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SEC Decides Telcos Must Give Shareholders a Vote On Net Neutrality 107

Posted by samzenpus
from the time-for-a-vote dept.
suraj.sun writes with a link about a SEC decision that telecommunications companies must give shareholders an annual vote on wireless net-neutrality resolutions. "The U.S. Securities and Exchange Commission has told AT&T and other telecommunications companies they must include a resolution supporting wireless net-neutrality in annual shareholder votes. In a letter posted on the SEC website, the agency asserted that net neutrality — the idea that Internet service providers must treat traffic equally — has become a significant policy consideration and can no longer be excluded from shareholder ballots. AT&T, Verizon and Sprint Nextel must now grant shareholder requests for votes this year on resolutions that would support net neutrality. In view of the sustained public debate over the last several years concerning net neutrality and the Internet and the increasing recognition that the issue raises significant policy considerations, we do not believe that AT&T may omit the proposal from its proxy materials, the SEC said in the Feb. 10 letter."
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SEC Decides Telcos Must Give Shareholders a Vote On Net Neutrality

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  • by Kenja (541830) on Thursday February 16, 2012 @12:35AM (#39056341)
    Shareholders will vote for what the company tells them will make the most money. This decision should not be left up to them or the telcos.
    • by Anonymous Coward on Thursday February 16, 2012 @12:37AM (#39056353)

      Not necessarily. A lot of this hubbub surrounds Mike D of Beastie Boys fame, who's an AT&T shareholder.

      http://boingboing.net/2012/02/15/mike-d-for-net-neutrality.html [boingboing.net]

      • by justforgetme (1814588) on Thursday February 16, 2012 @12:52AM (#39056427) Homepage

        Well, that is one out of the top 500 shareholders. Good luck convincing the other 499 Chauvinist pigs of what is the correct way. Almost every single one shareholder in history has voted for short time profits when given the option. That won't change soon; or at all...

        • Re: (Score:2, Interesting)

          by Anonymous Coward

          Oh please. You're watch too many indie "documentaries".

          If all the shareholders in public companies were willing to sink the company for short term gains, companies wouldn't stay listed for more than a year. I think you'll find that generally isn't the case.

          • by dna_(c)(tm)(r) (618003) on Thursday February 16, 2012 @05:18AM (#39057595)

            Oh please. You're watch too many indie "documentaries".

            If all the shareholders in public companies were willing to sink the company for short term gains, companies wouldn't stay listed for more than a year. I think you'll find that generally isn't the case.

            That's naive. And something went wrong with your short term memory (hint: banking crisis). Shareholder often keep their shares for only (fractions of) seconds - so what's preventing someone from buying lots of them, voting then selling off? Some shareholders even bet against themselves to limit their own risk...

            • What would the point be to buy shares, vote and then sell them? Why would someone do that? Your understanding of financial markets is weak, to say the least.
              • Well for example, you could buy shares when they're cheap, vote for the company to do something that will generate a short spike in share value, and sell when you think the spike is topped out. Or short the stock and do the opposite.

              • What would the point be to buy shares, vote and then sell them? Why would someone do that?

                Vote for free. A vote against net neutrality for those who want it. Without any long term interest in the company.

                Your understanding of financial markets is weak, to say the least.

                The Dunning–Kruger effect begs to differ

              • by s73v3r (963317)

                To make money? Your understanding of how humans work is weak, to say the least.

            • by dj245 (732906)
              Shareholder often keep their shares for only (fractions of) seconds

              The advent of higher and higher speed trading has diluted the word "shareholder" and "stockholder". A person who owns the share for a very short period of time is not really a shareholder, although they meet the dictionary definition. They are a speculator. Someone who holds the share over a long time period is a shareholder. Such persons should want the company making long-term decisions that benefit the company both now and in the f
      • by morphage (62416)

        Well I hope Mike D shuts them down because we all know that "like Ma 'Bell he's got the Ill Communication". Since you know he can't, and he won't and he don't stop.

        I wish I knew what that would really mean...

    • by Anonymous Coward

      It's a trial balloon. If the shareholders say "yes" then the government can point to shareholder support for their talking points. If the shareholders say "no" then the government can pull out the standard anti-business talking points.

      Either way, it polarizes the issue and gives the politicians another opportunity for a self-serving speech.

