Net neutrality and the political point of no return

Net neutrality and the political point of no return

Summary: My fellow blogger George Ou has taken me to task for helping to politicize a subject matter which he feels is undeserving of any politicization.  Commenting on a blog entry I wrote yesterday (see Some must see Net neutrality videos) which pointed to both MoveOn.

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TOPICS: Telcos
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My fellow blogger George Ou has taken me to task for helping to politicize a subject matter which he feels is undeserving of any politicization.  Commenting on a blog entry I wrote yesterday (see Some must see Net neutrality videos) which pointed to both MoveOn.org and SaveTheInternet.com, George wrote:

Why are we promoting Moveon.org propoganda? Net neutrality is a very complex issue. It is a case of the big telcos against the big internet companies like Google, Yahoo, and Microsoft. We don't need one-sided propaganda from Moveon.org.

George's question deserves an answer. But first, it's worth noting that George then followed up with his own treatise on how Net neutrality and politics don't mix.  He makes some interesting points that address the fairness of what amounts to bandwidth hogging and how free market forces should be left to correct any bad decisions on behalf of ISPs or inequities.  Says George:

Do we honestly believe that any ISP will make destinations like Google inaccessible?  I would dare say that the first ISP that tries this will be the first to go out of business, before the FCC even has a chance to have a hearing to fine them.

In a perfect world, George would be right when he says that the issues are largely technological instead of political and that politicians and activists should step aside and let the Googles and Yahoos of the world duke it out against the telcos and ISPs that are contemplating some sort of tiered chargeback structure that equates to the premium one pays for overnight delivery of a letter versus two or three-day delivery. But it's not a perfect world.  As much as I agree that politicians shouldn't play a role in matters that they know little about (something that routinely happens in matters of technology) and as much as I agree that that activist organizations like to offer an unbalanced view of the big picture, I also see a process that's already heavily politicized and believe that every Net neutrality-unfriendly political force deserves at the very least an equal and opposite force to oppose it.

As though the political forces at work are more herring than real, George says "we are suppose to believe that it is just the 'evil' telco companies and the 'evil' politicians they paid off opposing Net neutrality against the people." How sad is it when a complicated truth has to be gift-wrapped in iconic terminology like Net neutrality, SPAM, and C.R.A.P. in hopes of getting the masses engaged in a conversation? Not only isn't it a perfect world, the conversation about Net neutrality was both started and politicized before anyone called it Net neutrality. George is right. It's not like the telcos and politicians sat down around a table and agreed that it was time to stomp out Net neutrality.  But, on the other hand, George's herring is closer to the truth than most people realize.

For example, you'd have a very difficult time convincing me that Federal Communications Commission's decision to reclassify DSL Internet service provision as an information service (rather than the telecommunications service it was originally classified as) was a decision it magically came up out of the blue. For the FCC to come up with that idea, someone or some industry had to bring it to the FCC's attention. Who might that someone be? The telcos which happen to have extremely well-financed and active representation in Washington, DC.  As I wrote last August, the Net result (double-entendre intended) of that decision disabled a free market; the same free market that would have efficiently neutralized any attempt by telcos to turn the Internet into a tiered service instead of the dumb pipe it needs to be. Perhaps George didn't realize it, but when he rhetorically asked what part of the Internet the telcos control and what services and Web sites are being filtered, he was very very close to the heart of the matter.

When the FCC reclassified DSL internet service provision as an information service, it practically endorsed a monopoly (or perhaps a duopoly) that the previous classification (as a telecommunications service) was designed to prevent. When DSL internet service provision was originally classified as a telecommunications service, the telcos, which own a majority of the physical infrastructure needed to provision most homes and businesses with internet service, were also forced to make that physical infrastructure available (practically at cost)  to providers like AOL and Earthlink who didn't have the financial means or the government-granted right-of-way ("the pole") to put their own competing  infrastructure in.

By neutralizing government-granted right-of-way as a competitive advantage, the FCC had ensured a free market for Internet service provision. Under those arrangements, if your local telco decided to limit your access to Google, you'd be free to switch to a provider that doesn't.  But when the FCC reclassified Internet service provision as an information service, it released telcos from their obligation to cost effectively give ISPs like AOL and Earthlink access to their government granted right-of-way. With one decision, a largely free market was converted into a government-endorsed duopoly (if you include the cable-based ISPs). And, absent of a free market that allows you to choose from many Internet service providers, the telcos do have the control they need to change the way the Internet works.

