Net neutrality... opinions?

Yes I imagine Vonage pays someone (don't know who) for access to the internet. I also imagine that whoever they pay for access is not one of the telcos who make some of their revenue by charging private individuals for long distance phone calls. If it is that would be irrational on their part and once found out would soon be stopped (I imagine again). So I conclude that whoever they pay for access doesn't have a vested interest one way or the other if LD carriers loose revenue on lost long distance calls.

There is no free ride but there may be backbone domination. Cable companies don't provide backbones.

If the telcos only create tiers on their own ISPs, fine. We can move to other ISPs. if they create it on the backbobe so you can't get away from it, we need a new backbone provider. And maybe that will come.

The free ride stuff is pure balderdash. Conage pays for their access and bandwidth already. Telcos are targeting them because they want to compete with them.

Let Vonage spend some money and build some lines. Build some LD lines or some local lines or both. That would be competition.

But letting other telcos spend their money and Vonage use their lines to take their LD revenue from them is what I mean by a 'free ride'.

Now we know Vonage will not build lines. So let the telcos who carry their signal along the way charge Vonage for it. My best guess is that whoever Vonage pays for access is not sharing that access revenue with the telcos doing the long-haul for them.

We would quickly find out that the only advantage that Vonage has is one of cost. Now if Vonage provided some value-added benefit that would change things so that Vonage would continue to make money even when the telcos charge them more for carrying LD calls. That also would be competition.

But all Vonage is selling is just the same thing you get from a Plane Old Telephone Service, and the only reason they can undercut on cost is that they are using other peoples lines to do it.

Looks like Vonage gets access (which they pay a pretty penny for I imagine) from Level 3

http://www.level3.com/576.html.

"Level 3 (Nasdaq: LVLT) is an international communications and information services company and is headquartered in Broomfield, Colorado. The company operates one of the largest communications and Internet backbones in the world.

Level 3 is one of the largest providers of wholesale dial-up service to ISPs in North America and is the primary provider of Internet connectivity for millions of broadband subscribers through its cable and DSL partners."

Also interesting to note: "The world?s largest telecom carriers all continue to use Level 3 services, as do the 10 largest U.S. Internet Service Providers, and the 10 largest European telecom carriers."

So even the telcos aren't always using their own lines apparently.

A traceroute on vonage yields that they pass through Level 3, Cogentco and EV1.net. Cogent is a backbone as well (http://www.cogentco.com/htdocs/index.php). EV1 appears to be a Houston ISP.

Most interesting is that none of these are the telcos who whine that Vonage is getting a free ride and they need to government to step in and protect them from the evil VOIP competition that's stealing from them.

Sounds to me like Vonage can just tell the telcos to buzz off and get by just fine. The only folks that suffer will be the poor saps who are forced to use telco ISPs because they have no other choice. So the more I look into it the more it looks like there are enough alternate providers willing to recoup the costs of their fiber rollouts the old fashioned way, by charging a fair price for their product, that the telcos may just have this blow up in their faces. That is if they don't get Congress to step in and help them overcome this smattering oif open competition.

One reason this whole thing gets me so hot under the collar is that I'm tired of hearing big companies whine about how people are stealing from them (whether it be telcos or record comapnies) when they've been stealing tax dollars and unfair market advantages by taking advantage of lobbying big government for decades. If you really aren't a fan of big governbment, then you certainly can't be a fan of these companies and associations who spend millions buying influence in that government.

I want to thank Tom for the debate. It never got personal and we kept pretty much on topic with respectful give-and-take.

I wish all internet based debates were as this one.

That Vonage gets its access from someone other than a telco is as I expected. I wouldn't imagine that a telco would cut their own throat by selling access to a competitor.

I cannot find the link now but I am sure you have seen it.... the large diagram that shows in color who owns the various lines that transmit internet trafic. Even a cursory examination reveals that the lions share is owned by one or another telco.

If Vonage were (somehow) able to keep their traffic off of any of those lines owned by a telco then I would consider that they are operating fairly and equitably. However the likelyness of that happening is as close to zero as you could get. No matter what they would try they would have to use a line owned by a telco to transmit their phone calls.

I am sure this conversation has served to bring more light to the issue and in that I think it has been worthwhile. I think we are just now at a standoff. Perhaps my previous experience as an employee of a telco has colored my perspective, but I would like to think I am not biased by that.

