Do We Want a Neutral Net?
On April 6, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the Federal Communications Commission lacked the authority to regulate cable giant Comcast’s internet service. The verdict was the fallout from a long series of FCC rulings regarding Comcast’s policies towards customers it considers “excessive” users of broadband internet. The court’s decision is widely interpreted as deep-sixing the FCC’s recent drive towards requiring net neutrality and other new regulations for internet providers.
The ruling has been either cheered or jeered largely along partisan lines; National Review and the Washington Examiner’s redoubtable Michael Barone both supported the court, citing industry concerns of overregulation as stifling innovation and leading to bandwidth congestion. On the other side, Salon’s Jenn Kepka called for congressional action to overturn the ruling, fearing the potential of ISPs blocking political or commercial sites they disagree with.
While I suspect Kepka’s particular concern is overblown — the surest way for a company to find itself under an immense wave of public and governmental pressure would be to act as a speech censor — other left-of-center commenters like Mother Jones’ Kevin Drum have a legitimate point when noting that “open internet has worked pretty well” to date. The ISPs want to charge “heavy user fees” to big services like Google and Hulu (and presumably even small video providers like, say, PJTV), and one suspects such charges would result in fewer innovative new companies being formed in the future. And none of the above even touches on the lack of serious pricing competition in the American broadband market.
The problem here is, just about everybody has a good point or two, but neither the law nor the market has a seamless answer to: “What’s the best way to do this?”
To borrow a now hoary metaphor from Ted Stephens, broadband service requires large tubes, at least relative to the days of slow dial-up service. Most of those tubes are owned by large corporations — cable TV and phone companies. The fortunate side of that equation is that even before the internet era dawned in the mid-90’s, almost every home in the country was wired for phone service, and most of them were wired for cable. While it wasn’t as easy (or cheap) as simply plugging in a modem, getting from the black rotary phone or analog cable TV to high-speed internet did not require entirely new technologies and infrastructure to be built out, and fast access spread like wildfire to most of the country.
The downside was, well, that infrastructure belonged to cable and phone companies, both of which had spent decades as monopoly operators thanks to exclusive agreements with the feds, the states, and municipalities. This status did not exactly breed a bias towards customer service or competitive pricing. As a Wired profile of Comcast, the nation’s largest cable company, put it:
[T]here’s something about the business that makes executives a little blasè about consumer complaints. They’ve been lambasted for so long, they just don’t hear it anymore. Brian’s father, perpetually bow-tied 88-year-old Ralph, started Comcast in the early 1960s. Programming cost nothing — he simply took broadcast signals and piped them to homes. Government regulation (unlike for broadcast television) was nonexistent. And expansion was just a matter of finding more towns to wire. Customers complained about price and service — but they never cut the cord. “It’s the greatest thing since stealing,” one of Ralph’s first employees told his friends.
That’s not too different from the attitudes of the old Ma Bell or her post-1982 offspring (as Lily Tomlin put it, “We’re the Phone Company. We don’t care. We don’t have to”). Now that they are ISPs in addition to TV or telephone providers, the cablers and telcos still act like monopoly incumbents, charging more and more every year with only minimal improvements in quality. Customer service horror stories are rampant; nobody looks forward to calling either side of their local broadband duopoly when they have a problem.
Can we trust the cable companies to control the internet? Can we trust the government?
No.
Definitely no.
You might recall that cable was initially peddled as an advertising free venue. That worked out OK.
If the problem is created by govt regulation, is the answer more govt regulation?
Exactly. The author stated it best when he says that the telcos enjoyed “regulated monopoly status”. The answer would be to make it easier for other entrants to come into the market. Big companies despise competition and would rather profit quickly and innovate slowly. Guess what other entity likes this arrangement? It is no surprise that when FDR was developing his New Deal he worked alongside big firms at the expense of smaller ones (Hillary Clinton reportedly said the same thing when she was First Lady). Government likes controlling big things, not little ones.
Actually the answer is to overturn some regulations that started the whole mess.
