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A rational debate on Net Neutrality

By | June 4, 2007, 5:40am PDT

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The subject of Net Neutrality has become so politicized that it’s almost impossible to have a rational debate on the subject. Even the term “Net Neutrality” has become a political slogan that is often deliberately vague to hide its true meaning. Is it even possible to have a rational debate on Net Neutrality? That’s what I’m going to try and do here and this won’t be your typical Net Neutrality article that takes one side or the other because it will slap down the villains on both sides of the debate. I’m going to try and step back and share with you my thousand foot view of the whole war on Net Neutrality.

How the Internet really works:
The Internet is based on users only paying for their on-ramp access and nothing more. This is the way that the Internet has always worked on a “best practice” and contractual basis. The “Internet” also isn’t the single entity that people often perceive it to be; it’s actually an inter-network (hence the name Internet) or a network made up of many private networks that route Internet data amongst each other on a contractual basis. Large carriers who own chunks of the Internet don’t charge other large carriers in exchange for using each other’s infrastructure and this is called settlement-free peering. In other words, you carry my traffic and I’ll carry yours and everyone pays for their share of the Internet infrastructure.

If there’s an imbalance in the amount of traffic that one carrier passes through on behalf of another carrier, the larger carrier carrying more of the data will charge the smaller carrier. On very rare occasions the smaller carrier will balk and refuse to pay and the connection between carriers is severed and customers will get cut off from each other. Ultimately one side or the other blinks and sometimes it’s the bigger carrier quickly caving in because they’re afraid of the legislature stepping in to regulate the unregulated Internet if the stalemate doesn’t get solved in a very high-profile case where customers are cut off. But at no time do carriers ever get to directly charge customers who are attached to other carrier’s networks for their Internet for traversing their network because revenue is already shared when the smaller carrier pays a portion of their revenues to the larger carriers or it’s settlement-free because of mutual sharing.

The myth that the Internet has always been a dumb pipe:
One of the most common arguments I hear is that the Internet has always been and continues to be a dumb pipe and there is no intelligent packet prioritization on the Internet. That simply is false and there have long been contractual agreements QoS (Quality of Service) packet prioritization for business customers. These agreements allow customers to pay a premium to permit a certain percentage of traffic (usually a small percent) to get traffic prioritization across a carrier’s network.

Global Crossing for example has a premium service for its customers which it actually extends to other partnering networks using settlement-free contracts. Some of these partners are in Asia and they prioritize Global Crossing packets in exchange for Global Crossing prioritizes their packets in return. This is identical to the settlement-free connectivity I mentioned earlier only this extends the concept to cover prioritization as well. This is end-to-end QoS service which covers off-ramp QoS service without the customer directly paying the off-ramp remote network.

If we had to pay for access to other networks on the Internet, then we might as well go back to AOL or CompuServe circa 1994 when you had pockets of proprietary networks that no one else could reach and that’s the last thing we want. The minute you start demanding payment from customers of other networks, the Internet becomes fragmented because it’s becomes a metered closed Network. Even if you could afford to pay, it would be a logistical nightmare to keep up with all the various entities you have to pay.

Just like how we don’t directly pay to route and connect to other carriers on the Internet, we wouldn’t directly pay other remote carriers for prioritization services. We pay our own carrier once for connectivity (and premium prioritization service if we choose to do so) just once and let our carrier work out the dirty details with the other carriers on the Internet of whether they need to exchange money or not. This is how an intelligent but fair and open Internet works.

<Next page - Dealing with Internet Carrier abuse>

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Disclosure

George Ou

http://blogs.zdnet.com/Ou/?page_id=557

Biography

George Ou

George Ou, a former ZDNet blogger, is an IT consultant specializing in Servers, Microsoft, Cisco, Switches, Routers, Firewalls, IDS, VPN, Wireless LAN, Security, and IT infrastructure and architecture.

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Only "Rational" if you Believe Faux Noize is "Fair & Balanced"
drprodny 7th Nov 2007
Exactly, dotkayk - this reminds me of Bill O'Reilly's namecalling as "rational debate"! Ou's already shown his true colors here, hasn't he?

