Verizon

Where are all the payphones?

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Click here to read more about payphone deregulation

When the big earthquake, terrorist attack, or other civic disaster finally hits San Francisco, a lot of people are going to be in for a major shock: their high-tech cell phones and computer-based office telephone systems might not work.

But after the 1989 Loma Prieta quake and after the Sept. 11, 2001, terrorist attacks in New York City, residents found there was still a way to reach their loved ones and let the world know they were OK; they used an old-fashioned communications tool that’s low tech, securely grounded, publicly accessible, and reliable.

It’s called a pay phone.

Next time there’s a disaster, we may not be so lucky: pay phones, fixtures of the public landscape for more than a century, have been quietly disappearing. And many of those that remain don’t work. These essential communication tools — good for emergencies, privacy, and the poor — are falling victim to deregulation laws, the greed of telecommunications companies, and the public’s obsession with high technology.

In San Francisco they’ve departed in droves from sidewalk carrels; corner stores; bus shelters; subway platforms; office, museum, and movie theater lobbies; supermarkets; shopping malls; city swimming pools and YMCAs; diners; parks; and gas stations. They’ve been disappearing at a rate of about 10 percent annually for the past four years, down from roughly 400,000 at the height of the dot-com boom to 150,000 today, trade group attorney Martin Mattes told state regulators last year. The decline in San Francisco mirrors those in California and the nation.

And while pay phones may seem like quaint relics of another era, they remain an important part of the nation’s communications system, serving millions of people who for one reason or another don’t have or can’t use cell phones. And consumer advocates say the loss of the pay phone system is a serious problem.

Although cell phones are pretty ubiquitous, not everyone can afford one — and not everyone can use one. For socially marginalized people, pay phones are still a lifeline. For people who can’t use wireless technology — and can’t afford a home phone line — they’re essential.

Why are pay phones vanishing? The ready answer — cell phones — identifies the technology that’s replacing them and cutting into their profits. But it doesn’t completely explain why a society that once valued pay phones — and may ultimately remember that it still does — has let them disappear. That story has more to do with the politics of deregulation and the profits of telecom companies.

THE POWER OF OLD TECH


In the 2004 climate-change disaster film The Day after Tomorrow, Dennis Quaid plays a climatologist who anticipates dire consequences from a sudden oceanic temperature drop, which is triggered by global warming and leaves New York City frozen solid. From the beaux arts NYC Public Library where he’s taken shelter, the Quaid character’s son (played by Jake Gyllenhaal) needs to call Dad in Washington, D.C., but the cells don’t work. So he finds a half-submerged mezzanine pay phone with a dial tone ("It’s connected to the telephone lines," he notes brightly), drops in a couple of coins, and bingo — he gets Dad’s insider travel advisory.

Such a scenario — at least the pay phone part — isn’t science fiction. In fact, it has played out like that in NYC a few times and also did so in New Orleans after Hurricane Katrina hit in 2005. When the Twin Towers went down Sept. 11, cell phone masts went down with them. Lines were endless as outgoing calls from lower Manhattan funneled through two nearby landline pay phones, as reported on NBC’s Today. Ditto in the summer heat wave of 1999, when New York air conditioners on overdrive toppled wireless transmitters like dominoes, silencing cell phones from NYC to the Great Lakes. Landline telephones — including pay phones — continued to ring. And when the waters rose in New Orleans, residents flocked to pay phones made available for free use to contact loved ones and let the world know they were stranded.

Landline pay phones — like wired home and office phones — are simply more durable and reliable. "I love my cell phone," said Natalie Billingsley, who heads the California Public Utilities Commission’s Division of Ratepayer Advocates. "But I wouldn’t give up my landline. There’s not enough [wireless] network redundancy."

When the Loma Prieta earthquake hit the Bay Area in 1989, electricity and cell phone service were out for hours, but, Billingsley said, "landline phones were back up in 10 minutes."

Regina Costa of San Francisco’s the Utility Reform Network recalled that when the quake trashed Pacific Street in Santa Cruz, the public switch connecting local phones to the larger network worked despite a local power outage.

The reason, Costa says, is that the traditional wired phone network has a robust, independent electrical backup. Not so wireless transmitters and cable fiber-optic systems, both powered by the public grid.

"Wire lines are a really big public safety feature," Billingsley told us. Backup generators at switching points, where regional and long-distance lines converge, create "all kinds of redundancies" for rerouting calls if parts of the network go down.

That’s not just a technological issue. The new tech networks lack robustness and redundancy, Billingsley said, in part because such standards are no longer mandated. Before telecommunications were deregulated, companies were required to pay for reliability. Now reliability is no longer a public service. Under deregulation, reliability is more spotty. Last year state legislators addressed the need for adequate backup power-pack standards for Internet phones — but in the end, consumers will need to buy the backup systems.

In Japan, where the old but vital wired pay phone network has been reduced by more than half (from 910,000 to 390,000) since the public phone company was privatized in 1985, a public safety official recently warned against such shortsightedness. "To remove public telephones amounts to decreasing the means of communication during emergencies," disaster prevention program director Hitoshi Omachi of Yokohama’s Chiiki Bosai Laboratory observed in a May 8 Asahi Weekly article about cell phones overtaking pay phones. "People should think about measures to maintain public phones, including financial assistance from the central or local governments."

