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.

Re:Doesn't Really Matter...

[Anonymous Coward]

Here is the Complete article, not a summary...as linked to above: http://www.weeklystandard.com/Content/Public/Artic les/000/000/012/348yjwfo.asp

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...

[greenguy]

Telco: Hey, Google, as of tomorrow, we're going to charge you an extra fee to use our pipes.

Google: Uh, I don't think so. I think we'll just make google.com inaccessible altogether to your pipes, and buy a few ads supporting your competitors who provide full service at normal prices. Take a minute to think about how your customers might react to that before you try to throw your weight around against us.

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...

[argoff]

Wouldn't it be nice if they could all get a share by threatening to throttle Google's traffic on their networks?

My understanding is that they can do that right now, but they wouldn't dare - because google could tell them to go to hell and all their customers would eventually too when they turn on the throttle. What the telcos want is the ability to not throttle, but the ability to let google use up whatever google will use and have the law force google to pay them and not give google the option of telling them to go to hell. So then google turned arround and tried to get the law to "force" net neutrality, and not let them tier service at all.

Let me state this now on no uncertain terms. They will force some kind of regulation, it will fail, and then they will blame the market for failing to meet the rigorous needs of the information age, but the truth is, we are better off with no new laws at all. 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.

Re:I think...

[Red Flayer]

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.

You have a problem with Capitalism? And Libertarianism? Why do you hate America?

Re:I think...

[Billosaur]

I don't think it's a question of "hating" America, but more the system that we seem to be developing. It's obvious that money talks -- you don't need Pink Floyd to point that out. Corporations will naturally hold more sway than people (unless those people are Bill Gates or Warren Buffet), although collections of people can certainly bring to bear greater resources (hence special interests).

In the end, our government should not be about who has the money to have their voice heard, but what is in the national interest. The whole net neutrality debate is over what everyone thinks is best, but both sides, rather than having open and honest debate, are simply lining up their resources and preparing for a fight.

I've said it many times: the American people have the capacity and capability to make their voice heard, if they choose to. Vote. Write you Congressman. Write the President. If you are getting no satisfaction from them, find new people who you trust more. The only reason money in Washington, D.C. ever becomes an issue is because eventually, if you are there long enough, the power you wield will bring you suitors and they will court you ruthlessly, to get you to see things their way. That's the way of it, and even the best man will crack under it eventually, given a moment of weakness.

Re:I think...

[Schraegstrichpunkt]

Market forces? In the US telecom industry? Surely, you jest.

Re:I think...

[erroneus]

Google.com pays for its connection and class of service once. Now they're connected to "the internet." "The Internet" is at this moment a collection of network providers that agree among themselves to move data around. The money is collected from their customers. I don't know who Google's provider is, but for the sake of argument, let's just say it's Verizon. Google pays Verizon for its connectivity and a bandwidth capacity of "X." When I talk to Google's servers, my requests and Google's responses go not just through Verizon, but my own ISP and AT&T's as well. AT&T and Verizon have already agreed to let data pass though between each other... mutually charging each other the same amount of cost effectively nullifying expenses and costs. And keep in mind that Verizon is under obligation to pass Google's traffic at the rate and capacity they are paying for. It's not a free ride. My ISP is obligated to move data freely to and from my own equipment just the same, regardless of the type of data or where it's from. And as stated, AT&T and Verizon already have their agreements to move data as well.

Each hop is paid and accounted for. EACH ONE. And really and factually, the only concern that any entity on the internet has is itself and the peers it connects to. It doesn't matter if that peer is an end user, a NAT firewall or another ISP. Each hop has been paid for.

People keep making "road analogies" and so shall I. Imagine if you will that I own a segment of freeway. And I start to notice that an unusual amount of traffic is going to and from McDonald's restaurants. As it stands, everyone who travels across my road pays $0.25 per trip. But not only is the customer traffic to McDonald's getting ridiculously frequent, but so is the freight traffic brining bread, meat, cheese and pickles. Should I raise the rates for everyone going to McDonald's? Is it even my BUSINESS to know where they are travelling? Should I ask them where they are going? Will they lie to me? [hint: route obfuscation] Should I look down the road to a segnment I don't own and demand payment from McDonald's for burdening my road with their traffic?

My analogy, as complex as it is really comes down to the following:

A backbone provider on the internet is just like any other peer. They connect to a lot of other peers whether they are end users or other ISPs or backbone providers. The scope of their interest lies only to the extent of their immediate connection and no further. The backbone provider has no business modifying or otherwise snooping at the data passing their their pipes. Their only concern is that the peers connected to their network is a paying customer and they are paid to move the data; nothing more.

Anything that allows an ISP and/or a backbone provider to descriminate against data based on origin, destination or type of content represents a breech of general agreement (I'm pretty sure) and an invasion of privacy of sorts. The phone company is not allowed to listen to my phone calls, incoming or outgoing, simply because I am using their wires. They are obliged only to make the connection and let information flow.

It's just wrong and unethical for anything but net neutrality reign on the internet. Anything else will lead to all manner of problems, not the least of which will be invasions of privacy and interference with interstate commerce.

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.

Re:I think...

[Kadin2048]

Google: Uh, I don't think so. I think we'll just make google.com inaccessible altogether to your pipes, and buy a few ads supporting your competitors who provide full service at normal prices. Take a minute to think about how your customers might react to that before you try to throw your weight around against us.

Telco: We don't have any competitors.

Google: Oh.

Telco: Pay up, bitches.

Re:I think...

[smilerz]

If that is true why have DSL providers been lowering rates in order to attract customers? The fact is that nearly every consumer of broadband has at least one additional option.

Re:I think...

[rk]

Google: Maybe you do now...

Google lights up all that dark fiber they are rumored to have been buying over the last few years to build GoogleNet.