You can hardly blame the telcos for wanting it that way.  It's bad enough that their own Internet services were being used by their customers (you) to dismantle their traditional telephony business with applications like Skype. But to have other ISPs enabling the same sort of disruption over the telco "owned" infrastructure adds insult to injury. But, as has happened with past economic transformations, the move to a digital economy (I don't like "information economy") is destroying old business models. In Net neutrality, many may see outfits like MoveOn.org and SaveTheInternet.com as organizations that are unnecessarily politicizing an issue that shouldn't be politicized. But, the truth is that politics played a role in Net neutrality long before "Net neutrality" ever entered the digerati concsiousness and, like the old saying goes, you have to fight fire with fire.

Topic: Telcos

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  • Free Market

    I read Ou's posting.

    Free market priciples do not apply here. The telecoms enjoy monopoly or duopoly. There is virtually no free market competition to serve as protection for consumers.

    The telecoms limit their actions only to the letterof the law. They do not recognize any ethical or moral restraints. Given the history of the telecoms I think it's clear that they would eventually dicriminate in favor of their own services and content unless they were restrained by the letter of law.

    Without some kind of net neutrality limitations we the consumer will eventually lose. History bears this out.
    Tim Patterson
    • ...not here nor anywhere

      "Free market" is a mythical entity, as Adams himself eventually came to realize. The only free market is one in which inumerous vendors compete on equal footing. Such a theoretical situation would last about five minutes, not least because people want "standards" from a dominant entity, and this tips the market towards any entity showing dominance.

      Market dominators act in the interests of their shareholders and themselves...not in the interests of the broader community and certainly their customers (they no longer have to). Hence the need for regulation, to protect consumer interests.

      At this point, the marketing departments of the dominators, as well as their shareholders, employees and other vested interests begin trumpeting "free market", something they themselves patently don't believe in.

      It's all such standard farce and amazing that it still seems to work.
      Langalibalene
  • What's political?

    Remember when Microsoft had one (1) part-time lobbyist in Washington?
    The companies which spent substantially on (legal and even illegal) activities to influence regulators and politicians created quite a few difficulties for Microsoft.

    Regulation is subject to a poltical process, inevitably.

    On policy, government has to intervene to protect the consumer. There's no alternative. But how governmwent chooses to regulate has a major effect on profits. Companies are required to fight for influence.

    So of course there will be a political element to government policy decisions.


    Mr. Ou was right, though the word he might have used was "philosophical" rather than "political".

    The "net neutrality" debate as it exists is only a conflict among very large companies about the amounts billed. The content provider companies like Google, Yahoo, Microsoft et al are trying to stick the rest of us with the cost of doing business.

    If this were truly about the freedom of the internet I would be as eloquent as possible in favor.
    But this is cynical manipulation in order to reduce the bills of profitable companies at my expense. I know which side I favor in this discussion as well. My own.
    Anton Philidor
    • you fell for the spin

      [i]Remember when Microsoft had one (1) part-time lobbyist in Washington?[/i]

      Ever heard of Preston, Gates, and Ellis? Arguably the largest lobbying firm in the USA for at least the last 20 years?

      Guess who the "Gates" partner is.
      Yagotta B. Kidding
    • Google, Yahoo, Microsoft sticking us with the bill?

      This is absurd. I've never received a bill from Google. Assuming you mean that the cost is showing up in another bill that I pay (perhaps my ISP bill), since when is it my responsibility to subsidize backwards thinking? The companies that survive disruptions are the ones who embrace those disruptions, and in some cases, invent them. Dating back to the earliest days of internet telephony, the window of opportunity for telcos to invent something like Skype, or even acquire it, was open for a long time. Rather than lead the revolution by inventing and monetizing new applications that run on their dumb pipes, the telcos have chosen to beat it back with control, ignorance and regulation. Everywhere you look, telcos are blocking innovation. Look, for example, at how the wireless carriers disable some of th best features on the newer phones because of the potential disruption those features could cause to their existing businesses. So, now that telco lack of innovation and imagination is finally coming home to roost, you're placing the blame on Google, Yahoo, and others. Puh-leeze.

      db
      dberlind
      • If you take a paid video service...

        ... from Google you will receive a bill.

        Your bill will be lower if "net neutrality" goes through because I will be paying some of the cost of the capacity used to make Google's service work well, even though I do not subscribe to that service.

        Your bill will be higher if Google has to pay for the capacity that makes its paid video service more desireable.

        If you take the service, the cost should be between you and Google. Leave me out.


        The capacity being discussed is not yet available. The issue is who will pay for it when it is built, assuming that it will be.

        Because there's some doubt whether the capacity will be added at all if the telcos cannot bill Google et al for it, the hardware makers have taken a position against "net neutrality". They want the capacity added.


        The telcos cannot be considered blameless for their past and current decisions. In particular, the packaged pricing models which make "bare" internet costly restrict competition.

        But that's not this issue, and the paying-for-capacity-to-be-added problem appears a sufficient discussion for now.
        Anton Philidor
        • Capacity, not available?