      • by Daniel Dvorkin (106857) on Thursday February 16, 2012 @02:04AM (#39056807) Homepage Journal

        the government can pull out the standard anti-business talking points

        Only in right-wing-nutball-land can a policy designed to ensure that all players have equal access to the information infrastructure be called "anti-business." For that matter, the idea that the US government is in any way, shape, or form "anti-business" is also strictly in wingnut territory.

        • by Hatta (162192)

          The US is pro business the same way the Mafia is pro business.

      • by icebike (68054) * on Thursday February 16, 2012 @02:05AM (#39056813)

        It's a trial balloon. If the shareholders say "yes" then the government can point to shareholder support for their talking points. If the shareholders say "no" then the government can pull out the standard anti-business talking points.

        Either way, it polarizes the issue and gives the politicians another opportunity for a self-serving speech.

        Its pretty clear that the Telco's can word it in such a way that Tim Berners-Lee would vote the wrong way 8 times out of ten. I've seen many such proposals forced onto shareholders ballots which were worded in such a way that the reader was certain only Satan himself would vote for the proposal.

        Besides that, given the hijacking of the term "net neutrality" over the last couple years its not safe to say you support Net Neutrality without a clarifying definition, because some companies have managed to twist the definition to the point that it means exactly the opposite of what you think.

        Even Google [blogspot.com] fell off the bandwagon when they said this in the space of two sentences:

        There is widespread agreement among all parties that outright blocking, impairing, or degrading Internet traffic should not be tolerated. Beyond that, we also believe that broadband carriers should have the flexibility to engage in a whole host of activities, including:

        ...

        Prioritizing all applications of a certain general type, such as streaming video;

        • prioritizing is not "blocking, impairing, or degrading Internet traffic". If I have VOIP service I want it giving higher priority then smtp.
          • by icebike (68054) *

            If I rely on smtp, I want higher priority than your voip.

            You really can't have it both ways.

            • Thanks for playing, but this isn't subjective. There's three kinds of Internet traffic - high-bandwidth high-latency, low-bandwidth low-latency, and somewhere in the middle. Examples would be VoIP, FTP, and SMTP respectively. Your SMTP traffic delayed by a couple dozen milliseconds is objectively less bad than having the VoIP traffic delayed. Same with file-sharing - the low-bandwidth queue (which might be limited to a few hundred kbps) is objectively worse than waiting multiple hundreds of ms for each pack

          • by DarkOx (621550)

            Well that us the problem bless the queues are empty at every interface you can't prioritize anything without degrading something else. What we really need to talk about is classification without regard to source. Ie you treat everyone's smtp the same and everyone's VoIP the same, etc. If you prioritize VoIP traffic for your service then you do it for google voice and vonage as well.

          • by s73v3r (963317)

            Then you can do so at your router. But why should any of your traffic get higher priority than mine?

    • >Shareholders will vote for what the company tells them will make the most money. This decision should not be left up to them or the telcos
      My first thought is: Just change ISPs once this happens.

      My second thought is: Most of us don't have another option than one broadband provider.
    • Net neutrality should be decided by the people it affects, not shareholders of companies the lack of it will benefit ...

    • Not necessarily as there are a lot of tech stock owners that might be of a different mind than a profit oriented CEO / board.

    • by Hentes (2461350)

      If at least one will adopt net neutrality, then the users will have a choice. Prioritising internet traffic is not necessarily bad, giving services that require low lag, such as voip priority over, for example downloads is a useful that can save costs and enhance user experience, until the infrastructure is built up properly. The problem is when, intead of prioritisation, some ISPs simply throttle or ban some type of traffic, or even worse use their infrastructure to provide unfair advantage to other servic

      • If at least one will adopt net neutrality, then the users will have a choice.

        I wish it worked that way, but there are two problems: firstly in many places there are only one or two available ISPs, and secondly most people will not care unless their Netflix starts cutting out all the time. Sometimes free market ideals just do not work.

        • by Hentes (2461350)

          firstly in many places there are only one or two available ISPs

          I guess this is the problem. Here in Europe there is little need for a net neutrality legislation, because there are enough ISPs to choose from, some of them being neutral. Also, it helps a lot that any throttling has to be done transparently, so you know what you sign up for.

        • by Coren22 (1625475)

          and secondly most people will not care unless their Netflix starts cutting out all the time.

          If you are on comcrap, this already happens. They intentionally degrade Netflix to make their own streaming service more attractive.