Insert vague reference here to it achieving sentience sometime later and starting Judgement Day.

Re:I think...

[mrchaotica]

And Libertarianism?

True Libertarianism would mean ending the telco entitlements that created the problem in the first place!

I mean really, think about it: who are the ones advocating a so-called "market solution?" The telcos! And who are the ones with a strangle-hold on the so-called "free market?" The telcos! So how is it that nobody seems to notice how fucking absurd their position is? It makes me sick!

Re:I think...

[illumin8]

This isn't so much about google as it is about TV. The value of most internet traffic ($40/month for a 3 mbps unique connection) is nearly an order of magnitude below the value of TV ($60/mo for shared access to stream equivalent to ~27 mbps)

You're absolutely right.

And, you bring up an interesting point.

The cable and telcos have been arguing that without the ability to charge Google/Yahoo/MSN for access, they won't be able to deliver the next generation of HDTV on demand video streaming services. This is a bullshit argument , and here's why:

I used to work at a cable ISP and I learned that a cable modem segment only occupies one 6 mhz. band, or a single analog cable channel, and contains 27 megabits of broadcast ability a second. Basically there are ~80 or so analog channels available (forgot how many). This means that the cable company only takes a single analog channel on their network to deliver broadband Internet to an entire neighborhood or small town. They also deliver digital cable by compressing about 3 or 4 channels down to another 6 mhz. analog channel. That's why the big push to get people off of analog cable... each one of those channels is worth about half a T3 worth of digital bandwidth from the central office to the customers.

So, if the cable company is already streaming Hidef and standard def movies to me on a different channel than my 10 megabit cable modem service (I have OptimumOnline, YMMV), and watching an "on-demand" movie on my TV doesn't interfere with my BitTorrent download in the next room, then why even bring up this idea that Google and MSN and Yahoo somehow interfere with that. It's a Straw Man Argument...

They want the uneducated Congress-Critters to think that if Google video or YouTube takes up too much bandwidth... "the gosh 'dern TV might stop werking!!! Oh NOES!!!!!11!1!1One!1!!1"

The truth is, the cable companies (and telcos) have tons of bandwidth; way more than they could ever use at the last mile. This argument that internet, which only occupies a single ~27 mpbs channel, can possibly interfere with any of the 80+ other ~27mbps data streams is laughable at best.

I hope this sheds some light on the situation. I started to put 2 and 2 together on my own...

Re:I think...

[Onan]

And the funny thing is, this is actually most of the problem.

Telcos and cable companies have been so mad for market share that they've continued to cut prices until offering residential data service is actually not profitable for them.

And suddenly now they've noticed that they've got million of subscribers, and they're losing money on every one of them. They "can't" raise prices, because then those unprofitable customers would go somewhere else, which would retroactively invalidate the war they've been waging for years for market share at any cost.

So they've found a third option: charge on the other side as well! Keep losing money on every customer, but make it back up by using that huge customer base as a hammer with which to extort content providers.

This seems like a stunningly clear example of the problematic behaviour of unregulated monopoly. (Okay, duopoly, between your local telco and your local cable co.) It certainly does nothing to change my opinion that completely free-reign capitalism is as problematic as total socialism, and that they right mix is about five parts laissez faire to one part regulation.

Re:I think...

[sterno]

My understanding is that they can do that right now, but they wouldn't dare - because google could tell them to go to hell and all their customers would eventually too when they turn on the throttle. What the telcos want is the ability to not throttle, but the ability to let google use up whatever google will use and have the law force google to pay them and not give google the option of telling them to go to hell. So then google turned arround and tried to get the law to "force" net neutrality, and not let them tier service at all.

Actually no. What it is, is that the telcos want to be able to give preferential service to their own content. So you can get VOIP through some third party but the service will be better through your local telco's service. You can get Internet TV through anybody, but it will be choppier than through your local telco. Then the next step is permitting third parties to take advantage of that but then charging them a fee to do it.

They aren't going to cut google, or anybody else, they are going to boost other things. This sounds okay on it's face, but it has the same result: multiple tiers of Internet service. It puts anybody who doesn't own pipes at an innate competitive disadvantage when selling services. Worse, the companies that own the pipes are usually a monpology or at best have a single competitor. So there's no way to bypass whatever fees they want to extract.

Re:I think...

[blighter]

You realize, of course, that there is no such thing as a multi-billion dollar company footing the bill for anything.

They'll just pass that cost right along to thier consumers.

Re:I think...

[drinkypoo]

If that is true why have DSL providers been lowering rates in order to attract customers? The fact is that nearly every consumer of broadband has at least one additional option.

The phone companies are always afraid that the cable companies have a major expansion just around the corner, or that someone will come along with a wireless solution, and put them out of business. This is entirely possible now, since VoIP has been taking off. Just as the phone companies are now examining the possibility for television over the phone lines, the cable companies are examining the potential for phone calls over their television lines :)

Basically, the phone company (the real DSL vendor, no matter who you think you're buying it from) is scared shitless that they will become irrelevant. They're pricing their services as low as possible in an attempt to get customers now under the assumption that if they already have two of three services from their telco (vox and 'net) that they won't switch over and get all three from the cable company. I think that this is an idiotic assumption because it's worth a small amount of hassle now to have just one bill for all major teleinformation services.

The cable companies are only too willing to play along because they have more money than the phone companies (or at least, that has traditionally been true, not sure about the latest incarnation of the death star) and if they can put the phone company out of business then they will win this round by default and they can start focussing on the impending invasion of wireless.

Re:I think...

[Danse]

Google: Maybe you do now...

Google lights up all that dark fiber they are rumored to have been buying over the last few years to build GoogleNet.

All that fiber is useless if it doesn't cover the last mile to people's homes. If a monopoly (or duopoly) still controls that (which they do, pretty much everywhere) then Google is screwed.

