FCC throws in the towel on net neutrality

FCC throws in the towel on net neutrality

Summary: Three cheers for the cowardly FCC! They caved in to reason for political purposes, but the result is likely to be close to the right one.

TOPICS: Networking

It was obvious from the initial leaks that net neutrality advocates would view the new FCC proposals as a sell-out. They're right. And yesterday FCC Chairman Tom Wheeler used a tone of denial in a statement that basically confirms the leaks.

The Commission hasn't had much luck with their net neutrality proposals so far. Even though the Appeals Court, in their last FCC smackdown, essentially wrote the Commission a set of instructions on how to proceed in the future, I get the sense that what the Commission wants right now is something that they can call a victory and that won't be in court until after the current administration is gone. So they wrote rules that they thought the ISPs would go along with. It's a politician's move, but I'm basically happy with it. I've never thought much of net neutrality.

It's still a common misconception that there's some official thing called the "Internet." What we call the Internet is a series of networks, generally private, connecting to each other and conforming to certain standards.

A long, long time ago when the Internet was young and few, if any had thought to make a profit off it, an unofficial system developed among the network providers who carried the traffic: You carry my traffic and I'll carry yours and we don't need money to change hands. This system has collapsed under modern realities.

The old system made sense when the amount of traffic each network was sending to the other was roughly equivalent. Today though, we have content providers like Netflix which send huge amounts of data over other people's networks and don't return the favor. How huge are these amounts? A study last year found that Netflix accounts for 31.6 percent of downstream Internet traffic on fixed networks (like Comcast's), far above the #2 site YouTube at 18.6 percent.

This is but one of the realities that make the naive dreams of net neutrality advocates illogical and unfair. Of course Netflix should pay network providers in order to get the huge amounts of bandwidth they require in order to reach their customers with sufficient quality.

Another myth of net neutrality is a conflict like that between Netflix and ISPs (most prominently Comcast) involves some sort of discrimination against content. It doesn't. ISPs have no interest in discriminating against particular forms of content. They do have an interest in managing their networks so that everyone has adequate performance, and therefore they need to be concerned with providers who send huge amounts of data, whatever the type of that data. Bandwidth isn't free.

So what do the new rules say? First, they say that ISPs can't block any legal content. This is really the core of the original theology of net neutrality and the reason it's so divorced from reality. The real-world examples of ISPs blocking content for other than legal reasons (e.g., child porn) are few and far between. The common example of Comcast and Bittorrent is nonsense; in that case Comcast temporarily blocked Bittorrent users who were hogging the local circuit, but quickly moved to a protocol-neutral system. Now they only throttle users who are consuming excessive bandwidth when the local circuit is at or near capacity and they don't pick on any particular application or protocol. They have no reason to do so.

It's in this paranoid environment that Netflix is expressing outrage at having to pay the costs of their business model. I'm not a Netflix subscriber, but they want me, as an ISP customer, to pay for ISP build-out for customers who are.  Think about that next time you hear the ISPs are being unfair.

When they are generating such an extreme level of traffic, is it really "commercially unreasonable" to make them pay ISPs to build out the infrastructure needed to support it? It's not, which is why the second new FCC rule sets that as a standard for ISP actions that "harm the Internet." (The wording there is ridiculous and overwrought, and really ought to be "impose special costs on parties connecting to their networks." I think I'll make that comment to the FCC.)

The final rule, "[T]hat all ISPs must transparently disclose to their subscribers and users all relevant information as to the policies that govern their network..." seems reasonable enough and I'd be surprised if it generates any overt objection.

All that leaves is the one remaining objection ISPs might have to the new rules: Accepting them concedes jurisdiction to the FCC, something they haven't had to do so far. They might also be concerned that conceding jurisdiction subject to subjective terms like "commercially unreasonable" is too risky. But I don't expect this. I think the last appeals court decision was partly a message to both parties to find an acceptable (close enough to) middle ground. That's where we are.

