ISPs Race to Create Two-Tiered Internet

An anonymous reader writes "The ISP race toward a two-tiered Internet is picking up speed. This article from Michael Geist points to a wide range of examples involving packet preferencing, content blocking, traffic shaping, and public musings about premium charges for faster content downloads. ISPs are now reducing access to peer-to-peer applications, blocking Skype, and, scariest of all, lobbying Congress to let them do it."

Comments

Two word solution!

[dada21]

De. Regulate.

Real deregulation has nothing to do with Congress making laws, changing laws or getting rid of a few old regulations that actually don't affect communications. True deregulation means getting rid of ALL laws that affect communication, including ones that were set up over a hundred years ago that we still have to follow.

In my opinion, the interstate commerce "clause" in the Constitution was not intended to control communications, set up an FCC, or regulate costs or services. It was intended to prevent taxation and tariffs (exactly the problem we have today!) I'll grudgingly accept the argument for the regulation up to maybe 1995, but after that, we saw an unregulated quantity of computers magically connect without major subsidies (I'll grant you that ARPA was originally tax paid, but how big did it get during the government years?). The fact that so many people got online without excessive regulations aimed at driving the Internet leads me to believe that the best form of our beloved Internet IS anarchy (not chaos).

Congress shall make no law ... abridging the freedom of speech, or of the press ...

My speech is free to go where I sent it. For Congress to say that 2 or 5 or 10 big companies know better than thousands of little ones is typical nannyism. Who knows best? The People. We choose ISps that meet our needs. The system works. Some ISPs go under. Some combine into one ISP. Some fall apart into seperate smaller ISPs. This is how the free market works. We're going to see more free WiFi ISPs (my small town has 3!). We're going to see faster cell phone bandwidth (my EDGE network gets 150kbps downloads). We're going to see less reliance on the phone companies and the cable companies. This isn't happening because of regulation.

As to the two-tiered Internet, I'm all in support of the system if it isn't regulated. Without regulations, the ISPs must compete with one another. This means that the two-tier system could actually be of benefit to the end users. I have customers with offices all over the country who have to maintain expensive T1 lines. With a two-tier system that gives customers on the same network preferential treatment, I think we'll see lowered costs for corporate WANs, meaning lower prices for consumers of those corporations' products. Every dollar saved is some money passed on to the consumer.

Yet these two tiered systems can, overnight, become a mess if Congress decides to set rules and restrictions and requirements. Instead of promoting more bandwidth between same-network customers, regulations will push less bandwidth for different-network customers. If the little guy is pushed out (as regulations tend to do), the big guys won't have any reason to stay competitive. It isn't AOL versus MSN versus Comcast versus SBC that lowers prices and raises bandwidth. It is the thousands of smaller ISPs that are like mosquitos, constantly biting the big elephants and causing them to make changes to their service. For years I used Speakeasy and converted dozens of my customers. I still prefer Speakeasy, but they've been cut off in my market -- by SBC and Comcast that lobbied my local government and state government. REGULATION killed off Speakeasy in my area -- deregulation gave me years of amazing performance and price.

Don't believe the hype -- anarchy in communications has led us to a smaller world and a brighter future. Regulations have led us to 90 years of excise taxes on our phone bills that won't go away, even if the reason for the taxes is antiquated or ancient. Yes, we're still paying taxes on our phone bill that were set up in 1898 and for World War I costs. And you continue to support those leeches by voting for them?

Re:Two word solution!

[peragrin]

Your idea of two-tier internet and the ISP's are completely different.

Your new two-tiered ISP charges you 1.99 per download from itunes, plus the cost of the music, but if you download from their sponsered service they only charge you for the music.

Think Cell phone bills. The data charges on Cell phones are stupid high. They charge you per byte, plus minutes while online. Try downloading a ringtone sold by sprint on a verizion phone. It doesn't work. Not because the song isn't compatible but because they will put up money road blocks into the way to force you to pay.

I am sorry But I want the internet my way. Not the way some company wants to force me to pay Dollars extra for things they get for literaly pennies.

Re:Two word solution!

[Caspian]

This is a complete load of bollocks.

Complete deregulation in the telecom field wouldn't lead to "thousands of little companies". It'd lead to one company.

With no regulations whatsoever, telecom companies would be free to merger and reverse-merger and acquisition themselves into a recreation of Ma Bell. Shit, they're already halfway there.

From what I've heard (I'm too young to remember it directly), things weren't too bad under the Ma Bell monopoly the first time around. Ah, but times have changed. It's 2005, and quaint, antiquated notions like "the customer is always right" have gone completely out the window. You know the old Saturday Night Live line, "We're the phone company, we don't have to care"? Substitute "a Fortune 500 company" for "the phone company". I could tell you horror story after horror story of how I've gotten jerked around by existing ISPs and telcos. Once they congeal back into a single monopolistic entity (as they were before), this will only get worse.

And you free market religionists will be to blame.

In the absence of regulations, things turn into a monopoly. No, "the system" doesn't work. It doesn't work because Joe Sixpack is ignorant, and the telcos like it that way. Capitalism, like democracy, assumes a well-educated and informed populace, and we do not have that.

Re:Two word solution!

[aeoo]

Every dollar saved is some money passed on to the consumer.

You're wrong about that and you know it. Most saved dollars in fact do NOT pass onto the consumer! At best, they pass onto the shareholders or are reinvested into business, but more likely they are used for golden handshakes and exorbitant executive salaries and benefits (such as special loans, stocks and other such things).

Re:Two word solution!

[dada21]

This is a complete load of bollocks.

You're referencing the rest of your comment, right?

In the PC world, there is no regulations on the cost, quality or performance of PCs. We have hundreds of companies selling products -- big boys like Dell and HP, small guys like Ram's PC Shop. Guess what? Prices have fallen even against inflation.

In the automotive world, we have heavy regulations -- steel tariffs, union requirements and other government mandates. Car prices have risen, faster than inflation.

In the soda world, we have almost no regulations (except for some USDA/FDA ones). Soda prices have fallen against inflation, and generic versions taste as good as the real ones in some occasions. I can buy a 2 liter of diet cola for US$0.49 versus US$0.99 a few years ago.

In the medicine world, we have excessive regulations, and prices have climbed beyond inflation.

In the clothing world, we have few regulations (some tariffs on cotton and other materials). I can buy a nice, quality hoodie for US$10 at H&M. A few years back they were over US$50 at the mall.

Tell me again how regulations help and anarchy hurts?

