Net Neutrality, Schlocky Salesmen vs Monopolist Plumbers

Andy Kessler has written a short tongue-in-cheek summary of the net neutrality debate over on the Weekly Standard. Kessler identifies the two sides as the 'schlocky ad salesmen' (Google, Yahoo!, etc) and the 'monopolist plumbers' (Verizon, AT&T, etc) and when you add the politicians to the mix it creates a pretty untenable situation. From the article: "But the answer is not regulations imposing net neutrality. You can already smell the mandates and the loopholes once Congress gets involved. Think special, high-speed priority for campaign commercials or educational videos about global warming. Or roadblocks--like requiring emergency 911 service--to try to kill off free Internet telephone services such as Skype. And who knows what else? Network neutrality won't be the laissez-faire sandbox its supporters think, but more like used kitty litter. We all know that regulations beget more lobbyists. I'd rather let the market sort these things out."

Comments

Money

[Anonymous Coward]

Whoever spends the most money on lobbying will win.

I think...

[alfs boner]

...The problem (from the telco's point of view) is that Google is paying only one company for the bandwidth it uses. Wouldn't it be nice if they could all get a share by threatening to throttle Google's traffic on their networks? Not only that, you can squeeze out any small-time competition from the market by threatening to take away a big chunk of Google's users if they sign with a smaller company for bandwidth. Only why stop at Google, you could do it to anyone! Heck, maybe even political parties? (So, probably not but the telcos would love to do it anyways, I'm sure.)

Re:I think...

[Cleon]

"Heck, maybe even political parties?"

I think you hit something significant there, at least for me. You can talk about the financial aspects of Net Neutrality all up and down the information superhighway (remember that lovely phrase? Now think of a toll booth). In the end, however, we're talking about giving private companies control over the transmission of a giant steaming shitload of information.

So an organization with the sufficient funds could bribe pay someone, say, AT&T, to throttle content to sites they'd like shut down. So let's think beyond political parties...Suppose the Church of Scientology took it into their head to try and slow/stop traffic to, say, Xenu.net. Just a thought--I mean, I'm sure the Church wouldn't do anything so heavyhanded. After all, they've been so upstanding in the past and value open debate. Or suppose conservative organizations decided that adult-oriented content should be as inaccessible as possible. Maybe Microsoft reversing their position and decides that people don't really need to be able to access Slashdot.org, Firefox.org, or even Google.com.

The more I look at the issue, the more I'm concerned that this could open the floodgate of a free-for-all where you don't have a voice unless you've got a bunch of money to be able to pay for it.

Re:I think...

[rossifer]

The problem (from the telco's point of view) is that Google is paying only one company for the bandwidth it uses.

But the fees they pay go towards the provider's upstream bandwidth costs, so Google's fees get split with the upstream provider before you can measure profit. You and I pay into the same sort of a heirarchy, with everyone trying to obtain universal connectivity with everyone else.

What the telcos want is to obtain control over content. But the success of the internet is based on a lack of control over content. Anyone can publish, so (almost) everyone does publish. This results in enormous quantities of useless crap, but also more useful information than has ever been available to the public.

The telcos can get what they say they want already by selling dedicated channels beside the DSL channel. If you want DSL pay-per-view, there's not much preventing them from selling you a channel of that. You'll need some new gear to see your new TV feed, but people are used to that sort of abuse.

But when I agree to lease a 1.5Mbit DSL line, I intend to lease a 1.5Mbit link to the whole internet. If they stop selling me that, I take my business elsewhere. The huge problem arises if there's nowhere else to go.

Regards,
Ross

Re:I think...

[Mr. Slippery]

No forced neutrality, no forced billing - just get the FSCK out of the way and let things progress via market forces like they have been for the last 15 years now.

The reason we have had network neutrality is not because of "market forces" but because of regulation that made telephone lines "common carriers".

The question before us is whether cable, fiber-optic, etcetera networks should be regulated in the same way, or whether the common carrier requirements should be droppped from telephone (DSL) lines.

Market forces can't do dick when there's no competition; few consumer have meaningful choice between several broadband providers.

Will the market really sort itself out?

[gbulmash]

Can the market really sort things out?

