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General discussion

A strong argument against Net Neutrality regulation

Jan 11, 2011 9:02AM PST

Discussion is locked

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I like it...
Jan 12, 2011 3:06AM PST

I've always viewed the Net Neutrality argument in the same way as the article's author does: It's a solution to a HYPOTHETICAL problem!

Where, but where are all of these ISP abuses that spur on this debate? I have Time Warner service. I have no particular love for them as a service provider, but I don't see that they are impinging in any way my ability to do what I need to do online, and that includes Netflix streaming (in HD) to my Roku box in prime time. Sure, I'd like to pay less and get more bandwidth, but for now, it serves my purposes.

The FCC sticking its nose in is really the slippery slope. People might say that's hypothetical, too, but with the FCC, we have more than ample evidence of what they can and have done in the regulatory mode, and I'm talking CONTENT regulation, not just the nuts and bolts of infrastructure and delivery.

To top it off, it is, by its nature, a political body. Whatever party has the executive branch has the majority of FCC governors. So, while that may make you feel good this year, it might not make you feel so good next year, or the next election cycle.

If I start to see rampant abuses of traffic discrimination that affect my life, I'll be right there with you neutrality advocates. But for god's sake, the Net is one of the last vestiges of real freedom in the world today, and the best hope for freedom in places where freedom of expression doesn't really exist. The less we have governments meddle in it, the better. For now, I see the argument as a solution in need of a problem, and that's never a good thing.

I'm not here to argue that major ISP's are righteous and always looking out for the consumer. Far from it. But that's what the marketplace is for.

If there is to be any overt regulation on the internet in this country (US), I'd prefer it come from 435 elected representatives and/or 100 senators who have to answer to constituents, not a supposedly independent governmental body of 5 commissioners who have political obligations but not to any particular constituents.

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excellent reply
Jan 12, 2011 10:02PM PST

I'm very impressed with your clear grasp of this issue

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Right
Jan 13, 2011 4:30PM PST

But you're forgetting that governments and large corporations have a tendency to collude together for their own interests. And tyranny can as easily come from large corporations as from government. The government would very much like more control over the Internet, wikileaks for example, they'd love to control what information is distributed on the Internet. Don't you think that if an independent agency like the FCC is super using ISPs and net neutrality, that it would be harder for homeland security and CIA talking and 'convincing' private companies to do what they want and shut down and filter the sites that they consider dangerous? If the FCC had the powers to smack down ISPs for blocking infomation and content, it would make things harder for homeland security to mess with the internets freedom.

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The FCC answers to its government masters
Jan 14, 2011 3:53AM PST

The FCC isn't the Supreme Court. It's not an equal branch of government. And it's certainly not "independent". Whoever has the executive office in government (aka the presidency) has its political will in place in the FCC, by and large. Only a law that states that one party can't control more than 3 out of the 5 commissioner seats keeps it from being hugely overtly political.

The FCC has years of experience in the content-regulation realm. Now, people can argue over whether that's a good or bad thing. With cable television, what's the difference if a broadcast channel (networks like NBC, CBS, ABC) broadcast nudity and profanity like what can be seen on HBO and Showtime, et. al.? But it's still highly regulated because these networks have affiliates (and some owned stations) operating over the public airwaves, whereas purely cable stations don't -- even though to a home user, it's "just another channel" on the set.

I don't like a lot of the trash that appears online, but guess what? I don't frequent sites that traffic in it. I don't need the nanny state to make those decisons for me, however. And that's what's coming down the line once the FCC gets its foot in the door.

I'll take the current net, warts and all, over any more governmental intrusion. When I can't do what I need to do online, I'll be yelling just like people are now over what "might" happen. And it's certainly not something that can't be changed immediately if abuses are rampant and widespread. Laws can take effect right away with serious consequences for lack of compliance. I'm not worried about it, and I think major ISP's are smart enough to know that their own livelihoods as public companies depend upon providing good service. If they aren't, they'll eventually pay the price in the marketplace, and legally, if need be. Right now, just the threat of the hammer will suffice.

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Horsey...
Jan 22, 2011 4:39AM PST

Yes, I say "Horsey.." A little restraint is not communism. Curbing the worst excesses of Laize Faire Capitalism has been a good thing for this country for the last 100 years, anyway. Was Teddy Rooseveldt a Democrat or Republican?
When will we learn? Didn't we just witness the triumph of greed over virtue in the banking and real estate sectors? Even Alan Greenspan admits that the theory that markets can regulate themselves has proved faulty. I don't wish for business to control free speech even more than I don't wish for government to control it, to be oblique. Government will screw us over by accident, business will do it on purpose.
Horsey.