Re:Two word solution!

[Caspian]

Or, let me put it even more simply: Contrary to what libertarian dreamers like yourself would like to believe, in the absence of controls on the powerful, the powerful get more powerful (and the powerless get more powerless.)

This concept seems so ludicrously obvious, yet you completely don't understand it.

Even as things presently stand, the advances made by "the little guy" (E.g.: The rising influence (for better or worse) of bloggers) are the exception and not the rule. They are like those "human interest" stories you see on the evening news where a firefighter saved a precious cat named Muffins from a raging fire. Awww, how nice. Meanwhile, AIDS is still killing millions in Africa, and people are still being blown up in Iraq.

Loony Libertarian "to make the powerful less powerful, we'll remove all restrictions on them!!111" thought would only make the situation worse. It amazes me to think that there are those who cannot comprehend this.

Since when do you reduce the power of an entity by removing all restrictions on them!?

And please, spare me the lecture about how "with no regulations, barriers to entry in the [X] market would be lowered". It doesn't fucking matter. Little companies could enter the telco market-- they'd just fold inside of a year, since no one can compete with the marketshare and "mindshare" of the established carriers.

I'm starting to think that the entire libertarian/Libertarian movement/party was secretly funded by Fortune 500 companies seeking to grow their influence through eradicating all checks and balances on their nearly-limitless power.

Re:Two word solution!

[rainman_bc]

Complete deregulation in the telecom field wouldn't lead to "thousands of little companies". It'd lead to one company.

I agree totally. There's a natural tendancy for companies to consolidate, when growth cannot be achieved without consolidation. Economists theorize that in a normal environment, businesses consolidate, raise their prices, and when those prices rise, the incentive for new business to start is better and those businesses will be competitive.

They expand on that theory to point out that when economies of scale are reached, the barrier to entry is too high, and big fish will swallow the little fish because of it.

I'd like to draw attention to Fido and Clearnet in Canada.

At one time we only had two Cell providers in Wester Canada - Telus and Rogers and they hosed us on the rates. It was an oligopoly, where the incentive to keep rates high was better than the incentive to compete. So two new cell providers came to play: Fido and Clearnet. Fido offered amazing rates that were highly competitive - 200 mins for $20/mo. So did Clearnet - unlimited incoming calls for $29/mo. And they did this without a 3 year contract. All of which was unheard of before.

Telus bought clearnet, Rogers bought Fido.

Do you think they bought those cell carriers to compete, or to increase margins?

The barrier to entry for the cell market is very high now. We probably won't see a new cell providor in Canada for a long time now, and rates will stay where they are.

Re:Two word solution!

[_LORAX_]

It has been shown time and time again that competition in physical goods works as expected, but not in services like internet access or phone markets. The problem arises because there are very few ways to get a foothold on the requisite "last mile" or radio spectrum in order to compete. Without being able to come in and "set up shop" without being subserviant to the companies that you are competing against there is no REAL competition.

Re:Two word solution!

[Chris_Jefferson]

In the PC world, if Microsoft wasn't kept under some control, don't you think by now there would be Microsoft PCs, which (because they didn't have to pay for a copy of windows) would be much cheaper than other people's PCs, and they'd slowly take over 90% of the PC market?

Re:Two word solution!

[dada21]

Wal*mart increased my ma-and-pa store services sold almost 500%. They sold paintball markers and skateboards like we did, but when customers had problems, guess who Wal*mart sent them to? Us. We probably made US$100,000 one year on Wal*Mart referrals.

Blockbuster's rental of DVDs and CDs and videos caused a huge increase in the amount of DVD players and VCRs sold. This brought jobs to retail employees. Ma and pa video rental stores eventually bounced back in my area and now we are back to having 3 or 4 for every Blockbuster, especially in porn and import rentals.

How again did either of these two companies cause pain in the market? They made some things more efficient, and created new markets to support. Sounds good to me.

Re:Two word solution!

[penguin-collective]

In the PC world, there is no regulations on the cost, quality or performance of PCs. We have hundreds of companies selling products -- big boys like Dell and HP, small guys like Ram's PC Shop. Guess what? Prices have fallen even against inflation.

There is plenty of regulation in the PC world, it just happens to come courtesy of Microsoft, who also skim billions off the top.

In the automotive world, we have heavy regulations -- steel tariffs, union requirements and other government mandates. Car prices have risen, faster than inflation.

Car prices haven't risen fast enough--they still aren't anywhere near accounting for the cost they impose on society.

In the medicine world, we have excessive regulations, and prices have climbed beyond inflation.

Actually, the regulated and public medical providers are the most efficient ones in the system; it's the private insurance companies that are driving up costs further and further, not because of regulation, but because of a lack of regulation.

Tell me again how regulations help and anarchy hurts?

You didn't think your haphazard collection of poorly chosen examples constituted an argument supporting your position, did you?

Whether government regulation helps or hurts depends on the goals one wants to achieve, the market, and the details of the regulations. The details are fairly well understood economically, although doing the right thing is often politically difficult. One regulation that is generally a good idea is antitrust regulation: markets are rarely well-served by a single dominant company.

Re:Two word solution!

[Dun Malg]

From what I've heard (I'm too young to remember it directly), things weren't too bad under the Ma Bell monopoly the first time around

I actually remember it. There was a certain degree of predictability that we don't have anymore. They owned the whole system, from the lond distance system to the CO to the jack in your living room, so any trouble was definitely their problem and indeed they fixed things quickly. But there was a dark side. To make a bastardized reference to the Ben Franklin quote, the AT&T monopoly essentially guaranteed safety at the price of freedom. Local residential service was very cheap because it was subsidized by long distance. The old days were a time when you didn't talk to out of state relatives but a couple times a year, and then for not very long. And forget calling overseas. The only people who could afford to regularly use long distance were businesses, and they only did when they had to. Starting in the 50's and exploding in the 60's and 70's, the old AT&T service pricing more and more reflected a country that no longer existed. We were no longer a country of insular agrarian communities with no need or desire for outside communication. People no longer lived worked and died in the same place they were born. They moved around, sometimes going great distances. Also, TV came along and brought the outside world closer. By the late 70's, AT&T was a company with the most advanced 20th century equipment, but with a largely 19th century business model. MCI suing for access was just the inevitable first step in the explosion of the "information age". Widespread, global communication had reached a point where it was not only possible, but it was easy (at least from a technical standpoint). The problem was that the next step, communication becoming inexpensive, was thoroughly and completely blocked by a behemoth monopoly that had no reason to change its way of doing business. You think Ma Bell would have rolled out DSL for cheap? I remember even back in 1995 Pacific Bell was reluctant to field DSL because it was afraid to lose all that revenue from locked-in T1 and ISDN customers. Large incumbent monopolies are famous for not exploiting emerging markets until competitors force them into it. No, the AT&T monopoly was tolerable for the first 80 years or so, but by 1984 it's time had definitely passed.