Anyway, thanks for the debate. I will continue to listen to BOL (even if it promotes some ideas I do not agree with).

I consider you a worthy adversary in civil debate (despite your inability to convince me of your position)

KeyStroke

A good rousing battle of ideas in a free but civil exchange. It sharpens the issues and even if it doesn't change opinions, it sure does bring things into sharper perspective and flushes out the facts. Thanks to you too.

All our analogies are just 'red herrings' ??

OK

So, lets talk about this (supposed) 'conflict of interest' angle.

Bring it.

Lets say that cars and roads are invented, however jet airplanes are not (yet). You pay a flat monthly fee to your local road construction company and they pay fees to other construction companies and they pay (etc. etc). You wind up with streets leading from your house to other houses near you and to toll-free highways that lead to businesses and other interesting places.

All well and good.

Now someone starts tinkering with flight. They build a 'wright flier' and launch it off a cliff and it flies. Now more and more people are building 'fliers' and they are getting heaver but also faster. Soon you see fliers using the streets paid for by your monthly fee. So far the accidents have been minimal. When a 'flier' ( now called an airplane ) crashes into a car no big pile ups have happened.

Now a major change happens. Big businesses are now constructing big 747 like jet airplanes. But they don't want to pay for airports with big runways to let them fly faster. No, they want to use the existing set of streets and highways that your monthly fees have paid for.

Soon there will be huge traffic tie-ups on the highway you want to use because some 747 has decided to land on it. You have to re-plan your route and hope some other huge 747 hasn't used your alternate.

Wouldn't it make more sense to build airports for jet aircraft and limit use of those runways to jet aircraft (keep the cars off) while still allowing cars to use the streets and highways that their money has already paid for?

OK, lets say we agree that jet runways should be constructed. Now, who should pay for those big and expensive runways? Should it be the little guy who only drives his car on the streets and highways? Or should it be the big companies with the jet airplanes?

Net Neutrality would allow capacity-hogging traffic (streaming HD VoD and VoIP) along the same 'pipes' that your little blog would want to travel.

I think it makes much more sense to have the providers of streaming HD VoD and VoIP pay extra for a build-out of high-bandwidth, low-latency set of connections to carry that capacity-consuming traffic and allow the existing connections to continue to carry the traffic that exists, today.

But wait, you say! Your local asphalt company now wants to get into the business of constructing and flying jet airplanes! What about that? OK, so what? The asphalt-now-jet plane company will know that it would harm their car customers if they tried to land jet airplanes on the local asphalt road. So it is not in their best interest to harm their customers in that way.

The Internet was built by the Defense Department with your tax dollars. Fiber was subsidised with your tax dollars. This is nothing new.

My experience differs from your position that government funds built out the fiber networks in three aspects:

1) When I used to work for Sprint, back when they built out the first nationwide fiber optic network, there were no government funds provided to them to do that. In fact the competition was of the opinion that Sprint would bury themselves with the expense.

2) When I used to work for Boeing and government funds were used to build airplanes there was (and I imagine still is) very strict rules and regs that you cannot combine private industry use with government funded facilities. In other words, no mixing of private and government funds.

3) There exists lots of unused fiber (so-called 'dark fiber'). When I worked for an asphalt company it was very clear that the government never over-builds roads. They always under-build so that next year they have the justification for an increase in funds. Also, it is my experience (working at another aircraft company) that over-production is typically funded by rampant private-money speculation.

Combine these experiences with the condition that I had not ever heard that government money was used to build out fiber networks and you can see that I find it difficult to take your word for it. Therefore I ask for some links for validation that the government paid for the build-out (and over-production resulting in dark-fiber) of our fiber networks.

By the way, I am not a 'shill' as I no longer work for Sprint, and Sprint is no longer a local phone company anyway.

I hear you. They're cash amchines.

The telcos were all given tax breaks to extend broadband networks in 1996 in conjunction with passing the Telco Act that was supposed to deregulate the telephone industry. because of the tax breaks and subsidies and because of the horrible wording of the law we've seen the ressurection of Ma Bell rather than open local competition that was promised.

Here's a CATO institute report on the Broadband pork barrel printed in 2001

http://www.cato.org/tech/tk/010713-tk.html

And here's an excellent overview of the situation from Nieman Watchdog at Harvard.

http://www.niemanwatchdog.org/index.cfm?fuseaction=ask_this.view&askthisid=00186

I read the first site you linked to and the writer makes a logical fallacy of equating a tax credit with a subsidy.

