TIME Net neutrality

FCC Net Neutrality Vote Faces Furious Last-Minute Lobbying Push

Tom Wheeler FCC Chairman
Tom Wheeler, chairman of the FCC, listens during a House Energy and Commerce Committee hearing in Washington on Dec. 12, 2013 Andrew Harrer—Bloomberg/Getty Images

FCC Chairman Tom Wheeler is caught between net neutrality advocates and industry giants ahead of today's vote on his 'Open Internet' proposal, which could allow broadband providers to create "fast lanes," as both sides warn the web's future hangs in the balance

The Federal Communications Commission is poised to vote on the most controversial Internet policy proposal in years, after opponents of the plan — from both sides of the political spectrum — launched a furious last-minute lobbying campaign to influence the outcome.

Thursday’s vote on FCC Chairman Tom Wheeler’s new Open Internet proposal has become a flash point in the intensifying public debate about “net neutrality,” the principle that broadband providers like Comcast and Verizon should treat all Internet traffic equally.

Wheeler, a former venture capitalist who’s only been on the job for six months, finds himself squeezed in a vice-like grip between net neutrality advocates and public interest groups, who argue his rules don’t go far enough, and industry giants and their allies on Capitol Hill, who oppose net neutrality regulations altogether.

Both sides warn that the very future of the Internet — which has spawned a generation of technological innovation and billions of dollars in economic growth — hangs in the balance. The fundamental question is whether broadband regulation should move in a direction that treats Internet service more like a utility and less like a premium service.

Net neutrality advocates have been camping out for days in front of the FCC’s office, which has struggled to maintain open phone lines under a torrent of calls. Wheeler, an avowed supporter of Open Internet principles, came out to chat with the protestors on Wednesday morning, and was even photographed wielding a “Honk for the Open Internet” sign.

Thursday’s vote wouldn’t enshrine the new rules, it would only approve what’s called a “notice of proposed rulemaking” (NPRM) making the draft proposal available for public review, and trigger several months of public comment. Wheeler hopes to have the new rules in place by the end of the year. The FCC’s meeting starts at 10:30 a.m. on Thursday.

Net neutrality advocates want Wheeler and his colleagues to reclassify broadband companies under Title II “common carrier” provisions of the Communications Act that have governed traditional phone companies for decades. Such rules would subject the broadband companies to tighter regulation.

“We urge the FCC to use its clear authority under Title II of the Communications Act to reclassify the transmission component of broadband Internet access as a telecommunications service,” thirty-six U.S. lawmakers wrote in a letter to the FCC on Wednesday. “Recognizing our nation’s communications providers as common carriers under the law is common sense.”

The nation’s largest broadband companies strenuously oppose such reclassification, arguing that it would “threaten new investment in broadband infrastructure and jeopardize the spread of broadband technology across America, holding back Internet speeds and ultimately deepening the digital divide.”

“Reclassification of broadband Internet access offerings as Title II — telecommunications services would impose great costs, allowing unprecedented government micromanagement of all aspects of the Internet economy,” twenty-eight CEOs including Lowell McAdam of Verizon, Randall Stephenson of AT&T, Robert Marcus of Time Warner Cable, and Brian Roberts of Comcast, wrote in a letter to the FCC. “Under Title II, new service offerings, options, and features would be delayed or altogether foregone. Consumers would face less choice, and a less adaptive and responsive Internet.”

Wheeler’s plan would reportedly allow broadband providers to strike special deals with Internet companies for preferential treatment — sometimes called “paid prioritization” — in the “last mile” to consumers’ homes. Such Internet “fast lanes” would threaten innovation, net neutrality advocates argue, because they would put Internet startups — the next YouTube, Skype or Netflix, perhaps — at a disadvantage compared to deep pocketed media giants.

In January, a federal court struck down most of the FCC’s 2010 Open Internet order prohibiting broadband providers like Comcast and Verizon from blocking traffic like Skype or Netflix on wired networks or putting them into an Internet “slow lane.” (Comcast is currently the only broadband company bound by the Open Internet order, as a result of an agreement it made with the government as part of its purchase of media giant NBC Universal.)

Wheeler’s plan — which was leaked to the press two weeks ago — would allow companies to strike paid-prioritization deals as long as they acted in a “commercially reasonable manner subject to review on a case-by-case basis.” It’s unclear what kind of financial agreement would be considered “commercially reasonable” because Wheeler’s draft proposal hasn’t even been made public.