Re:I think...

[ikkonoishi]

Which is the reason why Google is trying to get nationwide wireless servers running.

Re:I think...

[Onan]

Actually, I'm not concerned about the Googles, the Yahoos, or the Microsofts of the world. You're right, they can afford to grease the telcos' palms without batting an eye.

I'm concerned about the next Google or Yahoo. (Okay, screw the next Microsoft.) What about that great new company that will have an idea for a fantastic new service a couple years from now, but can't afford to pay for the phone and cable companies' protection racket to make it available to users?

Re:I think...

[Anonymous Coward]

Sorry, not logged in right now, this is Red Flayer.
 
Do you have any idea what telco would have looked like without regulation of the monopolies? We'd still be in the info dark ages. The telco monopolies weren't created by legislation, they were bridled by it, inhibited by it, prevented from acting like the jackasses they are now.

True Libertarianism results in unbridled monopolies. Period.
 
Those entitlements you're so pissed off about? Why do you think they were established? There were two reasons:
 
(1) To encourage investment in the industry, since without guarantors of the ability to make profit, no one was willing to lay out tens of millions, even hundreds of millions, of dollars (a HUGE amount of money at the time -- think Google market cap) on infrastructure for an uncertain market force. They'd seen what happened to the railroad and telegraph industries, and wanted no part of the disappearing profits once a competitor ran a line between the same locations.
 
(2) To have a means of regulating the industry. Like the initial telco companies, the public (and thus the government) did not want to see a repeat of what happened in the railroad industry, when gouging and monopolistic practices hurt the consumer. So the government granted entitlement to the telcos in return for the ability to regulate their activity.
 
Of course, in today's politicoeconomic climate, government doesn't need to grant entitlements in order to regulate industry... theoretically... except for the fact that business interests still control the government in the US. Grant entitlements, or we yank your re-election funding.

So what happens in a truly Libertarian situation? Exactly what happened with the railroad industry prior to regulation. Privately enforced monopolies. Gouging of consumers. Railroad companies going belly-up and bankrupting entire banks and communities.
 
I'll not disagree that with today's technology, the telco easements are necessarily justified. But I will say that they were absolutely necessary to put the US in the place of the tech superstar in the second half of the 20th century.

Re:I think...

[colmore]

It would take a good chunk of a decade for that to actually happen. We'd all be screwed for quite some time.

This is the problem with a lot of libertarian thought. Yes markets eventually optimise themselves, but depending on the situation this process can be slow. So slow that the unhappy situation in question might have changed shape completely by the time that market forces come in to save the day.

Also markets optimize along the parameters that are actually used by the players in markets. Modern corporate structure places little value on long-term investment. Large publicly held corporations give little incentive to avoid failure to top executives, and the stock holders themselves are frequently invested in competitors or are only invested short term (that is, they'd rather see a spike that gets them $10 million this year than steady growth that gets them $100 over ten years).

Lastly there is not nor has there ever been such thing as a free marktet in the United States. The founding fathers wrote the commerce clause into the constitution: the market has always been intended to be second to the General Will (as understood by enlightenment political thinkers).

What sucks is that there's basically no solution. Regulation begins a slippery slope of congressional involvement, and in the end that will mean special services going to the highest bidder (for every liberal "socialist" regulation enacted by congress there are 100 pieces of appropriations bill pork handed out to well connected and deep pocketed interests, and THESE do far more damage to the free market than even overly restrictive regulations that apply equally to all market players). But no regulation means that ATT is free to triple bill up until the point where real competition comes about, which is only comforting in the abstract. The reality of scale pricing is that any realistic competition is going to be unlikely to compete on billing at two points on the connection when ATT is billing on three, and they would sell more on outbidding ATT where their nonneutrality is particularly exploitative, but not on restoring neutrality.

All of this is why I have very mixed feelings on market capitalism. On the one hand, if you ignore it, or try to go against it too strongly, it eats you alive, or you become some kind of totalitarian state. But on the other hand, it seems that cases where competition creates symbiosis and beneficial growth don't really outnumber the cases that look like degenerate instances of the "prisoners dillema" problem.

Dark Fiber

[(1 -sqrt(5))*(2**-1)]

From TFA:

Horse-drawn trolleys ruled cities, too, but had to be destroyed to make way for progress. How do we rip the telco's trolley tracks out and enable something modern and real competition?

With Google buying up dark fiber, how relevant would net-neutrality's demise be (for Google, at least)?

Google may have stumbled across a very expensive but robust solution.

Re:Dark Fiber

[mrchaotica]

Why not?

Because the government won't allow them to access the right-of-way to install the cable (due to telco bribery), that's why!

I've realized something: the real problem here isn't actually "net neutrality" or lack thereof; that's a red herring. The real problem is actually the fact that the telcos want to keep their monopoly protection and common-carrier status, but get rid of all those pesky regulations that keep them from abusing their power even worse than they do now.

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?

[One Louder]

I think the market can probably handle this- here's the scenario:

1) Some ISP attempts to extort Google
2) Google responds to all searches from that ISP with simple page explaining what's going on with appropriate contact information
3) ISP wishes they had a time machine so they could undo the damage
4) ISP stops extorting Google

The problem with these ISPs is that they really don't understand where they live in the food chain as far as customers are concerned - Google is an increasingly important tool, and the ISP is someone that sends increasing bills with diminishing quality of service. The music industry is in the same boat with Apple - a label that threatens Apple with removal of their catalog would be playing with fire.

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

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

Re:Will the market really sort itself out?

[DragonWriter]

With all those factors working against switching broadband providers, will the market really work itself out?

You leave out a bigger factor -- many people have very limited choices of broadband providers to start with, and no one to change too.

Re:Will the market really sort itself out?