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There is some merit to the libertarian, hands off approach.
Jan 15, 2011 3:16AM PST

And I agree that there haven't been any horrific abuses by cable companies and wireless carriers.... yet. So perhaps it is best to wait before enacting new regulations.

But its naive to think that these companies with their convenient little oligarchies will police themselves and do the right thing on their own accord. The ridiculously high pricing of text messaging across all carriers despite "competition" is proof of this. And the conflicts of interest between the content providers and the content that is provided are piling up fast and it's only going to get worse. This is an instance where "the market" may not be enough. When public resources are involved in the delivery of cable and cellular service and only a very limited number of players are allowed to attend the party it not really a "free market"

The knee-jerk government always makes things worse mantra is a massive oversimplification in my opinion. After all, it was government who split up phone company monopolies enabling real competition in the early 80's... not "the market". There is no reason to believe that the that it can;t happen again. And the free market cheerleaders have to deal with the fact that that many socialist governments (who heavily regulate their cable and wireless industries) are still kicking our butts when it comes to broadband speed and penetration. Sometimes government intrusion is necessary and works. Sometimes it doesn't. But saying "government screws up everything" is glib.

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Glib?
Jan 17, 2011 10:35PM PST

I didn't say government screws up everything. I gave specific examples of how the FCC has inserted itself into CONTENT regulation, not just infrastructure and delivery. If I may quote myself: "If there is to be any overt regulation on the internet in this country (US), I'd prefer it come from 435 elected representatives and/or 100 senators who have to answer to constituents." I want people who have to answer for their actions to make policy. I don't think that's asking too much.

And would that it was such a simple argument to make about "socialist governments" kicking our butt on broadband. The "conspicuous by its absence" aspect of that statement is that there's no mention of geography and where people actually live worldwide, for example. It's hugely important in the discussion.

Saul Hansell of the NY TIMES Bits Blog outlines some of the not-so-obvious reasons why U.S. broadband speeds are lower than some other countries in the world. I would invite you and others to read his blog from 2009, as he gives some cogent reasons why things might be different elsewhere:

http://bits.blogs.nytimes.com/2009/03/10/the-broadband-gap-why-is-theirs-faster/ (part 1)

http://bits.blogs.nytimes.com/2009/03/11/why-is-their-broadband-cheaper/ (part 2)

http://bits.blogs.nytimes.com/2009/03/12/the-broadband-gap-why-do-they-have-more-fiber/ (part 3)

http://bits.blogs.nytimes.com/2009/03/16/the-broadband-gap-your-take-on-the-issue/ (part 4)

You will see in this excellent compilation of info that it's not always correct to make appples to apples comparisons, nor is it easy to just swoop in and force telcos to share infrastructure without providing incentives (that other nations have) to do so. It's also interesting to read some of the anecdotal comments in the last part of the series where some people in some of these supposedly utopian broadband areas don't exactly enjoy what's been advertised.

Bottom line: "Glib" cuts both ways, because simplistic statements about regulation are no better than simplistic statements about free markets. I hope you read all the parts of the series. You'll find some things to bolster your contentions, and hopefully some context on why we are where we are.

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Note on geography:
Jan 18, 2011 9:07AM PST

Australia has a similar land area to the US and a much lower population. Hence Australia is behind the US in broadband speeds. So the government is building a fibre network for $42b which in comparison to the US's GDP, would be about $600b so this is a major project. But Australia has the capital to do it while still coming to surplus in 2012 so government claims. Strong economy here, there was no recession in Australia.

And FCC yes does censor television content etc. But you realise the US government is already censoring the internet through the department of homeland security. Mostly shutting down piracy and terrorism sites. They have the legal ability to take over a domain name without even needing a court order.
http://www.rawstory.com/rs/2010/11/homeland-security-shuts-dozens-sites/
Also with how closely AT&T works with the NSA in acquiring private citizens informations. I'd rather have the FCC monitoring ISPs and demanding they not block information, as a check and balance against Homeland Security and NSA telling ISPs what sites should be blocked on national security grounds etc.

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Calm down man. I'm not talking about you per se.
Jan 18, 2011 9:34AM PST

I'm talking about other people who use "government-screws-up-eveything" as some sort of self evident argument.