The changes made by the FCC regarding broadband under Michael Powell. Who now co-chairs a front group for the major telecoms and cablecos, AT&T, Verizon, Qwest, Comcast, Charter, Bright house, Cox and others. There list of members also includes other so called public interest groups, some that joined after they disbanded. Maybe the JD needs to look into how the FCC pushed through those changes without following proper protocol. Those changes locked non telco ISPs out of broadband completely, driving thousands of them out of business. Look at one prime example AOL, once the nations largest ISP for connectivity, has no broadband offerings.
Unless the government takes some action the US will continue to decline in Worldwide Internet ranking as the current providers have no real competition or incentive to do R&D and upgrades to give and maintain the US with the best Internet. They will invest as little as possible in infrastructure, and continue to fund their political work around.
I think the answer is to force open the market to competition, and to use Net Neutrality as a means of stopping misbehavior while that competition gears up and rolls out across the country. Net Neutrality is a good stopgap measure, but it’s no substitute over the long term for real competition.
Perfectly said, Rob! You are 100% correct.
NO! Keep the government FAR away from the Internet.
Ummm – it was government efforts that CREATED the internet. It’s government efforts that SUPPORT an open internet. Why do you now want to change that?
“CREATED”…
“SUPPORTED”…
REGULATED.
Quite a difference.
One thing is clear and that’s that ISPs should **not** be legally allowed to charge content providers for the “privilege” of accessing their customers. My FiOS bill is how Verizon gets paid for my use of iTunes, YouTube, etc. Verizon is doing no one a “service” by facilitating this. Google and Apple both paid for their infrastructure and I pay a monthly bill to connect to it.
Anyone who believes that they should be able to charge them additionally for that, on top of what end users pay every month, is defending parasitism and rent-seeking, not free market capitalism.
iTunes, YouTube, etc. don’t get a penny from Verizon or any ISP. Never have, never will. Those companies get money either directly from subscribers or via ad revenue. Your payment to Verizon pays for access to their pipe. Nothing more, nothing less.
Mark,
Perhaps I need to use simple words so you’ll understand. I know Youtube and iTMS get no revenue from ISPs…
The ISPs want revenue from THEM. They call Apple a freeloader because its customers use their internet connection to download content without paying an additional fee to the ISP.
If you didn’t know that that is a major issue here, then go do a little research before mouthing off again about the subject, please.
You have a funny way of defining parasitism and rent-seeking.
According to Websters, parasitism is “an intimate association between organisms of two or more kinds; especially, one in which a parasite obtains benefits from a host which it usually injures.”
Econlib.org defines rent-seeking as such: “People are said to seek rents when they try to obtain benefits for themselves through the political arena.”
So here you’re using two acidic words with which to describe a private transaction. It is not a parasitic relationship of the company asking you to pay more for its services (especially since many of its costs are fixed and increase over time) nor is it rent-seeking. Contrary to what you may believe you hold considerable influence over a company. If you no longer like the services of your provider you are free to leave and go to another. Your FiOS bill is not how Verizon gets paid for your use of iTunes and YouTube; your FiOS bill is how you pay Verizon for the services it provides you. When you look at your bill do you see monthly usage for itemized web usage? I thought not.
It is also not rent-seeking because the Verizon is not lobbying you to get you to pay them more for providing services to you. That’s just silly on its face.
What is going on in our society is that people feel they should have a “right” to affordable broadband use because they feel they “need” it. We have all seen how other rights – affordable housing, affordable health insurance, “free” education – has turned out. Go ahead and ask the government to provide you with a “right” to affordable broadband.
That is exactly what they are trying to do to iTunes, YouTube, etc. by charging THEM a fee to reach their customers who are already paying for Internet access.
Wikipedia defines it as: In economics, rent seeking occurs when an individual, organization or firm seeks to earn income by capturing economic rent through manipulation or exploitation of the economic environment, rather than by earning profits through economic transactions and the production of added wealth.
That definition fits better with the general behavior which is that these ISPs want to not only make their customers pay to get online, but then charge unrelated businesses for the “privilege” of accessing their customers while maintaining the facade that they are providing a consistent service to their actual customers.
