The FCC approved a set of auction rules today for the crucial 700 MHz spectrum. For 22 MHz of the spectrum, the rules apparently include some openness conditions, as Chairman Martin had indicated was likely. On the other hand, the rules do not require any spectrum to be operated on a wholesale basis with the goal of supporting multiple retail service providers, as CDT and others had urged.

The text of the rules isn’t yet publicly available, which makes it hard to say whether this is best characterized as a glass-half-full or glass-half-empty scenario. For example, it isn’t clear to us how broadly the requirement for openness to applications will be phrased and how it will be interpreted and enforced.

It’s pretty clear that the conditions fall well short of what Google had been publicly advocating in recent weeks. But the media’s excessive focus on Google, probably fueled by efforts of incumbent carriers to portray openness conditions as a money grab by Google, was neither helpful nor accurate. Yesterday’s front-page article in the Washington Post even characterized public interest groups as lobbying on Google’s behalf on the spectrum issue, and suggested that Google was responsible for recruiting various groups and companies to lobby for “its [Google’s] idea of an open network.”

In truth, it’s not just Google’s idea. The idea of an open network with no gatekeepers is one of the core principles that CDT has been fighting for since its inception, and a number of advocacy groups and academics have been working to promote open spectrum and open networks for years. The Public Interest Spectrum Coalition and Frontline Wireless played lead roles in bringing openness considerations to the fore of the spectrum policy debate.

As CDT has said before in the context of Internet neutrality, the debate really isn’t about what’s good or bad for Google. The focus should be squarely on innovation — the next Google, not the current one. Competitive broadband choices and networks that are open to innovative providers of services and applications would end up benefiting upstart entities that today have neither billions of dollars to participate in spectrum auctions, nor FCC regulatory counsel to weigh in on the intricacies of auction rules. Hopefully the FCC Commissioners, in deciding how far to go on openness and in crafting the specific rules, didn’t lose sight of why this really matters. It’s not just about who will buy the spectrum — it’s about whether the spectrum will be employed as key infrastructure that can enable innovation and economic growth by a diverse group of parties, or whether it will be devoted to narrower, single-company business models.

Yesterday I had the opportunity to attend a Subcommittee on Telecommunications and the Internet hearing titled “Wireless Innovation and Consumer Protection,” which focused on whether rules to promote consumer choice in wireless devices and applications would benefit the nearly 240 million Americans who are wireless subscribers.

While some of the lawmakers and witnesses at the hearing supported federal action, others maintained that market forces in the competitive space would serve consumers better than government regulation.

Tagged by many as the “iPhone” hearing, in reference to the controversy over Apple’s hot new product, the event kicked off with Chairman Ed Markey (D-MA.) criticizing AT&T’s exclusive service plan for the device, which he called a “Hotel California” service. “You can check out any time you like, but you can never leave: you’re stuck with your iPhone and you can’t take it anywhere.”

In addition to consumer welfare, the hearing considered whether the current wireless marketplace structure stifles innovation by would-be entrepreneurs. The subcommittee discussed Skype’s March petition to the FCC to extend the landmark 1968 Carterfone decision — which opened up a competitive, innovative marketplace for telephonic devices — to the wireless industry.

Separately, public interest advocates — including CDT, in recently filed comments — are pressing the FCC to apply “open access” principles to new licenses that will be granted to the winners of the upcoming 700 MHz band spectrum auction.

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Following up on its February workshop, the FTC recently released its report on Broadband Connectivity Competition Policy. CDT believes the report provides a generally balanced and comprehensive view of the Internet neutrality debate. We agree with the Commission that proceeding with caution and developing an in-depth understanding of the broadband marketplace are both essential to developing the appropriate policy in this area. However, as FTC Commissioner Jon Leibowitz noted in his concurring statement, the FTC’s conclusions about the adequacy of current law in addressing neutrality concerns are somewhat off-target.

The report explains the FTC’s view that the FTC’s authority to pursue both consumer protection and antitrust enforcement, together with existing FCC and DoJ jurisdiction, can sufficiently address current neutrality concerns. While this may be true in the consumer protection arena — where the FTC has authority over such issues as disclosure of prioritization practices to broadband Internet customers and the potential privacy issues raised by Internet packet inspection – it is less apparent with regards to antitrust. Moreover, in any event, it is not clear that consumer protection and antitrust principles taken together would address all potential neutrality concerns.