If Big Telco wants us to pay more for better service, then they shouldn't be lying by promising us "unlimited bandwidth at megabit rates" about it, should they? They should say "For X dollars a month, you get fast e-mail and non-data Websurfing, and what 'special services' we can monetize. If you want TRULY unlimited bandwidth so you can download/upload video files/torrents/etc. without us throttling you, it'll cost you a LOT more. Sorry, but that's the only way we can afford it." That would be financially hard on those of us who believe in Net Neutrality - but it would be genuinely fair, to both us and to those "regular people" Ou seems to be weeping crocodile tears over. (Sorry, smart guy - but *ad hominem* attacks deserve *ad hominem* attacks right back. If you want a really RATIONAL debate, first try not attacking your opposition like a spoiled brat - or a Limbaugh/O'Reilly/Coulter/Bush wannabe dittohead....).

I wouldn't LIKE paying 10 or even 20 times more for true "unlimited bandwidth" - but if it were explained to me like I was an adult capable of understanding the concept of "limited resources", I would grind my teeth, pony up and live with it. But don't LIE to me and promise me "unlimited bandwidth" when you have no intention of delivering that, all right?
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Markey and Snowe-Dorgan amendments died with that 109th Congress.

Since QoS is perfectly legal today, perhaps carriers could implement it quickly so as to prove (to governing bodies) that those customers that want QoS can have it and that it won't interfere with those users who prefer not to purchase that feature.
It's on hold. Remember that Markey is in charge of the very committee that narrowly blocked his amendment within the 109th Congress so he can do it at any time. It's simply on hold now as a poison pill to block any Telecom deregulation that would permit them to compete against the Cable TV companies. Google doesn't want any the Telcos to enter IPTV because it threatens their own Video service which they know can't scale to medium or high definition.
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America is increasingly at a competitive disadvantage. We used to just have black rotary phones. I guess you would call that phone service, too? I mean it's good enough, right?
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Say what?
Stuka 4th Jun 2007
It doesn't matter if other countries had 500Tbps internet connections, a T1 is broadband, period. The definition of "Broadband" is: Pertaining to or denoting a type of high-speed data transmission in which the bandwidth is shared by more than one simultaneous signal. A T1 has 24 signals traveling over it, I may be wrong here, but I am pretty sure 24 counts as 'more than one'.
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Re: Broadband
BubbaJ 4th Jun 2007
The entire bandwidth of a T1 is consumed by a single signal at any one time, hence it is really baseband (government definitions not withstanding). The 24 channels are multiplexed (only one at a time is on the wire, each consuming the entire bandwdith). Cable Internet service is actually broadband since there are multiple signals at the same time, and no single signal occupies the entire bandwidth.

24 is more than one, but the 24 are not at the same time.
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yes...
Stuka 4th Jun 2007
A T1 does use 24 channels which ride on their own respective lines. But they are multiplexed to act as a single line. CATV or DSL would have been a better example of broadband I suppose, as both use multiple signals on a single line. Although DSL is just barely broadband since it basically has the audio carrier at a lower frequency, then the data at a slightly higher frequency. CATV on the other hand can have in upwards of 110 analog channels, or a lower number of analog with digital mixed in.

But the issue here is defining broadband as speed, rather than its actual definition.
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Broadband Definition
BubbaJ 4th Jun 2007
It is interesting that, by the government (FCC) definition, baseband ethernet is classified as broadband. The only broadband ethernet (10Broad36) was never popular or widely deployed.
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Yes, that is the technical definition
dragosani 4th Jun 2007
The definition used by the public means high-speed Internet access. You can blame cable and other ISP's for making broadband mean high speed to the public.

Technically you can have broadband that is slower than dialup because the definition of broadband doesn't denote data speed at all. Broadband only means you have more than one frequency. You were incorrect to say that broadband includes high-speed.

