BlackBerry on "App Neutrality"
Net Neutrality: No on Reclassification, Yes on Adding Content & App Providers
U.S. President Obama and FCC Chairman Tom Wheeler have put net neutrality back on the front burner with their recently announced support for reclassifying both wireline and wireless broadband as Title II services. Congressional committees are holding hearings this week to consider these and perhaps other proposals. Here is BlackBerry’s perspective on the important issues raised by the various proposals under discussion.
BlackBerry is uniquely positioned to comment on these issues. We are a Canadian company offering service to customers in more than 150 countries. We provide the world’s most secure mobile communications platform. President Obama, Prime Minister Cameron, Chancellor Merkel, NATO, the U.S. Department of Defense, and Members of Congress rely on our high security, end-to-end secure communications network to protect their most sensitive communications. We do business with more than 600 wireless carriers globally and are intimately familiar with wireless broadband networks around the world, including in countries with higher and faster broadband penetration than the United States.
Based on our experience, we offer the following observations:
Defining Net Neutrality. There is widespread disagreement in defining the term “net neutrality.” Most discussion has focused on telecommunications carriers and how they operate and manage their physical networks. Neutrality advocates want to prohibit carriers from creating paid, prioritized “fast lanes,” and from slowing down or “throttling” customers using excessive bandwidth. Neutrality advocates argue that such practices will destroy the free and open internet, while the carriers argue such prohibitions will destroy their incentives to invest in infrastructure to carry more traffic.
BlackBerry believes policymakers should focus on more than just the carriers, who play only one role in the overall broadband internet ecosystem. The carriers are like the railways of the last century, building the tracks to carry traffic to all points throughout the country. But the railway cars travelling on those tracks are, in today’s internet world, controlled not by the carriers but by content and applications providers. Therefore, if we are truly to have an open internet, policymakers should demand openness not just at the traffic/transport layer, but also at the content/applications layer of the ecosystem. Banning carriers from discriminating but allowing content and applications providers to continue doing so will solve nothing.
Therefore, any net neutrality legislation must take a holistic view of the entire playing field, addressing both carrier neutrality and content/application neutrality.
Carrier neutrality. Opponents of reclassification fear that someday the FCC will use its Title II authority to regulate wireless rates, notwithstanding the current Administration’s stated intent to forebear from doing so. Proponents of reclassification argue that broadband has become the key telecommunications utility of the 21st Century, and thus must be regulated under Title II to ensure the broadest possible protections for consumers, such as utility-style non-discrimination and universal service mandates.
Given the unique nature of wireless networks, including the highly competitive wireless business in the United States and the bandwidth limitations inherent in spectrum-dependent transport, reclassifying broadband as a Title II service seems excessive to us. In contemplating how to construct a fair set of rules tailored to the special nature of wireless telecommunications, we suggest instead considering a set of rules already in place that fairly reconciles the needs of carriers and consumers. We refer to the FCC regulations set forth at 47 CFR §27.16, which apply to the C-Block broadband spectrum auctioned in 2008. Those rules, advocated at the time by Google and a coalition of public interest groups, mandate two key non-discrimination principles – no blocking and no locking – which have proven to be a solid model for wireless carrier neutrality regulation.
No blocking. The C Block rules prohibit wireless carriers from restricting customers from using devices and accessing applications or any other lawful content of their choice on the C Block network, except as necessary to manage or protect the network for the benefit of all other users.
No locking. The C block rules also prohibit wireless carriers from disabling features on mobile devices they sell to customers, or rigging those devices to prohibit their use on competitors’ networks.
Verizon won the entire C block in the 2008 auction, and has lived under those rules ever since. The rules have withstood the test of time and have functioned well. There is no evidence the rules have failed to achieve their purpose or have failed to protect the principle of an open wireless internet. With that positive experience to guide us, why not extend the C-Block rules to all mobile broadband spectrum and all carriers? Doing so would achieve the President’s non-discrimination and equal access objectives without creating the risk of future price regulation, and would also satisfy several of the key points set forth in the joint proposals advanced by Chairmen Thune and Upton. Customers would benefit from the ability to access any mobile broadband service, any application, or any other lawful content – on any network, using any device.
Application/Content Neutrality. BlackBerry has been in the midst of a turnaround since I took over as Executive Chairman and CEO in November 2013. During the past 15 months the company has stabilized and introduced a variety of new products as we pivot away from our prior reliance on hardware to become a full-service, device-agnostic provider of highly secure and productive software and services. Our balance sheet is strong and our turnaround is proceeding apace.
Key to BlackBerry’s turnaround has been a strategy of application and content neutrality. For example, we opened up our proprietary BlackBerry Messenger (BBM) service in 2013, making it available for download on our competitors’ devices. Tens of millions of iPhone and Android customers around the world have since downloaded BBM and are enjoying the service free of charge. Last year we introduced our secure BES12 mobile device management software, once again designed to manage not just BlackBerry phones but also available for enterprises and government agencies whose employees use iPhone and Android devices.
Unfortunately, not all content and applications providers have embraced openness and neutrality. Unlike BlackBerry, which allows iPhone users to download and use our BBM service, Apple does not allow BlackBerry or Android users to download Apple’s iMessage messaging service. Netflix, which has forcefully advocated for carrier neutrality, has discriminated against BlackBerry customers by refusing to make its streaming movie service available to them. Many other applications providers similarly offer service only to iPhone and Android users. This dynamic has created a two-tiered wireless broadband ecosystem, in which iPhone and Android users are able to access far more content and applications than customers using devices running other operating systems. These are precisely the sort of discriminatory practices that neutrality advocates have criticized at the carrier level.
Therefore, neutrality must be mandated at the application and content layer if we truly want a free, open and non-discriminatory internet. All wireless broadband customers must have the ability to access any lawful applications and content they choose, and applications/content providers must be prohibited from discriminating based on the customer’s mobile operating system.
This blog is adapted from a letter sent Wednesday, January 21st, 2015, to the Chairman of the Senate Committee on Commerce, Science and Transportation, John Thune, the Chairman of the House Committee on Energy and Commerce, Fred Upton, and Ranking Committee Members, U.S. Senator Bill Nelson, and U.S. Representative Frank Pallone Jr.
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