Then there are the social issues. Beth Abrams, director of Grupo de la Comida, which feeds 2,000 immigrants and refugees in the Mission each week, said many are dependent on pay phones. "The thing to remember," Abrams told us, "is that a pay phone could mean somebody’s life in an emergency, when time is of the essence." A child suffering an asthma attack or an adult with heart disease or diabetes (the occurrence of which is high in the immigrant community) "often needs immediate response and has difficulty walking far," Abrams said. Many people whom her group serves don’t have cell phones and rely on pay phones when caring for children outside the home or answering job ads.

Howard Levy, attorney and executive director of Legal Assistance to the Elderly, which serves about 1,000 clients a month, told us many seniors in the Tenderloin and in SoMa hotels don’t have home phones or cell phones. Besides the disincentive of cell phone cost, "folks beyond a certain age don’t feel comfortable with the technology," which is not designed for people "whose vision isn’t so great," Levy said.

Jennifer Friedenbach of the Coalition on Homelessness told us that "a lot of folks do have cell phones nowadays, on a prepaid card," but have only intermittent access, and none when the card runs out. "Poor people in general — people who have extremely low incomes — even if they have a phone at home, [it] can be shut off at times," she said. "Pay phones are really important for emergency situations for folks living outside," or when homeless people are first on the scene, to report an emergency.

In an impromptu survey of eight clients at the Independent Living Resource Center, a San Francisco disability-rights advocacy and support group, services coordinator Diane Rovai found three who had been seriously inconvenienced by lack of pay phone access. One needed a ride home from the airport and was stranded after an entire bank of pay phones was removed; another "missed a really important meeting" after getting wrong directions (the phone she finally found "was dirty and not in good repair"); and the third, who has no cell phone, has problems when she goes out to meet people.

"There are still people who depend on pay phones," particularly in rural communities, Anna Montes said. She belongs to San Francisco’s Latino Issues Forum and is a member of the PUC advisory committee on Universal Lifeline Telephone Service, which subsidizes phone service for low-income households.

Four percent of state households don’t have basic phone service, she said, and many of those are poor and Latino and rely on pay phones.

"Pay phones should be supported because there are individuals who can’t afford [cell phones] and places where wireless doesn’t work," said Bill Nussbaum, a telecommunications lawyer at TURN. "Public policy is a reason to wrap [pay phones] into the goal of universal service, the concept of maximum penetration with reliable and affordable phone service for all."

THE END OF PUBLIC SERVICE


One reason the government has allowed pay phones to disappear is that most people don’t think about them. Cell phones often seem like all one needs to stay in touch, at least to those who own them.

"There’s an unfortunate assumption that everyone has a cell phone. It’s not true," said Harold Feld, senior vice president of the Media Access Project, a Washington, D.C., nonprofit public interest media and telecommunications law firm.

Regulators used to feel it was important for people to have access to public phones, but "they don’t think it’s important anymore," he told us.

Feld pointed out that pay phones used to be owned by AT&T, which created and maintained the pay phone network as part of a widely accessible phone system. Government-guaranteed profit on the company’s investment essentially subsidized even those pay phones that weren’t profitable, an arrangement institutionalized by the 1934 Telecommunications Act. Moreover, as a regulated public utility, the phone company needed permission to get out of the pay phone business.

With the monopoly’s breakup in 1984, competitors could enter the pay phone market, and by 1996 AT&T could get out of it.

"The old Bell monopoly came with a historical sense of public service that did not survive the [company’s] breakup and the new cost-benefit accountants and the MBA bottom-line artists," technology historian Iain Boal, coauthor of Afflicted Powers: Capital and Spectacle in a New Age of War (Verso, 2005) told us. "Under neoliberal economic doctrine, all public goods are suspect."

Boal noted, "The new telecom companies had little or zero interest in the public phones they inherited. In fact, quite the reverse. It was in their interest to close or leave trashed any boxes that weren’t profitable and in general to force laggards to mobile phones."

It didn’t happen immediately, attorney Mattes, who has represented the California Payphone Association, a trade group, told us.

"Because the pay phone business was still pretty good in the late 1990s, the telephone utilities stayed in the business during those years, competing with the independents," Mattes said. Pay phone rates also rose.

But the economics of the pay phone business started to change around 2000, Mattes said, mostly due to wireless competition, and companies had difficulty collecting for toll-free calls and calls made through other long-distance providers. So telephone utilities started giving up their less-profitable pay phone locations.

"Bell South abandoned the pay phone market entirely about five or six years ago," Mattes said. "AT&T and Verizon have been gradually leaving the market, giving up their less-profitable pay phones at a steady pace."

From January 2005 to June 2007, AT&T reduced its pay phone lines in California by more than half — from 77,467 to 36,870 — according to PUC counts. And in the same period, Verizon went from 28,743 to 16,421 pay phones.

While the pay phone business was "modestly profitable," according to Mattes, it was mainly important to the utilities "as a platform for customers to make highly profitable long-distance calls." But, he said, with competition in long-distance and wireless services, the profits have been squeezed out of long-distance calls. Pay phone use also dropped dramatically, he said, due to wireless competition.

TURN’s Costa suggested that the old AT&T overpaid in its postdivestiture bid to acquire cable and bypass local exchange carriers for direct connections with its former customer base. Later, it abandoned the poor voice-quality network and may have needed to recoup losses.