The major ISPs claim that Google and Apple are “freeloaders,” an even more “acidic word” than the ones I used to describe the ISPs. Their claim is that despite the fact that people like me are paying them good money for a service, they are not **really** getting paid because they’re not getting money from both ends. That is, of course, despite the fact, that the only reason the network traffic comes to them is because of their customers’ requests, a few packet routing cases notwithstanding which are simply par for the course with running a large network.
I don’t think you even understand the issue. My comment was plain as day for anyone that has an actual understanding of this issue that rises above a few commentary pieces on this subject.
A key part of this issue is that ISPs want to double dip. They want to be able to go out of their way to sell their customers the perception that they are buying a certain quality of service, at a certain rate, and then turn around and tell the companies those customers want to access “pay us money, or we will throttle your traffic.”
If you don’t understand why that’s deceptive as hell, then you have no business lecturing anyone on this issue.
As it currently stands, network neutrality breaks down into not one, but two, issues:
1) Can ISPs discriminate against different protocols?
2) Can ISPs quietly jack content providers who won’t pay them what amounts to extortion to be able to have even a **chance** of reaching their customers at the rates that the ISPs advertise to their own customers.
Now, I don’t know about you, but if I’m sold a 15mbps connection and Apple gets told by an ISP “pay up or you’ll reach your customers at 2mbps” that borders on blatant fraud.
Issue #1, is not even a real issue. Traffic shaping has been in mainstream use since the early millennium, if not 1990s to ensure basic QoS for ISPs’ customers.
“That is exactly what they are trying to do to iTunes, YouTube, etc. by charging THEM a fee to reach their customers who are already paying for Internet access.”
No, Mike T. Having a consumer pay for services is not parasitism. When you think of parasitism, you think of a zero sum game. Here, Apple, Google and others would have to pay the provider a fee for using their service. There is no parasitic relationship: without the money from these customers, providers like Verizon go out of business and if Verizon go out of business these customers have no means with which to get their content to their users. A mutual relationship yes, but parasitic, no.
“Wikipedia defines it as: In economics, rent seeking occurs when an individual, organization or firm seeks to earn income by capturing economic rent through manipulation or exploitation of the economic environment, rather than by earning profits through economic transactions and the production of added wealth.
“That definition fits better with the general behavior which is that these ISPs want to not only make their customers pay to get online, but then charge unrelated businesses for the “privilege” of accessing their customers while maintaining the facade that they are providing a consistent service to their actual customers.”
No, Mike T, you attempted to find a definition to fit your argument. Reread that definition, but I’ll parse it for you. When Wikipedia explains that firms “seeks to earn income by capturing economic rent through manipulation or exploitation of the economic environment, rather than by earning profits through economic transactions and the production of added wealth”, what they are saying is that firms will use politics and lobbying of government to fix rules to a) introduce new rules to keep out potential competitors; b) introduce rules to get subsidies to help its bottom line; or c) do both. A company that charges a consumer more is not rent-seeking; they are still operating within the profit motive. It is a risk to raise prices because if the new price is not associated with increase value, whether real or perceived, then the consumer will go elsewhere.
“The major ISPs claim that Google and Apple are “freeloaders,” an even more “acidic word” than the ones I used to describe the ISPs. Their claim is that despite the fact that people like me are paying them good money for a service, they are not **really** getting paid because they’re not getting money from both ends. That is, of course, despite the fact, that the only reason the network traffic comes to them is because of their customers’ requests, a few packet routing cases notwithstanding which are simply par for the course with running a large network.”
If by pursuing net neutrality firms like Google and Apple get their way, then yes they will be freeloading because the purpose of net neutrality is not to bring YOU or I any benefit; it is to bring them a benefit of having their costs kept low at the expense of everyone else. That’s how it works when prices are controlled: the favored group will have its price fixed, but the unfavored group’s price will have to rise. That sounds like freeloading to me.
By the way, I wonder if you notice the irony that you are advocating for one corporation against another. You’ll probably say I am as well, but I’m not. I have already stated my preferred position: allow more competitors into the market. You, however, want to introduce regulation that will fix this market not only for the providers, but for Google and Apple as well (not to mention us).