Topic: Networking

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  • Out of everyone

    talking about this issue, you seem the most level-headed, the most reasoned. I've always taken issue with people whose starting point for an argument is philosophical, because no matter the facts, they will still have a fundamental issue that can't be changed.

    Yours is refreshingly... practical.
    luke mayson
    • He's also totally wrong on this subject

      For numerous reasons that the people on Arstechnica and other more respected websites are espousing on a regular basis in the comments section.
      Basically, the cable companies are trying to double dip and get paid by both Netflix and the internet subscriber for bandwidth used.
      That is not how things are supposed to work, the networks are supposed to be AGNOSTIC towards what is going over their 'tubes' because for them to not be raises the specter of them slowing down other services that compete with their services.

      I.E. Comcast has Comcast e-mail..... oh my, let's slow down G-Mail and AOL Mail!
      Comcast has Comcast On Demand..... oh my, let's slow down Hulu and Netflix.

      Simply put, Net Neutrality is the correct thing to have, where the providers are not allowed to slow down or speed up ANYTHING save perhaps for 9/11 emergency calls on VOIP.
      • Yep, he's wrong

        Anyone who thinks they are having to 'subsidize' ISP's support of 'bandwidth hogs' needs to read this:

        Also, anyone who wonders why the major ISP's might have an interest in treating traffic other than their own unfairly should watch this:
        (Especially the part about Wikipedia...very thought provoking.)
      • Lerianis10 has valid concerns as do others who've voiced similar opposition

        A variant of this comment was previously posted elsewhere when the net neutrality issue first stirred public debate in 2014. FYI it’s been tweaked a bit and the second-to-last paragraph is a new addition. Anyway it's fitting that I share the comment here so here it goes.


        It is right that this move against net neutrality generally has the populace up at arms. Unfortunately people who (a) haven’t been subjected to wrongful stifling, (b) haven’t learned the dangers of limitations on free speech by studying history, and/or (c) aren’t critical thinkers might not see the potential dangers in this type of move until it is too late. This should be ended posthaste…and I don’t state that on a whim. History is full of bad acting influential entities that have abused power that they should have never had in the first place. Think about these couple of scenarios:

        1) A startup launches and its success is highly dependent on its ability to deliver various web content to the masses. However, a direct competitor owns and/or operates one or more metaphorical “internet pipelines” (or is an associate of an entity that owns and/or operates one or more metaphorical “internet pipelines”). No problem…just have the delivery of the startup’s web content degraded and/or charge the startup an exorbitant dollar amount. Ours is a fast-paced society full of people who are accustomed to instant gratification. That being the case it is a foregone conclusion that a startup that is subjected to inefficient and/or buggy web content delivery will fail if web content plays a significant role in its business model.

        2) A group is fighting against influential wrongdoers and the group is effectively and rightfully utilizing the internet during the course of their warranted and rightful battle. However, one or more of the wrongdoers owns and/or operates one or more metaphorical “internet pipelines” (or is an associate of an entity that owns and/or operates one or more metaphorical “internet pipelines”). No problem…just have the delivery of the group’s web content degraded and/or charge the group an exorbitant dollar amount. Again, ours is a fast-paced society full of people who are accustomed to instant gratification. That being the case it is a foregone conclusion that a movement against wrongdoers that is subjected to inefficient and/or buggy web content delivery will fail if web content plays a significant role in the movement.

        Those who have a problem visualizing the scenario outlined immediately above need do nothing more than look at corruption-plagued countries that are built upon cultures where censorship is par for the course. Of the many things that this net neutrality move might be, one of the things that it definitely is is a gateway to the implementation of an alternative form of censorship. I’ll repeat that so that it will sink in…a gateway to the IMPLEMENTATION OF AN ALTERNATIVE FORM OF CENSORSHIP.