"The Bells have a separate incentive to pull out copper," the older coaxial wire that connects almost all landline phones, Feld said. "The FCC says they don’t have to share [fiber-optic cable wire with competitors] as they do copper, and copper needs to be maintained. It was laid because regulators made them. It’s more costly to maintain than they can charge."

"Without regulation," Feld noted, "big companies can leave the [pay phone] market, but they can also increase line charges" — monthly fees for phone connection to the local exchange — "and interconnection fees" for long-distance connection, paid by callers and local exchanges to the nonlocal carrier for allowing calls to go through.

The loss of pay phone service is one more result of faith-based deregulation, the belief that the market will provide for everyone’s needs. "The demise of pay phones was utterly predictable," Boal told us. "It’s a disgrace."

And the impact of the disappearance of pay phones ripples beyond service needs.

OUTSOURCED


A sprawling ’70s low-rise cement building at West Portal and Sloat, once hidden by shrubs from view of the adjacent Muni tracks, is now vacant and slated to become the new Waldorf High School. It used to be the Pac Bell operators’ building, housing 35 workers, mostly women with more than 30 years of service, "the forefront of the [union] movement," said Kingsley Chew, president of Communications Workers of America Local 9410 in San Francisco.

Those operators answered 411 information queries and routed 911 emergency calls. Two years after winning a strike by shutting down the phone company, the operators saw their jobs outsourced in 2006 to Dublin and Pleasanton.

The majority of the local’s members are women, Chew said. Their male counterparts, mostly collectors in the coin department, are now gone, accounting for the loss of 25 to 30 union jobs in the past five years. Besides gathering coins from pay phones, the collectors maintained the phones and removed graffiti (which is more prevalent these days).

Pay phones once meant union jobs, and as their numbers have declined, so has the union. Local 9410 membership is down from 3,000 when Chew took office in 2003 to 750 today, with those still around mainly technicians who install and repair phones.

Chew calculated that one job here is financially equivalent to six jobs in India or the Philippines, where 1-800 calls are processed and workers are paid $400 a month. The city and the state lose local business tax revenues when jobs go overseas, he said, and the costs of vanishing pensions as workers are laid off are eventually externalized and borne by local residents when demand for public services rises.

There may be greater demand for pay phones soon: the major phone companies are expected to raise home-phone rates. Basic service rates have generally been averaged geographically, within a major company’s service "footprint," Lehman said, but deaveraging can soon occur, which will drive up the price of basic rural and high-cost urban services.

Meanwhile, two state programs supporting pay phones are being axed.

REGULATIONS DIE


Two pay phone regulatory programs remain on the books, one frozen and one barely operating. The PUC created both programs in 1990 as part of a legal ruling, when new pay phone providers were struggling to gain a foothold in former Pac Bell (now AT&T) and GTE (now Verizon) monopoly territory and consumers were encountering new system abuses.

One program, the Public Policy Payphone Program (PPPP, or Quad-P), was designed to subsidize phones located "in unprofitable locations to serve the health and safety needs of the public," while the other, the Payphone Enforcement Program (now known as Payphone Service Providers Enforcement), was established "to ensure that pay phone consumer safeguards are being followed." Both programs, which were expanded statewide, were funded by a monthly per-line surcharge on the industry, unlike other telecom public policy programs, which are supported by a percentage surcharge on consumers’ monthly phone bills.

But the list of potential state locations for subsidized pay phones was reduced from 67,000 in 1988 to 22,000 in 1989, just before the state programs were initiated, and to 1,975 in 1993. By 1998, when deregulation was complete and pricing went to market rates, Pac Bell had only 300 subsidized business phones out of 140,000, attributing the change to the increased number of independent providers and to multiphone contracts, which enabled revenues and costs to be averaged out.

Applications to designate or install Quad-P phones have to pass through the PSPE advisory committee, which hasn’t aggressively solicited them or approved more than two or three (with just one installed) of the 33 received since 2001, according to the Division of Ratepayer Advocates.

Almost nobody knows that Quad-P exists — or that anyone can file an application if a proposed site meets certain criteria. Currently, there are only 14 Quad-P phones statewide, mainly in parks, down from 40 in March, with 13 supported by AT&T and one by Verizon.

The PSPE was set up "to enforce, through random inspections, consumer safeguards for all public payphones … such as signage requirements, and rate caps for local, long distance and directory assistance calls within California."

Until recently, inspectors made the rounds of for-profit as well as subsidized pay phones, numbering more than 400,000 in the ’90s, on a rotation schedule that took a decade to complete. Between December 2001, when the project came under PSPE administration (it was formerly run by the industry), and June 2007, civil-service inspectors logged 133,893 violations on 39,444 phones, a rate that has slowed with staff downsizing. The DRA estimates its activities reduced the average rate of violations significantly. The inspection staff was cut in half last fall, to three, and other program staffers were transferred to other divisions to cut expenses.

The number of pay phones to monitor has declined, but with reduced inspections, violations have begun to rise. Numbering too few to be proactive, inspectors now respond only to consumer complaints registered on the PUC’s consumer fraud hotline. This number, not posted on pay phones, is 1-800-649-7570; it accepts calls between 9 a.m. and 3 p.m. Monday through Friday. There’s no after-hours message machine, but if you’ve got a computer and are still primed when you get home, you can log on to the PUC Web site, at www.cpuc.ca.gov, to report a complaint. Patterns of systemic abuse — and dead phones — are less likely to be detected from reactive, hotline-triggered complaints.

