saying that this is a genuine problem.

Someone in the audience in Elliott Spitzer’s office, says, yes, there is a problem. They have phone taps interrupted when someone says, “Let me call you on my push-to-talk phone.”

Godwin: If you want to be able to tap every communications type, you’ll kill innovation.

McCollum: There’s a very good case that as soon as criminals know there’s a service that isn’t wire-tapped, that’s where they’ll go.

Q: What assurances are there that CALEA won’t open the door to all sorts of abuses in the name of fighting terrorism, just as in the 50s and 60s, the FBI engaged in abuses in the name of fighting communism?

No response from the panel.

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“That’s why I said to the Taliban in Afghanistan: Get rid of al Qaeda; see, you’re harboring al Qaeda. Remember this is a place where they trained — al Qaeda trained thousands of people in Afghanistan. And the Taliban, I guess, just didn’t believe me. And as a result of the United States military, Taliban no longer is in existence.” [Bush, 9/27/04]

There’s estimates that 90 percent of the country — at least a very large percent of the country, is under the occupation of the Taliban and the warlords.” [Rep. Paul (R-TX)., Remarks to House Committee on International Relations, 9/23/04]

Taliban Violence Threatens Elections: The pre-election period has been marred by repeated attacks against voter registration workers and facilities, mostly carried out by Taliban forces. The Taliban has vowed to sabotage the election — the first national poll in Afghanistan in three decades of war and turmoil, and the country’s first-ever presidential election. [Washington Post, 9/17/04]

“There is no Soviet dominance of Eastern Europe.” — Gerald Ford, 1976

[The first three quotes come from a mailing from the Kerry campaign.]

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According to an interview on The Connection, Iraqi insurgents holding a reporter googled him to confirm his identity. [Thanks to Marvin Ammori for the link.]

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Stewart is general counsel to the Commission on Intelligence Capabilties or the US Regarding WMD, but he’s speaking on behalf of himself.

CALEA was pretty good as written, he says. “The problem with the FCC’s tentative conclusions is that it takes a statutory set of standards and turns it into a kind of commission mush.”

“The one fundamental thing about regulating to give law enforcement access to new technology is that there’s a big cliff effect.” At some point the regulations stop. Are you going to tell Intel how to design their chips and Cisco how to design their routers? Eventually you got to a spot in the economy that’s beyond regulation. Where do you put the cliff? CALEA said they’d put it in rate-regulated industries. The FCC instead said that information services are exempt “sometimes.” That “mushy” response gives the FCC what it really wants: “Discretion to reach out and regulate a little more” to accommodate all the stakeholders. That means you can’t really know whether you’re regulated or not.

CALEA sets a performance standard for companies as opposed to a type of input-output regulation. It says you must make your telecommunications — every call — isolatable and deliverable to law enforcement. We don’t care how you do it. You won’t be challenged until a law enforcement agency comes to you, which gives you some time to establish your business. The FCC, under pressure from enforcement agencies, instead demands that on Day One you have to have all the CALEA features the FBI wants. That will discourage innovation: You first have to sit down with the FBI and figure out how you’re going to meet every CALEA requirement from the beginning.

The “substantial replacement” test that the FCC has adopted is “dangerous.” The original statute says that if your tech is going up as the PSTN is going down, then you are subject to CALEA. The FCC instead says that “substantial replacement” can be “decided in the abstract.” Anything that connects to you to the Internet is now a potential substantial replacement…wireless, maybe even private pbx connections, can be treated as covered by CALEA.

“The FCC makes a big deal” out of the few things it rejects, e.g., the FBI’s desire to have the right of approval over any new technology. The FCC says that if you have any doubts, you can go to FCC and they’ll them. So, innovators will do it because they don’t want to find out otherwise after they’ve built it. So, you’ll talk with the FCC and the FBI, and they’ll assume the worst, so you’ll launch anywhere but the US so you can see how it works, get the bugs out, have some money to go back to the FCC to go through the regulatory process. “What this does to innovation in the telecommunications in the market in the US is disastrous.”

[This and John Rogovin’s were excellent presentations, IMO I.e., I understood over 50% of what they said.]

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John is the legal counsel to the FCC and he’s going to talk about CALEA and the obligations of VoIP to assist law enforcement. But, first, as he steps up to the podium, he gets two phone calls. He doesn’t take either.