Re:Two word solution!

[antarctican]

It was de-regulation that caused every hamburger chain to combine into one.

It was de-regulation that caused every big box consumer store to combine into one.

It was de-regulation that caused every candy bar company to combine into one.

Apples and oranges. That argument applies to businesses where entities, offices, etc are separate. Telecommunications is completely different; there is one set of phone lines running through a neighbourhood, there is one set of cable lines running through a neighbourhood.

Do you really think a municipality would allow every company that wants to come along to put up more wires? Do you really think residents would want dozens of different wires running through their streets? Do you really think it would be economically viable for a company to wire up a neighbourhood if they only had one or two customers in an area?

It's an economic factor why there's only one set of telephone and cable wires in a city. And as another poster said, if there was pure deregulation, what would force the owners of those wires to let anyone else use them? They would be the gatekeeper for that telephone network or cable company, they would dictate what goes down those wires and how much you pay, and the consumer would have very little choice.

This is why regulation is needed, because it's not like a burger joint where someone can just put up a new franchise next door - a new player can't simply lay down a new set of wires.

The infrastructure in this case should be a public asset that is there to facilitate commerce and competition, allowing any players to enter, like our public road system. All companies can use the roads in an equal manner.

And that's what a one-tier internet does, allow anyone to enter the game because they have the same access to the market as anyone else. A two-tier would force all the small players on the wider internet out of business because they would have to pay a toll to reach the consumers.

You like real life analogies? It's like each neighbourhood being able to set up a toll on the roads in their area dictating that all red cars need to pay $5 to pass, after those roads were already paid for by taxpayers. I as a consumer already paid for a road to the internet, paying for my DSL or cable, I should be able to pick what colour car I drive down that road, not have that dictated to me.

Re:Two word solution!

[IAmTheDave]

I am sorry But I want the internet my way. Not the way some company wants to force me to pay Dollars extra for things they get for literaly pennies.

This isn't even "my way" - it's quite simply the connection itself. I am paying not for the service, but for the connection to the internet. Currently, the ISP passes my traffic back and forth to my computer/router. Serivces are provided by the connected server that is passing traffic back to my computer.

This is DIRECTLY akin to saying that phone companies want to provide better phone quality if you call another user on their network. Have Verizon and call someone on Cavalier? Well, we can't guarentee a connection, we can't promise you won't be booted off the line for a Verizon->Verizon connection, and we can't help the static unless you get the other party to switch to Verizon.

This, directly, stifles competition, especially at the small business level. It's sickening. And it will become law.

Re:Two word solution!

[hswerdfe]

Hey Wow

wouldn't it be Great if an Infrastructure based industry like Telecom, Roads, Internet.
worked the same as a commodity based industry like, pc's, or cloths.

I know lets pretend the economics of one apply blindly to the other...

Re:Two word solution!

[rainman_bc]

I've been in business since the age of 13 and there has never been a market I couldn't enter.

I'm starting a wireless ISP in my trailer park in March

You wouldn't be living in a trailer park if you were so capable. Just a small observation. I realize it's partially an ad-hominem attack, but you cite your own experience as starting a wireless ISP in a trailer park as an example of how easy it is to get into any business. I find it ironic that you live in a trailer park and are debunking economic theories that propogate far beyond your own business experiences, which incidnetally demonstrate you have failed, not succeeded if

Truth is, you can't just go and start a leasing company without startup capital. Sometimes the barrier to entry is so high it's almost impossible for a business to start and be competitive.

Re:Two word solution!

[dada21]

Actually, I sold my 1600 square foot home (worth over US$250,000) and bought a US$40,000 trailer with over 1600 square feet. Why? US$210,000 that I now have in my pocket to spend on vacations, business trips, and new ways to make me money. Some of my neighbors are friends of mine who sold their US$500,000 for 2200 square foot trailers. Why? The same reason -- we took advantage of the housing bubble (caused by regulations, mind you).

If you think living in a trailer is trashy, I applaud you -- it is why I can continue to live in housing that costs me less than US$3000 per year (including property taxes) and pocket the US$2000 a month in mortgage to spend on other things I like.

In the next 3 years I'll move at least 60 people with similar lives as mine into my community -- and we'll all live high on the hog getting rid of the 38% overhead of living in a "house." In fact, I've been able to cut my work hours almost in HALF and have more money in my pocket at year's end.

Don't knock it just because you want to keep up with the Joneses. The Joneses are in debt and live beyond their means and will have to both work until they're 65 to pay off their excesses. Me? My family loves life and has smiles on our face when we go shopping with cash in our pocket. It seems like everyone else we see has a frown and wonders if that plastic card will say "denied" at the register.

Re:Two word solution!

[DonChron]

The "market" doesn't exist without laws and regulations - ie. liability law, contract law, etc. Sure, you need buyers and sellers, but the framework in which they operate is defined largely by laws.

To pretend that people can vote with their feet and just embrace alternate ISP's is ludicrous. Businesses can do this - I can buy a T1 from plenty of providers. Consumers generally can't because Congress repealed the unbundling of local loop services. Unbundling was one of the key provisions of the 1996 Telecommunications Act, and this specific regulation successfully promoted competition. Look at the huge growth in small, DSL and dial-up ISP's in the late 1990's. But the re-bundling of local loop and telecom services allows ILEC's who own the (publicly subsidized, monopoly-fueled) phone lines to kick out their competitors. Bye Covad. Bye SpeakEasy.

Since the telecoms killed the regulations *allowing* competition in the baby bells' wiring closets, and all the major telecom providers are merging from a fear of being too small, your small-ISP options are going to evaporate (assuming they're not already gone). That leaves the cable companies, who are rapidly consolidating, and the bigger, post-merger, debt-and-infrastructure-heavy, incumbent telecom providers to choose from. Unfortunately, they all have the same business plan now: milk the infrastructure and perpetuate monopolies and oligopolies, just like the pre-Internet days.