[Archangel Michael]

Can the market really sort this out? In a word ... YES.

The problem is that RARELY is the market allowed to anymore. People fear Monopolies. Me? I Look at them not as problems, but oppotunities in disguise. Linux would NOT be where it is today, if it weren't for M$ Monopoly. Linux, IMHO, is a direct result of the Market routing around a break in the system.

Some systems, it just takes longer to route around the problem, but it eventually will.

Take Oil (Petroleum) for example. A hundred years ago, a naturally occuring monopoly occured in the marketplace and Standard Oil controlled a M$ type share of the Oil and Gasoline market. Along came do-gooders creating laws that broke up the company into itty-bitty pieces. Today, we are OIL dependant, and have no alternatives (to speak of).

Let us say, for the sake of arguement that nothing was done 100 years ago and Standard Oil was left untouched. Today, we would probably have 1) more mass transit 2) cities and highways designed for effiency alternative transportation etc 3) alternative fuels 4) no wars over oil (Iraq/Iran???) and the pety dictators world wide.

The unintended consequences for breaking up Standard Oil are completely unknown, but I am 100% sure that the world would have routed around the problem by now. But for political expediency and short term gains, we chose otherwise, and are living with the consequences.

Necessity is the mother of invention. We don't "need" another fuel source, so none has been invented. Relating this back to M$ and Linux, WE needed an alternative to M$ and Linux was the route around the problem (over simplified version).

Re:Will the market really sort itself out?

[Archangel Michael]

So, what you are saying is that solutions around problems do not exist, because you cannot see the solution only the problem. Your viewpoint is typical of the mass group think that society uses.

My analogy requires DEDUCTIVE logic, and the presumption that solutions work around problems. Where there is no problem (ie low oil prices) there is no solution (ie alternative), because there is no need to solve a problem that doesn't exist.

Yes, LINUX was a by-product of Unix, no one is disputing this. But it started out as NOTHING more than a sort of research project. The need to make it better was so great that people, not getting paid, continued to support and develop it to the point where it COULD replace the monopoly. The solution was in the developement because of a problem (M$) that existed. It gained traction as a ROUTE around M$.

My view is that if not LINUX than something else (BeOS, OS/2, who-knows-what). M$ Didn't force LINUX into existance, it forced a solution to the M$ Monopoly. LINUX was the solution but didn't have to be. Like I said, it could have been something else. We only see LINUX today because it suceeded inspite of the M$ Monopoly.

As for Oil and energy density/generation problem, how do you know that is the reason why? Perhaps someone would have figured out where Tesla was going with "free energy", perhaps something higher in energy density would have been developed, whatever. The problem is, we don't know, and everything else is ..... a plain old guess.

"The break up of standard oil didn't force the exsistance of a mysterious alternate fuel source to nto appear."

That is pure speculation on your part. You don't know that, you can't know that. I do know that we tend to only route around problems when they are severe enough.

Direct Link to article

[cinnamoninja]

Ick -- Slashdot is linking a blog post with the first two paragraphs of the real article. Go here instead:

http://www.weeklystandard.com/Content/Public/Artic les/000/000/012/348yjwfo.asp

Like how GM bought up and destroyed the Trolleys?

[FatSean]

You know, in order to increase demand for their automobiles in Cali? I dunno...that analogy and the article's tone as a whole is kind of disturbing.

we only have the internet because of forced neutr.

[mabhatter654]

The "internet" didn't get big until the 1990's because that's how long it took for just modems to get out from under Ma Bell's monopoly thumb. There's very many articles here on /. about how the telcos tried to sabotage regular 56k dial up... like we never get that because they won't clean up the lines! Every Net Neutrality argument misses this point. It's like now that stuff is faster we forgot what life was like when we "rented" phones, and paid $$$ per minute charges. What's even more disheartening is that there's a good share of Reps and Senators that were in Congress when we Made THAT rule... and when we broke up Ma Bell... and they STILL don't get it!!!

Missing summary

[Kesch]

RTFA here. http://www.weeklystandard.com/Content/Public/Artic les/000/000/012/348yjwfo.asp
The summary does injustice.

The author is neither pro nor anit-net neutrality. The next paragraph following the quote in the summary starts with "But what market?"

Kessler acknowledges that the Teleco's are aging giants and that something needs to be done. At the same time he does not think that NEt Neutrality and regulation are the right answer.

He does bring up an interesting tactic of using the Kelo ruling on eminent domain to sieze teleco wires and hand them to new players who want to expand and innovate.

Re:Surprising Policy Prescription

[stinerman]

I read that the author wanted to use Kelo as a sort of cattle prod in order to get the telcos off their asses and fix things. I don't think he really was advocating it.

I think that unbundling the lines at the local level is a good idea. I've heard that after France did it, competition came in and lowered prices and increased speed offerings nearly overnight.

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.

I'd rather let the market sort these things out.

[Stalyn]

...sort of sounds like "I'll let those chickens handle that fox problem".

Re:Well

[Red Flayer]

"This wouldn't even be an issue if the ISPs were not government-sanctioned monopolies"

Umm, they're not, with the exception of ISPs who are an arm of a telco -- and even in that case, the ISP subsidiary is not a government-regulated monopoly.

The telcos, whose fiber they are using, are government-regulated monopolies.

Perhaps you misunderstand what the whole point of regulated monopolies are, why they came about, and what the current problem is with how they are regulated.

The government regulates, and allows these companies to exist:
(1) To provide universal service. There is no economic incentive to lay cable out to Bumblewatsit, so in order to make sure the telco monopolies do, they force them.
(2) because of cost of entry. There is a natural monopoly in telco because of the cost of cabling and other infrastructure.
(3) Largely because telephone service is considered a necessary utility, government wants everyone on equal footing when it comes down to acquiring service.