Long ago, in a humor column on religion, I wrote: "Humanity, by nature, is an ambivalent animal, given to fits of inertia, and we're more than likely to sit on our noncommittal behinds unless there's a bogeyman to chase us out of our chairs." I was talking about how certain religions use the concept of the Devil to scare us toward God, but it applies to a lot of things.

I'm not so sure that the market will work things out due to a few factors:

• Consumer ambivalence - If your ISP starts slowing down X, Y, and Z sites, how bad will it have to get before you, as a consumer, go to the trouble of switching ISPs?
  
  
• Changing E-mail - While a lot of us have free e-mail accounts through Yahoo, Hotmail, or Google, how many people have just the e-mail address they got from their ISP? People who do not have established freemail accounts that they use as their primary address have an incentive to stay where they are, because if they leave, they lose the address everyone knows to contact them at.
  
  
• Changing ISPs can be a bear just on a technical level - I used to have 6 megabit DSL through speakeasy. When I made some job changes, I decided to downgrade to 3 megabit DSL from Verizon so I could save $700 bucks a year. Problem was that there seemed to be no way for me to cancel the Speakeasy DSL line and have Verizon pick up service on the same day or even the next. Best estimate I could get would be 3 days or more without broadband service as Speakeasy/Covad released the switch and Verizon assumed it. I'd gone with DSL because my house was built without cable running into the room I used as a home office and I didn't want to drill through walls. Finally, I went with 8 megabit cable, coming into another room, then shunted into the office through a Broadband over Power Line (BPL) bridge. With some tweaks in cabling and placement of the bridge units, I was able to get about the same speed I had with the 6 megabit DSL. But it was an adventure in frustration.
  
  
• Lock-in Contracts - The broadband providers have taken a page from the cell phone companies. They're offering free installation and equipment, but to get that, you have to sign up for a 1 or 2 year contract with early termination penalties. So if you have ISP X and you have 6-8 months left on your contract, how slow will your favorite sites have to get before you're willing to pay the early termination fee?
  
  

With all those factors working against switching broadband providers, will the market really work itself out? Things will have to get pretty bad to force the average consumer to vote with their wallets and go to the ISPs that deliver the services they really want. There may be some ripples felt in terms of new entrants to the market, but most of those will be people moving into new homes or new apartments. When it comes to the people in existing residences where broadband is available (excluding people in rural markets who are still waiting for broadband to become available), if they don't have broadband yet, are they really among the technically savvy people who will know enough or care enough to shop wisely?

Re:Will the market really sort itself out?

[gbulmash]

If Google were not available from my ISP for even 24 hours, I would go to a *lot* of trouble to find another ISP.

But what if your ISP offered you Microsoft's new gonzo search engine at full speed? And while it wasn't as good as Google, it was 90% as good?

Remember, that under the best of circumstances, you'd be looking at a couple of days to switch over to a new ISP. If Google slowed to a crawl, would you wait those days until you had a new ISP to do your search on Google? Would your brand loyalty to Google be so complete that you'd do without searching while you waited?

Maybe, maybe not. I think many people would try the alternate search their ISP was pushing. And if they got the results they wanted, the urge to switch might be diminished. They might take a "wait and see" attitude and try a few more searches on Microsoft before committing to switching. And if all those searches got them the results they needed, then it would become a matter of principle to switch, not a matter of utility.

Look at the way our country is today. Look at the people. Give me a ballpark estimate of the percentage of people who fall into one or the other of the following two groups. Group 1: People who get mad about something and do something about it! Group 2: People who get mad about something and merely bitch about it, but never get up the gumption to really do something.

Group 2 is huge and Group 1 is a minority. While you may be in Group 1, you've probably got lots of elbow room at the meetings. And because Group 2 is willing to settle for "almost as good" because it's easier than doing something about it, the market is not as efficient a regulator as some would have us believe.

- G

Indeed

[Anonymous Coward]

The Great God The Free Market will solve all ills. We must only have faith. If we regulate, we will be cast down in the eyes of our God The Free Market, and he will be much displeased, and cast us down for defying His will. Since it is impossible that a piece of legislation designed to solve a problem could ever actually solve the problem it is intended to solve, we must simply continue to pray that The Free Market shall turn His eyes kindly upon us, and accept His just decision when it comes.