As CDT has pointed out in recent comments to the FCC, ISPs may engage in a wide range of packet management practices. While competition law may well be a useful tool in dealing with certain behaviors, such as outright blocking of competing services, it is not clear that other forms of discrimination, such as prioritizing affiliates’ traffic or degrading entire categories of traffic, can be adequately addressed by antitrust regulation. Indeed, as CDT has previously noted to the FTC, it would be more useful for the Internet neutrality debate to focus on the affirmative goal of preserving the Internet’s extraordinary ability to facilitate independent innovation and speech, rather than being limited to an analysis of anticompetitive practices. Some ISP practices may ultimately harm innovation without necessarily being “anticompetitive” in a legalistic sense.

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Earlier this week we submitted the first of what we hope will become a regular series of columns about technology policy for ABC News’ excellent technology page. CDT Executive Director Leslie Harris wrote our first submission about the upcoming FCC airwave auction.

As we said in our comments to the Federal Communications Commission, we believe that a substantial portion of the soon-to-be-available public airwaves should be allocated to promote new competitive alternatives for general-purpose broadband Internet service.

The FCC is facing a momentous decision over what to do with valuable wireless spectrum in the 700 MHz band that is being returned by broadcasters as part of the switch from analog to digital television signals. CDT believes that allocating substantial spectrum to broadband with preconditions for neutrality and wholesale access will be the best way to foster competition and innovation on the newly available airwaves. We encourage everyone to read the whole article, and we’ll keep you updated about future submissions.

The FTC Broadband Connectivity Competition Policy workshop finished up on Wednesday, and the Commission should be congratulated for holding an informative event that on the whole stuck closely to the issues.

CDT staff counsel David Sohn had the opportunity to participate on the last panel of the day. Although in such a position it can be difficult to say anything that has not been said already at the workshop, David opened by emphasizing that the Internet has brought us not only economic benefits, but societal benefits as well, including extraordinary opportunities for free speech and democratic participation. Economics were much more the focus of the workshop, but it is important to always keep in mind all of the reasons why we value the Internet to such a great extent. David and the other panelists got into many other details about broadband access and Internet neutrality – the transcript and webcast are available at the FTC Web site under “What Framework Best Promotes Competition and Consumer Welfare/Academic and Policy Panel.”

Many workshop participants cited recent papers and reports to support the claims they were making. We jotted down most of the ones that were mentioned – Chuck Goldfarb’s recent CRS Report on broadband access, the Joe Farrell/Phil Weiser paper on anti-trust and regulation of the Internet, the FCC’s most recent broadband report, and Tim Wu’s new wireless paper – and added them to CDT’s Net Neutrality Reading Room.

Yesterday was the first day of the FTC’s Broadband Connectivity Competition Policy public workshop, which is examining the competition and consumer protection issues involved with broadband Internet access, including Internet neutrality issues. There were two themes that came out of the first day that CDT was glad to observe: a desire to dig deeper into the intricacies of the issues being discussed, and a move to generate new thinking and original solutions beyond what has already been offered.

FTC Chairman Deborah Platt Majoras began the day by describing her desire to bring the information gleaned from dozens of in-depth private meetings on Internet connectivity issues into the public debate. Many other workshop participants also expressed the need to go beyond sound bites and drill down on the issues. Broadband Internet connectivity involves many complex technical, business, and legal arrangements. From the standpoint of an agency like the FTC which is contemplating its appropriate role in this area, it is of utmost importance that all of these complexities be fully understood. CDT has been working in this vein and is pleased to see that so many others feel the need to leave the rhetoric behind and gain a deeper understanding of the issues.

FTC Commissioner Jon Leibowitz kicked off the afternoon portion of the workshop by discussing his search for a “third way” solution to the Internet neutrality issue. Many of the day’s participants echoed this idea, discussing the need for balance in any policy that is adopted. Participants across the fields of economics, engineering, and consumer advocacy all expressed displeasure with extreme solutions. They are looking for original ideas that stakeholders on all sides will find workable, as is CDT. We were glad to hear this feeling expressed so many times, and we look forward to continuing to work together to develop solutions that everyone can agree on.