The United States is behind other countries in access speed. That deficit is only going to get far worse in the next few years.
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You cannot compare
Stuka 4th Jun 2007
the USA to other, smaller countries. Yes, most european countries, and some asian (japan for one) have faster internet access. However, they are also *VERY* small countries (physical size, not population). Its very easy to make high sped internet cost effect if you have a small, dense country. The USA is VERY rural, and cannot be compared to these countries. I work for a company that designs and builds fiber optic equipment for the CATV industry, I know exactly what goes into building a network. Yes it would be nice to have fast internet to everybody in the country, but unless the federal government wants to dump billions into the project, it is not going to happen.
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I wasn't debating against that at all
dragosani 4th Jun 2007
I merely pointed out that the deficit will rise.

That includes the deficit between city and rural populations inside the United States.

Ethernet over Power sounds like it has the potential to fix this deficit. This would drastically reduce the cost of infrastructure since 99.9% of the population has electrical cabling running to their home/business.

I am in complete agreement that it will be more difficult to get high-speed Internet to everyone in the United States. We have shear scale of size to contend with.
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Total bunk...
civikminded 4th Jun 2007
Total telco lobby/industry rubbish. If country size is to blame, why is Canada kicking our butt in broadband penetration/price? The real reason is lack of any meaningful competition in the brodband internet industry in this country. The US doesnt have to invest billions. It just needs to force the increasingly monopolistic cable industry to be clasified as a common carrier and lease its lines to 3rd party providers. If the free market were actually allowed to floursh, prices would drop, speeds would increase, penetration would be greater.

I hold little hope of this happening however due to the total and complete lack of ethics our politicians show in the face of industry lobby.
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Canada...
Stuka 4th Jun 2007
...has good broad band in their major cities, and its determined by the province, not the country as a while. Sure the city of Vancouver has great broadband, but if you move east into the less populated areas, that no longer holds true.

The fact of the mater is if you live in an area with low population density (which most of the USA is) then it cost a LOT more to get a high speed connection to you, as the revenue from the area is much much lower.
and most other country's make you pay buy how much bandwidth you use not pay one price use as much as you want.

and most sites only let you download at anywhere from 1mb/ps to 1.5/mb/ps to have a tb/ps connection it seems to me would be a
waist.

i have a 12mb/ps connection and in my net travels i have never used more than 1.5 2mb/ps at the most at any one website.

so higher bandwidth on the end-user side with out the content provider giving faster downloads is just a waist.
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Quote from Consumer Federation report
civikminded 4th Jun 2007
Apologists for the poor U.S. broadband numbers are quick to attribute the low penetration level
to this country?s relatively low population density. In Martin?s Financial Times article, he states:
?Given the geographic and demographic diversity of our nation, the U.S. is doing exceptionally well.
Comparing some of the ?leading? countries with areas of the U.S. that have comparable population
density, we see similar penetration rates.?
Martin blames U.S. geography for our poor broadband performance, but the facts tell a different
story. For the 30 nations of the OECD, population density is not significantly correlated with
broadband penetration. Indeed, the leading broadband nation in the OECD, Iceland,
has one of the lowest population densities in the world.
There is no valid theoretical reason why population density should be correlated with broadband
penetration. What Martin is likely trying to convey is the phenomenon of ?economies of density.?
In theory, it should be less costly on a per-line basis to deploy broadband to an area that is highly
populated than one that is sparsely populated ? all other things being equal.
But population density is not the relevant metric to capture this phenomenon ? as people tend
to cluster in cities, regardless of the overall geographical area of a particular country. The relevant
metric is ?urbanicity,? or the percentage of a nation?s population living in urban areas or clusters.
Broadband Reality Check II September 2006 11
When the relationship between urbanicity and broadband penetration is examined, there?s only
a very weak, statistically insignificant correlation. Countries like the Netherlands
and Switzerland have lower percentages of their population living in urban areas than the United
States yet have higher broadband penetration rates. Similarly, countries like New Zealand and
Germany have higher percentages of urban population than the United States but lower broadband
penetration levels. Geographic factors alone cannot explain why the United States lags behind.
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No valid comparison there. Why not compare just the state of Texas, or California to the countries that you mention? I'll bet that the results would be different.