        There are probably multiple other scenarios that could be listed above but the given scenarios are sufficient to make my point. Again, this is not the right move and IT SHOULD END POSTHASTE. Even if there are conceivably some significant benefits (not that we’re necessarily of the mindset that there are) the very real risks far outweigh any potential rewards. And just in case anyone is saying “if you’re in one of the two groups listed above then sue”, you are naïve. The victims—and make no mistake about it, in the scenarios outlined above they are VICTIMS—indicated in the above two scenarios are already fighting against nearly insurmountable odds and they don’t need any other problems piled on. In other words, in a manner of speaking they are already “down” and don’t need anymore “kicks” such as having their web content interfered with and/or being faced with exorbitant costs. Although some things are right about America, some things are definitely going in the wrong direction. People such as Hitler, those who conducted the Tuskegee Experiment, and those whom were responsible for disseminating smallpox infested blankets to Native American Indians (just to name a few) would have a heyday with this move if they were alive and engaging in their bad acts today. Reason being, it goes without saying that as it stands the internet is the average joe’s most efficient form of a mouthpiece. And let us not forget that in America (as well as in the rest of the world) some of the greatest achievements have been accomplished by determined average joes who spoke out to the masses as efficiently as was possible. Rest assured that this move will make influential bad actors everywhere rejoice…they are likely already planning ways to exploit it (assuming that they haven’t already planned a plethora ways).

        In case anyone somehow thinks that I have no idea what I’m talking about. I will state that I most certainly do. I am personally involved in a long-running, massive, warranted, and rightful fight against epic public corruption. I can tell you that it is an undeniable fact that that warranted and rightful fight has been plagued by civil liberties infringements carried out via wrongful attempts by bad actors to stifle our free speech. For the record the fight is called GATORGAIT and those who are unaware of it can find out more information at the damning, truthful, and lawful website gatorgait-dot-com . Also for the record, the complete website and all of the website’s extensive content works perfectly and efficiently as of the time of this post (i.e. 04/26/2014). Additionally, there has been various other truthful and lawful Gatorgait-related content that has been posted online by us justice seekers and which has remained not interfered with…that content also works perfectly and efficiently as of the time of this post.

        As the net neutrality proposal involves revenue generation I’ve included this paragraph. Any “additional billing”, if any, for internet content received through “the internet pipelines” need only be on the end of the content recipient. Great power for abuse lies in that little area of the unknown created by the uncertainty bred by billing from “both ends”. In the proposed new internet model when your internet account (as a content recipient) is in good standing and lawful content you seek out is delivered in a slow and/or buggy fashion—assuming you can access said desired content at all—your natural response will likely be “oh, the content provider’s account with the ISP must be in ‘bad standing’”. But what if the content provider’s account is not in bad standing and the provider’s lawful content has merely been inappropriately interfered with or censored? No problem, you’ll know that’s the case right…W-R-O-N-G!!! You will likely have no idea of the truth behind the content delivery issue for it goes without saying that any notice posted by the content provider regarding the interference or censorship would likely be posted on the very same sabotaged website (and thus not be viewable or be difficult to view) and/or posted on some other distinct high visibility webpage that would itself likely subsequently be targeted and relatively quickly interfered with or censored. The only thing you could ever be certain of is the good standing or bad standing of your own personal internet service account. Rest assured that bad actors who would abuse the power granted by this assault on net neutrality know these things and are praying that the citizenry (1) has it’s blinders on and (2) is flush with apathy in regards to the matter. Those bad actors’ prayers must not be answered for history has shown time-and-time again that when warranted vigorous opposition is left undone when faced with intentionally-implemented incremental, but significant, wrongful acts (if not outright evil acts) what soon follows is sweeping persecution. If the additional revenue is so necessary—and for the record I’m of the mindset that it likely is not necessary—with all the years that the internet has been operational ISPs have the data available to classify the data volume and speed requirements of the median internet account (as in the median content recipient’s internet account). Using that data, after possibly incorporating a few infrastructure changes, pricing models could be established and tiered as needed…kinda like with cell phones. But with that the following must be stated. In my opinion the anonymity offered by the internet is an awesome thing…sure that anonymity can be abused but it’s my personal opinion that anonymity’s resultant long-term good far outweighs its resultant long-term bad (FYI bad actors who’ve been placed under scrutiny online, to their dismay, know this as well). Having stated that, I prefer the current pricing models where the ISPs calculate acceptable and reasonable profit margin targets and charge their customers that are generally in the same class pretty much the same thing across the board. As long as the ISPs meet their targeted profit margins all is well…that is until greed, corruption, etc. steps into the picture. It is my personal view that anything—that is anything besides the slander and libel remedies already in place and other public-driven backlash—that potentially pushes people towards self-censoring is problematic. And should this revamp of net neutrality be enacted that is exactly one of the things that would likely happen because the proposed billing would likely usher in closer monitoring of people’s internet usage…in other words more surveillance will likely ensue thanks to individualized internet billing. But obviously this time the arena targeted for surveillance will be, reminiscent of CISPA, the internet. Sure the internet might be a more cordial place for it, but the cost for that is way too high. Thankfully the ol’ saying “sticks and stones may break my bones, but words will never hurt me” is true in a significant number of cases. When the day comes that America’s leaders (1) are by and large above reproach, (2) consistently show that they are more concerned with serving the interests of the common man than they are with serving themselves and/or elitists whom they’ve embraced, and (3) consistently act with integrity I think we will be able to enact policies that don’t account for dissension (including anonymous lawful dissension). Unfortunately that day hasn’t yet arrived…thus the right to dissent must receive the utmost protection.