This happens in the midst of two major changes. First, there’s the digital revolution, which the FCC is trying to apply only a “light regulatory touch” to. Second, there’s the security imperative.

CALEA requires carriers to give access to the content and the metadata of calls to law enforcement agencies. But how do you do this in the digital age? That’s what CALEA is about, John says.

The FCC put forward some tentative conclusions for comment.

1. “Telecommunications” is broader in CALEA than in the Telecom Act.

2. Whatever substitutes for telephone service (= VoIP) is subject to CALEA.

[Missed the rest. Damn.]

The FCC concludes that VoIP is both a substantial replacement (and thus subject) and an information service (and thus not), so we’re going to go with the one that gives law enforcement the tools they need. Hence, it’s a substantial replacement.

Distintermediated calls — peer-to-peer — would not be covered by CALEA.

Comments are due Nov. 8

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BlogPulse is graphing the attention bloggers are paying to candidates and issues. They explain what they’re doing here.

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Robert Frieden, Penn State, College of Communications
Jonathan Askin, Pulver.com
Jonathan Weinberg, Wayne State, Law
Kevin Werbach, Wharton School
Brad Ramsay, Nat’l Assoc. of Regulatory Utilities Comissioners
Matthew Brill, FCC

Topic: “Should universal service contributions be required of all IP-enabled services? Or only those that use telephone numbers or connect to the traditional telephone network.”

From the FCC site:

The goals of Universal Service, as mandated by the 1996 Act, are to promote the availability of quality services at just, reasonable, and affordable rates; increase access to advanced telecommunications services throughout the Nation; advance the availability of such services to all consumers, including those in low income, rural, insular, and high cost areas at rates that are reasonably comparable to those charged in urban areas.

[Missed the first five minutes. Even bloggers have to pee.]

Askin: Wireless is decimating plain-old-telephone-systems (POTS). It seems strange to point to VOIP as the death knell for the universal service regime. We’re going to have to move to a proposal that’s either numbers- or connections-based. [Ok, not sure what that means. Later: “Numbers” refers to telephone numbers, not numbers of telephones or calls.]

Werbach: Blow it up! This is a very complex topic. It’s a mess. The social policy goal of providing universal service is a good one. How do we move from this incredibly messy system to something that works better? When you add VoIP, you have an unresolvable conflict. If voice is an application, any attempt to chase it down and apply universal service subsidies to it will fail? E.g., how do you apply it to Skype, a free app written by Swedes? On the other hand, we need something technologically neutral. Using numbers is a good idea: When you get a phone number, some subsidy will be collected through that, not through your actual phone charges. We should make the distribution technologically neutral as well.

Weinberg: We need to rethink the whole system.

Brill: The best thing about the number approach is we know what they are and who’s got them, so it can be administered. But, it’s not future-proof. Connection-based charges are hard to administer because carriers don’t always know how many connections they have. Policing it is hard. But it is more future-proof. Either way, we’re talking about spreading the burden over all users of the PSTN (public switched telephone network). We’re going to have to step in because we need a sustainable universal service program, and it’ll be either numbers- of conections-based.

Astin: The current universal service is devastating to broadband deployment. We need some serious national broadband program. If you won’t do a national highway-style project, then we’ll have a tax.

Werbach: The Internet model is different in that there’s an initial cost to build it, but then costs go down, unlike other systems. So, if we’re going to have a universal system, we need one that providies the intial costs, but not continuing costs at the same level.

Crawford (moderator): How about a reverse auction?

Brill: Nope.

Frieden: One reason we’re 15th in broadband adoption is that our dialup rates (isp and phone service) are so cheap.

Q: (Isenberg) What is the most efficient way to deliver services most efficiently to people who don’t have these services? That’s the goal of the Universal Service fund. Let me propose that what you’ve got is way over-specified. Nuke it! Instead, if the FCC did their job and got out of the way and let the technology flow through to the end user, we’d have twice as much to the end user in 18 months [because of Moore’s Law]. The only thing the regulators need to do is get out of the way.

Werbach: Not enough assessment has been done of what’s available now, on the ground.

Brill and Askin agree that the ETC (Eligible Telephony Carriers?) program has improved dramatically in the past three years.

Q: (Bruce) The first thing to do is audit the charges and surcharges on phone bills.

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Dan‘s giving the lunchtime presentation.