A subsidy is when the government pays producers to produce a product that the producer would not (otherwise) make a profit at producing. A tax credit is when the government agrees to take less in taxes (in this case if the telcos build broadband in the sticks).

Taking less (in taxes) is not the same as paying the telcos to build out rural fiber. It was the capital of the telco that was spent to pay for the fiber, not any money given by the government.

Secondly, that first link only talks about rural build-out. Even if I were to accept the premise that the government paid for the rural lines to be built (which I don't) that does not mean that the government paid for all of the internet to be built.

My opinion is unchanged. I still hold that the telcos should retain the right of ownership over the internet lines. Lines that their investment capital have spent building. And that right of ownership should include the ability to set different prices for different content and delivery levels...... but I will read info at the next link.

Based on your second link I am willing to admit that telcos underbid the effort it would take to build out rural broadband.... and I would state that for that they should be held accountable.

However the whole premise of the "net neutrality" argument is the idea that "the internet belongs to everyone". This idea is, in turn, based on the misperception that the internet was "built by Al Gore" (paid for by the government) which is just not true.

As I pointed out in my previous post: accepting a tax break is not the same as accepting payment or accepting a subsidy. Being paid is money that comes into the company, while a tax break is rather less money going out (to the government).

To address the point of the second link you gave I can imagine there are two reasons that we do not have rural broadband: 1) Labor in the US is much more expensive 2) there is a whole lot of land to cover per rural occupant.

These figures are from Wikipedia: South Korea has an average popu. density of 1,274/sq mi. Japan has an average popu. density of 873/sq mi. Slovenia has an average popu. density of 256/sq mi. The United States has an average popu. density of 83/sq mi. This means that running rural fiber to each citizen would cost so much more in the US than those other countries simply because we have so much more land to cover per person. And that would be true even if labor costs were equitable, which they are not.

Per capita GDP of the US is $43,555. Per capita GDP of Japan is $32,640. Per capita GDP of South Korea is $24,130. Per capita GDP of Slovena is $20,900. This means that it will cost (approx.) half as much to hire someone to run fiber in Slovena is it would to do the same in the US, and they would have (approx.) three times less distance to run (on average) to 'wire' each and every person. So in Slovena it would take (about) 1/6th the cost to wire each person with broadband than in the US.

Back to "net neutrality" ... I remain unconvinced that the telcos should be forced to surrender any of their ownership rights over the internet lines that their capital paid to build.

Let's stay on the heart of the issue, which isn't ownership. It's whether the telcos should charge content companies twice because they're in competition with the telcos.

IF there is a truly free market I say no problem. It's a stupid idea le tthem try it and they'll suffer. However if the telcos have regional monopolies and own all the backbones and can force it, that's not good.

...and I hope others find those useful, too. I skimmed the first one; then printed both and will read them as soon as I get a chance.

Here's some links to a couple of podcasts, in case anyone here is interested in podcasts... ya just never know!

First one is from Q and O Online Magazine (qando.net) (self-proclaimed libertarians; their motto: 'Free Markets, Free People'). You can listen to the podcast streaming online by going to the site, then scroll down the blog to "Podcast for April 23". On the way there's some pretty hefty writing on the net neutrality issue, which I'm still trying to plow through. The feed url for the podcast is http://www.qando.net/podcast.rss
Its probably the most comprehensive analysis of the issue I've seen so far.

Another good find is a podcast of a C-Span show called "The Communicators," according to the site its "C-SPAN's new weekly series featuring a half-hour interview with the people who shape our digital future." Link to the site is http://c-span.org/podcast/ and the episode that deals with net neutrality is 4/8/06 featuring Reps. Eshoo (D-CA) and Pickering (R-MS). The feed url is http://www.c-span.org/podcast/com_feed.xml

I love this new C-SPAN 'cast (I've been listening to all of the C-SPAN podcasts for a while now). Two things about that particular episode. First, the actual topic is actually video franchising but of course that ends up dealing heavily with net neutrality.