I live in a dense suburb of a major American city. If I want broadband, I can get it from Verizon, Comcast or RCN. Or I can pay a 100% monthly premium for a slower-than-cable SDSL connection from an independant DSL provider. Maybe I'll pay extra because I have some applications which benefit from unfiltered ports, and better upstream bandwidth, but I doubt it. And can I really expect my non-technical friends and family to do the same? For a principle, which almost never gives them any benefits?

Public Interest Research Group has some good analysis of the consumer-unfriendly results of telecom mergers.

http://www.pirg.org/consumer/media/reports.htm

When someone tells you "The Market will determine the optimal solution for consumers," they usually mean "The monopolies created by deregulation will be very profitable and the consumers get what they deserve." If it's a corporate spokesperson, they're buying (and writing) the legislation to re-shape the market. Why do you think these guys try to block all municipal ISP programs? They're allergic to competition. Look at SBC - they've built or bought all the infrastructure they care to build and now it's time to raise the prices and cut service levels. They could never do this with a truly competitive telecom market.

Why wouldn't you try to get your elected representatives to oppose such legislation? What other avenues are left? Start your own telecom business and compete with Verizon or SBC for those lucrative local phone customers? Not likely - the barriers to entry are too high. Sure, there's lots of dark fiber out there, but there's no excess capacity in the last-mile, local-loop side of things.

-Don

PS - What, exactly, is the ideology that takes the SBC chairman's statements about preparing to gouge consumers and turns that into "Consumers win! Everybody wins!"?

Re:Two word solution!

[Comboman]

Telus bought clearnet, Rogers bought Fido. Do you think they bought those cell carriers to compete, or to increase margins?

I don't know about Fido & Rogers, but Telus was a mostly western company and Clearnet mostly eastern. After the merge, they had solid national coverage. It seems more like a fast and cheap way for Telus to expand into eastern Canada rather than getting rid of a rival.

The barrier to entry for the cell market is very high now. We probably won't see a new cell providor in Canada for a long time now, and rates will stay where they are.

Is that why Virgin Mobile just started up this year? With lower rates than everyone else?

The thing that really stops major competition in the cellphone world is not cost-of-entry for new providers, it's things like service-provider locks on phones and non-transferable phone numbers. I doesn't matter how many providers there are if you can't easily switch from one to the other.

Re:Two word solution!

[DonChron]

What's the up-front cost of starting a generic Mom-and-Pop store? Or a video rental store? Let's call it one million dollars (US), though it's probably much lower in most places.

What's the up-front cost of starting a DSL or cable ISP? Remember, you can't share existing last-mile facilities with the big guys (unless they charge you much more than you'll be able to charge your customers for the resulting services). What's it going to cost to build some new copper or fiber infrastructure, even in a dense urban area? How are you even going to get right-of-way access to buildings? Maybe you can lease the conduits from a power company, like some of the ISP's do. How are you going to connect to the Internet? Don't even think about the public peering points - they're kind of saturated and run by the incumbents. So you'll have to pay someone much bigger for IP's and bandwidth. Good luck with that.

The cable television and local phone service infrastructures took decades to build, with tons of public subsidies, tax breaks, and protective legislation. How are you going to buy enough legislative influence to keep the big guys from regulating you out of business?

In round numbers, I think you would need about a billion dollars.

Let's you and me take on the AT&T death star - how about it, dada21? Sell the ma-and-pa store and let's start talking to banks and VC's about how we're going to beat AT&T or Verizon or SBC in, you know, one or two big, high-margin metropolitan markets. We can do it, right? Just like you competed with Wal-Mart. It'll be easy, like shooting womp rats in your T-16 back home.

Re:Two word solution!

[toad3k]

In my small town, they removed a "regulation" that isps had to lease their lines to competitors at a fair price. So now my town went from about ten isps smaller isps to four or so, and it is continually shrinking down to two. Comcast and Verizon. And the only reason they won't consolidate is because one is cable and the other is dsl.

But surely these companies are bastions of virtue who would never dream of putting a squeeze on google, yahoo and microsoft for kickbacks. I'm sure Verizon would never ever block skype. I'm sure Comcast couldn't possibly have a reason to block bittorrent. There's not the slightest hint of conflict of interest and anyone who says deregulation in this instance is bad must be a commie/hippie.

Go time

[panxerox]

If there was ever a time for slashdots to be active politically it is now, this is a wake up call that the Internet as we know it is in jeopardy. What this new ISP movement really is all about is to remold the Internet into what Gore invisioned originally, that is a wholly owned and controlled network primary based on cable technology.

Favoring content delivery over customer participation, the original concept for the "information super highway" was basically a one way street from the providers to the customers with the consumers having very little control. The Internet is not what he and the corps envisioned and they are pissed that they can't generate decent income streams from it (at least the majority of corps the innovators like google are able to but being an innovator is to hard for most corps).

As for liability the isps had better think about this real hard before they leap into content control, I'm sure the lawyers are licking their chops as the possibility for massive waves of lawsuits dance in their heads. From the article

"The network neutrality principle has served ISPs, Internet companies, and Internet users well. It has enabled ISPs to plausibly argue that they function much like common carriers and that they should therefore be exempt from liability for the content that passes through their systems. "

Let me guess...

[IAAP]

The ISPs are going to submit it to Congress as the "Keep the Children Safe from Porn and Stop Content Theives."

Well...

[aug24]

...something's blocking access to the story. (Millions of other slashdotters most likely.)

Justin.

Mirror

[winkydink]

http://www.networkmirror.com/AQGdtdGeemUeo3VD/www. michaelgeist.ca/index.php%3Foption%3Dcom_content%2 6task%3Dview%26id%3D1040.html

Two Tier Highways

[Anonymous Coward]

This idea of having two tiers for the information superhighway makes about as much sense as having two tiers of regular highways. Could you imagine what would happen if we had two "tiers" of highways, one for everyone to use, and another where you had to pay money in exchange for limited access and faster travel? I mean, come on. This whole argument that faster, more efficient systems will get built years earlier than if they were funded solely through tax dollars is just a load of BS. Everyone knows that "highways want to be free".

Re:Two Tier Highways

[velkro]

Actually, we have that in place in Toronto, Ontario, Canada. Highway 407 charges per km for usage, and takes you the same place the 'free' highways take you. They just sell it as 'faster' (even though the speedlimit is the same) as it's suppose to be less congested.

The government built it, and then sold it to a private company to run. They make millions off it.

Re:Vote with your money

[Jeff Mahoney]

A lot of ISPs have caught on to customers talking with their feet and now lock in subscribers.

