No Matter What Happens With Net Neutrality, an Open Internet Isn't Going Anywhere, Says Former FCC Chairman (recode.net)

Michael K. Powell, a former chairman of the Federal Communications Commission, writing for Recode: With an ounce of reflection, one knows that none of this will come to pass, and the imagined doom will join the failed catastrophic predictions of Y2K and massive snow storms that fizzle to mere dustings -- all too common in Washington, D.C. Sadly, rational debate, like Elvis, has left the building. The vibrant and open internet that Americans cherish isn't going anywhere. In the days, weeks and years following this vote, Americans will be merrily shopping online for the holidays, posting pictures on Instagram, vigorously voicing political views on Facebook and asking Alexa the score of the game. Startups and small business will continue to hatch and flourish, and students will be online, studiously taking courses. Time will prove that the FCC did not destroy the internet, and our digital lives will go on just as they have for years. This confidence rests on the fact that ISPs highly value the open internet and the principles of net neutrality, much more than some animated activists would have you think. Why? For one, because it's a better way of making money than a closed internet.

Comments

better way for who

[thaylin]

the ecommerce sites or the ISPs, I would think a closed internet is better for the ISPs

Re:better way for who

[Austerity Empowers]

I would think a closed internet is better for the ISPs

Evidently they think so too, in spite of this guy, because they seem to be willing to buy a government official and motivate him to completely ignore the majority voice repeatedly, and just happen to have a president who is favorable to the whole fiasco. Usually you don't try to kill a thing that you value significantly.

What he's not saying about this future, and maybe doesn't see, is that yeah, probably the "open internet" isn't going anywhere. But its price structure certainly will change. And yeah, some people will pay, but many will be unable to. And we'll be deciding which of those activities he lists up there that we will pay for, and which we will not in favor of other less good options that ISPs push for us. They absolutely will push for their own broadcast TV options, it makes technical sense (for them) to be able to better utilize their network without investing in it. I don't see any way they won't do that. Similarly, anything that becomes a significant fraction of their network usage, they're going to try to price out.

The irony is that the argument they use is net neutrality is hurting investment...but they actually don't want investment anyway. It makes business sense, but most of us do not care at all about their profitability and would happily replace their business with something else that delivers what we want.

Not to mention public reaction to these pricing schemes is going to be increased usage of VPNs, to the point where that is our default network. This will either end up driving internet prices way up, or beget a lot of ISP induced regulation to forbid us from doing this. THe net result is we can expect a higher latency, more expensive, less functional network than we had before.

Really?

[Anonymous Coward]

In the run up to a very large shopping season, wouldn't it be terrible if all of a sudden Amazon was slow?

People also usually have time off, and Netflix is entertainment, it would really suck if that was slow to.

Good thing you can purchase the special ISP provided "holiday package" to make sure that your surfing of Amazon and Netflix doesn't slow down over the holidays.

And hey, Amazon, Netflix, i'm afraid before we can offer this package to our serf's You're going to have to pay us, "benevolent ISP" about a billion dollars a month.

Mike Powell, Not MBA

[140Mandak262Jamuna]

That is the fundamental flaw in his argument. He is thinking about what is good for the ISPs in the long term, and naively believes they will act in their long term interest.

No ISPs are managed by MBAs. They compete with other ISPs. It is so very tempting to squeeze 1$ more revenue this quarter, even if it means losing 3$ next year or 30 $ over the next decade. The managers know their stock options, the vesting schedule, the exercise price and bonus trigger stock price. Meeting that is of paramount importance for the C?O crowd. Getting 1$ more in their personal pay is a lot more important to them than causing 50$ worth of damage to the company and its long term assets. These managers have an average tenure of about 3 years. There are very very few managers who stick with the same company for decades.

If by chance one company decides to go for the long term play, Wall Street will immediately punish it. Its stock will plunge, its revenue will be compared to its competitors. The pressure is relentless and there is no way for a public company to recover. Moderate size companies will manipulate their stock price downwards, and make it attractive enough for Private Equity. Usually by dumping their insiders' stock and negative guidance in the quarterly calls. The true viability and strength will be disclosed to private investors, and once the public stock holders are paid off at the fire sale prices, the private equity firms will richly reward the executives who got them the plum. But these ISPs are too big for private equity. Even at fire sale prices, the market valuation would be so high it is off limits for private equity. Making them bankrupt intentionally would help them take it private, but bankruptcy is a public court managed affair, not the hush hush under the table dealings with private equity. So it is not likely to happen.

So it will be a race to the bottom. So they will race to the bottom. Some eagerly, some reluctantly, but it is to the bottom they will race.

Doesn't sound like an "open Internet" to me!

[GameboyRMH]

The vibrant and open internet that Americans cherish isn't going anywhere. In the days, weeks and years following this vote, Americans will be merrily shopping online for the holidays, posting pictures on Instagram, vigorously voicing political views on Facebook and asking Alexa the score of the game.

That sounds closest to the nightmare scenario we're trying to avoid, where users are (even more) locked into only the most popular commercial services from Silicon Valley megacorps, who will be the most capable of paying for the "fast lanes" (most likely in the form of zero-rating).

Startups and small business will continue to hatch and flourish,

Hatch and die in the nest is more like it...they won't be able to afford "fast lanes" to compete with the most established players.

Re:Oh, noes!

[Anubis IV]

Yes, I do. We had court rulings that permitted ISPs to block BitTorrent (see the results of Comcast v. FCC), ISPs extorting the companies I do business with to deliver the packets their customers had already paid their ISP to deliver to them (which then affects me, since the companies I do business with have to raise their rates to makes up the difference, which ends up impacting me), and ISPs interfering with SSL handshakes to prevent secure connections while simultaneously injecting advertising identifiers (i.e. supercookies) into all of their customer’s traffic.

Ah, the good old times, right? How quickly you forget.

The only good thing back then for me was that the local cable ISP hadn’t yet managed to consolidate their complete control of my region, so their prices were about 40% lower, but that’s a separate issue, sadly, and one that won’t be affected by these changes. Even so, if they decide to misbehave like other ISPs were in 2015, the only choice I’ll have for broadband this time around is “take it or leave it” with the local cable monopoly.

Horse Shit.

[MachineShedFred]

This confidence rests on the fact that ISPs highly value the open internet

I had no idea that Michael Powell was a comedic writer.

ISPs highly value the ability to extort content providers that aren't fully owned subsidiaries of the ISP, or aren't other ISPs that can extort their fully owned subsidiary content provider.

ISPs highly value the idea of being able to charge other companies money for access to your eyeballs and ears, while also charging you money for access to content that the ISP doesn't actually own.

What a load of horse shit.