“I don’t think you even understand the issue. My comment was plain as day for anyone that has an actual understanding of this issue that rises above a few commentary pieces on this subject.”
No, I don’t think YOU really understand the issue. This issue is at its core about being able to get a high quality broadband line at an “affordable” price. Otherwise, there would be no reason to be talking about “net neutrality” at all. The rest of your argument justifies what I said before and can be summed up succinctly here by you:
“Now, I don’t know about you, but if I’m sold a 15mbps connection and Apple gets told by an ISP “pay up or you’ll reach your customers at 2mbps” that borders on blatant fraud.”
You want Apple to have the ability, which it doesn’t have because it provides a software service, not broadband service, to be able to deliver to you services up to 15mbps. However, you want it because you pay your provider to get 15mbps downloads. This is like you telling Pizza Hut that in order for the pizza man to get the pizza to you, he should be able to drive 100mph because you paid for the pizza, but then you get mad at the traffic cop because he tells you that the pizza man can only do 45mph. I’m pretty sure that Apple would be happy to give you that download speed, but that download speed comes at a hefty price. I may be satisfied with only getting 2mbps: should I have to pay extra because I think 2mbps is good enough? What if everyone demanded to get downloads of up to 15mbps? Hopefully you can see why “net neutrality” can turn into a “net nightmare” for everyone.
One other thing: as I mentioned on another board regarding this topic, do you honestly think that any provider would sensibly try to restrict the content of one of the information providers? If Google can take on China, don’t you think it would have no problem outing the restrictive practices of Verizon or Comcast?
You two have the same WordPress template. weird.
But seriously, Chris, here’s where your argument falls down. The preponderance of people are NOT free to switch to another provider save moving to another town. That’s because cable companies try to “buy” exclusivity with the towns they serve by donating money for parks, roads and the like. IN other words, they bribe local officials to keep competition out. As a result, they can literally, defecate all over their customers with the knowledge that their customers cannot do a thing about it.
Exhibit #1 is the recent name change from Comcast to Xfinity. Comcast is not undergoing the name change because their customers love them. They are changing their branding because their customers LOATHE them. This happens in a government enforced monopoly, not in a real competitive marketplace. Until such a marketplace comes into being, some sort of utility like regulation is required to keep the ISPs from engaging in their STATED goal of throttling content providers who do not pay up extra money to them.
Crony capitalism is NOT capitalism, and in broadband, we basically have crony capitalism. It’s time that the situation be remedied.
The pizza delivery analysis is horrible. It is more like the Cop only letting pizza hut go 45mph but letting papa johns go 100 mph because papa johns paid an extra fee. While at the same time you are also paying the Cop to let papa johns deliver to you. you have no understanding of what is going on.
“But seriously, Chris, here’s where your argument falls down. The preponderance of people are NOT free to switch to another provider save moving to another town. That’s because cable companies try to “buy” exclusivity with the towns they serve by donating money for parks, roads and the like. IN other words, they bribe local officials to keep competition out. As a result, they can literally, defecate all over their customers with the knowledge that their customers cannot do a thing about it.”
Really? Where I live I can get rid of Qwest and get Cox@Home. If I get bored of Cox I can sign up with HughesNet (satellite service). If I don’t like HughesNet, I can go to Verizon Wireless and use it for my service. If I don’t like Verizon Wireless I can leave them and go to Sprin, AT&T or T-Mobile. Of course, wireless isn’t available for online games so I’d probably go back to Qwest for that, but at a lower speed.
If you’re anywhere in the contiguous U.S. or Alaska or Hawaii all of these options in one form or another is available to you. If it’s not like this in a particular area, it is probably because of geography that makes it hard to get other services out there or because of regulatory hurdles. Where I will agree is that when the AT&T was trivested, the government essentially authorized mini-monopolies in the form of Ma Bells in various regions of the country, but that is only in concern to landline service. That business model is not working out so well for the telcos so now they have to compete on something else. Broadband service is highly competitive. Think of it this way: it was only 10 years ago that most broadband connections maxed out at 256kbps. Now, you can get up to 20mbps in some areas of the country. If there was no competition in broadband services how did that occur?