Circumventing ISP filtering

[CCMCornell]

How do the ISP's block or attenuate traffic speeds for certain services? Do they actually look at the contents of packets or is it simply by port? If by port, can't many applications like p2p's be set to use non-standard ports? For a few years now on Time Warner Cable/Road Runner, I've noticed that sometimes default settings for P2P's yield very slow results and sometimes no connection to the tracker/server and connections to very few peers. I've simply changed those port settings. I guess some applications can't be changed either because of lack of customization in the program or a required standard port.

Re:Circumventing ISP filtering

[wfeick]

It's not so much that they will select specific things to block, but rather they'll select specific things to be given preferred access.

In the router world, this is referred to as ToS (Type of Service) or QoS (Quality of Service). They are slightly different, but for the purpose of this conversation let's just say there is a single byte in every IP header that can be used to differentiate different kinds of traffic.

Routers also have the ability to have multiple outbound queues on a single hardware interface. You can configure a priority queue such that its packets are sent before any packets in the non-priority queue.

1. Force the byte to be 0 for any traffic coming in from a customer's site so they can't declare any traffic to be priority.
2. Set up an access control list (ACL) that matches traffic going to or from the service provider's audio server, video on demand server, etc. and sets the byte to 1.
3. Throughout your network, you configure priority queues that ensure your priority traffic gets transmitted first.

Given all this, the ISP can reduce the bandwidth of their backbone (or avoid increasing it as demand grows) and their pay-for-content services will work just fine but anyone else's services will suck.

The ISP can then go after other companies that are trying to sell content to their users. If Apple wishes to have priority access to the ISP's customers, they must pay a fee to have an ACL set up which flags their traffic as priority. Ditto for anyone selling a real-time stock market feed, video-on-demand, etc.

The ISP can then also target you as a customer. If you want to be able to receive any of this priority content, you'll have to pay an additional monthly fee to do so.

Personally, I don't like the idea of being charged differently based on who I'm talking to. It's like the post office or Fedex charging you more for a letter you're sending to your attorney because they know that must be important, but less for your letter to your mother. It's like when a truck enters a toll highway, they look inside to see what is being moved. If it's just a moving van full of personal belongings, the fee is low. But if it's a load of consumer electronics headed for sale they'll charge a higher fee.

I'd rather see this be done based on the level of service you're requesting. If you want low jitter, low latency access to the network, it costs more per Mbit than it does for high jitter, high latency access. Whether you have a voice call to your grandmother or your attorney, it shouldn't matter. Whether you're viewing a movie from the ISP's server of HBO's server, it shouldn't matter.

Unfortunately, the ISPs want to go the way of the cellular providers, to maximize their profits by charging you additional fees for anything they can get away with.

Yay!!

[JWW]

Yay! They're trying to gain more of our business by limiting what we can do no the intenet and making things suck.

As a "consumer" that exactly what I look for. I wouldn't want the greedy telcos to have to actually price stuff based on a competitive market.

I look forward to a few years from now when Japan and other countries in Asia will have cheap, and abundant bandwith (at least 100Mb/s, probably wireless to boot) and I'll still have a 1.5Mb/s DSL line and be paying MORE for it. Yeah, that'll be great.

If the telco's succeed in this we (US internet users) will be relegated to a second class status on the net.

And that doesn't even take into account the chokehold they'll have on innovation in the IT sector. Then we'll get passed there too.

Don't get me wrong its not a US and them internet, the net is a global endeavor. It just that in the future being from the US I'd like to participate in it and not get blown past because increasing our bandwidth has take a back seat to Telco profits.

Re:Yay!!

[JWW]

Could worse grammar and speling I had in that last sentance?

Sorry about that. Grammar Nazis need not reply, I know that was horrible.

Re:Yay!!

[clambake]

look forward to a few years from now when Japan and other countries in Asia will have cheap, and abundant bandwith (at least 100Mb/s, probably wireless to boot) and I'll still have a 1.5Mb/s DSL line and be paying MORE for it. Yeah, that'll be great.

Sooo, you are saying, in a few years, you think places like Japan will have LOWER internet speeds than it does now? I had 112 Mbit fiber to my home when I was in Tokyo LAST year... Of course, if cost an ungodly $40 a month and installation was nearly $100 (with only a measly 80% "special price" reduction, I had to pay close to $20! The horrors!) ;)

It has already started:

[acoustix]

"Firefox can't establish a connection to the server at www.michaelgeist.ca."

See, they're blocking me already!!!!

-Nick

sad truth

[podRZA]

The sad truth about something like this is that is will go larely unnoticed by the tech-saavy-less public. It will be advertised as a "more reliable, more secure, more parental-control friendly" internet connection, and will succeed. Most people only want the internet for email and web surfing and so if that is still possible, people will go for it.

rigged election

[mapmaker]

Unfortunately, most people have either one or two choices for broadband internet service - the cable company and if thy're lucky also the phone company. It's hard to vote with your wallet when there's only one candidate running for office.

I think it's fantastic in a way

[rainman_bc]

Just in a way. I'm all for freedom of speech.

I think this plan will backfire on ISP's. They presently do not filter content, so they are held excempt from liability of the content. Plenty of court cases have backed that.

However if they are filtering content, controlling what an end user can and cannot access, then won't the courts hold them accountable for this behaviour?

This will be a splippery slope, one where a few ISPs will get burned from it.

Re:I think it's fantastic in a way

[dr_dank]

However if they are filtering content, controlling what an end user can and cannot access, then won't the courts hold them accountable for this behaviour?

Yes, you're referring to common carrier status. As long as the legislature is bought and paid for, I'm sure this loophole will be closed before long where they can filter and divert packets that threaten their revenue but wash their hands of responsibility for copyright infringement and kiddie pr0n.

As it stands now, common carrier says that they either let data ride on their network without discrimination or they become accountable for everything that comes across it.

Give in. We're screwed.

[kid-noodle]

Not to be cynical - but we're essentially screwed here.

Nobody else will give a damn. AOL are the most popular ISP in the world, and we all know they suck - doesn't matter. Vote with your wallet, fine. Nobody else will. They'll believe the hype - the megacorps will win, they will be convinced that this means they get a safer, faster internet. They'll be pleased.

Even then, it won't matter - your escape options will vanish, because every major ISP will do exactly the same thing.

We're losing the internet to the Bad Guys, the battle is half over already, and on balance, they're winning it. I have no idea what the solution is - we're under attack from the politicians on both national and international levels, the corporations on a global scale... I don't see us winning this fight. Best we can hope for is a draw.

