The Future of e-Commerce and e-Information?

An anonymous reader writes "The Washington Post has an interesting article on what they label 'The Coming Tug of War Over the Internet. From the article: 'Do you prefer to search for information online with Google or Yahoo? What about bargain shopping -- do you go to Amazon or eBay? Many of us make these kinds of decisions several times a day, based on who knows what -- maybe you don't like bidding, or maybe Google's clean white search page suits you better than Yahoo's colorful clutter. But the nation's largest telephone companies have a new business plan, and if it comes to pass you may one day discover that Yahoo suddenly responds much faster to your inquiries, overriding your affinity for Google. Or that Amazon's Web site seems sluggish compared with eBay's.'" Seems like the idea of the 2-tier internet is really catching on with the market-droids.

Comments

Capitalism

[PlayCleverFully]

Isn't this the basis of capitalism?
Competition creates better products with lower prices.
This is capitalism on the internet at its finest.

Re:Capitalism

[Jah-Wren Ryel]

This is capitalism on the internet at its finest.

Telecoms are public utilities. This is not capitalism at all, it is the abuse of a government granted monopoly.

Kinda funny how that other government granted monopoly, copyright, is also being used to attack the usefulness of the internet. Perhaps there is a pattern here.

Re:Capitalism

[CmdrGravy]

Clearly any price increases faced by businesses will be met by corresponding price increases for those businesses customers. For example Amazon would have to charge you more for their products if they wanted to use this prioritised system and Yahoo/Google would have to charge more for adverts which would in turn be paid for by increases in the prices of the advertised products.

Really the only winner in this is the Telco with everyone else ending up paying more for much the same level of service ( I suspect that rather than their customers seeing any great increases in network speed you would see people who weren't paying for this scheme to suffer decreased network speed ).

The best bet would be for no company to sign up to the improved service but this it's probably optomistic to hope this would happen.

Re:Capitalism

[lynx_user_abroad]

Like I said before: consumers and businesses already pay taxes to use highways, just like you and businesses have paid for access to the network.

Your analogy is flawed.

In the U.S., highways are built by and maintained with public money which is gathered in the form of taxes, including such things as fuel taxes, license and registration fees, etc. (Toll roads are an exception.) So to say that both private individuals and business both indirectly fund the roads is for the most part correct.

This does not hold for the Internet.

The Internet is composed of a large number of privately built, privately owned, and privately maintained networks which have been internetworked together. If you use dialup, then you are using the publically finded (and paid for largely by tax dollars) telephone system running across public infrastructure under Common Carrier rules to reach a private modem bank. Once you hit the modem bank, you're on a private network. If you have any sort of broadband access (cable modem, high-bandwidth portion of a DSL line, etc) you're on a private network as soon as you hit the network interface. Even if your Internet access is provided by a municipality or a public school, it's considered a private network.

So the telco's have a point to say you're using their network. Unless you're in favor of nationalizing the Internet (let's not go there, please) you really have no claim to it as just a taxpayer.

So while both "you and businesses" can demand a phone line, you can't demand high-speed Internet access: it's only available if some private network provided chooses to let you have access, and you choose to pay their asking price.

Small question:

[TripMaster Monkey]

From TFA:

In a November Business Week story, AT&T Chairman Edward E. Whitacre Jr. complained that Internet content providers were getting a free ride: "They don't have any fiber out there. They don't have any wires. . . . They use my lines for free -- and that's bull," he said. "For a Google or a Yahoo or a Vonage or anybody to expect to use these pipes for free is nuts!''

Perhaps I'm missing the point here, but aren't the end users paying for these pipes? I know I'm certainly paying enough for mine...

Re:Small question:

[p00pyhead]

You are paying for bandwidth? ok. you will now pay for latency.

Re:Small question:

[mckyj57]

In a November Business Week story, AT&T Chairman Edward E. Whitacre Jr. complained that Internet content providers were getting a free ride: "They don't have any fiber out there. They don't have any wires. . . . They use my lines for free -- and that's bull," he said. "For a Google or a Yahoo or a Vonage or anybody to expect to use these pipes for free is nuts!''

Guess what, bud -- you don't have any content. So you are even.

Eminent Domain

[Billosaur]

From The Washington Post: The Republican-led Congress is struggling with the issue. On one hand, it has taken a deregulatory approach to the Internet, but on the other, it can't ignore the concerns of Google, Yahoo and eBay, some of the most successful companies of the last 10 years. These companies alone have built up businesses worth hundreds of billions of dollars on an unfettered Internet. Moreover, unfettered Internet access has come to be seen by Americans in general as not just a privilege or a product, but a right akin to free speech and free association.