I guess that comparing apples and oranges is only good if you want to skew the results........?
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Re: You cannot compare
none none 4th Jun 2007
Its very easy to make high sped internet cost effect if you have a small, dense country. The USA is VERY rural, and cannot be compared to these countries.

But you can compare. The DC-Boston corridor, a megalopolis with about 46 million residents, compares rather nicely to a small dense country. S. Korea has 48 million residents in a larger area.

The access speeds are much slower in the US than other countries even when you compare apples to apples.



happy
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Re: Canada...
none none 4th Jun 2007
The fact of the mater is if you live in an area with low population density (which most of the USA is) then it cost a LOT more to get a high speed connection to you, as the revenue from the area is much much lower.

That may be true, but there are areas of the US as large and dense as some of the countries beating us, and we can't get better service there, either.

Like the megalopolis in my post above this. If the DC-Boston corridor split off into it's own small, dense country, by your account it would have all the properties needed to get cheap, high-speed access.

Which means it already does have all the properties needed. So why don't the residents there have access like they do in S. Korea?



happy
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Billions = $3/person/billion
gardoglee 6th Jun 2007
On the topic of costs, with 300 million or so Americans, amassing a few billion dollars would not actually be an insurmountable barrier. The economic barrier is the billions we have already put into infrastructure deployment for what is now terribly obsolete infrastructure, but which the various carriers (telco, CATV, et al) need to depreciate in order to keep the financials looking good. We have the means to deliver higher speed service whether we use broadband, which I take to mean a multiplexed media using frequency division multiplexing, or baseband such as single signal Ethernet and time division multiplexed T1 or mixed media as in baseband voice and carrier based data in a mixed DSL/voice line, or even some other technology like Ethernet over Power (darned if I even know how that one is encoded...) Regardless of which you choose, our biggest disadvantage is that we were the rabbit who was wqay ahead, and now we are taking a nap while the turtles cruise on down the highway. That's the result of market forces, not the government.
House Committee wants GAO to investigate US broadband
By Eric Bangeman | Published: June 03, 2007 - 11:00PM CT
http://arstechnica.com/news.ars/post/20070603-house-committee-wants-gao-to-investigate-us-broadband.html

The House Committee on Oversight and Government Reform has asked the Government Accountability Office to see if the federal government has been doing its job when it comes to encouraging broadband deployment. In a letter (PDF) recently sent to the GAO, the Committee asks the GAO to report back with all actions taken by the federal government to ensure that there's a phat broadband pipe to every home and business in the US.

Related StoriesNew Senate bill defines "second generation broadband"
House Dems: Broadband isn't broadband unless it's 2Mbps
The Oversight Committee has requested that the GAO compare US broadband deployment and "individual access rates" to those of other countries and report on the "unique characteristics" of the US that affect broadband penetration. The Committee also wants to know the extent to which federal agencies are utilizing existing tools to encourage the growth of broadband service.

Congress has recently expressed a great deal of concern about the state of American broadband. Last month, the House Subcommittee on Telecommunications and the Internet held hearings on the Federal Communications Commission's methods for measuring broadband availability in the US. During those hearings, Rep. Ed Markey (D-MA) decried the US broadband situation, noting that in Japan, 50Mbps connections are widely available for as little as $30 per month.

Not long after the House hearings, Sen. Daniel Inouye (D-HI), the chairman of the Senate Commerce Committee, introduced the Broadband Data Improvement Act. That bill would drastically reform the FCC's data collection methods, which currently define broadband as any service faster than 200Kbps and say that an entire ZIP code is served if a single address within its boundaries can get 200Kbps service.

The House Committee's letter, signed by chairman Henry Waxman (D-CA) and ranking minority member Rep. Tom Davis (R-VA), calls broadband a "critical component of the United States' physical infrastructure and a key driver of economic growth." It notes that while the federal government has made some efforts to increase the availability of broadband, there are concerns that the government has not used all of the tools at its disposal.

The FCC has already announced plans to reexamine its broadband data collection policy, but has yet to make any changes?even after a report issued by the GAO earlier this year found significant problems with its methodology.
I remember paying 50 cents a minute to call Asia in 1999. Now you can pretty much get flat rate VoIP calling to anywhere in the US, Europe, or Asia for a very low fee.