Something big is happening, he says. The former readers are now writers and participants. The media need to learn some lessons. E.g., CBS should learn not to refer to bloggers as “pajama people.”

He describes the moments when he realized that something big was happening to media. [I’m not going to recount the anecdotes in detail because I won’t do them justice. Get his book.] E.g., Election night in Hong Kong when he realized that he was assembling for himself Net sources that were giving him a better view than the broadcasts in the US. Also, Dan watched how the Net responded on 9/11. The Trent Lott story breaking in the blogs. Qwest’s Nacchio at PCForum being caught out by a guy who was reading the bloggers at the conference, in real time.

The tools won’t just be text, however, Dan says: Mobile phones, video cameras, etc. We’re re-mixing and it’s great. Unfortunately, it’s probably illegal, especially if you’re breaking the DRM to do it. Also, the better you are, the more it costs you: If people flock to your web page to see your great video, “you’ll get a whopping bill” from your host. “The only plausible delivery mechanism is peer-to-peer. Naturally, that’s under attack, too.” Dan says he’s a proud user of BitTorrent, to a smattering of applause. He says he was in Hong Kong and wanted to watch West Wing, so he downloaded it. “My question was: Who can I send my money to for this wonderful service?” But Hollywood doesn’t want his money for that because it’s disruptive.

Now he turns to policy “because I’m afraid this culture of creativity that I love and is the future” is threatened by the incumbents. The government wants “chokepoints” and insertion points. “The copyright lobby definitely wants chokepoints.”

“Copyright is a disaster area for the new kind of media I believe in so strongly.” The Broadcast Flag is “madness.” “It’s just nuts from any perspective except Hollywood’s.” “It’s about fundamental freedoms.” “Think about if we need permission to quote text. And with digital books, that may be where we’re headed.”

The Web is now a read and write place, but the architecture doesn’t support it well, e.g., the fact that your download speed is faster than your upload speed.

“I’m pretty afraid that end-to-end is going to disappear. The mobile carriers have never believed in it.” Nokia has a phone with Python on it, an example of the good stuff that will come from the phone manufacturers if they’re separated from the carriers.

Peer-to-peer is under attack. “I plead with you not to support the Induce Act” because it will make things clearly ok now subject to legal action.” Even, potentially, the iPod.

“End-to-end and neutrality of the network are important to me.”

Governments, as well as carriers, want to control the content. E.g., Yahoo’s fight with the French government, Google’s changing the content they deliver on their China news site, Cisco gleefully selling quality of service routers to the Chinese and Saudi Arabia. “I don’t want to zone the Internet.” Dan understands the policy reasons for applying CALEA to VoIP, but it doesn’t make sense to him. “Have these people heard of Skype with 10 million users already?”

Dan gives Michael Powell credit for what he’s been saying and doing with spectrum. He hopes there’s more unlicensed spectrum. “When I’m in the Valley, the most amazing stuff I’m seeing among the entrepreneur’s is wireless.” Dan used to think that we ought to have a public works project to lay fiber, but now he thinks wireless may solve it, “if it’s given the freedom to solve it.”

“I hope we enforce with rules nework neutrality.” The owners of the pipes ought not to own the content.

“We are on the cusp of an era that will be incredibly messy…but more voices are already better than fewer voices, especially when there’s been a concentration…Without those voices, it could get pretty scary indeed. So, let’s not lose the potential. Let’s let the Net be the Net.” If we have behavioral problems we have to deal with, then let’s not deal with it at the architectural level.

Q: BellSouth and Qwest are building networks that won’t let other people’s video on.

A: If there won’t be rules that say you will provide open networks, we have to count on wireless. I’m not crazy about that solution. Maybe both would be good. The power is with the incumbents. The power wouldn’t be with the incumbents if the technology industry, which is bigger than Hollywood, would take up the challenge.

Q: Does end-to-end cover just the network, or also the operating system and the browser?

A: Yes, and the market seems to be taking care of this. There’s enough progress in Linux that we have a better shot at the discipline of the marketplace. Dan says he was a vehement supporter of the Microsoft antitrust suit that was sold out by the Bush administration, a “scandal,” says Dan.

[Terrific talk, I thought. But, then I am a huge admirer of Dan’s skill and self-effacing goodness.]