Last week, more than 100 Internet giants and startups sent a letter to the FCC expressing alarm over Wheeler’s proposed net neutrality rules. In response, Wheeler wrote that he has “made clear that if someone acts to divide the Internet between ‘haves’ and ‘have nots,’ I will use every power at my disposal to stop it, including Title II. I will not allow some companies to force Internet users into a slow lane so that others with special privileges can have superior service.”

In the wake of an intense backlash from Internet giants, startups, venture capitalists, public-interest groups and consumers, Wheeler modified his draft proposal to make Title II reclassification a more realistic option, a FCC official told TIME earlier this week. But any proposal that doesn’t include strict safeguards preventing the largest broadband giants from establishing what net neutrality advocates consider to be a “two-tiered Internet” is unlikely to quell the firestorm.

TIME Startups

Uber Will Give New York Kids Car Seats—At A Price

Baby boy Sally Anscombe—Getty Images

New York parents can pay a $10 surcharge to transport their kids around the city in a car seat

Uber isn’t just for shuttling around tech-savvy twenty-somethings any more — the on-demand car service announced Thursday the launch of UberFAMILY, a feature that will provide busy New York parents with car seats for their children.

But the service is going to come at a price. Although UberFAMILY will be free this weekend in honor of Mother’s Day, adding a car seat will regularly come at a $10 surcharge on top of normal UberX prices. Users currently have to type in the promo code “FAMILY” under the promotions tab in order to unlock UberFAMILY.

New York City parents have already been using the trackable service to transport their teens around the city—carefully watching them get from Point A to Point B on the app.

Uber’s New York City General Manager, Josh Mohrer, told TechCrunch that “several hundred” of its top-rated UberX drivers will now be driving around the city with IMMI Go car seats in their trunks. Mohrer said the drivers have been trained by Dr. Alisa Baer, better known as “Car Seat Lady,” on the proper way to secure the seats.


Here’s Why Uber May Seriously Want to Watch Its Back

Lyft Car
A Lyft customer gets into a car on January 21, 2014 in San Francisco, California. Justin Sullivan—Getty Images

This post is in partnership with Fortune, which offers the latest business and finance news. Read the article below originally published at Fortune.com.

Calling Lyft’s expansion over the last year anything less than “aggressive” would be an understatement. Now, the Uber competitor is available in 24 new U.S. cities effective Thursday, bringing the total number of markets to 60.

In addition to cities ranging from Los Angeles to Baltimore, Lyft’s “tens of thousands” of drivers are now servicing places such as Kansas City, Mo., Omaha, Neb., and Corpus Christi, Texas. The company also announced a temporary 10% price cut on fares in all markets, following a recent 20% cut it had already announced.

Lyft’s swift growth has largely to do with its “sharing economy” business model, relying on a preexisting infrastructure — citizen drivers sharing their cars and their time — whenever it enters a new market. “We don’t have to open an office in every market we go to — it really helps us grow the community,” explains Lyft president and co-founder John Zimmer.

More: Coca-Cola’s equity plan: Did shareholders say yes, or no?

The news comes just one day after Uber announced a milestone of its own: With its most recent launch in Beijing, the company is now available in 100 cities worldwide. And while Lyft may fall short of that — it hasn’t expanded beyond the U.S. yet — the company has been extremely ambitious in recent months. Indeed, Lyft’s latest news almost doubles the number of available U.S markets. This April, it raised $250 million from backers including Alibaba, Third Point, and Andreessen Horowitz toward international growth. And over the last 12 months, Lyft has ballooned from 60 to 250 employees.

Like Uber, Lyft has faced legal battles in new markets where it threatens existing transportation services, such as taxis. In St. Louis this week, a circuit judge barred the company from operating in the county after the Metropolitan Taxicab Commission sought an injunction because Lyft had failed to apply for a taxi dispatch license. (Because of its business model, Lyft has said existing taxi and for-hire vehicle regulations do not apply.) Meanwhile, in Houston, a July injunction hearing could decide whether companies like Lyft and Uber can legally operate in the area.

“If it’s anticompetitive, we strongly disagree with that, but if it’s focused on safety, we’re there hand-in-hand working with local officials,” argues Zimmer. “As long as there’s a focus on safety and an honest conversation about what the real reason for regulation would be — protecting consumers — then that’s a really great conversation to have.”