In places like South Korea where the price of bandwidth is low, the Telcos make up by soaking the users on long distance charges. They just recently banned US Soldiers who are guarding their freedom from using VoIP services like Vonage to make cheap calls home.

My friend in Germany pays more money to make a local call than he does to call me over Lingo VoIP service. It isn't as simple as rest-of-world good, USA bad.
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How about calling to South Korea
nucrash 5th Jun 2007
A former roommate moved to South Korea to teach and his girlfriend went for broke trying call him on a phone card. Ofcourse there were other factors there too, like he was using the phone card to call family as well and she was footing the bill and wouldn't commit to anything longer term and ... oh well, he ran up a debt with me for $2400, but all was forgiven. I just mention these things because he was a ****** roommate.
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Vonage is banned from S. Korea
georgeou 5th Jun 2007
Our soldiers are going to be forced in to using expensive S. Korean company services.
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In India they have their own way
p.vinnie@... 6th Jun 2007
In India VOIP is allowed, however it cannot be mixed with public telephone networks & mobile networks.
That means you can make overseas call using your PC but not using telephone. So there is no concept of calling cards as well.

TRAI (a telephone regulatory authority) is expecting to have license fee to run ISP similar to what TV channel and Mobile companies pay in India.
"They just recently banned US Soldiers who are guarding their freedom from using VoIP services like Vonage to make cheap calls home."

George, are you saying the US government is banning US military personnel from using VoIP services? Just curious.
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In either case, it goes back to the question of whether the PTT or Telco or ISP will ever provide services that meet the needs of any but those who can pay extravagantly.

Allowing the Telco or ISP to treat Internet service as if it were a scarce commodity means that the price goes up and they collect more. Period. Forcing them to treat it as a ubiquitous commodity means that the price stays low. That's all the market analysis one needs to know.

You can't blame the Telco or ISP for wanting to collect more money for doing less work; that's the name of the game. If someone gave you the right to do so, wouldn't you?

Even if there is some premium service with guaranteed QoS needed on the Internet(s) (and I think there might be, in some cases), let's not return to the old "scarcity" model for providing it, or at least let's not let the ISPs and Telcos create the scarcity and the rules that go along with it.
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I can't be sure, but doesn't gov regulation usually make things worse? In fact, for example, the deregulation of air traffic control seems to have been very good for the airline industry. And where has the regulation of Ma Bell gotten us? I believe that AT&T is a far worse monopoly than Bell ever was.(which is really the same company anyway)

So to say that the same government, that is often referred to on these forums as corrupt and evil, is going to "help" the internet with regulation (when there isn't even really a problem) seems ludicrous, or "rick-diculous" to me.
The S. Korean government just banned our Soldiers from using services like Vonage which allows them to have US phone numbers which let them do cheap bidirectional calling. Our General complained last year and they put the ban on hold for a year but they just put the ban in to effect last week.
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How do the Korean telcos block Vonage? Aren't Vonage call packets just like every other packet, just minding their own business traveling across the internet? Are Skype or other IP based calls blocked as well?
Simple, just put an access control list blocking all of Vonage servers and all the other non-Korean VoIP services. It's rather trivial to do.
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George, McCain is your man!
WiredGuy 5th Jun 2007
http://www.thedailybackground.com/2007/05/30/mccain-comes-out-against-net-neutrality-says-would-hire-microsoft-ceo-steve-ballmer/

If this report is accurate (you can never tell these days) then McCain is your man. Sounds like Sen. McCain would end net neutrality and allow carriers to block access to competitors. Now that's a unregulated market at work!

By the way, thanks for the link to the ARSTechnica piece. Of course, it doesn't say that "Markey wants to ban less than 2 mbps as broadband". The article does say that the FCC's practice of considering any connection of 200kbps is a broadband connection is outdated. Don't you agree?
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"Sounds like Sen. McCain would end net neutrality and allow carriers to block access to competitors. Now that's a unregulated market at work! "

McCain said that regulation isn't needed on the Internet. He did NOT say he would permit carriers to block access to competitors. The Republican bill from last year put up a $500,000 fine per infraction for any carrier that attempts to block access. You'll also note that on page 2 on this blog I specifically said that we should increase the fine AND make deliberate degrading of service below best effort illegal.