So what's the problem? It's not the monopolies themselves, they are the most efficient way of delivering these services -- the government needs to ensure that the consumer is not gouged, however. The problem is that government regulation has fallen short of its mark, and the telcos (who are in their strong position in terms of internet service due to their monopolies granted for telephone service) are taking full advantage of the pay-to-play government we have now.

if you actually look at any individual telecommunications market, and see real competition

OK, look at my market. Cablevision (OO). Verizon DSL. Dialup, from many providers. This isn't about the ISPs, this is about who owns the fiber they transmit over, and the monopolies that exist in the throughput fiber market.

So, go ahead and open it up for competition. Who is going to lay the thousands and thousands of miles of fiber on speculation that they can compete?

Not only that, but by opening up the market, you've just limited your ability to regulate that market. So what you'd get is people in dense markets getting options, while people in scarce markets getting dick-all.

Re:Finally, some sense

[dgatwood]

My parents have a choice of internet providers. They can choose the Cable company... or they can get dial-up access. That's it. About one out of every five people in the U.S. do not have any real choices. Saying "the free market should work out this problem" is fine in theory, but in practice, it fails miserably because we do not have, have never had, and likely never will have a free market in information services. The barriers to entry are too high for the relatively small ROI.

You can tell that most of the people giving these opinions have never lived anywhere in the South, where over half the population lives in rural areas, and where broadband availability is spotty, at best. An awful lot of hard-working Americans depend on the government to protect them from abusive monopolies like the telcos. That's what net neutrality is really about---ensuring that users have the freedom to choose where on the internet they go without getting inferior service because their ISP is playing extortion games. The ISPs have already said that they hope to do this. This isn't hypothetical. This is in the planning stages.

Back in the early days of telephone, the government did something really smart. It passed laws that said that the phone services had to make phone service available to any customer no matter how far out in the weeds they lived. It wasn't always pretty---indeed, it often included using parts of fences, etc. as sections of the connection---but everyone had equal access to the technology. Government intervention could do the same for data services, but the big boys don't want that. They want to be able to charge companies for preferential access to their customers while simultaneously locking their customers into their service by limiting competition in the marketplace, through distance limitations (only servicing the customers they can cover at a minimal expense), through not providing DSL service on all of their COs or cable modem service in all their served cities, and through trying to block CLECs from being able to provide data services on their lines. In short, they want to have their cake and eat it, too.

The way I see it is this: the telcos and cable companies should have a choice:

• Provide equal access to content from all providers without preference, or
• Open their lines to CLECs (INCLUDING remote terminals) at a reasonable cost AND provide universal service to anyone without regards to distance.

Make the law such that the company can choose which to do. Then, the free market might stand a chance of working this out....

Re:we only have the internet because of forced neu

[iminplaya]

What's even more disheartening is that there's a good share of Reps and Senators that were in Congress when we Made THAT rule... and when we broke up Ma Bell... and they STILL don't get it!!!

They're still in Congress? What didn't they get? Seems to me that the people who continue to re-elect them are the ones who don't get it. Oh, and by the way, We are still under Ma Bell's thumb. It's just that she's been divorced and remarried so many times nobody remembers her name(s). But she's still the same old whore.

The market? Please...

[DAldredge]

Verizon has installed all the equiptment necessary to provide DSL service in my town - this is according to both the local techs and online account access.

They refuse to offer the service to anyone because they are trying to blackmail the PUC into doing what they want.

Their actions do not make any sense.

Agreed

[Anonymous Coward]

The problem is not that regulation in-and-of-itself is a bad idea in this case, but that the people who would be doing the regulating do not have their loyalties where they should be.

Re:Finally, some sense

[DragonWriter]

If you like the Intarwebs and want to see a neutral web, the best way NOT to have either is to promote their regulation. Legislation solves nothing - a free market would sort it out quite nicely.

A nice, concise expression of the religious doctrine I like to call "free market fundamentalism", the faith, completely without support, that in the absence of regulation, every market will function ideally, born, apparently, of the naive belief that every real world market is an Econ 101 perfectly competitive market with no substantial barriers to entry.

I wrote Joseph Lieberman (CT)

[C_Kode]

I just got a responce today:

June 20, 2006

Mr. XXXXXXXXXXX
XXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXX

Dear Mr. XXXXXXX:

Thank you for contacting me with regard to the issue of net neutrality. It was good to hear from you.

The principle of net neutrality suggests that data from all Internet content providers should be treated equally, regardless of provider or content. In recent months, broadband service providers, including cable, telephone companies, and wireless providers, have expressed a desire to charge Internet content and application providers, such as Google, eBay, Amazon, and Vonage, for delivering content to Internet consumers.

Net neutrality is one of many issues that have been the subject of hearings held by the Senate Committee on Commerce, Science, and Transportation as it prepares to advance telecommunications reform legislation. Commerce Committee Chairman Ted Stevens (R-AK) has scheduled a meeting for June 22, 2006, where details of his proposed legislation will be debated among members of the Committee. Furthermore, you may be interested to know that Senator Ron Wyden (D-OR) introduced legislation, the Internet Nondiscrimination Act of 2006 (S. 2360), aimed at codifying the concept of net neutrality. According to Senator Wyden, S. 2360 would prohibit network operators from charging Internet content and application providers for faster delivery to consumers or from favoring certain content. Senators Olympia Snowe (R-ME) and Byron Dorgan (D-ND) have introduced similar legislation, the Internet Freedom Preservation Act (S. 2917). Both of these bills are pending consideration by the Commerce Committee. To keep track of future actions on this legislation, you can go to the "Bill Tracking" service at http://lieberman.senate.gov/issues/resources.