“Exhibit #1 is the recent name change from Comcast to Xfinity. Comcast is not undergoing the name change because their customers love them. They are changing their branding because their customers LOATHE them. This happens in a government enforced monopoly, not in a real competitive marketplace. Until such a marketplace comes into being, some sort of utility like regulation is required to keep the ISPs from engaging in their STATED goal of throttling content providers who do not pay up extra money to them.”
Companies change their names all the time, partly because of the reason you’ve stated. That is because of competition. If there was no competition, then Comcast would never worry about changing its name for its broadband service. To wit, Qwest was formerly known as US West was formerly known as Mountain Bell. Accenture used to be Arthur Andersen. A company changing its name is not out of the ordinary.
“Crony capitalism is NOT capitalism, and in broadband, we basically have crony capitalism. It’s time that the situation be remedied.”
This is important because, like Mike T, you’re ascribing a definition to something that is not. Crony capitalism is when there is a cozy relationship between government and business. “Rent-seeking” would be an example of crony capitalism. A business that charges you a high price for its services is not engaging in crony capitalism.
“The pizza delivery analysis is horrible. It is more like the Cop only letting pizza hut go 45mph but letting papa johns go 100 mph because papa johns paid an extra fee. While at the same time you are also paying the Cop to let papa johns deliver to you. you have no understanding of what is going on.”
It was a crude analogy, yes, and yours is even better. Price discrimination is fine, especially when it helps businesses accurately determine how much is being used and what resources must be committed to ensuring that the extra strain can be handled without affecting anyone else’s service. People who support net neutrality does not want this happening, but it is unfair to the provider and to those who are not excessively using the service as opposed to companies like Google and Apple.
But I like how people can easily say, “you have no understanding of what is going on” when they themselves don’t understand what it is they’re asking for. Let me remind you that you guys want the government to regulate the internet – the same government that have given you hits such as public education, affordable housing, and, now, healthcare that the Congress itself is not sure whether covers themselves or not.
But I have no understanding of what is going on.
Chris,
You are incredibly, painfully ignorant of how the economic relationships work here. Google and Apple HAVE ALREADY LEASED BANDWIDTH FROM THEIR LOCAL TELECOMS. Get that through your head! Google and Apple don’t just magically send you data, they get it actually leasing serious quantities of bandwidth from telecoms all across the country wherever they have data centers. Google has even gone so far as to invest additional billions of dollars into buying out vast amounts of dark fiber to become its own mini-telecom on top of that precisely because it wants to be able to establish its own peering relationships with nearby telecoms.
If you didn’t grok some of that, then let’s take a detour to be blunt:
Google and Apple have already leased, at their expense all of the bandwidth they need to send you the data.
That’s right Chris, Google and Apple are no more freeloaders in this argument than AT&T, Verizon, SBC, Qwest, Comcast, etc. because they have already paid fair market value every whatever-their-contract-period-is for the bandwidth they need to provide services to you.
The real issue here is that your ISP doesn’t want to tell you that you are underpaying them, so they tell you that Google, Apple, etc. are the real free loaders, not you, their residential customer.
I’m all in favor of metered bandwidth. That’s one of the reasons I find your position so disgusting. You’re defending the end user who is the real free loader here by claiming that somehow Google, Apple and other companies are offloading costs to you.
Chris,
Once again, you made a mockery of your own argument:
As I said, if I subscribe to a service at 15mbps, and Apple is capable of sending to me at roughly that speed, it is a deceptive practice bordering on fraud for my ISP to secretly tell Apple to pay them a periodic fee or their traffic will be throttled down.
I did not advocate for a mandatory limit, what I specifically attacked was the legal ability of an ISP to sell me a service at a certain speed and then tell companies I want to receive content from that if they don’t pay my ISP an additional fee on the side, the ISP will quietly keep me from receiving service at the speed which they advertised to me. That is what many of them want to be able to do. They want to be able to sell you, say, a 15mbps package and then tell content providers that they have to pay up or they’ll get throttled down to a point where they definitely cannot send you data at that speed, even if they have the means to otherwise do it.