Last summer the industry’s PSPE advisory committee formally requested that both programs and the committee itself be eliminated and program surcharges ended, citing reduced activity and need. "All that Quad-P has done is subsidize its own costs," said Mattes, the attorney for the California Payphone Association. "It deserves a quiet burial."

The DRA argues that the reduction of these state programs is premature: even if dramatic market changes have made pay phones a distant second choice over wireless for many, the old technology is still important.

For one thing, predictions of the death of pay phones may be exaggerated. "It is likely that some core base of payphones will continue to be used regularly and earn a profit," the division observed in a July 2006 report, responding to gloomy industry forecasts.

For another, the actual basis for the pay phone network’s decline is far from clear. The division noted "a distinct lack of quantitative analysis regarding both the reduction … and demographic information about the location and need for payphones" in its program review comments, part of the PUC’s formal rule-making process (to be concluded in coming months, following administrative law judge Maribeth Bushey’s findings).

Acknowledging that "concerns about migration to wireless phone plans and cost recovery issues (including interconnection costs, phone card fraud, and 911 services)" need to be addressed, the division restated the universal service goals of both the ’96 act and the original 1934 Telecom Act, quoting a commission ruling from a decade ago, now more urgent: "Parties have not substantiated that telephone service will continue to be available at unprofitable locations to satisfy public health, safety, and welfare needs. Nor have they convinced us that the marketplace will replace the existing public policy payphones or fulfill the public policy objective in public health, safety, and welfare."

The DRA recommends a two-pronged strategy for stabilizing the for-profit market and assessing the need for subsidized pay phones — one that could potentially restore proactive inspections.

Instead of eliminating Quad-P oversight, it said, "the task, rather, is to address these problems by reforming and strengthening the program, as well as by assessing [systematically] the continuing public need for payphones" and finding ways to meet it. The division proposed a formal workshop or survey to compile data about profits and costs, locations, and demographics — hard data on where pay phones exist and where they don’t but are needed.

The DRA also suggests that regulatory oversight be overhauled; that the PUC exert closer control over pay phone service providers by imposing fines or through disconnection; that pay phones be registered or certified, as they are in numerous other states; and that new procedures be adopted for installing and removing pay phones.

Oversight is needed, the division says, even if the industry can’t pay for it; it recommends a surcharge on monthly phone bills, as there are for other public policy telecom programs. It also says an overdue audit of both programs is needed and that the hotline-triggered inspection regimen needs to be reassessed within 12 to 18 months of its inauguration last fall.

SAVING PAY PHONES


On the ground floor of San Francisco’s City Hall, a single pay phone remains among six phone bays. Under existing subsidy rules, the city — which contracts for multiple phones — is ineligible for a subsidy.

It seems like high time to figure out how to restore some conventional lines of communication. Instead of shifting the whole cost of backup phones to the public, why not consider allocating it between the industry and ratepayers, placing the industry’s contribution on a sliding scale to be reviewed every year or two along with revenues, and even incorporating a percentage of more competitive telecom video and cable profits?

Admittedly, this goes against the current tide. Avid deregulators — like former PUC commissioner Susan Kennedy, now Gov. Arnold Schwarzenegger’s chief of staff, and current commissioner Rochelle Chong — have aggressively promoted advanced technology and less oversight.

But is what’s good for AT&T and Verizon really good for ratepayers or small businesses? Letting the pay phone network — a real, decentralized public space — be dismantled just because many of us now have private cell phones violates fairness and common sense. Corporate-minded advanced-tech boosters may dismiss the older technology, but it serves everyone.

"Just because it’s old," TURN’s Nussbaum said, "so what?"<\!s>*

NOISE: Meditating on Incubus…and on coveting your neighbor’s cellie

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Guardian intern Aaron Sankin checked out the Incubus show put on Verizon Wireless on Oct. 20; here’s what he thought:

incubus.jpg

Incubus + Verizon Wireless = Synergy!

The LG VX8500 Chocolate phone is available from Verizon Wireless for $149.99. It has an iPod-style touch wheel, Bluetooth compatibility, a digital music player, and a 1.3 megapixel digital camera that can take both pictures and movies.

I assume it can also make and receive cellular telephone calls, even though it’s capacity to do so isn’t really advertised anywhere.

If my phone were to break suddenly, such as if I were to absentmindedly drop it in a toilet during a heated conversation with my bookie (I never said to bet on the Mets!) or have it accidentally fall from my pocket while running from the zombie hordes (they’re everywhere!), I would seriously consider taking a look at this phone.

The people at Verizon Wireless should be happy because they worked like hell to put this idea in my brain. The other group of people who should be very pleased with themselves are Incubus because they joined with Verizon Wireless to have a special private concert at Bimbo’s on Oct. 20 in the most epic feat of techno-musical cross-promotion since Bono realized that Apple loved iPods almost as much as he loved himself.

First, a disclaimer: My relationship with the band Incubus is fairly complex. I first heard about them through a friend when I was in eighth grade. This was during their early period when all they wanted to do was be like Primus and years before any modern rock radio station would touch their stuff.