It comes down to who you think is more important: companies like AT&T, BellSouth, etc. that provide a connection to the Internet, or Google, Yahoo, etc. that provide the content that cause people to want to have an Internet connection in the first place.

Personally, I think this is sour grapes by the telecoms, because they didn't think to invest in the content side of things. Let's face it, one share of Google's stock is worth one share of each of theirs combined and then some.

If I'm Congress, I threaten to nationalize the Internet, specifically its infrastructure and connectivity. Tell them the Federal Government now owns the trunks and fiber and they can bid on a contract for maintenance of the whole thing. Thorw some billions their way as "compensation." They'll change their tune in a hurry lest the lose their steady income.

Re:Eminent Domain

[Glock27]

It comes down to who you think is more important: companies like AT&T, BellSouth, etc. that provide a connection to the Internet, or Google, Yahoo, etc. that provide the content that cause people to want to have an Internet connection in the first place.

Personally, I think this is sour grapes by the telecoms, because they didn't think to invest in the content side of things. Let's face it, one share of Google's stock is worth one share of each of theirs combined and then some.

It's not "sour grapes". It's "rampant greed". The telecoms are already (or should be if they're competent) turning a profit on the ISP side of things. They get a shiny new income stream of $40-$80 per house that signs up for DSL. That isn't peanuts, that probably averages $600 a year with a target audience of around 100 million households. That's right, if a company managed to sign up 10% of US households, it'd have around a $6 billion annual income stream.

The greedy jerks (who probably received fat government subsidies to install the infrastructure in the first place) simply see an opportunity to charge on both ends of the deal. They don't care if they wreck the Internet in the process.

This needs to be fought.

Re:Eminent Domain

[ranton]

I think it is funny that on Slashdot the government can do whatever it wants as long as it only hurts big companies. If it hurts small companies or the average person, then it is an outrage. But if a Telco or Microsoft or Amazon is hurt by unfair legislation or overabundant governmental control, it is okay or even welcomed.

Re:Eminent Domain

[Billosaur]

The thing about this 2-tiered Internet is, it hurts everyone, from comapnies to individual users. What it says is, "only those of you who play by our rules [the telcos] can get faster access, otherwise we take our toys and go home." The telecom companies created this situation and now they want to throw a tantrum because they can't profit from it (even more!). And so, not only will it hurt the big firs, but the mid-level and small firms, who will have to shell out more of their precious cash to keep up with the big guys, and in the end this "play-by-our-rules" mentality will mean that content may be altered in way we users don't like or appreciate.

Public Utility?

[Anonymous Coward]

Is the web/internet becoming a public utility? It is becoming more and more important to commerce and also is a shared resource. Up to now, telcoms have played nice. But if access becomes restricted and privatized, so that only a few players can afford fast and efficient access, that has the potential of destroying the utility of the internet. Barriers to entry will arise and the internet and web could stagnate. Should it be regulated as a utility, with safeguards to insure entry into the commons? Is this even possible?

Death!

[Glock27]

To the marketroids...

This is the stupidest idea ever and will receive the warm welcome it deserves.

It is the same idea as making TVs that receive certain stations better than others. "What do you think dear, should we get a Sony?" "No, let's get a Toshiba, I want CBS to come in clear and last year Sony made that deal with MSNBC..."

Brilliant thinking.

Capitalism will certainly fix this (non) problem.

Greed is NOT good

[digitaldc]

Now that more and more money is being made using the internet, Corporate greed is tainting everything from internet search results to the integrity of the internet itself. This was not the original intent of creating the 'Information Superhighway.'

Sure you can wait for your site to load, but why? Just because tiny fraction of the world's population wants it that way? With a greater income gap in this country and world, this will only lead to the MOST AFFLUENT to be able to afford to have a fast, reliable and enjoyable web site. Not my idea of a free Internet.

Network Neutrality is essential for maintaining a free and fair internet.

You want more money?

[AviLazar]

Meanwhile, on the other side, companies like AT&T, Verizon and BellSouth are lobbying just as hard, saying that they need to find new ways to pay for the expense of building faster, better communication networks. And, they add, because these new networks will compete with those belonging to Comcast, Time Warner and oth er cable companies -- which currently have about

Here is a suggestion - offer me the same speeds U/D'l that comcast offers, at the same convenience (no I do not want to have to log-on, I want to play and play). Offer this at a cheaper price, or offer faster speeds at the same price. Offer me better service. Do these things and you will have my business - do it not, and go fuck yourselves! I use comcast, yea I pay more, but you know what - i get 3 times the speed of verizon DSL - and for a programmer/web designer that is important.