TIME Courts

Supreme Court Cloudy on Aereo Streaming TV Case

Chet Kanojia, founder and CEO of Aereo, Inc., stands next to a server array of antennas in New York, Dec. 20, 2012.
Chet Kanojia, founder and CEO of Aereo, Inc., stands next to a server array of antennas in New York, Dec. 20, 2012. Bebeto Matthews—AP

The justices considered arguments around a tech startup that is capturing free over-the-air broadcast signals and selling them to consumers on the cheap, without paying networks the hefty retransmission fees they get from cable companies

There was a lot of talk Tuesday at the Supreme Court about the future of television—how we will watch it, how we will pay for it, and whether, crucially, the old broadcast model will be blown up for good. While such rhetoric is usually overwrought, in this particular case—American Broadcasting Companies vs. Aereo—it’s actually justified. If the court decides in favor of Aereo, a small, Brooklyn-based TV-streaming tech startup, it could have the effect of destroying traditional broadcasters’ business model, and fundamentally reshaping the way the TV industry operates.

Aereo captures free, over-the-air TV signals with thousands of small antennas that are rented to individual users, and it transmits that content to customers online for a small monthly fee—without paying broadcasters the so-called retransmission fees cable companies pay them to provide their channels to cable customers. While Aereo founder Chet Kanojia has publicly tussled with the big broadcasters over whether such a disruption is good for consumers—Kanojia says it will free viewers from pricey cable bills but the big broadcasters disagree—the Supreme Court on Tuesday homed in on another question entirely. Namely, this one: If it’s legal for someone to put bunny ear antennae on his roof and watch TV for free, and it’s legal for him to record that free TV onto a DVR (or an old school Sony Betamax VCR, for that matter) so he can watch it again later with friends, then does it matter, from a legal perspective, whether he actually owns that antennae, or that he is in possession of a physical DVR?

The antennae farm across town and a “DVR” based in the cloud, Aereo argues, are legally no different from the old antenna and VCR.

ABC, backed by CBS, NBC, FOX, and the U.S. Justice Department, says: not so fast. They argue that by capturing copyrighted television programming and then transmitting it back to thousands, or tens of thousands, of users, Aereo is acting exactly like a cable company and should pay retransmission fees.

The justices didn’t offer much in the way of clues as to how they might rule during hour-long oral arguments Tuesday. A ruling is expected in the summer.

Aereo’s lawyer David C. Frederick insisted repeatedly Tuesday that the company does not “perform” anything; it is nothing more than an “equipment provider.” ABC’s lawyer, Paul D. Clement, scoffed at the idea. Of course Aereo is “performing,” he said; to suggest otherwise “is just crazy.” Clement argued that Aereo—by essentially plucking copyrighted material out of the sky, selling access to that copyrighted material back to subscribers, and refusing to pay copyright royalties—is attempting to “get something for nothing. … It’s like magic.”

The justices’ questioning returned repeatedly to the implications that any decision on this case will have for cloud computing as a whole. If an individual downloads a video onto the cloud using a popular application, like Dropbox or iCloud, and then accesses it later and watches it on his computer, then does that also amount to, as Justice Elena Kagan asked, “public performance?” Both Aereo and ABC appeared to agree that an individual user of the cloud should not be required to pay royalties when he watches, say, an episode of The Sopranos that he has already purchased.

Clement urged the justices not to try not to “solve the problem of the cloud once and for all” in this one case. He instead attempted to steer the discussion toward what he characterized as a common sense interpretation of copyright law.

Frederick, by contrast, relished the cloud debate, warning the justices that if they decide in favor of the big broadcasters, they run the risk of fundamentally undermining the business model of the cloud. “If you turn every playback into a ‘public performance,’” he said, that will have “huge implications” for cloud-based businesses.

“The court’s decision today will have significant consequences for cloud computing,” Frederick said in a statement following oral arguments. “We’re confident, cautiously optimistic, based on the way the hearing went today that the Court understood that a person watching over-the-air broadcast television in his or her home is engaging in a private performance and not a public performance that would implicate the Copyright Act.”

MONEY Entrepreneurs

Entrepreneurship sprouts among older ex-execs

Dream of capping off your career with a startup venture? Join the crowd.

Last year 5.5% of jobless managers and executives launched a business, up 31% from 2012 and the highest level since 2009, says outplacement firm Challenger Gray & Christmas.