Videos and transcripts from all of the workshop’s panels and speakers are available here.

Earlier today we released our comprehensive legislative recommendations for 2007. This Congress will face a lot of big decisions — on issues ranging from privacy to free speech — that could have lasting impact on the Internet as we know it. In light of the growing attempts among lawmakers in recent years to exert greater control over Internet, that’s a somewhat unnerving concept. But by the same token, this Congress will have a great many opportunities to reestablish an approach to high-tech policy that respects both civil liberties and innovation.

Our agenda, which we’ll be distributing to key lawmakers in Congress in the coming days, includes a short treatise on what lawmakers need to know about Internet policymaking, as well as issue-by-issue legislative recommendations.

The underlying message is this: the Internet did not evolve to become one of the most robust, democratic communications tools the world has ever known by accident. An important element of the Internet’s success can be attributed to policymakers who realized early on that the Internet was different than anything they had yet encountered, and as such it required a different regulatory approach. That message remains true today, and that’s what we’ll be telling lawmakers as the 110th Congress gathers steam.

An article in yesterday’s Wall Street Journal (”Cellphone Carriers Let Others Sell Mobile Content to Users,” by Amol Sharma and Li Yuan) reports that mobile phone carriers are starting to let third-party content providers sell content to mobile phone users. That may well be a positive development for users. But it also highlights how different the mobile phone model is from the Internet, and offers a good illustration of what’s at stake in the Internet neutrality debate.

Initially, mobile phone carriers provided “mobile content” (ringtones, games, etc.) exclusively through their own portals. Verizon Wireless customers who wanted to download content to their mobile phones had to buy it directly from Verizon Wireless. The Wall Street Journal article reports that this is changing — carriers are striking deals with third parties such as MLB.com, which will then be able to offer on their own websites content for download to users’ phones.

I suppose that’s a step in the direction of openness, but the limits described in the article are striking. Users’ choices are still limited to content providers who have “partnered” with the mobile carriers by agreeing to a revenue sharing deal. The mobile provider generally keeps a hand in the transaction by arranging for charges to be added to the monthly bill, and may actively discourage direct credit card or PayPal transactions between the user and the content provider. About 75 percent of all mobile content sales are still through the carriers’ own portals. And some content is available to subscribers of certain mobile carriers but not others; for example, Verizon subscribers can’t get access to online mobile content by World Wrestling Entertainment, Inc., while subscribers of other carriers can.

Maybe all of that is ok in the fledgling and spectrum-constrained market for mobile content. But whatever you may think about it, it is very different from the Internet. Internet users download content, services, and applications from whomever they choose — not just “partners” of their ISPs. The sites and services users can access don’t depend on which ISPs they get their Internet connections from. Users and content providers enter into payment transactions with one another directly, using credit cards and PayPal, with no ISP involvement and without the ISP taking a cut. The result has been a hyper-competitive environment with unparalleled innovation and diverse choices for users. Innovation by untold numbers of entrepreneurs of all stripes and sizes turns out to yield a lot more interesting stuff than the product development divisions of a limited number of “content partners.” Given all those entrepreneurial content providers, the idea of an ISP providing 75 percent of the content its users buy online is virtually unthinkable.

The differences between these models — and the consequences of those differences — are a big part of what’s at issue in the net neutrality debate.

As we all know, we’re entering the end-of-Congress “silly season” during which time scoring rhetorical and political points takes precedence over reason and deliberation; and our transparent, open legislative process often gives way to stealth lawmaking and backroom deals.

This election year, with control of Congress hanging in the balance, the range of troubling and outright dangerous bills that could be shoehorned through the process is daunting. We’ve identified nine serious legislative efforts that could have long-lasting negative impact if passed.

To highlight the dangers posed by these efforts, CDT today released its “Internet Watch List. ” For us, the list is a tool to talk to lawmakers, journalists and the public about the some of the bills we’re particularly worried could make their way into law in the waning days of Congress. We hope you find it useful as well in your work to defend the Internet, privacy protections and civil liberties from these daunting threats.

For those who didn’t get a chance to read our paper on Internet Neutrality, we’ve synopsized our findings in a Policy Post published earlier today.

In a related development, BusinessWeek columnist Stephen H. Wildstrom gave a favorable nod to our position in his latest column on the topic, which will obviously be in the news for some time.