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Robert Blau, BellSouth
Jeffrey Carlisle, chief of Wireline Competition Bureau of FCC
Bill Hunt, Level 3
James Lewis, MCI
Randolph May, Progress & Freedom Foundation
Gigi Sohn, Public Knowledge
James Speta, Northwestern U., Law

Since this is about ancillary jurisdiction and I don’t know what this, I’m lost. As I’m googling around, the panel is proceeding. Damn. (Some resources here). Here’s the official topic:

What are the arguments for and against FCC’s exercise of “ancillary jurisdiction” over IP-enabled services? Are there new ways of thinking about the FCC’s role (e.g., a “layers” approach) that might be useful? Can the FCC preempt state actions without itself acting?

Aha! This is from the materials posted on the conference’s site (d’oh!):

[Panel 2 addresses] whether the FCC has statutory authority to undertake the proposed regulation. Under basic principles of administrative law, the FCC, like any agency, cannot regulate without Congressional authorization. It does not have (nor does it claim to have) express authorization to regulate IP-enabled services. However, courts have long deemed the FCC to possess so-called “ancillary jurisdiction” over matters not directly within its express authority. The NPRM invokes this ancillary jurisdiction

I.e., it means the FCC can regulate stuff they don’t have the right to regulate in order to enforce regulations on stuff they are allowed to regulate…in this case, IP-enabled services.

[It was just announced that the panelists want to clear what’s being written about them. Apparently, this does not apply to bloggers. I should note, however, that I make no claim to accuracy or fairness. I’m doing my best, but I am an unreliable narrator, especially when I don’t understand what anyone is saying.]

Sohn describes the Broadcast Flag: The FCC says that all digital devices have to be compliant to the “flag.” Her group‘s position is that there’s nothing in their ancillary jurisdiction that gives the FCC to compel electronics manufacturers to do this. You have to tie it to a Congresssional mandate, but the FCC didn’t even bother to do that. Not only has the FCC never mandated an architectural fix without a Congressional mandate, but the FCC is prohibited from doing this. “I think the FCC has really over-stepped its bounds…This is mainly the motion picture industry banging away on the FCC until it did something for them.”

Speta: There are good reasons for the FCC to have jurisdiction over all these things. Section 230 would be very important. [?] He refers to his paper which says (from the abstract):

the FCC likely does not have jurisdiction to address most Internet regulatory issues, because whatever expansive readings such ancillary jurisdiction has received in the past are no longer tenable. The paper proposes, instead, a new, limited statutory interconnection rule, which the FCC could enforce in limited ways in Internet markets.

Lewis says that you ought to look at physical, layer, app and content layers. As you go up the stack, the need for regulation diminishes.

The panel discusses the “layers” model, which comes from an MCI paper by Richard Whitt, “A Horizontal Leap Forward: Formulating a New Public Policy Framework Based on the Network Layers Model,” (March 2004).) From the abstract:

Some argue that new IP services should be “shoe-horned” into the existing requirements of the legacy system, despite the poor fit. Others believe that new classifications and definitions can be created within the confines of legacy regulations. In MCI’s view, however, the optimal solution is to turn the conundrum around on itself, and begin to adapt our legal thinking and institutions to the reality of how the Internet fundamentally is changing the very nature of the business and social world.

In this paper, MCI will explain that trying to impose the current outmoded legal system onto the Internet and all its IP progeny is a flawed, damaging, and ultimately doomed approach. Instead, policymakers should adopt a new public policy framework that regulates along horizontal network layers, rather than legacy vertical silos.

From later in the paper:

To avoid the risk of further serious damage, policymakers must move away from the increasingly outmoded vertical “silos” that artificially separate communications-related services, networks, and industries from each other. Informed by the way that engineers create layered protocol models, and inspired by the analytical work of noted academics and technology experts, policymakers should adopt a comprehensive legal and regulatory framework founded on the Internet’s horizontal network layers. We must build our laws around the Net, rather than the other way around.

Sohn likes the layers model because it limits what the government can regulate. The alternative seems to be to call everything “communication” and regulate the whole shootin’ match.

Carlisle: The statute isn’t set up to be very nuanced: We have telecom and we information services. The layered approach looks great, but how does it fit into the statute?

Lewis: The layers model translates well.

Speta: Layers help analyze problems, but I worry about writing it into the act. As for moving it into the executive branch: I don’t like it.

Blau: When the next legislative debate gets going, probably next year, it will be difficult to justify today’s heavy-handed approach to regulation…

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