Two tier internet

[thewiz]

Sounds to me like they want our virtual lives to reflect our real lives: rich vs. poor.
And who said we have a classless system?

Define the "Internet" and then sue

[rcpitt]

If someone sells me access to "the Internet" and blocks ports defined in RFCs then it isn't "the Internet" it is something else.

Back when AOL and Compuserve were BBSs (networks unto themselves with minimal/no connection to other services) their customers demanded access to Internet E-mail and got it; eventually bundled in as opposed to for extra charge.

The ISPs will have to realize that there are ways to circumvent their blockages and all it takes is one person to come up with it and the whole world knows.

How about "port knocking" as a data transport? I hesitate to list some of the other methods our group of gurus has discussed over the past few years, but you can be assured that there are lots, and the black hats have been using them for some time now.

How about someone providing a service that tunnels other traffic via an unblocked port? Unencrypted there would be not much extra overhead - encrypted it would be proof against almost any blocking since the tunnel service provider can use any port they want and the ISP can't block them all or what's the use of calling it a network. Port 80 sounds like a good choice.

And if the ISP blocks the service's address block, how about something that does a shared-bandwidth service such as bittorrent does now?

Pretty soon the ISPs will get it through their thick skulls that blocking ports isn't the way - providing lower latency for similar service (to that provided by someone farther away by net) or making partnerships (franchises, etc.) with the data/service/application providers is really the only way to differentiate.

Using the routers is easy - but it will not prevail.

Re:Define the "Internet" and then sue

[Anonymous Coward]

Port 80 sounds like a good choice.

Try port 443. ISPs may send your outgoing port 80 to a transparent proxy, and such a proxy could simply drop traffic it doesn't understand, crippling port tunneling without affecting web surfing. Typical port 443 traffic is already encrypted, so if they block any of it they risk all their users complaining.

You're right in putting the legal solutions ahead of the technical solutions for this one, though. If someone is selling lemons their customers should be talking to a lawyer, not a mechanic.

Barriers to entry

[klubar]

You're missing the piece about barriers to entry.

Where the entry cost is low, competition works well (joe's computer shop, asmet's sweatshirt shop, even beverages). Where barriers to entry are very high (telecom, drugs, automobiles) regulation is needed to prevent monopoly powers.

Re:Barriers to entry

[dada21]

And this is why new companies show up every year that compete just fine with the big guys? Where was google on the map 10 years ago? Oh, they weren't.

If you have a high cost to enter a market, and you have people with good ideas, money is available from risk taking investors. My friend sells Love Sacs -- they're big "bean bag" chairs that sell for $300-$600 at malls. The kid who started this company is now a multi-multi-millionaire, and he started in his garage. Now he has millions to spend on other ideas (to make himself even richer) and he'll invest in technology or medicine or who knows what. Look at the billionaire who invented the Segway and tell me that transportation is a hard market to buy into. He did it, and there are numerous billionaires out there pushing for outer space and underwater, but can't do much without getting rid of government regulations.

Your attitude is based on the belief that big companies are bad. They are only bad if they're given the ability to use force, and only government can grant that ability.

Re:Barriers to entry

[squiggleslash]

Where was google on the map 10 years ago?

I could start a search engine company tomorrow. It's not expensive. The tricky bit is coming up with an original and effective way of searching, but money isn't the object. A search engine company is not an ISP, not a provider of infrastructure.

I'd find starting a telecommunications network, with its own infrastructure, of any useful kind pretty close to impossible. So, unless you're actually Bill Gates et al, would you.

And trust me, I'd love to do that. I'd love to just start a mobile phone company. I mean, I have some great ideas about how mobile phones should work. I can pretty much work out how the things could be funded too so the business makes a profit. But, you know what? It's a little expensive. I need a huge amount of money up front, before I can get it back from the customers.

Creating a website, and writing a program to crawl the Internet is cheap.

Building towers every few miles, and linking them with some form of high-bandwidth telecommunications link, is phenominally expensive. Out of the range of the vast majority of us.

That's mobile phones. Of course, if we're talking land-based telecommunications (copper, fiber optic), then competition actually makes the costs more expensive. Let's suppose I decide I'm going to compete against BellSouth in my city. With my own infrastructure, because, remember, you're proposing total deregulation.

Suppose I get half their old customers. Does this mean:

1. BellSouth's costs just halved, meaning they can charge their existing customers the same amount.

2. BellSouth's costs, for maintaining a network that still covers the same area but with half the number of paying customers, just, for the most part, stayed about the same?

Not difficult to answer that one, and it's actually part of what made early AT&T leaders actually support the notion of monopolies in telecommunications to begin with.

Can you see me actually getting half of BellSouth's customers? I'd have to build out a network that costs as much to maintain as their's does for the same group of potential customers, yet survive on a fraction of that group. I'd have to be nuts to even try.

Here's what happens if you deregulate:

Competition dies completely. Companies work out that it's in their best interests to combine, for two reasons: The first is, as in the infrastructure example above, it's cheaper to build and maintain one network than two. Two companies mean supporting two networks for the same group of potential customers. The second is that control over the market means control over the customer - as long as the product isn't unusable, the customer will pay through the nose and no market will open for exceptionally expensive alternatives that might otherwise eventually come down in price once enough people move to it and compete.

Most of us want regulation. We want the big guys to play fair. We either want competition, or we want services that are reasonably priced, high quality, flexible, and non-discriminatory. What we don't want are monopolies that kill any chance of real competition and force us to use an inferior product. We know that BellSouth doesn't need to come to our doors with guns to put us in a position that we can only use their internet service, it just has to own its own wires, and not make any exceptionally stupid errors.

Re:Barriers to entry

[Guppy06]

"And this is why new companies show up every year that compete just fine with the big guys?"

How many new tier 1 providers popped up in the past year?

"They are only bad if they're given the ability to use force, and only government can grant that ability."

Your calls for deregulation are nothing more than allowing those companies to continue to reap the benefits of government force (namely, all those wires run through eminent domain) without having to abide by any of the stipulations through which they gained access to that force to begin with (the requirement to be a common carrier).

The only fair way to deregulate is to tear up the network entirely and let these people build without the advantages of government forcing property owners to sell easements or keep the radio spectrum clear. This is not something I see you supporting.