I strongly support efforts to promote broadband deployment, but we must remain vigilant to ensure that congressional efforts to promote deployment by reforming telecommunications law maintain the openness of the Internet that has fueled economic growth and has reinforced our nation's commitment to free speech. Please be assured that I will keep your views in mind should legislation affecting net neutrality come before the full Senate for debate. I also want to review the materials and testimony from the Committee hearings and actions. My official Senate web site is designed to be an on-line office that provides access to constituent services, connecticut-specific information, and an abundance of information about what I am working on in the Senate on behalf of Connecticut and the nation. I am also pleased to let you know that I have launched an email news update service through my web site. You can sign up for that service by visiting http://lieberman.senate.gov/ and clicking on the "Subscribe Email News Updates" button at the bottom of the home page. I hope these are informative and useful.

Thank you again for letting me know your views and concerns. Please contact me if you have any additional questions or comments about our work in Congress.

Sincerely,

Joseph I. Lieberman
UNITED STATES SENATOR

Another, and smarter, NN proposal

[pjones]

Is there a place for fresh thinking and new recommendations in the infamous "network neutrality" debate?

Seth Johnson, David P Reed, Siva Vaidhyanathan, Pamela Samuelson, David Weinberger, Andy Oram and others [including me] have issued a new proposal on designed to "Preserve the Internet Standards for Net Neutrality."

The authors point out that "IP-layer neutrality is not a property of the Internet. It _is_the Internet." Then go on to say that "Providers certainly should be allowed to develop services within their own networks, treating data any way they want. But that's not the Internet."

Explanations are provided for CongressCriters, lawyers and lawmakers and human folks.

Re:QoS question

[Pfhorrest]

Question about Net Neutrality:

If net neutrality passes, what if I need a connection with QoS (quality of service) for two-way video or VOIP communication?

In order to implement QoS in a workable way, my packets need priority. But if my packets need priority, that's not "neutral". And it seems like network neutrality is designed to prevent me from buying any kind of QoS from network providers.

How is this a good thing?

Two things:

1) Net neutrality doesn't imply that no prioritization of packets is happening, only that no prioritization is done based on the origin of those packets. E.g. Verizon et al can prioritize voice or video streams coming across their network over web traffic, but it can't prioritize Google web packets over MSN web packets, or Skype voice packets over Vonage voice packets, etc. So you can still buy QoS for various services over your connection, but you can't pay more to prioritize your particular traffic over their network, as opposed to your competitors' traffic, except inasmuch as you're paying for a faster connection than your competitors are.

Which brings us to the second point...

2) If you need a guaranteed quality of service between two particular points, you'll need to buy high-end connections at both ends anyway, net neutrality or none. If you've got a high-bandwidth line with QoS for video traffic, and I've got my dinky home DSL connection with no such QoS (other than what my ISP might apply standard), I'm not going to get the full quality of your full-screen streaming video feed.

So you can still buy two high-speed uplinks to the network and even prioritize certain kinds of traffic over those connections to get a high-speed video conference going. And you can buy a faster connection on your end if you need to send out traffic faster. But you can't bribe the network to give your traffic higher priority than your competitors to me, the typical home user.

How Access Tiering will come to be

[tlabetti]

I don't think ISP's will degrade or restrict access to web sites (stop your typing about port 25 and craigslist now). I do think what they will do is offer private or exclusive bandwidth to their partners. For no extra charge to the end user I expect them to cordon off a portion of their fiber bandwidth to be used exclusively by their partner.

Let's say you have a fiber connection and a 15mbps plan. I think the ISP would give you a value added extra 5mbps for dedicated for use by a third party, let's say MSN.

So in your house you have your son using up bandwidth playing counterstrike, your daughter chatting away on skype while downloading a Warner movie using Bittorrent and your significant other watching a streaming video on how to boil water from YouTube.

You want to check your stocks so you go to google, google has to share that 15mbps connection with the other apps and is slow, so you switch over to MSN and find it blazingly fast in comparison. So you start to use MSN more and more and google less and less. Is that because MSN is doing a better job then google? No it is because the ISP has partnered with MSN. Over time this will limit your choices and you will find that you only use you ISP's partner services.

Has your ISP violated the tenets of Net Neutrality? They are not blocking your or slowing down access to sites.

Re:How Access Tiering will come to be

[aaarrrgggh]

If it is advertised this way, it is reasonably fair. The reality will be that the service is 256k UP, 5M DOWN, and 20M "Preferred Partner" access. As long as your needs fit in the 256/5 area, the 20M is just a bonus... a legitimate "value add." This is a speculative service that the telco provides, and is subsidized by their partners.

Unfortunately, the telcos need you to consume all of that 5M before the 20M has any value... Unless... they play with QOS and add latency to the 5M side, and maybe even limit that 5M by specific ports. Then, your games won't work on the 5M side, and maybe your company's VPN starts to act strange. Past experience suggests that the telcos will mess with the "common carrier" portion to create a need for the "preferred partner" portion.

Better Partner Up!

Question on latency law...

[Nazo-San]

You know, this isn't exactly 100% related to the article, but, one thing I've been wondering about since I first heard about this is, what's to stop the companies from deciding they don't like, oh, say their competitors or someone who hasn't paid his extortion fees (and don't kid yourself, by every definition I can find -- except the one that relies on the word "illegal" -- this is extortion plain and simple) on schedule and setting latencies to that site so incredibly high that it causes anyone trying to visit to get a timeout? Essentially cutting that site off of the web as far as anyone is concerned. Even if they can't get away with setting it that high, imagine if some big online game company accidentally bounces a check or something. If they add any latency to those lines at all, the game company goes right down the pot. Online games just don't work once heavy latencies start. Who would pay to play, say World of Warcraft, when latency can never go under 1s (and I might add that they are kind of shooting themselves in their own foot with that background downloader saturating people's connections and causing latency to shoot up to 1+s while the average joe doesn't know what's causing it or how to disable the thing.)