“You are incredibly, painfully ignorant of how the economic relationships work here. Google and Apple HAVE ALREADY LEASED BANDWIDTH FROM THEIR LOCAL TELECOMS. Get that through your head! Google and Apple don’t just magically send you data, they get it actually leasing serious quantities of bandwidth from telecoms all across the country wherever they have data centers. Google has even gone so far as to invest additional billions of dollars into buying out vast amounts of dark fiber to become its own mini-telecom on top of that precisely because it wants to be able to establish its own peering relationships with nearby telecoms.”
I am aware that Google would lease a huge amount bandwidth from the telcos because that would be prudent them as business. It’s a shame that you think so little of me to point that out. However, if Google is growing at an exponential pace, don’t you think that they recognize that means their costs will have to also exponentially increase? That would mean having to renegotiate pricing with the telcos at a higher rate. You say that I don’t get this through my thick head, but it seems that it does not penetrate yours: GOOGLE, APPLE AND OTHER CONTENT PROVIDERS ARE USING THE LEVERAGE OF GOVERNMENT IN ORDER TO KEEP THEIR COSTS LOW WHILE HAVING THE TELCOS SHIFT THE COSTS TO THEIR END CONSUMERS.
In other words, think of your argument in terms of another commodity: airline fuel. When airlines negotiate contracts with fuel providers, they lock in a rate to try and anticipate the future pricing of oil. Once locked into the contract, they cannot renegotiate to get to the lower price without incurring a huge cost to themselves. Most bet wrong, few bet right on the future price of oil: Southwest Airlines, for example locked in a contract very favorable rates where they were not only able to pass on savings to its consumers, but was able to sell some of its future positions at a favorable rate. The ones who were not so lucky suddenly found that their fuel costs were so great that they had to start passing on rate hikes to their consumers.
That is not unlike what is going on in broadband services. If you know that the there is a lot more room for growth in the internet technology, then you know that a lot of these newer technologies are going to be making more demands on the bandwidth to deliver them. This is going to cost Google and Apple more money than what they are currently paying. Now companies like Apple and Google have one of two choices: they can a) either negotiate with these companies and try to come up to terms with a new pricing structure that will benefit both or b) they can go to the government, use their political power (because no one likes the telcos) and lobby government to pass legislation that will treat them the same as everyone else. We all know which one they chose.
“I’m all in favor of metered bandwidth. That’s one of the reasons I find your position so disgusting. You’re defending the end user who is the real free loader here by claiming that somehow Google, Apple and other companies are offloading costs to you.”
It’s funny that you are advocating for metered bandwidth. You DEFINITELY do not want that. I’ll relate a story. When I worked for Verizon Wireless, we had sent a bill to a consumer of our wireless broadband service who used almost $1,000 worth of broadband. Turns out he bought a package that only allowed him a limited amount of data per month, but he went over it. That turned out to be a nightmare for the consumer and can become a potential headache for the telcos, so the best platform we have now is to sell an “unlimited” package and a monthly rate.
And you took my argument in another post and turned it on its face. I did not argue that at this moment Google and Apple are offloading their costs on to us, however, I did say that someone has to pay for extra load that will be put on the network. I say that Google and Apple should pay and if that means charging their individual consumers, fine. Their preferred position is to have the costs picked up by the providers and have the pass it on their consumers. It is as clear as day that that is what “net neutrality” is about. Here’s an argument from net neutrality proponents:
“Without net neutrality, the Internet would start to look like cable TV. A handful of massive companies would control access and distribution of content, deciding what you get to see and how much it costs. Major industries such as health care, finance, retailing and gambling would face huge tariffs for fast, secure Internet use … Most of the great innovators in the history of the Internet started out in their garages with great ideas and little capital. This is no accident. Network neutrality protections minimized control by the network owners, maximized competition and invited outsiders in to innovate. Net neutrality guaranteed a free and competitive market for Internet content.”
For starters, there is no such thing as “free”. Someone has to pay. Many of these proponents are making a de jure argument that entity that should pay are the telcos. Which is interesting why you find my position disgusting. My position is thus:
If the telcos have to do R&D to expand the network, their consumers should have to bear the costs. If the content providers will make more demands on the network which gives rise to the need for the telcos to do the R&D to expand the network, their consumers should pick up the charge. In other words: perhaps Google should stop providing “free” content and start charging user fees and Apple raise its price on some of its products.