        Generally speaking I have lost faith in man’s ability to consistently do what’s right. Over hundreds of years of bad practices and policies promulgated largely by those who have wrongfully and shortsightedly used their gift of intelligence to increase their power and “line their pockets” at the long term expense of mankind and the world we have, as a whole, lost our way. Let’s see where this recent net neutrality move takes us. Just as we opposed the most recent attempt to pass the far too intrusive CISPA and the recent tentative decision regarding search engine censorship we strongly oppose this net neutrality move. Pay attention…close attention. As indicated above I’m jaded; therefore, I have no confidence that if there isn’t an abrupt about face that bad acting men and women won’t ensure that action becomes warranted. It may be soon or it may be later, but rest assured that serious action will become necessary.

        Best wishes to all,

        “Some people see a problem and do something about it. Others do nothing but sit on their a$$e$ and complain. Be a doer.”
      • In a free market, how are things supposed to work?

        What is allowed, and are there regulations that can keep them from doing what is deemed "not how things are supposed to work"?
    • How about a nice cup of STFU?

      Oh, come on, Luke. Could you be anything but a corporate shill? Get real.
  • I can't agree.

    I'm paying my ISP to get data sent to me. In my contract with them they state what bandwidth of data they will send me and how much data I can recieve each month.

    Now they want to charge sites like netflix to send data to me. If they want to change their business model to make it more like the postal service, where you pay to send something, that's one thing, but what they are trying to do now is to charge a fee on both ends.

    If I buy something (physical stuff, not data) from amazon pays a shipping service, like fedex, to send me that stuff. Fedex doesn't charge me a fee to recieve that package.
    • Don't mix the NetFlix deal into the discussion


      The NetFlix deal wasn't ISP's trying to set up toll booths for payment to get into your house. It was about the rarely discussed world of Interconnect and peering. That's what Larry refers to at the top of this article when he discusses the days where traffic was agreed to by a handshake.

      I highly recommend that you read this blogpost on how Interconnect and peering works. http://blog.streamingmedia.com/2014/02/media-botching-coverage-netflix-comcast-deal-getting-basics-wrong.html
      • Mixing Netflix is the discussion...and the FCC is preparing for regulation

        Netflix is not pushing content to subscribers. Subscribers are pulling the content. Comcast, in turn, charges the consumer a larger monthly fee if they subscribe to a larger bandwidth service to support the data they are pulling.