But unfortunately, Rep. Eshoo doesn't do a good job of representing the democratic side. She's the representative for the Silicon Valley area and she comes across as not knowing very much about technology. She sounds like she's been heavily coached but not well versed. Its obvious she's determined to drop buzzwords that will *supposedly* appeal to the right (free markets, choice, etc) and a few to appeal to the left (fairness, the little guy, etc). As if we won't see through her loyalty to her constituents, the tech geeks in the valley. Its just too bad that she can't do better than steer the conversation to some somtimes strained politico-speak cliches.

But to be fair, the republican rep is clearly on the side of the telcos... especially considering his years of experience in the upper echelons of management of major telcos (I can't remember the specifics of what jobs he held with which companies, but he says it in the 'cast). But he is obviously much better prepared to speak much more intelligently on the issue.

So I don't advocate extrapolating the competency of the guests to the validity of either position. Its just an observation. I'd love to hear the democratic position presented better.

The internet did not start as, and never has been, about democracy.

The internet started out as a government defense project to keep electronic lines of communication open in case of a nuclear attack..... so it started out as a totalitarian venture.

Once the cold war started winding down then the government opened it up to COMERCIAL applications.... so it became a capitalistic venture.

And that is what it is now, a comercial venue.... which is all about "you get what you pay for".

Don't let the socialistic 'Dot-Commie' ideals proffered by frustruated and low paid college professors fool you.

The Internet was bought and paid for by a government project then opened up to *academic* uses where it was further developed bu Universities into the World Wide Web, Usenet etc. Commercial uses came third.

The Airline industry also started out as a military venture with the second Wright Flier being built for the Army for reconnaissance.

But just because the military funded the first production of aircraft (beyond the initial home project of Orvil and Wilbur) does not mean that everyone should be able to pay a flat fee for access to an airfield then load up with however much luggage they wish to bring along.... and fly as far or as fast as they want with no extra charge.

Aircraft are now owned by commercial airlines and people pay based on how soon they buy a ticket, what kind of aircraft they are going to fly on, and how far they are going to fly and where (first class or coach) they are going to sit.

If anything of the Wright Flier built for the Army exists it is housed in a museum somewhere and no longer is used to fly people.

The same thing goes for the internet that was built by government funds during the cold war. I am confident that all those original circuits have been replaced by lines built and owned by the telcos.

What we have right now is the same as buying a ticket and flying.

The tiered Internet is more like this.

The space in the sky is owned by several private companies one of which is SkyCorp.. I fly on United. But if I want to fly on a 770 I either have to pay to fly on a SkyCorp plane or United is charged an extra fee to fly a 770 through the skyspace owned by SkyCorps.

Your version of the analogy only works if SkyCorp "built the air" in which SkyCorp planes fly. Of course no one can 'build air' and we all know that no one owns the air.

But telephone lines are not like air. Telephone lines have to be built. Building telephone lines is not free, nor is it paid for by the government. Telephone lines are built by telcos re-investing the profits they get from the traffic they already carry on those and other lines.

We have an excess of fiber (so-called 'dark fiber') which is a good thing, I guess, since if 'net neutrality' wins out then telcos will not have the profits needed for re-investment. We may be able to live out our lifetimes before the lack of profits for the telcos take their toll and we start losing capacity in the internet.

As I had mentioned before: I previously worked for Sprint (actually Sprint PCS when it was more separate). The whole time that Sprint PCS was in existence it never turned a profit.

The whole industry suffered from excess competition, which is why telecom industry experts were predicting (and calling for) the consolidation we have been seeing. On the one hand the competition has spurred fantastic innovation. We have had an explosion of capability and service in the wireless phone market that could not have happened were it not for the competition. Yet that competition kept (at least one) telco from ever turning a profit during its (short) existence. The lack of profitablity was endangering our ability to keep up in the world. A company cannot go without making a profit forever, it will go bankrupt and cease operation.

But back to the analogies.... can you see that you had to resort to an analogy where the medium of transmission was one that could not be owned? ( no one can own the air, contrary to the movie Total Recall ) When you use an analogy where the medium of transmission has to be created by expenditure of capital then you wind up drawing a conclusion that agrees with my perspective.

So, again, the bottom line is ownership.... who owns the medium of transmission for the internet?

Yes there's a hole in that analogy. So the air analogy you proposed can't work. I think the highway analogy works pretty darn well though. Do you favor privatizing the highway system?

As to the telcos, you keep mentioning phone lines, but INternet doesn't always run on phone lines. In fact it very often doesn't at all. Telcos got in the game late, one reason their crying about profits. I don't mean to be callous but if Sprint couldn't cut it they should have gone out of business instead of being propped up by the Clinton administartion's tax breaks.