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And representatives are the absolute WORST govenment
Jan 18, 2011 9:47AM PST

officials possible to make broadband policy. The House of Representatives is filled with demogagues who routinely grandstand for constituents and twist the truth to match whatever political narrative they are trying to weave. If their's any branch of the government that deserves mockery and scorn it's the House. The crap that's being sold to right wing talk radio listeners in the US is a perfect example how easily net neutrality can be spun to people who don;t know any better as an attempt by the government to control what you see on the internet... conveniently ignoring the much bigger threat of telcos and big business controlling what you see and hear on the internet.

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monopoly
Jan 20, 2011 1:08AM PST

It was government that *created* the phone company monopolies in the early 80's... not "the market"

Free market monopolies cannot maintain their market share without offering incredible value for their customer's money.

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A De Facto Monopoly
Jan 21, 2011 11:12AM PST

Where I live there's only one broadband provider (the local telco), so don't talk to me about free markets.

And please don't consider this a hypothetical problem. Perhaps you're unaware that Comcast recently announced they would block Netflix streaming to their network unless Netflix paid them a fee to pass their content through. I dunno, maybe this had something to do with Comcast buying NBC which competes with Netflix?

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A monopoly of NOBODY
Jan 22, 2011 9:08AM PST

If you've only got one provider in your area, consider yourself lucky, not entitled. It must not be cheap to wire up to your house. You're not getting ripped off, you're getting a great deal for your money.

Without your 1 provider, you would still have a monopoly of broadband in your area. NOBODY.

The market is the best place to let these matters sort out.

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A Market of one
Jan 22, 2011 11:54AM PST

Is not a Market. A monopoly is just as bad as public ownership, as the problem with both is no competition.
So if we are to be left with a monopoly like this, perhaps the best solution to get a healthy free Market place, is to run the infrastructure as a public utility like the roads, by the county. And rent the infrastructure to ISPs.

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Don't create a monopoly in order to prevent a monopoly
Jan 22, 2011 3:08PM PST

No, that wouldn't solve the problem of a uncompetitive monopolistic control, that would establish it.

Unfortunately there's so much confusion about the word Monopoly. In a free market it simply means a company has reached a large market share. That's not a sign of anything wrong, it's a sign the company is offering significantly more value than the rest. That market share will erode fast if that company ceases to remain competitive. There's nothing to fear from a company in a free market that has achieved a large market share.

Then there's an enforced monopoly. Like the utilities. Like the public school system. Like ATT was in the 70s. They've gained their market share by force. They are a menace because they don't have to care about their customer in order to get paid by him. The only thing that can bring about an enforced monopoly is Government or Mafia.

The problem in the Net Neutrality debate is people are fighting to fix a good situation by making it bad.

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Umm
Jan 23, 2011 11:21AM PST

The whole point of the free Market system is that competition incentivises improvement and innovation.
A monopoly is little different to communism, it's just another variety of a large bureaucracy with control of a Market and no competition.
The point is in this scenario there is no perfect solution. And the lesser evil is probably to separate infrastructure owners from end customer service. ie, have ISPs rent coax or fibre lines going into people's homes so at least there is competition on the service side.
And in this scenario it really makes no difference whether the infrastructure is publically or privately owner, as long as it is separated.
One thing is for sure, one company owning device and infrastructure, and customers that have no choice an alternative but a single company, is the worst outcome as is just as bad as if it was entirely government run.

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Because forcing AT&T to separate
Jan 23, 2011 9:50PM PST

it's infrastructure from the service it was providing in the 80's caused such a huge monopoly on landline phone service. Prices plummeted, long distance telephone provider options multiplied by the dozens. Every company that wanted to compete had access to the same lines for the same price. Yes, I can see how treating phone lines as a utility cause a horrible monopolization of the landline market and put an end to innovation.

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Who's going to pay Verizon/Comcast, etc., for their costs?
Jan 24, 2011 2:23AM PST

Verizon has sunk billions of dollars into building out their fiber network. I'm guessing some people here think it would be just fine to tell Verizon, "Hey, you need to open up your lines to any johnny-come-lately who wants to provide broadband service". (This is known as "unbundling") Of course, said johnnies have had ZERO--ZILCH--NADA dollars invested in actually building and maintaining the network. But they just get to use the fiber that Verizon spent those billions on, "just because". That's absurd.

And if Verizon, et. al., are forced to open said networks at some pre-determined price, no doubt, exactly what incentive would they have to ever improve service, add new technologies, etc.? Answer: NONE.