From the first moment I heard their music, I loved it. It was funky and spazzy and, most importantly, it was mine. Incubus was the first band that I unconditionally loved that no one else had heard of. It made me feel underground, important and cool (the last one being especially important to an uncoordinated middle-schooler looking for angle to talk to girls).

Once they broke into the mainstream, I started liking them less and less. With their albums Make Yourself and Morning View, they seemed to loose some of what made them exciting and distinctive, and got lost in the slop of the myriad or post-grunge alt-metal bands. Two years ago, they came out with Crow Left of the Murder and it was the first new Incubus album that I liked even half as much as the first time I heard them way back in eighth grade.

Anyway, this event was a private party held Verizon Wireless in support of the LG Chocolate phone, which was just released in America last month. When people bought the phone, they could enter a contest to win tickets to this show. If they were one of the lucky winners, they got an email on their phone that contained a bar code. This bar code was their ticket into the concert. Instead of scanning a piece of paper, the security guard at the door scanned the phones.

My phone cannot do this. It can, on the other hand, play Journey’s “Wheel In The Sky” whenever someone calls. While this has never gotten me into a concert, it did once get my into a bar conversation with drunk 35-year-old investment banker who later bought me a rum and coke because, “Journey is awesome!” Yes, yes they are.

Once inside, the real silliness began. There was a screen next to the stage where people could send text messages from their phones and see them on the screen. The messages ran the gambit from “Incubus rox” to “I love my new phone”. Joe Strummer rolled in his grave, and Gene Simmons wished he thought of it first. I tried texting, “Once Incubus killed a pirate in support of the Basque separatists,” but it didn’t make the cut. Why must the telecom industry continually spit on the proud Basque people day in and day out? It truly crushes my heart.

But running up people’s cell phone bills with needless text message charges wasn’t the only goal of the night. Incubus was also there to shoot the video for their upcoming single, “Anna Molly”. Much like Verizon did with its customer service, Incubus decided to outsource the production of their video. They told everyone there with the new phone to take videos of the band playing and send it in to them and they would eventually painstakingly edit the clips together to make the band’s video. I know what you’re thinking, and the answer is probably terrible. But hey, at least they’re trying.

Incubus opened the show with, “Anna Molly.” It sounded like Pearl Jam. In fact, it sounded a lot like Pearl Jam. This is neither a coincidence nor is it a bad thing. They recorded their new album, Light Grenades, with Pearl Jam’s longtime producer. Vocalist Brandon Boyd even pounded a bottle of red wine onstage like Eddie Vedder seems to do at every show.

Their set was incredibly solid. Their newer stuff sounded great, particularly “Sick Sad Little World,” and everyone there appeared to know ever word to every song, which always bodes well for a band. And when they played a couple songs from their first album, I wasn’t the only person there who got noticeably excited (there were at least three others).

I guess the whole thing was pretty successful. It made me want to buy a phone I have no real need for and made me remember what I loved about this band when I was a pimply-faced eighth-grader trying to appear hip. I believe, in the business world, they call they synergy.

NOISE: Ka-Chingy! For free, actually

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Who doesn’t love free music? Can we all agree that despite its mammoth size and the weird experience of tearing through brambles and over big dogs, small children, and oldsters reading the Sunday paper, that Hardly Strictly Bluegrass wouldn’t be quite the same if it wasn’t free, free, free!?

chingy.jpg

Anyway here’s even more for you cheapskates: we all know pop stars are increasingly making more appearances at, of all things, cellie stories (Chris Brown showed at a San Leandro Verizon store last week), but now phone and wireless companies are also getting behind music in other ways.

Tomorrow, Oct. 11, Flash Concerts (backed by Cingular Wireless and Sony Ericsson) present Chingy, free, at the Mezzanine. The dealie is that fans have to register to “Get in and Win” and sending the text message city code “SF” to “FLASH” (35274). Registrants will receive “Alerts” including: event details, exclusive free concert invites, VIP access, meet & greets and special music prizing. Text “SF” to “FLASH” or visit your local Cingular Wireless store for more details.

Then you’re “Right Thurr,” as the Chingster might say. One wonders how many Sony Ericssons the dude scored with this tie-in. Ah, something to contemplate when the doors open at 8:30 p.m. at 444 Jessie St., SF.

At least you didn’t have to sit through any commercials…

Veto the cable giveaway

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Editor’s note: This editorial has been corrected. An earlier version mischaracterized the effect of the cable bill on municipal finances.