Sounds like you're just spewing what you want to believe which is fiction.
Here are Senator McCain's words on the subject,
http://mccain.senate.gov/press_office/view_article.cfm?id=38
Although they are a year old, I would like to think that these words more accurately represent his position than the "off the cuff" responses that he gave a the D5 conference.
http://d5.allthingsd.com/20070529/d5-mccain/

George, I'm not spewing anything, I was merely pointing out that Senator McCain (a front running candidate for President of the United States) shares your position on net neutrality.

Personally, I like John McCain and share his views on many issues.
You said he and I supports the carrier's right to block competitors when neither of us have ever said that nor do we support that. So pardon me if I sound offended.
but georgeou if AT&T says well were going to charge some company.com ₵.001 per 10mb of bandwidth.it uses and thats on top of what said company pays it's service provider.

because AT&T decides it wants to provide the same services. as said company.

and you know this as well as everyone else it does not matter how well intentioned a bill is there are all ways loopholes in it and the 500.000 fine might be given out.

but how many small company's will be run out of business before the FCC gets around to looking at the case and deciding if a fine is warranted

and all the while AT&T will continue to run roughshod over small company's and we the net user will be the one that pays with higher prices.

AT&T is out for nothing but there bottom line and they could care less about making the net better the CEO and CIO probably can barely use a computer.

they would love to go back to the days when we paid ₵.50 a min for a long distends phone call.

and no they would not block competitors they would cut there bandwidth. i do not trust the telcos and i sure don't trust the politicians.

do i hate them no i just see them for what they are and my eyes are open to what they will do but there passed actions.
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You tend to look at things from the view point of a techie. Nothing wrong in that really, but it is a very singular view point and doesn't take into account history and perceptions.

Historically every time the Telco's have been granted anything, they ALWAYS found away to turn it into another way to ding their customers. Need an example? The Telco's were allowed to add a premium charge to customers that went with touch tone dialing. The argument at that time was that it required an infrastructure upgrade and there were costs associated with doing it.

Now I could make the argument that moving to touch tone saved the Telco's millions (billions?) of dollars a year, greatly simplified switching, lowered support costs, etc, and they should have paid for it themselves but I'll let that go for the moment. Here we are today and I'll bet you can't find a CO anywhere in the continental US that even uses rotary technology. And yet, take a look at your phone bill and you still see that after all these decades users are still paying for this "premium" service.

Need another example? How about long distance charges? The very truth of the matter is there is no such thing as long distance calling. All calls are routed automatically based on available circuits. Your call across town may very well be routed through circuits that are out of state or even via satellite. Physical distance simply is not part of the equation anymore, except of course to the billing department of the Telco's.

These sorts of business practices by the Telco's has earned them the distrust of the American people. Simply stated, the perception is that if the Telco's are given anything it will only come back and bite their customers in the backside. I mean lets face it, the Telco's have been so horrible in how they treat their customers they have become the most regulated industry in the country. That was something they brought on themselves.

So when we (customers) hear them start talking about how they will improve things "if we just give them what they claim they need" the immediate reaction is to start looking for how they are going to use it against their customers. Everyone fully expects there to be an ulterior motive and so far that has always been true and no one sees any reason its not true now.

I agree with your technical assesment, there is no "technical" reason that the internet can't do as yuou suggest, the problem is in who is to do it and the fact no one trusts them as far as they can throw them.

"We are the phone company, we don't have to care"...
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I agree (WOW)
dragosani 4th Jun 2007
This is rare.

No_Ax, I commend you on an excellent post.

I would like to see more of these from you.
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I Agree!
ogmanx@... 8th Jun 2007
Shocking post. What happened to the real No_Ax???
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I remember dozens of times back in the 90's where the FCC would try to regulate the cost of cable to keep it lower which would in turn raise the cost of cable for the customers.