Confidence in the economy and access to individual health insurance via Obamacare help fuel the trend, says CEO John Challenger.

Age has its advantages. People 45 and older started 48% of firms in one Kauffman Foundation study, but ran 64% of firms surviving four years.

That’s likely because older entrepreneurs often have more experience, contacts, and financial resources, says Kauffman researcher Dane Stangler.

To keep costs low, he suggests taking advantage of the` explosion in freelance help available online; clearinghouses oDesk and eLance, which are merging, list 8 million professionals, up from 900,000 in 2009.

You can use crowdfunding sites such as Kickstarter, he adds, not just to raise money, but also to gauge demand for your product or service.

TIME Startups

Dudes, Tech Aim to Put an End to DUIs

Blurred lines Stephen Simpson—Getty Images

The next time you go bar hopping, you could pass your keys over to an unusual choice of designated driver—some college-age kid you’ve never met before.

Beyond traditional taxis and upstart ride-sharing operations such as Lyft and UberX, a new category of car service is emerging around the country, and the entrepreneurs who have created these businesses are focused almost entirely on eliminating drunk driving.

The South Florida Sun-Sentinel used the arrival of St. Patrick’s Day—one of many holidays where designated drivers are in high demand—as a reason to review growing DD services available to folks in South Florida. The list includes RedCap, which launched in Florida three years ago and has since expanded to San Francisco (with plans for Los Angeles and New York City soon), and Be My DD, an app introduced in Cleveland around St. Patrick’s Day 2010 that now operates in dozens of U.S. metropolitan areas and matches up drivers with customers who have wisely decided to request that someone else drive them home.

(MORE: After PBR: Will the Next Great Hipster Beer Please Stand Up?)

Another startup, Shuttle Dudes, launched a year ago in South Florida, describing itself as “a new key remedy to the ongoing issue of drunk driving.” Interestingly, the company argues that bars and restaurants should support the new designated driver business model because customers will drink (and spend) more once they know they’re not going to have to get behind the wheel. “From surveying actual designated driving customers,” the Shuttle Dudes site explains, “it was found that most would drink more once they knew they had a designated driver booked to drive them home.”

In some cases, designated driver businesses are started as exceptionally small operations. Like just one guy. Last summer, the Sioux City Journal ran a profile of Jesse LaFramboise, a local college student who began offering himself as a sober driver in 2012, before he’d even turned 21. Now a three-person operation, Sober Driver staffers patrol the local bar scene in yellow vests and offer to drive people home, in their own cars. Drivers usually place foldable electric bikes or scooters in the customer’s car, to get back downtown after dropping someone off. LaFramboise told Fast Company that he plans on expanding the business to new territory. “Lincoln, Nebraska. Iowa City,” he said. “Maybe in Sioux Falls or Vermilion–a lot of the smaller college towns are good areas.”

How much do these services cost? LaFramboise’s Sober Driver generally charges a base $10 fee, plus $2.50 per mile; if the ride is so far that the driver can’t use a bike or scooter to get back downtown, the rate is upped to $15 and $3.50 per mile. In South Florida, BeMyDD charges $25 per hour for a pickup service, plus a $25 annual membership fee, plus additional mileage charges, while Shuttle Dudes service costs $20 per hour for the first 5 miles, plus $2 for additional miles, and there’s no membership fee.

In some cases, a regular old taxi would be cheaper, but remember these services help get you and your car home.

(MORE: Nissan Sees Electric-Car Sales Boom)

Yet another sober-driver service, Sobrio, works differently. As the Hartford Courant detailed last fall, Sobrio is a smartphone app created by a pair of University of Connecticut undergrads in 2012. Passengers pay $2 to $3 per head—via credit or debit cards handled by the app, never with cash—and are picked up and dropped off at parties and bars by Sobrio drivers behind the wheel of their own cars. Everyone involved is a student in the area, providing a level of comfort and safety. Sobrio has since expanded to several other college areas, including UMass-Amherst, SUNY-Stony Brook, the University of Rhode Island, Michigan State University, and Ohio State University.


Yahoo to Donna Users: We’re Dispensing With Your Indispensable App

When Yahoo -- or any big company -- buys your favorite startup, worry.

Incredible Labs — the company behind smart-calendar app Donna — is being acquired by Yahoo. The app is being shut down, and most of the folks who worked on it will join the Yahoo Mail team.