Read this link from above: http://bits.blogs.nytimes.com/2009/03/11/why-is-their-broadband-cheaper/. This is spelled out quite clearly. Even other nations who have forced such a system into being knew they had to provide incentives to these telcos in the form of reduced taxes or other subsidies to get this to work. The theory people have about unbundling is great. Unfortunately, the reality is quite another matter.

So, let's hear your plan (you meaning everyone who wants this) to open up the lines, so to speak. Tell me exactly how you would get these telcos to put another dime into their networks if they have to let anyone else jump on that doesn't need to bear the build-out costs and ongoing maintenance they did.

Don't misunderstand; I'm not saying the heavy hand of government couldn't actually force this kind of thing at some point. I am saying that in the real world, you had better make it worth the telco's whiles to get them to keep investing in their networks.

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The same can be said of AT&T in the 80's.
Jan 24, 2011 7:47AM PST

They also had huge amounts of money invested in the telephone network that they had built as well. But yet somehow the sky did not fall and the phone technology did not stagnate. In fact the technology thrived even more on the increased competition. I don't buy the if-they-take-away-our-monopolies-we-won't-have-an-incentive-to-compete excuse either. That's just a scare tactic from the cable companies who like their cushy position. If there is money to be made someone will always step up to the challenge. Demand will not disappear just because the pipes must be shared. If anything it will increase because new companies will find compelling ways to use access to those pipes which will make the Comcast of the world have to up their game as well. You didn't see AT&T and the Bells take their ball and go home just because the government said they no longer had exclusive access to the phone lines. They stayed and competed and technology advanced (and they profited nicely in spite of the change).

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Well, actually...
Jan 25, 2011 4:18AM PST

If you are to believe some of the net neutrality groups, the AT&T breakup has been an unmitigated disaster for consumers. Why? Because (in their view) agencies like the FCC and even Congress have kowtowed to industry groups, and have given even more power and profitability to the major telcos that have emerged post Ma Bell breakup to the detriment of consumers.

Now, on the one hand, that goes to net neutrality types who advocate more open access. On the other hand, it shows quite clearly how government (both Congress and the FCC) have failed over the last 30 years or so to actually "get it right", and hence can't really be entrusted to get it right.

I just sat through about 90 minutes of a 2009 video presentation by ISOC (NY Chapter), which had a symposium on --among other things-- whether the AT&T divestiture actually *worked*. The verdict? Not great. And remember, these guys are essentially on your side re: neutrality.

http://www.isoc-ny.org/?p=618

I did learn quite a bit, however, about how we've gotten to where we are today, and how the big telcos have gotten things their way in many respects, and how the FCC has made some good and bad rulings over time that have resulted in why independent ISPs are a dying breed.

One could only hope in these kinds of presentations that there were contrary viewpoints, as it's entirely one-sided. That doesn't make it false, but it does make it one-sided.

Nevertheless, I would recommend you spend 15 minutes watching the first speaker of the first panel (Bruce Kushnick) and maybe first speaker of Panel 3 -- Fred Goldstein. Kushnick outlines how the Ma Bell breakup didn't get us where we needed to be whatsoever, and Goldstein talks about how re-regulation --in very specific models he outlines-- can be a win-win for virtually everyone.

Again, I'd like to hear opposing viewpoints from other experts, but it's still pretty informative stuff. If I understood him right, let's say, for example, that all infrastructure like fiber is treated like utility. Verizon, in this model, would sell off/spin off its physical assets related to fiber to a totally separate and regulated company -- even if it's a subsidiary-- that couldn't discriminate who to sell bandwidth to and couldn't manipulate pricing (couldn't sell bandwidth cheaper to the parent company, for example, or exclude anyone else).

This secondary company that owns/maintains the fiber and other physical equipment would be a utility. In that case, Verizon (parent) gets compensated for its costs for actually laying the cable (assuming a fair market value), and can even continue to compete with any other ISP if it wants to. Anyway, that's what I got out of the Goldstein presentation. Lots of industry jargon, but informative.

This Goldstein regulation model is quite different than just telling Verizon and/or Comcast to share their lines. It suggests selling/spinning off the lines, so to speak, to separate regulated companies. Again, that's if I'm understanding his model correctly. I'm still not clear on how having a utility like that would necessarily create more network growth, both physical and on the bandwidth side, as there still must be some kind of incentives in place to do that.

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This isn't a free market.
Jan 23, 2011 12:43AM PST

In a free market any company that wants to compete can compete. When the public resources are limited and exclusive contracts are the norm there can be no real competition.