          You've been fleeced Anton. The capacity is definitely there. The problem is that telcos want to reserve it for themselves for forward-thinking (and I'm being very facetious) ideas like proprietary video on demand.

          Read this: http://blogs.zdnet.com/BTL/?p=1731 and make sure you click through to some of what Bob Frankston has to say.
          dberlind
          • Scenarios

            Interesting that the issue here is capacity for paid video on demand.

            Mr. Frankston has a scenario in which he makes certain technological assumptions. He complains about the fact that regulators and telcos are preferring their own hidebound approaches.

            Whether Mr. Frankston is correct or not, let's assume that the telcos and regulators believe what they are saying and using to justify their actions.

            They certainly have been consistent.

            Here are a couple of quotes from the story reporting that the hardware companies oppose net neutrality, probably because it might prevent capacity expansion projects:

            http://news.zdnet.com/2100-9588_22-6073629.html

            "Legislating in the absence of real understanding of the issue risks both solving the wrong problem and hobbling the rapidly developing new technologies and business models of the Internet with rigid, potentially stultifying rules."
            [Note the "hobbling ... technologies", as stated by hardware companies]
            ...
            For their part, major broadband providers have repeatedly pledged not to block traffic or censor Web sites. Instead, they say, it will only be economically feasible to invest in higher-speed links if some bandwidth can be reserved for paid content.

            And here's a story in which the telcos explain what they intend:

            http://news.zdnet.com/2100-1035_22-6052986.html

            Tom Tauke, executive vice president for public affairs for Verizon Communications, and Jim Cicconi, senior executive vice president for AT&T, said at the TelecomNext trade show here on Wednesday that their companies have no intention of degrading or blocking other companies' traffic that rides over the public Internet.

            Instead AT&T and Verizon would simply like to offer content companies, such as Google and Movielink, virtual pipes directly to consumers over their broadband connections that would allow these content companies to make sure users at home have a good experience accessing their content.



            You can argue that the telcos and the regulators (and politicians) who are their primary audience are wrong about the technology and about what needs to be done to improve broadband service.

            But I think you (and Mr. Frankston) can also accept that the telcos believe that what they are doing is best.
            Anton Philidor
          • The problem is that ...

            ... the telcos have had the capacity to provide fiber to the curb for a decade but they have held that capacity back (instead of investing in it) because the Telecommunications Act of 1996 forced them to share their infrastructure at wholesale rates.

            By recinding that requirement, the FCC abrogated its responsibility to act in the public interest. It is one thing for policiticans in Congress to be unduly influenced by lobbyists. it is quite another for an office of the Executive Branch to allow itself to be so influenced.

            The telcos are continuing to act like monopolies and hoarding bandwidth because they can -- and in doing so, they expect to drive up the price.

            Offering a tiered pricing structure first began when the government broke up AT&T. The trick was to get all your 'friends and family' to join one company so you all got the lowest rates. And it still works today in the cell phone business. Isn't this just the same scam -- being run by the same people, except now they are interfering with access to information.

            Censorship is censorship, whether it is government sponsored or 'defacto' since access is controlled by the telcos -- and sold to the highest bidder.
            M Wagner
          • Censorship issue.

            Tiered pricing can't be considered censorship; no one is prevented from supplying a paid service (the speech supposedly being censored), but the most effective way to supply the service, resource intensive, costs a bit more.

            If the need for money were a sign of censorship, then candidates would receive free time on television.
            Anton Philidor
          • Flawed analogy

            Rules governing political ads state that if a media outlet decides to air any political ads, then they must air ads from all campaigns, and the rate must be identical, and must match the lowest rate offered to any advertiser.

            This way a media outlet can't censor one candidate with whom they may not agree by manipulating the price of advertising.

            This is exactly an example of government regulation to ensure lack of censorship by ensuring that all campaigns pay a fair market value for ads while avoiding favoritism.
            robert.rohr@...
          • Is it the curb that's the problem?

            The need to be answered by adding capacity results from the requirement to carry streaming video that works smoothly, coming from many sources, including the telcos themselves.

            Is that a problem primarily of the last mile?

            Probably not.

            Have the people opposed to tiered pricing argued that the additional capacity is not needed, so that this is an attempt to create a precedent without justification?

            Not that I've heard. The discussion centers around billing.

            I think we can conclude the extra capacity is needed.

            This is a dog-that-didn't-bark argument, but I think it's reasonable in this case.
            Anton Philidor
          • No, bittorrent is the way

            Caching technologies like BitTorrent is the way and we don't need politics here. This whole business of buying extra bandwidth to deliver video in unicast mode is crazy.
            georgeou
          • Excellent point....