  • by grahamsaa (1287732) on Thursday February 16, 2012 @12:55AM (#39056447)
    Yes, shareholders should have a say in the policy of companies they own, but net neutrality should most certainly not be left to shareholders. If shareholders were allowed to set the minimum wage a company will pay, they have a financial interest in voting for $0.

    In a democracy, the government should work to ensure that the interests of the people are served. Net neutrality should be enforced by legislation.
    • Re: (Score:1, Insightful)

      by Anonymous Coward

      In a democracy, the government should...

      Good thing the US is a constitutional republic.

      • Fair point, but it's more or less a non sequitur. The US is, or at least claims and appears to be a democratic society.
        • by 404 Clue Not Found (763556) * on Thursday February 16, 2012 @01:22AM (#39056603)

          It's not a non sequitur because the US's republicanism (as opposed to direct democracy) at the federal level is exactly what contributes to things like this.

          Lobbying, revolving door politics, corruption, etc. all happen because it's easy for big corporations to persuade/bribe/donate to/promise to hire/etc. a few essential elected representatives. It's much easier to focus your resources on a few people in power than 300,000,000.

          If instead the issue were brought to a direct vote to the general public, it's likely that net neutrality would have been passed long ago, music piracy would be legal and probably state-subsidized, etc.

          • I agree completely and would mod you up if I hadn't already posted here.
          • by Ihmhi (1206036)

            If instead the issue were brought to a direct vote to the general public, it's likely that net neutrality would have been passed long ago, music piracy would be legal and probably state-subsidized, etc.

            Yes, but it's also less likely that unpopular but necessary laws relating to things like civil rights wouldn't have passed for many years.

            • Tyranny of the majority can occur in any democratic system, despite republicanism, despite a constitution, etc.

              If we're going to be screwed either way, I'd rather it be from the majority of my countrymen and not a rich, manipulative 10%.

          • the US's republicanism

            It's called a representative democracy. Republicanism just means that the head of state is not an inherited position.

            • I looked up a few definitions and it seems that "republicanism" can fit both meanings, depending on definition source and usage context.

              Nonetheless, given that "representative democracy" is a less ambiguous term, I'll try to remember to use that in the future. Thank you.

          • by s73v3r (963317)

            Look what happened when Gay Marriage was brought before the voters of California. This is exactly why you DON'T want direct democracy, and do want a republic.

            In a direct democracy, the majority can decide what rights the minority should have.

            • Civil tragedies have been committed by both masses and magistrates; tyrannical or oppressive laws aren't limited to either direct or representative democracies.

              In a direct democracy, the people have more direct power, both to make bad laws and to later repeal them.

              The same is still true, just to a lesser degree, in a representative democracy where the federal government tails popular culture. The effects of cultural changes take more time to progress through the federal government due to long tenures and li

              • by s73v3r (963317)

                I'm sorry, but I can't take you seriously at all if you're going to take all the problems involved in direct democracy and just sweep them under the rug.

                • It's not so much sweeping them under the rug, but pointing out that every political system has its (different) flaws. Even representative democracies can and do oppress minorities, but we've managed to implement subtle checks and balances instead of throwing out the whole system.

                  Representative vs direct democracy is an interesting question (at least to me) and systematic flaws should be identified and responsibly analyzed, not overgeneralized into things like "direct democracy can never work because they'll

    • by TubeSteak (669689) on Thursday February 16, 2012 @03:40AM (#39057217) Journal

      If shareholders were allowed to set the minimum wage a company will pay, they have a financial interest in voting for $0.

      Your faith in the American people is seriously lacking.
      Companies frequently fight off shareholder initiatives that are socially responsible and would slightly lower profits.

      The first organization I recall is The Interfaith Center on Corporate Responsibility.
      It is comprised of churchs and religious organizations that use their investments to push socially responsible corporate governance.
      I only know of them because it grew out of an (eventually successful) effort to force American companies to stop doing business with/in apartheid South Africa.

      Of course, these days socially responsible shareholders have to go up against hedgefunds and other Wal Street financial firms that are managing deep pools of money and chasing short term profits instead of social and corporate responsibility.

      • by rtb61 (674572) on Thursday February 16, 2012 @05:22AM (#39057615) Homepage

        Here's a little share holder game. Company A has very socially responsible share holders, the require the company to pay top wages and only charge 10% profits. The income generated by the company defines it share price. Now along come a bunch of dicks led by Ritt Momney and the company he runs Cain Bapital. Now they see how well the company is run and how great it's reputation is and, they know they can really capitalise on this.