An industry can have too much competition you say? So whats' the answer? Survival of the best companies, or government regulation?

I very much disagree that we've had an explosion in capability in the wireless market. The UNited States lags sorely behind Asia and Europe in both features price and capability. Every worthwhile innovation in phone technology I saw at CTIA wasn't coming to the US because they couldn't find a carrier. In my opinion the carrier stranglehold on wireless has caused a retardation of innovation and incredibly restrictive terms of service. We get phones and capabilities years after Europe and Asia.

...is taking ownership rights away from those that own the lines.

President Ford will hardly go down in history as a presidential intellectual heavyweight, but there's one quote attributed to him that's worthy of Abraham Lincoln and Benjamin Franklin (Franklin: the only US president to never actually serve as president). Ford said, "a government big enough to give you everything you want is a government big enough to take from you everything you have."

Remembering that a hallmark of socialism is no private ownership, show me one socialist state that is also democratic. As property rights decrease, so does democracy.

These political groups and corporations that you decry have no capital or power, except that which is freely given to them by free citizens in a democratic republic. They're beholden to the donors somewhat.

Giving too much power to the state to dictate to the corporations and citizens exactly what we all must do - regardless of the loftiness of the purported goals - is truly the giving up of power.

That is all true, but also keep in mind tha this isn't some businesses trying to do their business and the government just won't leave them alone.

These are large business deeply in bed witht he government so many purport to want out of our business. These telcos could not survive as contituted without tremendous amount of cooperation, favoritism, and compliance from the government.

On the other hand content companies and VOIP companies have started and are operating business free and clear of any government handouts.

but I have to agree with KeyStroke, this one is wrong on so many levels.

First, since when is ''the internet SUPPOSED to be about democracy''? According to who? Its nice that it serves some democratic functions, but...

Freedom of speech has never been precluded from those who can't afford to buy a printing press or tv station. Sure the delivery is quicker if you can get your message into a mega press or broadcast stream. But if your message is strong enough, it will end up there anyways.

What ''little guy'' blogger has brought down any giants? Sure there's some truth that individuals without the clout of mass media mega corps have equal access to the new information distribution network, i.e., the internet... but how many people will ever see a single ''little guy'' blog, compared to Ariana Huffington's?

There's probably more people who will see a single M&M commercial than those who will ever see the world's most popular blog ever, let alone how many will ever see the world's least popular blog. So if some little guy has some big news, it likely won't hit the masses unless its (drumroll, please...) reported about on several mass media outlets. Its probably faster to get your big news out by calling your local TV news station. People have been doing that for 60 years.

Anyways, you have always had freedom of speech and freedom of the press. Yes rich people are better situated to get their message out. I don't think the framers of our constitution had any inherent problems with rich people being better situated to accomplish certain tasks. I think battling that eternal truism is a foolish endeavor.

You ask, ''can we not then begin packaging content and pricing access differently?'' Napster, iTunes, WalMart and individual bands websites all package content. Access is priced differently based on speed, dial up cheap, dsl costs more, etc. I believe you're trying to address the ''tiered internet'' idea? If a content stream can be prioritized or guraranteed without a noticeable diminishing of services already available then what's the problem?

The internet should be whatever the owners and consumers decide it should be, with minimal government interference. If we decide to make it an exclusive social club for the ultra wealthy then that's our right. If we decide it should be for porn only then forget about the .xxx domain controversy, it'll be a moot point.

If we want it to be democratic, and we vote with our dollars via contracts with the owners of the equipment then that's what it will be. If you want a democratic net, or net neutrality, if you want the poor to have the same access as the rich, then vote with your voice, your blog, and your dollars.

Find other like-minded people, who agree that the net should remain democratic. Organize and pool your resources, make your voice heard. Network with them, start a website. Have everyone pitch in with time and money to get the word out. Give yourselves a name and file the appropriate paperwork with the government. Get publicity, recruit canvassers.

You have fantastic, correct and powerful ideas that are shared by many... probably the majority of americans feel the way you do. Or at least most of them would if they were informed of the issue. Unite that majority, create a network of activists who are willing to spend time and money getting the word to your duly elected representatives in government.

Hi. You are now a special interest group (political group). And there's nothing wrong with that.