EDITORIAL A terrible bill masquerading as a proconsumer law cleared both houses of the state legislature last week and is now on the governor’s desk. It could cost cities and counties millions of dollars, potentially wipe out local control over cable TV franchises, and give a big boost to AT&T, which is best known these days for cooperating with the Bush administration on illegal wiretaps.
The bill, AB 2987, was introduced by Assembly Speaker Fabian Núñez (D–Los Angeles), but its real sponsor is AT&T. The bill would allow big telecommunications companies to apply to the California Public Utilities Commission (CPUC) for a statewide franchise to deliver cable and video services to California residents. The idea is to make it easier for these companies to offer telephone, Internet, and cable TV service all in one bundle. AT&T and the bill’s other backers say it will increase competition and lower rates. Lenny Goldberg, who runs the California Tax Reform Association and is one of the smartest analysts of economic policy in the state, says the bill will actually lead to increased rates.
But beyond that, there’s a huge problem with the measure. It would effectively take away from cities and counties the ability to regulate local cable TV providers. It would give AT&T or Verizon (or whoever might come along in the future) the ability to ignore local government, get a permit from the state, and deliver service to cities and counties — without having to negotiate a local franchise fee or accept local terms and conditions. Comcast, for example, pays San Francisco millions of dollars a year for the right to sell cable service under the city streets — and under the franchise agreement is required to provide public-access and government channels. A cable provider with a state franchise would never have to go beyond what an existing franchise pays.
Sen. Carole Migden (D–San Francisco), one of only four senators to oppose the bill, argued passionately against giving any favors to AT&T, which has a proven record of turning information on its customers over to the federal government. That’s another excellent reason to oppose the bill, and Gov. Arnold Schwarzenegger should veto it.
Meanwhile, Assemblymember Mark Leno’s industrial hemp bill, AB 1147, is on the governor’s desk and should be signed into law. So should AB 2573, which Leno had to fight the Pacific Gas and Electric Co. for and will help San Francisco expand its solar power production. There’s also Leno’s public records reform bill — and perhaps most important, his bill that would allow San Francisco to impose its own motor-vehicle fee, bringing the city $70 million a year. SFBG

Verizon’s tubes

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› tubes@techsploitation.com
TECHSPLOITATION If you think I’m done making fun of Sen. Ted Stevens from Alaska, then you are sorely mistaken. I have only just begun to mock.
In a rousing speech about why he would be trashing network neutrality provisions in the Senate’s version of the new telecommunications bill, Stevens sagely pointed out that the Internet “is not something you just dump something on. It’s not a truck.” Instead, he explained, “it’s a series of tubes.” And those tubes get all gummed up with icky stuff like big movies and things. For example, Stevens said, “An Internet was sent by my staff at 10 o’clock in the morning on Friday, and I just got it yesterday. Why? Because it got tangled up with all these things going on the Internet.”
Ultimately, after worrying at length about how “your own personal Internet” is imperiled by “all these things,” Stevens concluded that there is no violation of network neutrality that “hits you and me.” And that’s why he’s pushing to keep net neutrality from being written into law. This is the sort of politician who is deciding the future of Internet regulation — a guy who thinks that he received “an Internet” yesterday, and that it was made of “tubes.”
What’s even worse is that Stevens’s main beef with the Internet is that it moves slowly, and this is a problem that will only be worsened when big companies like Verizon and Comcast start creating prejudiced pipes that privilege certain kinds of network traffic over others. You think your own personal Internet is slow now? Wait until Verizon starts making Disney movies travel faster than e-mail over its, um, tubes.
While Stevens is basing decisions that will affect the future of communications technology for decades to come on trucks and tubes, Verizon is covertly preparing its newest customers for a world without network neutrality. A few weeks ago the telecommunications giant announced it would be installing fancy new routers with its high-speed fiber-optic cable service known as FiOS. Available in only a few places across the United States, FiOS has been drooled over by tech-savvy blog Engadget and CNN alike. That’s because it can deliver a wide range of media (from movies to phone calls) much faster than its competitors — supposedly at a speed of up to 20 megabits per second, far faster than typical DSL’s 1.5.
Sounds great, right? Not so much. The router that comes with new installs of FiOS, according to Verizon’s press release, “supports remote management that uses new industry standards known as TR-069, enabling Verizon to perform troubleshooting without having to dispatch a technician.” Whenever I see the phrase “remote management,” I get antsy. That means Verizon can talk to your router from its local offices, which the company claims is all for the good of the consumer.
However, if you actually read the TR-069 standard, you’ll see that Verizon can do a lot more than just troubleshoot. It can literally reflash all the memory in your router, essentially reprogramming your entire home entertainment system. As a result, Verizon can alter its service delivery options at any time. Even if you’ve signed up for a network-neutral FiOS that sends you to whatever Web sites you like and routes your peer-to-peer traffic the same way it routes your e-mail, Verizon can change that on a whim. With one “remote management” event, the company can change the settings in your router to deliver Fox News faster than NPR. It can block all traffic coming from France or prevent you from using Internet phones that aren’t controlled by Verizon.
Verizon’s new router is also great news for anyone who wants to wiretap your Internet traffic. All a bad guy has to do is masquerade as the Verizon “remote manager” and he or she can fool your nifty router into sending all your data through his or her spy computer. The more people allow companies like Verizon to take arbitrary control of their “personal Internets,” the less freedom they’ll have — and the more vulnerable they’ll be.
Surely even the good Sen. Stevens can understand why Verizon’s antineutral router isn’t desirable. You see, it turns the Internet into a truck. A truck that doesn’t go. SFBG
Annalee Newitz is a surly media nerd who is powered by trucks.

The cable that bind s

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› sarah@sfbg.com

Oakland, San Francisco, and other California cities have in recent years tried to negotiate maximum public benefits under their franchise agreement with cable television provider Comcast, but all have backed down when the telecom giant threatened costly litigation.

The latest episode played out May 30 at the Oakland City Council meeting when the council voted to repeal an ordinance that would have required franchisees like Comcast to allow workers to decide whether they want to form a union.