The farewell post on the Donna blog, by Incredible’s Kevin Cheng, follows the standard five-act kabuki of startup acquisition announcements I’ve written about before:

1. Announcement of thrilling acquisition
2. Reiteration of startup’s wildly ambitious founding notion
3, Explanation that either Google or Facebook (or, in this case, Yahoo) is the best place to change the world
4. Acknowledgement (or sometimes non-acknowledgement) that the startup’s product is being discontinued or is going into limbo
5. Expression of heartfelt gratitude to various supporters, usually including the consumers who are losing something they liked

The acquisition isn’t surprising — these days, Yahoo is snapping up interesting little companies with talented crews at a rapid clip. It’s also not a catastrophe. Donna is cool, but it’s in a category crowded with competitors, such as Tempo and Sunrise. Thinning of the herd is inevitable, and there’s obvious potential to incorporate Donna-like features into Yahoo Mail, where hundreds of millions of people could end up benefiting from them.

Still, I’m fascinated by the oddness of Yahoo’s statement on the deal, as quoted by TechCrunch’s Ryan Lawler:

We have reached an agreement to acquire Incredible Labs, the team behind personal assistant app, Donna. In case you haven’t heard of her, Donna’s pretty amazing – she has an immense amount of intellect, she keeps you on time and gives you the information you need, when you need it. For her clients, she’s the ultimate daily habit. When we met with the team from Incredible Labs, it was an immediate fit. As we look to the future, our visions are aligned in that we think technology should be smart enough to think for us. Five team members will join the Communications team in Sunnyvale at deal close, where they will work on Yahoo Mail. The transaction, which is subject to customary closing conditions, is expected to close in the next few days.

Donna is amazing! It’s the ultimate daily habit! We’re killing it!


ReFleece: Eco-friendly iPad cases start to pay off

Sam Palmer, 46, Arlington, Mass. Then: Applications engineer. Now: Eco-entrepreneur. Jared Leeds—© Jared Leeds 2012. All Rights Reserved.

Sam Palmer knew the end was near. His employer, a solar-panel manufacturer, was foundering, leading the applications engineer to decide that “the time was coming for me to step out on my own.”

A devoted tinkerer, Palmer had been experimenting with felt he made out of recycled fleece and molded into sleeves for tech gadgets. Convinced that these eco-friendly covers could sell, he raised startup capital by refinancing his home and applying for a home-equity loan.

So when the solar firm (which was indeed on its way to Chapter 7) laid him off in late 2010, Palmer was ready. “It was a kick in the pants to get going,” he says.

Palmer took his prototypes to a previous employer, clothing giant Patagonia. Executives there connected him with their coat-recycling initiative, which began supplying him with fleece. With raw materials in hand, Palmer found a manufacturer to press and form the fleece and ship orders to a fulfillment center.

After paying the factory a one-time fee of $13,000, he is now charged based on the number of cases made (that came to $60,000 for 10,000 units in 2012).

Palmer began selling his $25 to $32 cases in late 2011, first for Kindle and later for iPad, under the name ReFleece. They’re available at U.S. Patagonia stores, Amazon.com, and his own website.

Related: Suite dreams: Opening a bed and breakfast

Getting ReFleece going put Palmer, his wife, Jennifer Feller, and their two children in a challenging spot, prompting them to borrow from his parents and tap their savings. But the engineer expects to hit $150,000 in sales in 2013, which, after covering materials, office space, and manufacturing, should put the company $80,000 or so in the black, letting the couple take a salary for the first time.

While it’s just the first step to stability, says Palmer, he’s committed to his idea: “It’s gratifying to bring it to life.”


Startup funds: $150,000

Using a home-equity loan and a cash-out refinancing, Palmer has already invested $100,000 in manufacturing and raw materials. He plans to use the remaining $50,000 to add new product lines, including cases for the iPhone and iPad mini.

When Palmer expects to match his old $100,000 salary: 2014

He hopes to be up from four to 10 products by then and to start selling internationally. Revenue should hit $300,000. “I’m enjoying feeling the connection between what I do and what my rewards will be,” he says.

How much longer the family’s savings will last: 6 months

Palmer and his wife, Jennifer, who started working full-time for ReFleece in spring 2011, began with $80,000 in savings and a $20,000 loan from his parents. Palmer is negotiating with his mom and dad for an extra $30,000 to cover expenses until the firm turns a profit in 2013.

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