And then, with your lack of service, you dare complain you are losing out? And you think you have the right to charge the content providers? They are not the ones requesting to send their information over the net, I am going to them requesting the information...I paid already, i shouldn't have to pay again - and yes I will have to pay again as Yahoo decides to charge me for email.

Scary

[Quixote]

I don't know what is more scary: the fact that these companies are thinking along these lines, or the fact that our representatives in Congress are so clueless that they haven't done anything about it. I mean, this is a no-brainer. Any sane person would tell the Telecomms to fuck off.

Re:Americentric

[LWATCDR]

Big shock considering that you are posting on a Website created by Americans, owned by an American company, and in English. Why wouldn't Slashdot tend to be Americentric?

Re:OR

[dasil003]

Just like the music industry, the telcos better wise up. This whole phenomenon of creating markets out of thin air, and boosting profits by price manipulation rather than innovation is a serious threat to our economy. Only in a first-world country like America do we forget that an economy is supposed to represent some actual goods and services. This is exactly why China will surpass us, because we've got so much money that everyone's trying to scam a piece of the pie without actually doing anything.

Unfortunately it's inevitable that big companies will be too slow to adapt to an evolving economy, and they will push their bulk around trying to grab as much profit as possible before hitting the mat. That would be all fine and good if they didn't also control the government in the absence of a cohesive counter-interest.

Re:OR

[sosume]

When this happens, content providers will have to begin rolling out custom Wimax networks. If you cannot reach Google very fast through YaHooFi, but you can through GoogliFi, which in its turn blocks Msn.

It won't be long until the pc owners will combine their own Wimax access points and form a completely free unwired network. This is inevitable.

Big Players Lose

[Saeed al-Sahaf]

you may one day discover that Yahoo suddenly responds much faster to your inquiries, overriding your affinity for Google.

Considering how much "dark fiber" Google owns, I suspect they saw this comming. I think it is not Google, but Yaho and MSN that might be in for problems. And, don't think that the Big Palyers in the content supply business will just sit by and take this, they have a lot to lose...

Re:Next: exploit their loss of common carrier stat

[kingpin2k]

Parent is exactly right. The ISP's can't be responsible for only part of their traffic (ie ensuring speedy Google delivery). If they go down this path, ALL traffic is their responsibility. It's nuts that they would even get close to this issue. Part of me wants them to succeed just for the sick legal (read: civil litigation) ramifications to kick in.

Countermeasures to 2-teir

[G4from128k]

I can see several countermeasures to this development. The key is that the site owner can tell which ISP is stifling the traffic or extorting extra speed payments and change elements of their site to reflect that ISP's unpleasant behavior. For any traffic coming from a Bell South or other 2-tier "badISP" customer:

1. Publish BadISP's tech support numbers: "If you are having trouble with this site call 1-800-BadISP" -- at about $5-$10 per call, the telco would soon see the folly of its ways.
   
2. Publicize BadISPs performance issues: "This site optimized for BadISP competitors" and provide links to non-2-tier competitors.
   
3. Post higher prices for BadISP customers: iTunes for $1.09 per song to BadISP customers to pay for "faster" service.
   

Creating a 2-tier internet is hardly anonymous and site owner can easily inform end-users of misbehavior.

Middle Ages of the Internet

[the eric conspiracy]

This reminds me of stories from the middle ages when local robber barons set up their own tolls on local roads as sort of a protection racket. The ultimate solution was to have government take over and run the roads. I wonder if that is where this will lead.

Re:Americentric

[PhoenixFlare]

Americentric

A story on an American-run website writen by an American paper about American companies lobbying the American government....Imagine that!

Re:Americentric

[Anonymous Coward]

www.ebay.co.uk
www.amazon.co.uk

Who are these people and can we kill them?

[namespan]

Seriously. These guys are basically the same level of morality and worth to society as Spammers -- looking for an easy way to make an extra buck at the expense of the total experience.

And if we can't murder them and have their arms and legs mailed back to their families by the powers of darkness, maybe it's time to make a pact among geeks that THEIR email and internet traffic should always run an order or magnitude more slowly.

Been there done that

[rickb928]

Haven't we done this before? Wasn't it called AOL?

Seriously, I say let the telcos do what they want. Just don't call it Internet service.

Cause it ain't.

rick