        Comcast is just bitter that the consumers are pulling from Netflix rather than from their own on-demand service. Charging consumers by the drink is very unpopular so Comcast is going back to content providers. If content providers have to pay to put content on other's networks they have to increase rates. That may level the playing field somewhat and drive consumers to the content that Comcast prefers they access if it becomes cheaper.

        If Comcast had content that people wanted for a competitive price, they would not be having to charge Netflix, they could charge the subscribers directly.

        Telecommunications law solves this by regulating the costs that Telecoms charge each other and the law requires that transmission line owners wholesale bandwidth to other providers. That was the primary reason for the breakup of AT&T originally.

        What I see, is the FCC putting their foot in the door to prepare to regulate that content providers receive fair access to all ISPs. This is just an extension of the policies that allow the multitude of Telecoms to compete on other's infrastructure. The FCC is extending their reach from regulating right of way to regulating content.
        Freddy McGriff
        • Mixing Netflix is the discussion...and the FCC is preparing for regulation

          Exactly. Comcast - and others are not getting the on-demand traffic they once had - so now they want to charge on both ends - the streaming providers AND the streaming users. Users are already paying for the bandwidth they consume.
        • It's not whether THE Netflix has to pay higher fees.

          It's whether the NEXT potential Netflix, or Twitter, or Facebook, etc. has to pay higher fees BEFORE they get big enough to afford them. In other words, if the extra payment is to have content sent FASTER, rather than to have LARGE amounts of content sent faster, the next startup that needs to send content to its BEGINNING customer base, if it competes with their ISPs, could be charged a fee that prevents it from making a profit with customer fees low enough to compete with that ISP. This new service (call it "Flaxnet" for discussion), if it competes with "Castcom" (another hypothetical name), would be essentially cut off from Castcom customers, although it may be able to serve "TTA" or "Nstrip" customers at a profit.

          This motivation to harm would be avoided if ISP carriers were treated as COMMON CARRIERS just like phone companies or freight carriers, not allowed to own, or have common ownership with, their potential commercial customers.
        • You can't equate "content" to "size".

          ISPs have no interest in what is _in_ the data, or where it comes from, or who it goes to. Its just the _amount_ of data that is the problem. The ISPs can't afford to build out their networks to provide the crazy data rates that HD movies demand without passing that cost along to the users.
          Those of us who don't need such bandwidth shouldn't have to pay for those who do!
          • Bullplop, Papa_Bill

            They are making MASSIVE MASSIVE MASSIVE (repeat 50 times to get the point) profits on their internet services. Yes, they can damned well afford to build out their networks in order to support Netflix.

            Also, since people using VPN's had absolutely NO problem streaming Netflix, it was goddamned clear from second ONE that this was Comcast artificially slowing down Netflix for no other reason then to hold them over a barrel.

            The analogue comparison would be Comcast telling Netflix "Sorry, we own I-95, you cannot use it, go on backroads!"
          • that they do

            I have the $60/month plan because I can use 20mbs to watch shows. If they slow down or block video service, then the 6mbs for $29 becomes more than enough.

            We basically built "roads" that are privately owned. Right now the destination address pays, but they want paid up front and at the destination. That's BS, plain and simple. It's bad enough we pay for the internet plus the CEO's, now they want more???