        So they offer say 50% more per share than the company is worth and naturally enough buy the company. They now shift the debt, the money the borrowed to buy the company on to the company, fire all the workers and only rehire say 75% of the ones who will accept a 75% pay and demand they increase their productivity by 25%, otherwise the company will go broke trying to repay the debt Ritt Momney and Cain Bapital dumped on the company.

        They also decide to screw the customers, basically running down service, support and quality of product to practically nothing. They then on sell the company to gullible investors highlighting the low labour costs and high profit margins (based on about to disappear customers due to appalling service, support and quality) and obfuscating the debt by focusing on return on capital (value of all the assets of the company less debt, you might think that is crazy but that is the way finances work). They sell the company at a huge profit and run away before it all blows up due to, appalling service, support and quality, disappearing customers as the companies reputation goes up in flames, an unhappy experienced labour force all looking to get another job and quit, and massive debt with reduced sales coming home to roost.

        Basically if it ain't legislated psychopath executives will screw it up every single time (consider the about tactic would be executed with full and complete foreknowledge of the outcome, company bankrupt, all the workers fired and the gullible investors loose pretty much everything, hell, Ritt and Bain will even make financial bets that the company will go belly up, they did after all set it up that way).

    • by Asic Eng (193332)

      net neutrality should most certainly not be left to shareholders.

      And it's not. All the SEC is saying that the Telcos must consult shareholders on the position they are taking regarding net neutrality. So if the shareholders vote for net neutrality, then the *Telcos* may not pursue an anti-net neutrality position. If the shareholders allow them to pursue an anti-net neutrality position, the decision is still in the political sphere. Just like now - no change.

  • by gsiarny (1831256) on Thursday February 16, 2012 @12:59AM (#39056473)

    Regular old representative democracy has had a hard time enshrining network neutrality in law. It will be telling if shareholders manage to secure it through "corporate democracy".

    Whether a push for network neutrality through shareholder activism succeeds or fails, however, this appeal to shareholders on such a basic social issue is just a symptom of the creeping corporatization of American politics. The surrender to corporations of the right to make decisions on matters of fundamental social importance is frightening, but hey - corporations are people, right, and AT&T's just this guy who means well, you know?

  • by koan (80826)

    Seriously? This sounds like something the telco's would have lobbied for.

  • by Lazarian (906722)
    Since when does the SEC decide whether or not to relegate decisions regarding net neutrality to anyone? That should fall under the domain of the FCC, not a bunch of dipshit shareholders who's only interest is the next quarter return. Fuck them.
    • Well, it falls to the SEC now because the FCC tried, and got bitchslapped by Congress.

      If the proper way doesn't work, use the half-assed back door. That's the way of the United States Government.

  • by Coeurderoy (717228) on Thursday February 16, 2012 @03:52AM (#39057265)

    One definition of madness is doing again and again and again what failed first and hoping that the results will be different "this time"
    One definition of evil is doing something, seeing that it is bad for people, and doing it again and again and again...

    Having a "public authority" asking the shareholder to vote on what would be in effect an element of "self regulation" is either mad or evil, probably both.

    It is worth while to read: ( http://arstechnica.com/tech-policy/reviews/2010/12/ars-book-review-the-master-switch-by-tim-wu.ars [arstechnica.com] ) The master switch
    to learn about how again, and again the government supported the creation of private monopolies, and stronger business control on public expression and opinion.

    The only justification for this would be if there would be some way to make the shareholder liable for the crimes of the management.
    If the SEC would seriously think that the FCC might for a nationalisation or a breakup of the operators if they do not garanty network neutrality, then asking the Shareholder about their opinion would be somehow justified.
    By the way this should not be an issue since the operators are supposedly liable for defaulting on their "common carrier" responsibilities, so asking the shareholder is basically: do you want us to comit a crime to make a lot of cash for you ? or would you prefer us to be honest.
    (not that the PR agency would let them ask the question that way of course...)

  • Since when should foreign stakeholders get a vote as to how laws are built in the U.S.? Another problem with the SEC overstepping their bounds.
    • Like they don't already? Sure, there's a 1970s law on the books, but that only stops direct lobbying.