Comcast dubbed the “Wal-Mart of Telecom” by the American Right to Work Foundation not only sued Oakland over the ordinance but also decided to void a tentative franchise agreement with the city that had taken three and a half years to work out.

Comcast officials claim the company walked away from the contract because two years had elapsed since major parts of the agreement had been hammered out and during that time the competitive field had shifted.

As for the lawsuit, company officials argue that Oakland’s union ordinance is preempted by federal law and that the city doesn’t have a “proprietary interest” in its franchise.

A proprietary interest occurs when a city has to manage critical public rights-of-way, such as streets, alleys, and utility easements, and must make sure it receives fair compensation for the ongoing use of those public properties by private entities, like Comcast.

In such situations, a city must ensure the efficient and cost-effective management of its public rights-of-way and must maximize benefit and minimize risk, including the risk of a labor-<\h>management conflict that could arise from a union organizing campaign.

That, at least, was the argument the city of Oakland made when it drew up its labor ordinance, and it was the argument that city council president Ignacio De La Fuente continued to make at the May 30 council meeting.

Councilmember Desley Brooks managed to sound like a Comcast apologist by claiming the city had been wrong to pass the ordinance in the first place.

“We knew that when this ordinance was passed, we had no basis to do it,” Brooks said. We can try and justify why we did it, but federal law is settled in this matter.”

But De La Fuente was joined by Councilmember Jane Brunner and Vice Mayor Jean Quan in insisting that the city wasn’t backing down because it was wrong, but because it couldn’t afford to fight with a deep-<\h>pocketed monopoly in court.

That was the same argument that led the San Francisco Board of Supervisors to narrowly approve a four-year contract extension with Comcast last September, rather than negotiate better public access and other community benefits as part of the contract.

San Jose, Walnut Creek, and other cities have also been tied up in expensive litigation with Comcast, which has virtually unlimited resources and a willingness to spend big in court fights and the political arena. But a bill now moving through the California State Legislature has the potential to shake up the cable television playing field some say, in ways that are hard to predict.

The Digital Infrastructure and Video Competition Act, authored by Assembly speaker Fabian N??ñez, seeks to allow telephone companies like AT&T and Verizon to provide television services through fiber-<\h>optic lines and thereby compete with Comcast and other cable providers.

The landmark bill, AB 2987, cleared the Assembly on a 70<\d>0 vote the day after the Oakland City Council repealed its ordinance. It is now awaiting consideration and possible modification by the Senate.

It is being watched carefully by Communications Workers of America, which represents 700,000 workers nationally, including 2,000 in the Bay Area, and is one of the few labor unions that is growing.

As CWA field coordinator Lisa Morowitz explained, for cities to take on Comcast individually, as Oakland, Walnut Creek, and San Jose have tried without success to do, is like David fighting Goliath.

“It’s one step forward, two steps back,” Morowitz told the Guardian. Nevertheless, she believes Oakland has substantial leverage in future negotiations with Comcast, precisely because of the N??ñez bill.

“CWA supports AB 2987,” Morowitz said, “because we believe it’s going to create conditions more favorable for cities, communities, and workers by bringing competition to video service.”

She acknowledged that the bill won’t directly address the issues raised during Oakland’s ordinance battle, but, she said, “theoretically, it will create more accountability.”

CWA argues that in addition to creating competition in the video services marketplace, the bill will replace city-by-city franchising deals that have led to steep rate increases, protect revenue streams for local governments, and expand local tax bases.

But Sydney Levy of San Francisco<\d>based Media Alliance worries that it will simply help the titans of industry and not the communities they supposedly serve.

“I understand that labor thinks it has a better chance of being able to organize within companies if there’s more competition and AT&T is pitted against Verizon is pitted against Comcast,” Levy told us. “But I disagree with CWA on how to have that competition be fair. It’s like energy deregulation. It sounded cute, but it wasn’t. So, we can’t be stupid this time around. We need to do it in a way that’s good for cities, consumers, and communities.”

The goal of franchise agreements that cities enter into with cable companies is to ensure that providers cover the entire city, provide public affairs programming, and pay for their use of public rights-of-way.

“But with the new bill, there’s no enforcement, no contractual obligations, no timetable,” claimed Levy, who worries that under the proposed arrangement Comcast’s competitors could say, “We can’t put fiber everywhere; we’ll upgrade as we see fit.”

“But that’s not good enough,” said Levy, who also worries that the bill will screw up community media locally and that redlining providing new services in higher-<\h>income neighborhoods while bypassing areas already underserved by broadband services may well occur.

And then there’s the sticky matter of ceding control to Sacramento.

“If we don’t have the ability to complain at the city level, then we’ll have to take all our fights to Sacramento, where we don’t have equal access,” Levy said. “That would be disastrous for local decision making.”

To his mind, AB 2987 is about cable vs. phone companies, and not about what’s best for the public interest.

“Having competition is a good thing for cities, consumers, and communities, but having competition that is unfair to communities and dismantles protections is not. We need to fix what’s in the Senate version,” he argued.

Levy believes that Comcast is playing a wait-and-see game as the N??ñez bill makes its way through Sacramento and that Oakland should continue to negotiate with Comcast for the best franchise deal possible.

“Because it may be the last franchise deal Oakland gets,” he explained, warning that if AB 2987 passes unmodified in the Senate, “we’re going to go from an irresponsible monopoly system to one that’s a system of unfair competition.”