I'm really worried that we may be looking at a heck of a lot worse than making the competition's websites act really slow. I'm afraid they may have the ability to cripple online games the moment they have a disagreement with the game company (essentially pay up or I'll break both your legs type of thing) and cut competition completely off the web as far as their customers are concerned -- not just make the sites slower. This really scares me because it puts the Internet largely in control of the ISPs and if they get too greedy, they can essentially make the Internet a useless thing for US citizens -- essentially killing the Internet as far as we would be concerned.

Perhaps I am reading too much into this? Maybe all the law is talking about is allowing them to use those little squid-type caching services simply to speed up sites rather than applying latency to slow sites down? I can understand the idea of charging for maintenance of the servers that would be necessary to implement such a large scale caching system (though it should be the customers who want the benefits of the caching who pay, not companies who are afraid that their sped up competition will get ahead while customers get tired of waiting for their site to load.) Please someone tell me it's just the caching one?

EXACTLY!!!

[mrchaotica]

If these shills want a "market solution" to the problem, then the first thing that needs to happen is that all the entitlements, sweetheart deals, and monopoly enforcement that the telcos currently enjoy needs to be taken away!

That would be a fucking "market solution!"

Re:Finally, some sense

[mrchaotica]

The way I see it is this: the telcos and cable companies should have a choice:

• Provide equal access to content from all providers without preference, or
• Open their lines to CLECs (INCLUDING remote terminals) at a reasonable cost AND provide universal service to anyone without regards to distance.

You know what would be both simpler and better? Ban all "common carriers" from serving content themselves, and only allow "common carriers" to own infrastructure. Now that's a solution!

Re:Like how GM bought up and destroyed the Trolley

[3leggeddog]

The National City Lines exploit involved much more than just trollies in California. It also involved buying bus lines throughout the country and systematically putting them out of business. A part of the story can be found on Wikipedia http://en.wikipedia.org/wiki/National_City_Lines

A possible solution - Strip common carrier status

[jeffc128ca]

I can't remember where I saw this before but some one had an intelligent solution to this debate. If telco's want net nuetrality, give it to them but on the condition they no longer have "common carrier" status.

As I understand it, "Common Carrier" status ensures the ISP's don't get sued for people who download child porn or arrange drug deals via email. You could add a provision to the bill saying any ISP that chooses a non neutral way of handling traffic looses the this common carrier status. If any of their users downloads at lease one child porn pic, or email through there system that facilitates a crime, they are held responsible in both criminal and civil court. Politicians would love it as they can show they are cracking down on crime on the internet, and it would pretty much garuntee that every ISP would be net neutral for fear that one users downloads something they aren't suppose to.

Naive Libertarianism

[Angst Badger]

I'd rather let the market sort these things out.

If the market was sorting things out alone, there would be one telecommunications monopoly, you'd be paying whatever the hell it felt like charging, and there wouldn't be any competition.

Laissez faire economic fantasies always depend on willful ignorance of the fact that wealth is a competitive advantage. Sooner or later, especially in fields like telecom where the barrier to entry is high by nature, one player gets far enough ahead to either buy out or squeeze out the competition. Excessive or ill-considered regulation is always a bad thing, of course, but some degree of regulation is necessary to ensure that competition exists in the first place. Mature markets do not have spontaneously occurring competition in most cases.

Re:Naive Libertarianism

[SideshowBob]

You're kidding right? Hit wikipedia and look up antitrust law. That will get you started, anyways.

Also see: FTC, Department of Commerce, SBA.

Two Paragraphs is all it takes to see the mistakes

[weston]

Within two paragraphs, we already encounter this particular misunderstanding:

"Everyone should be allowed to hang out in the town square and use it as they please, one low price, eat all you want at the buffet."

The rest of the article isn't worth reading. That level of grasp on the problem tells me the writer already thinks in glittering generalities and doesn't understand the issue. "One low price" hardly begins to describe the current state of net neutrality.

Not too surprising, however. I've yet to see an opponent to net neutrality who can make their case without misunderstanding or misrepresenting this particular point, if they examine specific points at all.

False dichotomy

[Aire Libre]

The article says "But the answer is not regulations imposing net neutrality. ... We all know that regulations beget more lobbyists. I'd rather let the market sort these things out." This is a false dichomoty. A fresh approach, that recognizes this, is being offered at http://www.dpsproject.com/. In a nutshell, it says "don't regulate the application layer of the Internet, but don't let the big companies pass off distorted networks and application layer limitations as "the Internet."

SEC. 3. DECEPTIVE PRACTICES IN PROVIDING INTERNET ACCESS.

(1) Definitions.- As used in this Section:

(A) Internet.- The term "Internet" means the worldwide, publicly accessible system of interconnected computer networks that transmit data by packet switching using the standard Internet Protocol (IP), some characteristics of which include: i) Transmissions between users who hold globally unique addresses, and which transmissions are broken down into smaller segments referred to as "packets" comprised of a small portion of information useful to the users at each transmission's endpoints, and a small set of prefixed data describing the source and destination of each transmission and how the packet is to be treated; ii) routers that transmit these packets to various other routers on a best efforts basis, changing routers freely as a means of managing network flow; and iii) said routers transmit packets independently of each other and independently of the particular application in use, in accordance with globally defined protocol requirements and recommendations.

(B) Internet access.- The term "Internet access" means a service that enables users to transmit and receive transmissions of data using the Internet protocol in a manner that is agnostic to the nature, source or destination of the transmission of any packet. Such IP transmissions may include information, text, sounds, images and other content such as messaging and electronic mail.

(2) Any person engaged in interstate commerce that charges a fee for the provision of Internet access must in fact provide access to the Internet in accord with the above definition, regardless whether additional proprietary content, information or other services are also provided as part of a package of services offered to consumers.