Mod parent up

[Overzeetop]

Man, I don't usually chime in to get the moderators attention, but this is possibly the most salient point made. There really is very little choice here. It's like telling somebody that if they don't like their cable TV service, choose a different cable provider. Oos - there are no others, unless you're willing to move to a different house that's served by a different company. In an era of consolidation by companies with large, varied interests, the "choice" is quickly leaving the table as a possibility. It's going to become opt in or opt out. And opting out is just cutting off your nose if you have any need for those services. The internet has become almost as necessary as a phone to most people, and for good reason.

In a way, I hope it does go to hell in a handbasket. Then maybe something will happen.

Re:hmmm... why lobby congress?

[Tony]

It's a free market right?

No. There's no such thing as a "free" (as in "freedom") market.

Big companies lobby congress (and the President) because it *isn't* a free market. There are two ways of controlling a market: either be the biggest and baddest and have real teeth (like Microsoft, or the old Ma Bell) so that others in the industry *have* to do what you say or face your wrath; or get congress to give you teeth.

That's what the MPAA/RIAA/BSA/etc have done with bills such as the DMCA, and are attempting to do with the new Analog Hole bill. That's what "service providers" are trying to do with this lobbying effort.

Once they have this advantage over the rest of the telecom industry, they will use this advantage to keep their superior market position. Simple as that.

Considering the development of the internet was funded in a big way by our US tax dollars, the thought of corporations moving in and fucking us over out of greed kinda gets my dander up a bit.

Not only that, but in many areas, there *is* no choice for broadband. What happens when you have Cox on one side, and SBC on the other, and that's your only choice? When two companies will fuck you over equally, and they "own" the infrastructure (partially paid for by tax dollars), what choice do you really have? What kind of "free" market is that?

"Free market" is a myth for naive slogan-spouting arm-chair economists. I was taught the whole "free market" ideal back in high school, right along with the concepts of how our government works.

Both turned out to be lies.

But, no, I'm not cynical.

It's a free market right?

[Renraku]

Yep. Its a free market.

What would happen if the ISP silently blocked P2P, server, VoIP, and gaming ports of their entire user base?

A few people would cancel their accounts. No more than 10%. Really no one else would know that something is up. Its a free market, and people are voting with their money. But they don't even know they're voting and dutifully write their checks each month. More importantly, ISPs see this as compliance. Which opens the way for more restrictive rules..

Hell, I wouldn't be surprised if the US made like the Aussies and had draconian bandwidth restrictions. With..I dunno..say $300 per gigabyte over 2GB down per month? It'd sure make them a lot of money in saved bandwidth..think of how many more subscribers they could jam into the saved bandwidth..after all, its not about the customers or providing a good service. Its about extorting money out of people, through laws, regulations, shady service, passing the buck, whatever it takes.

All I'm going to say is....

[scronline]

This is what happens when all you care about is the cheapest price. Go to smaller independants and this kind of thing wouldn't be happening. More often than not the service is better from independant ISPs as well as they don't practice this kind of B.S. For that matter, you'd be surprised, prices may very well be the same or even lower. But really, if you're ISP is blocking something you need/want, is a mear $3 a month more really that much more to pay?

America is getting what it deserves in so many ways right now it's not even funny. When you reward behavior like this, you get MORE behavior like this. We are responsible for it because we allow it to happen.

My suggestion would be....get away from the telco ISP and be happy with real quality of service.

It's already happening in Canada

[8127972]

Rogers High Speed Internet (http://www.rogers.com/ is already doing the following:

- Throttling back Bittorrent speed to the point that it as well as some other P2P services are unusable (http://www.dslreports.com/forum/remark,15033490). As a side effect, it's affected iTunes (http://www.dslreports.com/forum/remark,14747626) and XBox Live (http://www.dslreports.com/forum/remark,15038493) usage.

- Killing off their Newsgroup servers as of the 15th of this month (http://www.dslreports.com/forum/remark,14769820)

- Creating and enforcing bandwidth limits(http://www.dslreports.com/forum/remark,1448 8371) although they do so selectively.

And all of this without letting their users know up front. Lovely. This is what you Americans have to look forward to.

Is This The End of the Internet!?!

[mpapet]

Sadly, this idea in conjunction with another story posted a couple of days ago about how anonymity on the Internet is viewed as a bad thing go together.

The cable companies got it right. They have a box in your home with big-time controls and identification features. It's critical they know who you are to make paying for content easy. They've made that model work and work extremely well. How many /.ers have cable? Somewhere along the way, they figure out how to "prefer" their packets over others.

No one with any power to substantially influence government values your anonymity. I don't know about the rest of the world, but in America, we tend to abhor a kind of neutral freedom where all participants have similar access. It smells too much like "Socialism" which we've been trained to believe fails.

The people that value a free internet will be sequestered to their own little freedom-loving ghetto while the rest pay. (and pay and pay some more) It was fun while it lasted. In the future, I'll be one of those in the freedom-loving ghetto.

No More Common Carrier

[charnov]

I can't believe no one brought this up. As soon as they show an ability to shape and control all types of traffic and actually make it their business to do so, they lose common carrier status and can be sued for anything and everything. I can't even imagine what damage this would do. The carriers are either insane or greedy. I vote the for the latter.

Re:No More Common Carrier

[KingPrad]

Well the unspoken assumption you're making is that the law won't be changed to cover them. I assume the concept of "common carrier" will be abolished or twisted to cover whatever these companies want to do. When these companies and industries start moving in some obviously illegal direction, you can bet they are already working on subverting the legal controls. Many of the laws governing corporate behavior are becoming little more than a document of current business standards, subject to change with the companies' interests.

Disconnecting them: skype and ebay

[Alan Cox]

I can see that happening. Won't be long before ebay is saying things like "You block skype we make ebay block you and suggest other ISPS' if people try and access ebay via your network" . As always it will be the little people who suffer.