          • If you don't need the bandwidth, you chose a lower plan

            The customers that use services like netflix pay for a higher tier plan, paying for the higher bandwidth. The whole point is that comcast wants do drive customers to their own video on demand services. They are moving towards a vertical monopoly.
            Another case where a service provider is taking similar but different actions is Time Warner, they purchased the rights to broadcast Los Angeles Dodgers games, made a new channel for it, and want to charge other providers exorbitant fees to carry the channel. If the other providers pay the fees, and have to increase rates to cover it, Time Warner wins by getting the fees and customers switching based on price. If the other providers refuse, Time Warner wins by customers switching in order to get the channel.
            Many customers have little or no choice in internet providers, depending on the area, and the time the phone network was built out, the majority may never have access through DSL based on distance, Even if DSL is an option, that generally gives 2 options, DSL or Cable.
        • I am amazed

          So many have got it! And Larry seems to me to be way out there on this one.
          Netflix is not asking ComCast to pass the bandwidth across their network to a third party network, they are being asked by their own subscribers to pass them information they asked for from NetFlix. And any charges, throttling, screwing with the bandwidth at all had better have been spelled out in our original agreement or you are violating the terms that you signed your subscribers up to. Now if they are all trying to get more and more data.. as a service you have three choices.. 1) raise prices to add the bandwidth now, 2) reinvest your profits to continually add to your growing customer base and their thirst for bandwidth, or 3) get out of the business of selling bandwidth to the subscribers. I cannot see 1 or 3 doing much to increase your customer base.. in fact, might make it hard to maintain it.. but if you try unlisted 4, charge them more money by adding a penalty to the places the customers are going to for their data, and forcing those places to raise the prices to pay your illegal bandwidth tax. I think that would make a lot of lawyers happy, but not many customers.. but fewer will be unhappy each month as they bail out to support another service, that with it's influx of new customers can afford to increase it's bandwidth to support them and gain even more new customers, and revenue.
      • Thanks for the link

        very useful
      • While the article you linked to seems very well informed,

        it is also quite biased. It does not take into acount the anticompetitive nature of these interconnect relationship deals. Maybe Comcast can offer better service for a fee than some third party CDN that netflix was using previously. but then what happens when mediacom, AT&T, Verizon and other major ISPs split the Netflix traffic amongst themselves and Netflix now must have and pay for seperate deals just to reach 95% of their potential customer base and deal with various third party CDNs to reach the other 5%?

        First of all, the thrid party CDNs are going to suffer and many won't survive. the remaining ones will have to consolidate merge and raise prices just to stay in the market. Meanwhile Netflix wil be paying each ISP/CDN a seperate negotiated rate. You better believe that negotiations will also include higher rates to compensate ISPs for money lost due to competition where streaming media from Netflix causes loss of revenue from their own media streams. ISPs will have the leverage to force Netflix not to deliver certain media content as it would be competing with their own revenue streams.

        Looking at all the comments to your linked article, it is amazing to see how many people don't seem to realize how little competition there is in high speed/throughput communications options throughout most of America and how that has driven up prices. Giving major ISPs and media content providers the ability to force out other CDNs gives these last mile monopolies (or oligopolies at the very least) an unprecedented amount of control over what media is available to the end user and how much it will cost.

        If you don't think cable companies would act in bad faith when it comes to negotiating "fair" deals with media content providers look to history to see what AOL/Time Warner did:


        They did this due to contract negotiation disputes and did so during sweeps week which was, presumably, intended to have dire consequences for ABC/Disney when it came to advertising revenue. In the long run, it was the customers who paid for it and it will ultimately be the consumers who pay for any leverage the oligopolies will gain if they are allowed to force out thrid party CDNs leaving media content providers and their customers at the mercy of the ISPs who can and will use that leverage to extract greater and greater profits from us the consumers.
    • Re: I can't agree

      This. ISPs are trying to get paid twice for bad service, and that's incredibly sleazy. I dare you to compare US costs and network speeds to South Korea, and then try to tell me that the ISPs deserve any more money. It's downright embarrassing!
      • That's so true

        US residents have some of the slowest connectivity to the internet of any 1st world country. There are countries in Europe that have gigabit connections at home as standard fare.

        And now US companies want to double charge access to the internet just like US cellular companies do. It's ridiculous and requires better regulation than what they've come up with. In other countries users of cellphones get charged for making the call only. They don't also get charged for receiving a call like they do in the US.