National Telecommunications and Information Administration
In the matter of )
Request for Comments on Deployment ) Docket No. 011109273-1273-01
of Broadband Networks and Advanced )
COMMENTS OF THE DIGITAL MEDIA ASSOCIATION
The Digital Media Association ("DiMA") is pleased to submit its comments to the National Telecommunications and Information Administration of the U.S. Department of Commerce (“NTIA”) in response to Notice, Request for Comments on Deployment of Broadband Networks and Advanced Telecommunications Services (hereinafter "Notice"). DiMA represents established and emerging technology, media and online services companies that transmit and sell (or support the transmission and/or sale of) audio and audiovisual works to the consumer via digital networks, and particularly broadband networks.
Like other commenters, DiMA member companies are critically concerned that a robust, secure broadband infrastructure be developed and deployed quickly. DiMA appreciates the leadership of NTIA in its efforts to support the digital economy, as well as the efforts of the Department’s Technology Administration.
DiMA's Interest in this Proceeding
DiMA is a trade association representing 50 companies that deliver performances and recordings of audio and audiovisual works to the public over digital communications networks. DiMA includes America’s leading webcasters, digital entertainment distribution companies, and broadband infrastructure companies.
From its inception, DiMA's efforts have been guided by core principles, two of which are most relevant to these Comments. First, copyright owners and performing artists deserve fair and reasonable compensation for commercial uses of their content. Second, law should not discriminate against new media companies or, conversely, favor existing media companies, based upon the technology used to deliver content to the consumer.
With this background, DiMA wishes to focus its comments on the policies that will enable consumers to access the types of digital media they desire, in the flexible manner they desire, at the price point they desire.
DiMA’s Responses to Specific Questions
For ease of organization, DiMA’s comments are offered in the same format as the Notice. As there are several issues that DiMA does not address, the absence of answers to all questions or issues is intentional.
A. What should be the primary policy considerations in formulating broadband policy for the country? Please discuss the relative importance of the following: access for all; facilities-based competition; minimal regulation; technological neutrality; intra-modal competition; inter-modal competition; and any other policy consideration.
· DiMA historically has supported technological neutrality in law and policy, whenever practicable. Consumers are agnostic regarding the type of transmission technology that delivers content to their home or device; rather consumers care about the quality of content, quality of the performance or delivery experience, and price. Government should similarly be agnostic, and should refrain from pursuing policies – federal, state or local – that advantage or disadvantage any transmission technology, codec, format, business model or consumer experience.
· DiMA views the broadband services market as a single market among various technologies. However, to ensure that consumers have access to the most compelling products and services at the best price, competition in every geographic market is critical. Moreover, that competition should be as evenly matched as possible, with similar regulatory regimes, tax incentives or disincentives, and access to high-value content.
B. How should broadband services be defined? Please discuss (1) what criteria should be used to determine whether a facility or service has sufficient transmission capacity to be classified as "broadband;" (2) how the definition should evolve over time; and (3) the policy implications of how the term is defined.
· Broadband services (and the infrastructure that supports them) must be capable of delivering multimedia content in a manner that the consumer deems equal to or better than traditional media, and with qualitative attributes that exceed traditional media. In recent years, consumers have enjoyed the convenience of the Internet and the ability to access content that is not otherwise available through traditional media channels; but had to accept the trade-off of significantly lower quality performance (e.g., a postage stamp-sized screen or low bitrate audio). Consumers deserve and expect full quality from digital media, and will demand better quality if they are asked to pay for content. Interactive television must have a picture quality that meets or exceeds broadcast television but which also provides consumer on-demand flexibility. Broadband music services will sound equal to or better than radio, and permit consumers to influence or interact with the music or other audio programming.
C. Several studies indicate that the rate of deployment of broadband services is equal to or greater than the deployment rates for other technologies. What is the current status of (1) supply and (2) demand of broadband services in the United States? When addressing supply, please discuss current deployment rates and any regulatory policies impeding supply. When addressing demand, please discuss both actual take rates and any evidence of unserved demand. Please also address potential underlying causes of low subscribership rates, such as current economic conditions, price, cost-structure, impediments to the development of broadband content, or any other factor. To what extent has the growth in competition for broadband and other services been slowed by the existing rates and rate structures for regulated telecommunications services?
· Broadband services’ ability to offer high-value content has been inhibited in several respects. In the music marketplace, legal uncertainty and litigation, combined with marketplace incumbents’ fear of piracy, channel conflict and the digital disruption, combined for several years to limit consumers’ lawful options for online music. The marketplace vacuum was filled by free services that met consumer demand (and drove broadband take rates and computer hardware and device purchases) but failed to compensate copyright owners. Though the Notice asks about unserved demand, this consumer demand was met albeit perhaps in ways that policymakers would not have preferred. Many entrepreneurial music and video services have attempted to fill the market with legitimate goods, only to be thwarted by ambiguous legal contentions of certain copyright owners and reticence to license content in an uncertain environment. Thus, while broadband services will resolve certain underlying technical and business issues for the marketplace, DiMA believes that the Section 104 Reports of the NTIA and the Copyright Office have identified important issues at the intersection of copyright and ecommerce that also need prompt resolution.
· Some fear that unserved consumer demand for motion picture programming will satisfied by similar consumer-driven market-vacuum-fillers. If market leaders’ fear paralyze their development of legitimate commercial services, consumers will drive adoption of chaos services that undermine traditional intellectual property values – but will undoubtedly drive broadband adoption and higher-value services.
H. What cable companies are currently conducting trials to evaluate giving multiple Internet service providers access to broadband cable modem services? Describe the terms and conditions of ISP access in such trials. What technical, administrative, and operational considerations must be addressed to accommodate multiple ISP access? How can cable firms manage the increased traffic load on their shared distribution systems caused by multiple ISPs?
· There was a time when cable broadband services were largely owned by incumbent cable services, and in order to avoid competitive channel conflict the broadband services were forced to make marketplace concessions that undermined the services’ value. For example, a traditional term of cable broadband services’ contracts with cable MSOs was a 10-minute limitation on the performance of “streamed” video content. DiMA is uncertain whether this contract term remains standard, but it does illustrate the lengths that incumbents will extend to avoid enabling new competition that might ultimately spur innovation and societal progress. It is important that the ultimate broadband infrastructure support openly and freely-accessible browsers so that consumers will always have the opportunity to direct their own interactions with content.
DiMA appreciates the opportunity to participate in the development of this important policy and economic initiative. America has led the development and business adoption of digital technologies and Internet technologies. We must also lead in the development and adoption of consumer broadband technologies and services that will enhance our culture, generate new value to consumers and increase significantly the royalties flowing to creators.
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