(3) Network providers that offer special features based on analyzing and identifying particular applications being conveyed by packet transmissions must not describe these services as "Internet" services. Any representation as to the speed or "bandwidth" of the Internet access shall be limited to the speed or bandwidth allocated to Internet access.

(4) Unfair or Deceptive Act or Practice- A violation of paragraphs 2 or 3 shall be treated as a violation of a rule defining an unfair or deceptive act or practice prescribed under section 18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 57a(a)(1)(B)). The Federal Trade Commission shall enforce this Act in the same manner, by the same means, and with the same jurisdiction as though all applicable terms and provisions of the Federal Trade Commission Act were incorporated into and made a part of this Act.

Hidden Flag Provisions

[alricsca]

Hey has anyone noticed that hidden in the so called Nework Neutrality bill (S. 2686: Communications, Consumer's Choice, and Broadband Deployment Act of 2006) http://www.govtrack.us/congress/bill.xpd?bill=s109 -2686 are provisions to create digital video and audio copyright flags, to implement analog watermarking, and to force all hardware and software to respect them? What a ticking time bomb!

The Telcos didn't even pay for the build out...

[z-kungfu]

and they made promises of fibre to the home. Read all about it at http://www.newnetworks.com/scandals.htm Get it straight it's another something for nothing deal for big business...

Just a littie summary...

This book documents the largest fraud case in American history The case is simple: Do you have a 45 Mbps, bi-directional service to your home, paying around $40? Do you have 500+ channels and can choose any competitive service? You paid an estimated $2000 for this product even though you did not receive it and it may never be available. Do you want your money back and the companies held accountable? Background: Starting in the early 1990's, the Clinton-Gore Administration had aggressive plans to create the "National Infrastructure Initiative" to rewire ALL of America with fiber optic wiring, replacing the 100 year old copper wire. The Bell companies -- SBC, Verizon, BellSouth and Qwest, claimed that they would step up to the plate and rewire homes, schools, libraries, government agencies, businesses and hospitals, etc. if they received financial incentives. The Commitment: * By 2006, 86 million households should have already been wired with a fiber (and coax), wire, capable of at least 45 Mbps in both directions, and could handle 500+ channels. * Universal Broadband: This wiring was to be done in rich and poor neighborhoods, in rural, urban and suburban areas equally. * Open to ALL Competition: These networks were to be open to ALL competitors, not a closed-in network or deployed only where the phone company desired. * Each State: By 2006, 75% of the state of New Jersey was to be wired, Pennsylvania was to have 50% of households by 2004, California to have 5 million households by 2000, Texas claimed all schools, libraries, hospitals....Virtually every state had commitments. * Massive Financial Incentives: In exchange for building these networks, the Bell companies ALL received changes in state laws that gave these them excessive profits, tax savings, and other perks to be used in building these networks. * This was not DSL, which travels over the old copper wiring and did not require new regulations. * This is not Verizon's FIOS or SBC's Lightspeed fiber optics, which are slower, can't handle 500 channels, are not open to competition, and are not being deployed equitably. * This was NOT fiber somewhere in the network ether, but directly to homes. The Harms and Outcome * Costs to Customers -- We estimate that $206 billion dollars in excess profits and tax deductions were collected -- over $2000 per household. (This is the low estimate.) * Cost to the Country -- About $5 trillion dollars to the economy. America lost a decade of technological innovation and economic growth, about $500 billion annually. * Cost to the Country -- America is now 16th in the world in broadband. While Korea and Japan have 40-100 Mbps at cheap prices, America is still at kilobyte speeds. * The New Digital Divide -- The phone companies current plans are to pick and choose where and when they want to deploy fiber services, if at all. * Competitor Close Out -- SBC, BellSouth and Verizon now claim that they can control who uses the networks and at what price, impacting everything from VOIP and municipality roll outs to new services from Ebay and Google. The Truth: This is a Fraud Case * Fraud: There is a dark secret -- the networks couldn't be built at the time the commitments were made and are still not available. If someone pays thousands of dollars for a service and doesn't get it, isn't that fraud? * Collusion and Cover-up: TELE-TV and Americast, the Bell companies' fiber optic front groups, spent about $1 billion and were designed to make America believe these deployments were real in order to pass the Telecom Act of 1996 and enter long distance. How did every major phone company in America not know that these fiber-based services couldn't be built and were able to defraud over 40 states? * The mergers killed fiber optic deployments in over 26 states and harmed competition.

no competition?

[falconwolf]

Google: Uh, I don't think so. I think we'll just make google.com inaccessible altogether to your pipes, and buy a few ads supporting your competitors who provide full service at normal prices. Take a minute to think about how your customers might react to that before you try to throw your weight around against us.

Telco: We don't have any competitors.

Google: Oh.

Telco: Pay up, bitches.

Google: Okay then, we'll become your competition.

Partering with Earthlink, Google is setting up wireless access in San Francisco. The service is called MetroFi and is advertizer paid for, there isn't a subcriber fee. The Wall Street Journal has an article that mentions it:

Cities Shop
For Lower Prices
In Wi-Fi: Free

Also mentioned is Portland, OR's plans. MetroFi is waiting for city council approval and they will offer ad supported as well as paid for services.

Falcon

SLASHDOT is ADVERTISING AGAINST NET NEUTRALITY

[schneidafunk]

There is currently an advertisement on slashdot that is very clever. It's a flash animation saying "To see the future of the internet". If you follow the link www.internetofthefuture.org you'll see a cartoon advocating the people to rise up and protest against the net neutrality bill. It's a very misleading cartoon, yet entertaining. There's no credits or contact info associated to this ad, and at one point they even boil the argument down to an issue of "the people" vs. "the government".

This banner ad can be found at the top of the slashdot home page (hit refresh many times)