And one more aside: you REALLY should read your contract or at least read the fine print when it comes to the actual speed with which you will receive. The advertised speed is never what you will receive. No provider will ever guarantee that you will receive the maximum speed, but will give you a range because there are a variety of factors that will determine the quality of access speed. Here’s the typical language you will find when the telcos tell you to read the important details (and this is from Qwest):
“Qwest High-Speed Internet®: Service not available in all areas. Price for Life offer available to Qwest residential customers. Downgrading service to 256Kbps, changing ISP, moving out-of-state, suspending or disconnecting service may cancel price guarantee and may result in an early termination charge. Connection speeds are based on sync rates. Download speeds will be up to 15% lower due to network requirements and may vary for reasons such as customer location, websites accessed, Internet congestion and customer equipment. Speed tiers of 7 Mbps and lower are provided over fiber optics in selected areas only. Customers qualifying for Qwest High-Speed Internet® 7 Mbps will receive maximum line speeds ranging from 3 to 7 Mbps. Windows Live is compatible with Windows® XP (with Service Pack 2 or greater) and Windows Vista® operating systems. Customers with other Windows operating systems will receive MSN Premium. Certain features of Windows Live are not available to Macintosh users. Activation fee applies. Prices exclude taxes, surcharges, and other fees. With approved credit. Requires compatible modem. Subject to additional restrictions and subscriber agreement. Windows Live also requires acceptance of Microsoft terms and conditions.”
So, please, if you respond just be civil about it. I didn’t resort to berating your position or trying to insult your intelligence.
Chris,
The extra load they’re putting on the network is due to user demand. Therefore, the users should have to pay their ISPs higher access fees. It’s just that simple. Metered bandwidth is the only way it’ll work. A little old granny who uses Google or Bing and YouTube a few times a day shouldn’t pay anywhere near the cost of someone who is using their fiber connection to download half of Hulu or iTMS.
If the users don’t like that? I have two words for them: screw them. All-you-can-eat is for cheap buffet lines, not utilities.
NO! This is another of those measures designed to stifle freedom of speech. It’s anything but “neutral.”
Exactly. Rob makes some good points but the answer is not to let the government get its nose under the tent. The regulation would definitely not be temporary and would grow to be a monster in a very short time.
For those of you too young to recognize the picture:
That is ‘The Phone Lady’, Lily Tomlin’s character
from the ‘Laugh-In’ TV show, _way_ back in the Day.
Her punch line, delivered right after making a major mistake, was:
‘Oh, well, we don’t care, we don’t have to; we’re the Phone Company.’
I am very wary of corporate rent-seaking / government intrusion under the (Orwellian) guise of “net neutrality”. Band width, like every other good, is a scarce resource, and can only be priced and allocated fairly within a free market, e.g., voluntary arrangements between providers and consumers. The “issue” is who pays for the internet’s capacity, or ability to carry bits at peak usage. High-volume users like Google and YouTube want this cost to be “socialized”, wherein sporadic users of the net will be charged the same amount per unit of bandwidth as they are, even though the former account for the vast majority of traffic.
To put it in a way more people can understand. Should the person who uses 1,000 KW a month of electricity pay the same amount as a person who uses 100 KW a month?
The person who uses 1000KW would quite naturally say yes.
That has nothing to do with net neutrality, which is whether an ISP can charge more for a byte that comes from “in network” as opposed to “out of network”.
I’m buying access to a pipe. The question is whether government created monopolies will be forced to use common carrier rules which make it illegal for them to care about where the bytes in the pipe come from.
Electricity transmission is a good analogy. All end-users (directly or indirectly) are charged a capacity fee based on peak usage. Absent these payments, there would be no incentive to build capacity (i.e., everyone would attempt to “freeload” on existing lines) and the whole grid system would eventually trip when individual usage coincided, e.g., on a hot day. What I believe the ISPs are doing is trying to do is to collect enough from the Googles of the world (first mile)to build out the internet backbone, rather than socialize that cost over the casual users (last mile).