But N??ñez deputy chief of staff Steve Maviglio told the Guardian that without the N??ñez bill, “cities have as much choice as they did in the former Soviet Union…. This bill is a powerful incentive for other providers.” Maviglio said that the bill language could still be modified in the Senate, but that its basic goal is clear.

“We hope this bill will save consumers money, lead to more competition, and prevent redlining,” he said. “We want to make sure under<\h>served communities don’t get left out of the digital picture.”

Comcast is the 800-pound gorilla lurking behind the vote in Sacramento, the force that all cities are looking to find some leverage against.

San Francisco supervisor Ross Mirkarimi told us that the Board of Supervisors had tailored legislation that mimicked Oakland’s union-<\h>organizing ordinance but abandoned it on the advice of CWA and the SF Labor Council because of what was happening to Oakland at the hands of Comcast.

To Mirkarimi’s mind, the best solution is neither piecemeal ordinances nor statewide laws, but for cities to municipalize their telecom and Internet systems.

“We would not be facing these kind of legal challenges if San Francisco was able to municipalize,” he told us.

And that’s precisely what San Francisco is now pursuing. A proposal by Sup. Tom Ammiano to study the creation of a citywide municipal broadband system to be installed as streets are opened up for sewer lines or other infrastructure needs was recently put out to bid.

Ammiano told the Guardian he expects to get some preliminary indications as to whether the system would be viable as soon as this summer, and he’s confident San Francisco will ultimately be in the position to offer television and other broadband services to city residents.

Mirkarimi, who supports the proposal, said it’s the best hope to “redeem our utility democracy as it pertains to our cable industry.” SFBG

The NSA’s political fiction

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› unsealtheevidence@techsploitation.com

TECHSPLOITATION Here’s what disturbs me: In light of recent revelations that the National Security Agency has been illegally collecting vast databases of information about every single phone call made in the United States since late 2001, only 53 percent of US citizens polled by Newsweek think the government has gone too far in its efforts to stop terrorism. That’s a majority, but not a very large one. And in the same poll, 41 percent said they thought spying on phone calls made to and from everyone in the country was necessary.

This arouses the same sinking feeling I got many years ago when I was a young graduate student at UC Berkeley, grading my very first set of papers. From that sample, and many others in subsequent courses, I learned that 70 percent of college students in an upper-division English course at a top university cannot construct a coherent argument using evidence taken from books they’ve read. That’s what convinced me that most people, even highly educated ones, go through their lives without ever examining the way rhetoric works, and the way evidence is used (or abused) in its service. These people weren’t stupid by any stretch of the imagination. They simply didn’t understand how narrative persuasion works, in the same way that many people who are smart nevertheless don’t understand how their car works.

And just as technical naïveté makes you vulnerable when your car breaks down on a deserted road, so too does narrative ignorance when your nation is breaking down right before your eyes. That such a paltry majority is convinced the government has gone too far with surveillance is a perfect example of this. The Bush administration has cited no evidence to justify snooping on innocent people’s telephone calls. In fact, government analysts have admitted that the reason they didn’t know about the impending Sept. 11 attacks had to do with poor foreign intelligence. You can’t remedy poor foreign intel with domestic spying on the telephone network. Nor do you strengthen your nation’s cohesiveness by allowing the government to break the law, gathering private information from corporations like AT&T, Verizon, and BellSouth without any court oversight, without any warrants.

Certainly the government can and will argue that certain interpretations of the USA-PATRIOT Act allow the NSA to snoop on my telephone calls in the name of national security. But where is the proof that it’s necessary to log my telephone calls? When my fundamental right to speak privately is violated in such an extreme manner, along with the rights of all my fellow US citizens, we deserve some hard facts to back up the claim that this unambiguously totalitarian strategy is for our own good.

Instead of evidence, however, we’re given incoherent emotional appeals. We’re told that the danger from terrorism is so great that the government should be allowed to do anything it likes including emuutf8g the blanket surveillance strategies of the now-defunct USSR. We’re told that civil liberties groups like the Electronic Frontier Foundation can’t sue AT&T for handing over personal information to the government without a warrant because examining the evidence in a court of law would violate national security and endanger us all. But appeals to fear are not counterevidence. They do not bolster a logical argument. They simply add punch to what is nothing more than a fictional narrative about how monitoring electronic communications will somehow magically stop terrorism.

Cyberpunk author William Gibson has said that this disastrous episode in our nation’s history is about our struggle to deal with the scope of new technologies. Our vast telecommunications network, including cable, phones, and the Internet, has made it easier than ever for telecom companies to expose our private lives to authority figures with the power to punish us severely even kill us. What the NSA has done, Gibson argues, is the result of evolved but unregulated computer storage and search capacities that make it possible to record, search, and maintain archives of the whole nation’s telephone calls.

Certainly technical evolution has made it easier for the government to place us under surveillance without revealing it and without any oversight by the judicial system. But it’s not technology that’s stoppering the country’s outrage. That’s a problem as old as recorded communication itself. Most people cannot take apart a piece of rhetoric and tell you whether its component parts are facts and evidence or merely seductive fiction. SFBG

Annalee Newitz is a surly media nerd who can take apart and reassemble an argument in one minute flat.