            You're absolutely right George. Who really cares how much bandwidth there is beyond a certain point. Multimedia content is better off viewed in a timeshifted (TiVo-like) format anyway. That's what podcasting is all about and the same sort of timeshifted architecture (eg: BitTorrent) speaks volumes about the idiocy in trying to reserve bandwidth for prehistoric applications. Nevertheless, politics is what the telcos needed to turn themselves into a scarce resource. Which means that politics has also already played a central role in the current state of affairs. As a commodity, dumb pipes are not a very profitable business. So, you use regulation to make them profitable by un-commoditizing them (snuffing out the competition). I don't like the political intertwining any more than you do. And, just like you, I totally hate the way anything complicated is packaged and embellished for a five year old mentality. You see this happening with organizations like moveon, but you know the same sort of package was sent to the politicians that have somehow been convinced of the scarcity of bandwidth (a farce where it exists and a farce where time shifting will render it moot anyway).

            db
            dberlind
          • Ah but what is wrong with the alternative legislation?

            I agree. But do we need overreaching regulations that ban tiered service? This is the way it works. The bottom line for me is that there should be two basic types of service. It should be "best effort" (what he all have now) or "priority service" for those who want to buy it since there are something things that do need it. Remember that it's not the average bandwidth we should be concerned about, it is the worst case conditions that mandate prioritization. So long as it's not "no effort" or "deliberately slow effort", then I don't have a problem with allowing tiered service.

            The Republican alternative to mandate FCC action to look at all complaints and levy half million dollar fines per incident is perfectly sufficient. We don't need the moveon.org brand of socialistic "no two tiered Internet access" since this is fundamental to a market driven free society. As stupid as the telcos are in this case to offer priority service for Google video, I don't need the Government to ban this kind of stupidity since it will fall on its own dead weight.
            georgeou
          • If streaming video were a dead weight...

            ... then the telcos would not be attempting to install separate capacity for it - at great expense - and those organizations which would pay the bills would not be spending a fortune to oppose it.

            If you want a larger context, streaming video is equivalent to television, the service which the telcos need to match cable offerings. I would not be surprised to find the cable companies working hard for "net neutrality".
            Anton Philidor
          • To Geroge

            Why let Politics decide this. If a company wants screaming bandwidth let them pay for an
            OC-xxx Line. Let technology decide their fate. All this bill does is put companies like Vonage out of business so companies like Cox Quest and AT&T can continue to run their monopolies. It is an unfair bill and will badly damage technological advancement, as much as VHS put BetaMax out business in the 70's. The internet will someday be a carrier for the world of entertainment for now it only for those that can afford the high cost of bandwidth. There are still high numbers of dialup users that will not benefit from any of the tech advances. It may become a reality in the future but for right now it is a bad idea to stifle competition in such a manor. If you want more reasons to save the internet go to:

            http://www.savetheinternet.com/
            IceTheNet@...
          • are you nuts!?!?

            Keep it simple: what if you had a choice between two phone lines, one that always guarantees the call goes through, or one where you have to wait for your call to connect, sometimes timing out during your wait....

            You'll probably pony up the cash for the enhanced service.

            The heart of the issue here isn't bandwidth. Telcos are lying THROUGH THEIR TEETH. How can telcos complain about infrastructure with all of the dark fiber out there? Furthermore, I have worked for Bellsouth, I have friends STILL at Bellsouth, and in an area as dense as South Florida, there is only a 42% utilization of their total bandwidth!!!!!

            What this is all about is the fact that the Telcos are just now realizing that content is king, and unless they deal themselves into that equation-- they'll be relegated to a wire. People will drop phone services in favor of Skype, and IM w/ Voice... or altogether because of their cell phones.

            Cable companies are losing AD revenue because more and more people are using the Net to get their content-- not the tube. With the advent of TVoIP (just a matter of time) it comes down to the simple fact that the once content and communication providers are being relegated to teh role of wire providers. They want more, they want in, and this is how they'll do it.

            While I'll agree that Net Neutrality is heavily politicied-- well, THEY STARTED IT!

            Also, Dave B makes an excellent point: deregulation is nothing more than a venue for foul play, and Enron is a poster child of those results... the difference betwen them and every Telco is that Telcos are smart enough to not get caught-- yet.

            Finally, let's gauge your trust of your Telco. Do you check your phone bill every month? If so, why? Don't want to get overcharged right? Well, if you can't even trust them on something as simple and automated as a bill, why would you trust them to do the right thing here?
            kckn4fun
          • Right on

            My dad worked for Southern Bell, and then after split, AT&T. He said the upper Execs laughed about it. "We'll have it all back together in 20 years."

            What did AT&T just do? Buy Bellsouth.
            SysTech42
    • Ah that reminds me

      Bill Gates was labeled by many as the worst politician of 2000 because of his refusal to lobby when his competitors like Sun and Netscape did. They paid a huge price for it.
      georgeou