Alan

This is inevitable in the US economy

[surfingmarmot]

Once upon a time, the government recognized the value of unfettered communication to our democracy. So it held at bay those who wanted to privatize it, meter it , and restrict access. No longer it seems. This is not really a new phenomenon in a capitalist economic system, many of our forms of communication have drifted away from the commons. The internet was granted a brief reprieve because it had its roots in the non-profit government and academic worlds. But it has grown big enough and widepsread enough, that the capitalists want to own it now. They leer at its freedom and scope and lust to control it. What they miss is that it grew exactly because it wasn't owned privately by people whose only vision is profit. I don't think there is any stopping it unless the goverment declares it a utility and a commons--and that is very unlikely to happen under this administration. It was at one time a popular notion which is why the air waves have been generally a commons--though that distinction has been chipped away. And today's media moguls will be damned if they let new forms of communication follow that 'free', as in unbiquitous and uncontrolled, route. The Telcos and video broadcasters just want what the RIAA and MPAA want: to meter their services, IP, and content to the greatest extent the market will bear and maximize profits. The Telcos, unlike the RIAA and MPAA, suffered a setback with the breakup of 'Mother Bell' and that despoiled their fertile field for profit, telephone service, and ruined it for a long time to come. They moved rapidly into cellular mobile phones and that rewarded them for a while until the price wars broke out and bandwidth cheapened to the point it is difficult ot get a great return on infrastructure (it doesn't help that the merger mania the execs engaged in caused them to over pay which significantly lengthened payback periods). So as they search for ways to bring their profits back, the internet provides a great and vast infrastructure for content, services, and IP delivery that they want to control. In order to squeeze every last bit of profit out of it the telcos and broadcasters will need to wrest control from the public and concentrate it in their hands. This means the usual: eliminate competition from free content, supress service competitors like Skype , create a premium tier they can use for content delivery and charge, charge, charge for every scrap of value and access. If free speech and communication for everyone is trod upon and obliterated, they'll shed not a tear--they don't care about anything but profit. That's the nature of the beast and part of the tragedy of the commons. And that's why not all things should be 'free' as in 'free markets'. There are some things too precious to give to those who worship profit above all else and the handful of brilliant men that founded this nation tried to anticipate the rapaciousness of the capitalist and preserve those things in their founding documents. Too bad no one in the White House, the legislative, or judicial branches reads the writings of those men or those doucments much any more--too little time left after reading the checks from the lobbyists, popular polls, and their bank statements. The hundreds of billions in Iraq could have funded a free internet for our children as a commons--but that ship has sailed. they are building oen in the EU and Aisia--we'll be left behind.

To whomever downmodded the parent

[Caspian]

You can moderate the truth (-1, Flamebait) or (-1, Troll) all you want, but it will still be the truth. I stand behind my words. Not all ideas are equally valid. Libertarianism is idealistic nonsense. It assumes that consumers are all informed, make sensible decisions, and care about quality (or even price, to a point). It assumes that companies won't collude together to fix prices; it assumes competition is perfect and "by the books". It conveniently disregards such concepts as pre-existing mindshare (who'd buy phone service from Joe-Bob's Discount Long Distance if AT&T or Sprint already serves the area, and then some?), FUD, and barrier to entry. It's a pure form of idealistic free-market religionism, cut from the same cloth as the Pollyannas who constantly chirp about how America is "the land of opportunity" and anyone who really works hard and has a can-do attitude can make it rich here.

Just because libertarianism/Libertarianism is currently in vogue on SlashDot doesn't make it a good idea, and just because I'm pointing out similarities between a religious belief in obviously contradictory ideas and an economic belief in obviously contradictory ideas doesn't make me a troll. (Or wrong.)

Bull on that.

[Kadin2048]

What?

Honestly, that's ridiculous. If that's what you believe, than ... well, have fun doing whatever it is you do, in whatever world you live in. It must be a nice place, pity you can't get there from the Universe I apparently inhabit.

Practically everything that's ever been done has been out of some sort of profit motive or another. I won't say 'everything,' because certainly there have been some things done from various altruistic motives, but they pale in comparison to things that were done for profit. And that's profit both on a personal and corporate/institutional/national level. In fact a lot of people who do "charitable" work are doing it for personal profit of some sort. You can argue whether that's their chief motivation or not, but it's undeniably quite strong.

Just because I'm aiming to make a profit off of you, doesn't mean that it's a bad thing. In fact the basis of a truly 'free' economy in the sense that free-marketers talk of it, is that every interaction is a win-win. That is, for you and me to do business together, BOTH of us have to be getting some sort of profit out of it. Does that always happen in our real world? Probably not; but it happens a lot more often than you'd realize.

The owner of the pizza parlor down the street from me is quite wealthy. He doesn't stay in the business he's in because he really enjoys enriching other people's lives by serving them pizza, he does it because he's good at it and makes more money running a pizza shop than he would in an alternative career at this point in his life, given his education. His business, on paper, is ripping off its customers. After all, it sells what is probably less than a dollar of raw ingredients (probably the cardboard box is the most expensive thing) and a few cents worth of gas for the oven, and a few dollars for overhead of the store and employee wages, for $10. And I happily pay it, because I'd rather pay him to do this, even if he's making money hand over fist, than do it myself. It's a win-win transaction.

Just because you're in the business of making money for yourself doesn't mean that you're harming anyone else. As long as the transaction is not coerced in any way, everyone ought to be able to go about their profit-motivated ways and be fine. It's not a perfect system, but it's a damn sight better than anything else I've heard offered up as an alternative.

What really pisses me off...

[Anita Coney]

...is that the ISPs want it both ways. By that I mean they want to be considered nothing but common carriers. So when someone wants to sue for defamation or copyright infringement, they can escape liability because all they do is transfer bits. But now they also want absolute control over those bits, in addition to the near absolute immunity.

They won't be able to have it both ways. Unless Congress gives them some sort of statutory immunity, which I doubt will happen, expect the lawsuits to start from the RIAA, the MPAA, anti-pornography nuts, etc.

Everyone appears to be missing something

[GuyverDH]

The point that everyone, including the big-name ISPs are missing, is what this will mean to everyone else.

Case in point.

Let's say that a Verizon broadband customer buys service for a new Verizon VOIP product.
Let's say that this same customer has a friend across the country, that is also a Verizon customer.
They both get the new product, and one decides to call the other.

In todays market, that call will go from one end of the country to the other, with no impediment to it's packets (at least none that isn't applied to all traffic going through a certain subnet).

In the proposed market, let's say that to get from point A to point B, this traffic has to cross subnets owned by Sprint and Qwest.

Both Sprint and Qwest will throttle back the data as it's originated at, and destined for a foreign network.

Even though both customers are on Verizon's network, they get CRAP service due to the way the internet works.

Now, even though both customers paid Verizon for high speed VOIP service, Verizon couldn't deliver the goods because the user didn't pay Sprint and Qwest for that same service. Verizon sure as hell isn't going to pay Qwest and Sprint to speed up these connections as that would minimize their profit margins, so the customer gets shittier service, for a higher cost.

All this idea is, is a way to allow ISPs to charge more, for less service.
My guess would be that they won't do anything but throw controls in that throttle foreign network traffic, or traffic that hasn't been paid for by the customer.

It will be the end of the Internet as we know it.