Infact, unless there is a definite sign of corporate abuse, I think the best interest of the government would be to stay the hell out of the dealings of business. I know this is a re-active approach that doesn't always work in the best interest of the customer. I do however feel that there are a number of companies that the government could focus their time on regulating rather that try and haggle with a industry which is currently somewhat competitive.

Instead we are currently focusing on these problems instead of focusing on the dangers of cellphone towers wiping out the bee population. The world without bees would soon be a world without us.
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Focus on the wrong problem
dragosani 4th Jun 2007
"Instead we are currently focusing on these problems instead of focusing on the dangers of cellphone towers wiping out the bee population. The world without bees would soon be a world without us."

They think it is more of a fungal, parasite, or genetically engineered crop problem than cellphones. Remember the bees are vanishing (not necessarily dieing).

http://sfgate.com/cgi-bin/article.cgi?file=/c/a/2007/03/10/HOG5FOH9VQ1.DTL&type=printable

This is a prime example of what happens when a study is done and the media "takes off running" with it.

This has turned out to be more FUD on cellphones.
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There are larger issues at stake though that we don't really focus on. An ill informed country could very well be an example of what to focus on.
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What the market will bear.
Anton Philidor 4th Jun 2007
In some circumstances the market will bear higher charges than are good for the customer.

Currently communication with the outside world, beyond shouting or driving to where you want to be heard, is controlled by the telcos and the cable companies. That may currently be "somewhat competitive".

But the groundwork is in place for the telcos and cable companies to form a tacit alliance that will allow them to charge what they like.

The most important event encouraging a settled duopoly was defeat of legislation which would have prevented bundling of all services, the so-called "naked-internet" bill.

The telcos and cables own their custometrs by providing all services. Once the telcos are stabilized, the companies watch each others' prices so that neither advances quickly enough to make switching worthwhile.

Regulation is needed in monopoly situations. As you know.
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On a Personal Note
nucrash 4th Jun 2007
I think the government needs to stop allowing so many mergers.

What was the entire point of the break up of AT&T if the government is going to allow them to get back together a litte more than 20 years later.

What ever happened to trying to run a business into the ground rather than purchasing them?
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Uh... Anton
Linux User 147560 4th Jun 2007
there is not one single charge good for the customer... ever. That's hard earned $$$ being spent, in many cases on a service that, as No_Axe pointed out, is no longer a true premium and has been paid for 10 fold OR not wanted or needed by the customer!

Case in point. I Just recently called Comcast up to cancel my cable TV but keep my high speed internet. They had the audacity to tell me that if I canceled cable TV service my internet speed would diminish (I kindly explained to the nice moron, that was completely un-true) and that if I were to cancel my cable TV I would end up paying MORE for the internet connection!

So not only is this a scam in my opinion but it's also abusive in that if all I want is cable internet I am being PUNISHED by a higher price because I don't want to watch cable TV! I don't see how this benefits me. I have to pay for a service I neither use or want, just to get a reasonable price on internet. How the hell is that fair? I know what I want... so I am looking elsewhere now to see about getting JUST high speed internet with NO cable TV for a reasonable price.

It's a scam, and once again I have to pay for something I am not even using nor that I want. devil
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You said Ed Whitacre is saying the same thing I am. I say nonsense. You've failed to explain why breaking Internet best practice of ONLY charging at the onramp for connectivity or QoS is a good thing.
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LU, I think you wrote to agree with me.
Anton Philidor 4th Jun 2007
Bundling of services gives the cable companies or the telcos exclusive control over customers. The "naked-internet" bill would have required both to keep the internet out of the bundles, and so allowed for real price competition. The gouge you were told is probably the result of the bill's failure.

I know it's surprising, but we did find agreement.
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Agreed
NetArch. 4th Jun 2007
Wow, for once I agree fully with No_Ax! Who'd have thought?