    • Since when should foreign stakeholders get a vote as to how laws are built in the U.S.? Another problem with the SEC overstepping their bounds.

      As soon as you guys force your government to stop interfering with the passing of laws in the rest of the world then I will cede you the moral high ground.

  • by serviscope_minor (664417) on Thursday February 16, 2012 @05:05AM (#39057553) Journal

    the idea that Internet service providers must treat traffic equally

    The trouble is that when people treat QoS the sme as Net Neutrality they then believe invalid arguments like bittorrent will swamp VOIP or somesuch nonsense.

    Net neutrality is not about treating all traffic equally.

    Net neutrality is about not discriminating based on source/destination.

    Entirely different. In fact, being all IP, 4G networks will make heavy use of QoS ( http://4gwirelessjobs.com/articles/article-detail.php?QOS-over-4G-networks&Arid=MTU2&Auid=MTIy [4gwirelessjobs.com]) to prioritise voice. That doesn't mean that htey nobble google because they haven't been given a huge kickback.

    If it's done properly, you could do P2P transfers over VOIP QoS, though it would be eye-wateringly expensive.

    • by will_die (586523)
      You are using an very old definition of net neutrality.
      Net neutrality is about if your ISP can block certain web sites, certain protocols or provide different levels of service to different sites or types of info. Read the current examples and they keep on using that your ISP could slowdown access to Google since the ISP is getting funding from Bing, or other names of search provides.
      Even the creator of BitTorrent worries that if net neutrality passes ISP will have not beable to block spam messages from
      • Net neutrality is about if your ISP can block certain web sites,

        That certainly comes under "regardless of the destination".

        certain protocols

        I missed that one.

        different levels of service to different sites or types of info.

        Again, that's discriminating based on the destination.

        Even the creator of BitTorrent worries that if net neutrality passes ISP will have not beable to block spam messages from your mailbox.

        Sounds like FUD to me. Net neutrality means that they have to let everything through to your machine

        • It's even entirely reasonable (and neutral) for the ISP to have tiered service where QoS levels are charged at different amounts and you can opt to have certain protocols QoS'd at different levels.

          That would be awesome. 10 GB/month of high priority transfer and unlimited bulk transfer would be much more useful than 250 GB of best-effort for everybody. Alas, nobody does it.

          It's not neutral if the ISPs own brand VOIP gets high QoS for free whereas you have to pay extra for generic VOIP.

          What if the ISP provides a non-IP video-on-demand service and gives it a dedicated channel, while lumping IP streaming video (Netflix) and torrents into best-effort and capping transfer at some restrictive value, say 250 GB/month? This is actaully happening right now.

          • What if the ISP provides a non-IP video-on-demand service

            Well, it's pretty much not the internet at that point. It's also not being sold as internet access. The problem I have with non net neutrality is that the ISPs are not giving you what you have paid for.

  • Power to the People
  • washing their hands of the decision so they can blame the shareholders for the choices they make...
  • by Anonymous Coward

    In the late-Apartheid era, in South Africa, activists bought (barely, if I remember correctly) enough GM stock to get into meetings and vote. And propose votes. They got a vote on equal working conditions for 'whites' and 'nie-blankes'.

    GM shareholders voted overwhelmingly in mainting apartheid in the office, factories and - mainly - on factory floors. The difference between corporate shareholders in general and nazi slaveholders is well nigh nonexistent. Not bait, not trolll. Truth. Verified. Verifi

  • by 3seas (184403) on Thursday February 16, 2012 @08:50AM (#39058753) Journal

    Have Individual Taxpayers instruct government as to where their taxes are to be spent?
    Of course if you don't trust the tax payers then rig the elections... Right!?

    Maybe the same can apply to the telcos and with reduced traffic.... how will the investors respond.... Oh I know, raise prices and drive more away... yeah that will work.

    There is also another telcos issue of the past.... they participated in violating the privacy rights of americans and were taken t0 cort byt those who hired them to do so (the government) let them off. Perhaps the share holders can vote on spying issues too?

  • I see this as a brazen shift from public policy matters being handled by the elected government of the people, to policy being determined by corporate entities, and therefore only by the propertied owner.

    Which would finally return us to the grand old system of the landed property owner exclusively having a vote.

    But this is worse. In a stockholder scenario, those with more property have a proportionally greater vote, rather than an equal vote like the landed property owner model.

    So, what we are telling peopl

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