• Future of the Internet

    Surprise! World’s largest telco calls for a ‘Net Neutrality bill’

    AT&T wants US Congress to adopt an Open Internet bill, says its CEO Randall Stephenson in an open letter. A new spectacular turn in the US saga over Net Neutrality? Some might see it as a new spectacular turn in the US saga over Net Neutrality. In an [read more]
    byThe Digital Post | 25/Jan/20183 min read
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    AT&T wants US Congress to adopt an Open Internet bill, says its CEO Randall Stephenson in an open letter. A new spectacular turn in the US saga over Net Neutrality?

    Some might see it as a new spectacular turn in the US saga over Net Neutrality. In an open letter issued yesterday, AT&T Ceo Randal Stephenson called on US Congress ‘to establish an “Internet Bill of Rights” that applies to all internet companies and guarantees neutrality, transparency, openness, non-discrimination and privacy protection for all internet users’.

    The text marks an unprecedented step, which might have an impact coming from the world’s largest telecommunication company.

    In the letter, Stephenson assures AT&T will stay committed to the open internet principles, but argues ‘that commitment of one company is not enough’, signaling that ‘congressional action is needed’.

    Internet rights’ apart, the stance of AT&T is also driven by the perceived risk that the endless legal battle over Net Neutrality is producing too much uncertainty, at the expense of investment decisions.

    ‘Regulators under four different presidents have taken four different approaches. Courts have overturned regulatory decisions. [..] It’s understandably confusing and a bit concerning when you hear the rules have recently changed, yet again’, writes Stephenson.

    In December the FCC reversed the decision voted in 2015 to reclassify high-speed Internet service as a telecommunications service, instead of an information service, under Title II of the Telecommunications Act.

    Taken in order to enforce strict net neutrality rules on Internet service providers, the precedent decision had de facto exposed Internet providers to the possibility of heavy regulation dating back to “the phone company era”, although FCC had opted to apply only some provisions of Title II.

    The new vote restores a light-touch approach, but the last word has not been said, as the decision is being challenged in federal courts, where it could be stuck for years.

    The text signed by Stephenson follows another open letter to FCC signed by 141 members of the EP pleading for a Net Neutrality bill in the US. The EU adopted its own net neutrality legislation in November 2015.

     

    Picture Credits: Ozzy Delaney

     

     

     

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  • Telecoms

    Is Donald Trump (at last) waking up to the reality of digital markets?

    Donald Trump’s willingness to change his stance against the proposed AT&T-Time Warner merger is a sign of realism. US President should take a clear position in favor of the country's digital industry. This is the only possible approach if the US is [read more]
    byAndrea Giuricin | 27/Jan/20176 min read
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    Donald Trump’s willingness to change his stance against the proposed AT&T-Time Warner merger is a sign of realism. US President should take a clear position in favor of the country’s digital industry. This is the only possible approach if the US is to maintain its leadership in the digital market.

    President Trump demonstrated a welcome realism towards the economy last week, declaring that he had not yet “seen any of the facts” regarding the risk of monopoly associated with the merger between AT&T and Time Warner.

    The new US President put the US Telco operator’s offer for the TV market leader under the spotlight in October during a campaign speech in which he warned about the risk to competition linked with creating a group that was too big.

    While this type of risk is a significant factor to consider in a liberal economy such as the US, it is important to understand what “too big” actually means in the telecoms and digital market.

    If we look at the new digital market, which includes huge internet groups (Google), logistics groups (Amazon), content producers (Netflix) as well as traditional telcos and TV operators, it is easy to see that the definition of “too big” has dramatically changed.

    Today we must understand that competition is not confined to a single country, but that we have a real global digital market.

    When AT&T bought DirecTV it was clear that the Americas was being treated as a single area, but it is equally easy to understand that an OTT such as Netflix aims to reach a global market.

    The latest financial results of Netflix underlines this, showing that the non-US markets will soon form the largest part of its revenues.

    The competition in the digital market is not just vertical (Google enters several markets), but it is more and more horizontal in terms of geography. There is a new challenge, clearly recognized and outlined by President Trump: the rise of Chinese companies.

    The two leading countries in terms of the number of mobile connections are China and India, with over 1 billion subscribers each. Last week, Chinese President Xi Jinping advocated for an open economy and the end of protectionism at the World Economic Forum. It was a nice speech, but in reality Chinese competition is difficult to fight given the many barriers to entry in its market.

    The big players from China are targeting digital markets globally with companies such as Alibaba or WeChat operating in a number of markets, not just in Asia but worldwide.  It is becoming clear that operators such as AT&T in fact risk becoming too small to compete on this global stage..

    So, would the merger between AT&T and Time Warner create too large a player?

    AT&T realized several years ago that it was impossible to compete in a digital market without content. The decision to buy Time Warner following DirecTV is the right strategy to ensure continued competitiveness in a global world, especially when considering the expanding Chinese companies.

    President Trump’s outlook on the economy is clear and it should lead to him taking a position in favor of US operators. This is the only possible approach if the US is to maintain its leadership in the digital market together with the high value-added jobs associated with it.

    To make America great again, the US needs realism from its President on this AT&T and Time Warner deal.

     

    Picture credits: Jack Skipworth
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