The touch tone charges are a particularly egregious example. In my first job out of college, fresh with a BSEE degree specializing in telecom, my first project was to engineer the installation of DTMF adapters in older X-Y mechanical central offices. The costs were minimal, and the savings really began to add up when callers dialed inter-exchange and long distance. Remember that in the early days of "1+" dialing, most CO's connected you to an interoffice trunk as soon as you dialed a '1'. Since the telcos couldn't begin charging you until answer supervision kicked in, there were tremendous incentives to shorten the dial duration. A seized trunk that wasn't producing revenue - even for 5 seconds - was an anathema to a telco. Hence the move from dial pulse (rotary dial) to DTMF. AT&T already proved that in their long distance network back in the late 40's when they began planning the move from DP to MF signalling. Their "lobbyists" at the time were easily able to convince the FCC and all the state PUCs/PSC's to allow them to charge customers so they could "recover" their capital investments.

There was no way that the government would deny the ability to fleece the public because at that time - the height of the Cold War - AT&T was part of the national defense infrastructure (like the Interstate Highway system). The DoD needed the network to be reliable - even at the expense of the public.

Today, we'd be facing a similar scenario. The telcos have a huge investment in their billing infrastructure (the cost of billing a long distance call crept past the technology infrastructure costs of actually completing that call - way back in the late 90's). For a long time it costs the telcos more to bill a call than it does to actually make the call! The telcos want a method of billing for QoS services, and they also want to be able to sell the same bandwidth to multiple customers again and again. They've built this huge 'house of cards', and need more and more revenues to justify the investment.

That being said, the proponents of "no QoS" on the Internet have their heads in the sand. Without QoS, today's Internet would collapse under its own weight. The idea of a packet from an HTTP session having the same priority as a UDP packet from a voice call or realtime video conference call is preposterous. These non-QoS proponents would be the first to complain that their VoIP service is no longer useful because of the horrendous quality. There's nothing wrong with prioritizing different types of traffic. Where I draw the line is the example George pointed out - telcos installing gear whose singular purpose in life is to deliberately introduce jitter into UDP voice and video streams of their competitors services just to goad their own Internet customers into switching their VoIP service over to them as well.
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That's the whole point of my blog
georgeou 4th Jun 2007
I didn't really go in to the Broadband debate here which I was saving for another time. The purpose of this blog was to set some definitions straight like how the Internet should work and identify the villains.

My key point is that Net Neutrality in the true sense of the word Neutrality is good but Net Stupidity is bad.
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So you prefer a cable company monopoly...
Anton Philidor 4th Jun 2007
... because the cable companies are known for their mercy to customers and their philanthropic renunciation of profits.

If the telcos fail, the cable companies win. They already are overcharging, based on inconveniences to the telcos providing advantages.

So, your comments are accurate, as far as they go. But when used as the basis for setting policy or regulatory action, the implications of your comments are damaging to the public.

There isn't a good solution, but there are better and worse solutions.
Exactly, dotkayk - this reminds me of Bill O'Reilly's namecalling as "rational debate"! Ou's already shown his true colors here, hasn't he?

If Big Telco wants us to pay more for better service, then they shouldn't be lying by promising us "unlimited bandwidth at megabit rates" about it, should they? They should say "For X dollars a month, you get fast e-mail and non-data Websurfing, and what 'special services' we can monetize. If you want TRULY unlimited bandwidth so you can download/upload video files/torrents/etc. without us throttling you, it'll cost you a LOT more. Sorry, but that's the only way we can afford it." That would be financially hard on those of us who believe in Net Neutrality - but it would be genuinely fair, to both us and to those "regular people" Ou seems to be weeping crocodile tears over. (Sorry, smart guy - but *ad hominem* attacks deserve *ad hominem* attacks right back. If you want a really RATIONAL debate, first try not attacking your opposition like a spoiled brat - or a Limbaugh/O'Reilly/Coulter/Bush wannabe dittohead....).

I wouldn't LIKE paying 10 or even 20 times more for true "unlimited bandwidth" - but if it were explained to me like I was an adult capable of understanding the concept of "limited resources", I would grind my teeth, pony up and live with it. But don't LIE to me and promise me "unlimited bandwidth" when you have no intention of delivering that, all right?

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