Telecom Campaign Money Shifts to Democrats in Net Neutrality Fight

Telecoms and Internet users are girding for new battles over net neutrality rules.As the new Congress considers legislating network neutrality for internet service providers, telecoms in Colorado are piling on the campaign cash for Democrats who will decide the issue. Campaign donations from telecoms in the state have shifted dramatically from Republican candidates to Democratic ones over the 2004-2008 election cycles.

Net neutrality — rules prohibiting service providers from favoring one type of Internet traffic over another — is one of the major issues for the large and small players in the Internet economy, but it doesn’t code into any easy political shorthand. In general, big telecoms like AT&T, Qwest and their suppliers, such as Cisco Systems, oppose net neutrality rules.

But you can hardly read a story about the topic without seeing the phrase “strange bedfellows.” Supporters of net neutrality include the Christian Coalition and the American Civil Liberties Union, Google and Gun Owners of America, among many others. The Christian Coalition or the ACLU doesn’t want AT&T, for instance, deciding whether its message deserves priority in AT&T’s “pipes.”

Net neutrality is a term popularized by Columbia University law professor Tim Wu. It refers to regulations that were in place prior to the summer of 2005 that prevented owners of the physical “backbone” of the communications structure from discriminating in disseminating content. The Federal Communications Commission abandoned the rules in 2005.

If net neutrality is enforced an owner of the “backbone” – like, say, AT&T or Qwest – couldn’t provide faster service to Google and slower service to Gun Owners of America. Since the rules have lapsed, there have been a few isolated cases of this kind of discrimination. A small East Coast provider blocked voice-over-Internet provider Vonage from access to its servers, but the action was quickly reversed. Comcast last year was sharply criticized for blocking peer-to-peer Internet traffic from file-sharing networks BitTorrent and Gnutella. The FCC is investigating that incident.

Some of the owners of “the pipes” have been pretty straightforward about wanting to control their networks and make more money from them. AT&T’s Ed Whitacre was quoted in BusinessWeek:

“Now what they would like to do is use my pipes free, but I ain’t going to let them do that because we have spent this capital and we have to have a return on it. So there’s going to have to be some mechanism for these people who use these pipes to pay for the portion they’re using. Why should they be allowed to use my pipes?”

Representatives at AT&T did not respond to emails asking for comment. AT&T has apparently also said it plans to filter its Internet traffic for possible violations of intellectual property laws.

“Blocking” controversies like the Comcast case are often not a simple case of corporate censorship of undesirable material, however. Comcast says it was only exercising reasonable network management. The peer-to-peer files use up a lot of bandwidth, but serve a small portion of its customers. As one telecom spokesman said:

“What they were doing was trying to control peer-to-peer traffic. If you live in a neighborhood where your neighbors are doing a lot of that, it’s going to slow down your connection. [Comcast] may have harmed three percent, but they did it to benefit the 97 percent who are just ordinary users.”

Net neutrality activists are not persuaded. Save The Internet said:

“Comcast’s defense is flimsy. The company’s blatant and deceptive blocking is exactly the type of problem Net Neutrality supporters warned would occur without open Internet protections. Public pressure is now forcing the FCC to act.

“Comcast’s meddling with user content is the canary in the coal mine for corporate efforts to control the Internet. The FCC must send a stern message to stop other phone and cable companies that want to follow Comcast’s lead.

“Blocking access to the Internet should never be tolerated.”

Rep. Edward Markey (D-Mass.) plans to introduce legislation in the U.S. House of Representatives early this year that will legislatively reinstate net neutrality protections.

In general, Democrats have been more sympathetic to net neutrality than Republicans have, though there is considerable crossover in both directions.

In Colorado over the election cycles from 2004-2008, telecom and media political action committees have donated just under $540,000 to Colorado’s U.S. senators, representatives and candidates for those offices. They gave $198,000 in the 2004 cycle, $229,000 in the 2006 cycle and $103,000 so far with ten months still to go in the 2008 cycle.

There’s been a dramatic shift in the pattern of donations, however. In 2004, about 57 percent of the donations from the telecom industry went to Republican candidates, and 43 percent to Democrats. In 2006, only 29 percent went to Republicans and 71 percent to Democrats. And in the 2008 cycle so far, a whopping 92 percent of telecom donations have gone to Democrats and only 8 percent to Republicans.

In addition, Qwest has pledged $6 million to the Democratic National Convention here in August. Level 3 Communications has pledged $1 million and other telecoms lesser amounts. A spokesman for Save The Internet said:

“The national conventions are a schmoozefest for influential and powerful lobbyists. All the largest telecom firms are going to have a very strong presence there.”

Jeff Hart, a professor at Indiana University and an expert in national net neutrality policy, said in an interview:

“Up until the debates of 2006, the majority of the telephone and cable money was going to Republicans on this issue. If the telephone companies were shifting their money, that would be interesting. It’s probably because the Democrats control Congress now.

“The Republicans gave the Democrats an opportunity on this issue,” Hart says. “They put themselves in the camp of the telephone and cable systems and weren’t willing to listen to the arguments of others.”

John Ryan, senior vice president and assistant chief legal officer for Level 3 Communications, said in an interview:

“If you look at all our PAC contributions, we have been relatively balanced. If the money is going to Democrats, it is largely because our Colorado delegation is mostly Democrats. We have supported Sen. [Wayne] Allard [R-Colo.] and would continue to if he were running again because he has been receptive and open to listening to our concerns.

“We focus our efforts on those members who sit on committees that are appropriate to what we do and area receptive to the competitive industry. You find those people on both sides of the aisle.”

Colorado’s big congressional player in telecom issues is Democratic Rep. Diana DeGette, who is the vice chair of the House Energy and Commerce Committee which has jurisdiction over much of the net neutrality legislation. DeGette’s office declined a request for an interview with her about this topic. She was an early opponent of net neutrality rules, but has since changed her position to support them.

DeGette has reaped the most donations from telecom PACs of any Colorado member of Congress over the last three cycles. She’s gotten a total of $89,500 since the 2004 election, including $15,000 from Level 3’s PAC, $11,000 from Comcast’s and $8,000 from Qwest’s PAC.

Democratic Rep. Mark Udall has received about $82,000 from telecom-related PACs; former Republican Rep. Bob Beauprez got more then $71,000 in only the 2004 and 2006 election cycles; Rep. John Salazar has gathered up $63,300; and Sen. Ken Salazar, $53,250.

Udall’s office says that the congressman supports net neutrality, and that he voted for a version of Markey’s legislation that was considered in the last congressional session.

Whether this shift in financial support will result in any changes of position on net neutrality remains to be seen. The Communications Workers of America, a labor union, has come out against net neutrality as possibly hurting job prospects for its members. The CWA’s been a major donor in Colorado, giving a total of $37,500 in the 2004 and 2006 cycles to candidates Angie Paccione and David Jeffrey Thomas, Democrats who lost, and to successful Democrats John Salazar and Ed Perlmutter.

Level 3’s Ryan says that net neutrality regulation may be a solution in search of a problem:

“Our belief is that, given the speed with which the Internet changes, any attempt to regulate carrier conduct is going to be outdated the moment the regulation is passed.

“On the network neutrality front, existing anti-trust laws or slight modifications can be done and subscriber rights to access all sorts of content can be protected, without getting into the weeds about what individual carriers can and can’t do with their networks.”

But Indiana University’s Hart says:

“The key thing is if you want to keep integration happening on the Internet, you don’t want to favor some companies over others. If you allow people who control the ‘pipes’ to control the information, they can slow the information down.”

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