You have your explanation backwards. They’re attempting to make Google subsidize their (the ISP) users. The ISPs don’t want to go back to their users and make them pay for the actual bandwidth they’re consuming via Google’s YouTube service or Apple’s iTMS.
That is what some of the commenters here don’t understand. The ISPs don’t have the stones to go to their users and make them pay for their actual bandwidth use, so they go to Google, Apple, etc. and say “that’s a nice service you provide, it’d be a real shame if our customers couldn’t access it at a good speed…”
“You have your explanation backwards. They’re attempting to make Google subsidize their (the ISP) users. The ISPs don’t want to go back to their users and make them pay for the actual bandwidth they’re consuming via Google’s YouTube service or Apple’s iTMS.”
“That is what some of the commenters here don’t understand. The ISPs don’t have the stones to go to their users and make them pay for their actual bandwidth use, so they go to Google, Apple, etc. and say “that’s a nice service you provide, it’d be a real shame if our customers couldn’t access it at a good speed…””
Or, perhaps Mike T, Google and Apple want to hold down their own costs so as not to pass them on to their consumers and have the providers pick up their costs, which they will invariably pass on to their consumers (and not just broadband users). At some point someone has to pay for the bandwidth that is being used. The costs can’t be hidden forever.
Chris,
Google and Apple already pay fair market leasing fees to their telecom providers for their bandwidth. Therefore your argument is a load of bullcrap.
To put it in a way more people can understand. Should the person who uses 1,000 KW a month of electricity pay the same amount as a person who uses 100 KW a month?
That’s a reasonable question to ask. One problem is that people who search for the odd recipe here and there and have email to keep up with the grandkids are subsidising the 30-something down the block watching streaming video content 5 hours a day. Net Neutrality *guarantees* that this is the case.
Part of the problem in this discussion is that the cable companies really are modern era robber barons. They are universally despised. As Mike T notes they’re trying to go after streaming video and other super high bandwidth providers to get *them* to subsidise.
The correct answer ought to be that ISPs ought to be able to charge for bandwidth consumed at the consumption end; e.g. guarantee “n” Gb xfer per month and then charge per Gb after that. There’s a lot of precedent: if you have your own dot com web site, this is the pay arrangement. And yeah this will probably require some sort of regulation. Asking grandma who looks up recipes or birthday gifts online to pay the same connection price as the streaming video neighbour is just wrong.
You do realize that all companies pay for the amount of bandwidth that they use.
The more traffic going to their site the more they pay.
Isn’t the ultimate answer competition? And the biggest “pipe” is the air? There should be as much RF spectrum (not to mention other encoding mechanisms) set free and left as open and accessible under creative multiplexing as possible for as many wireless enthusiasts, including reasonable set-asides for membership cooperatives, to distribute signals by any means that can be dreamed up. Then let Comcast, Hughes Sat, Verizon, et al compete against each other and everybody else. Let Google and Wells Fargo build their own nets if they really object to making deals with other parties for bandwidth.
It also lacks the Constitutional authority from regulating free speech.
When it comes to cable, it looks like oligopoly to me, where the industry are price makers rather than really competing over costs–hence the price always goes up. I can remember when cable first started, marketed as the medium without commercials, unlike “free TV.” Now cable has commercials and high prices. What competition there is is over programing content, rather than price. Fine, but it seems to me that the consumer should then be able to select and buy the programing he or she wants, rather then get stuck buying an entire programmed package. Of course, if such content competition was actually allowed, some, maybe many, of those packaged programs would have little or no market value and fade away–PBS comes to mind. Gee, but then cable’s programing would end up like talk radio, not a very profitable venue for Air America or MSNBC. Yeah, lets have some genuine market based programing competition.
Yes, you are buying access to a pipe, probably a residential one that you use intermitently. Google buys access to a very large commercial pipe that they fill to capacity 24/7. We all pay something for the back bone that connects the two pipes. The question is, should you and Google pay on the basis of maximum rate (which you achieve infrequently) or on actual usage?
call me crazy, but i think the simplest solution is just to end the monopolies, or at least cut it back. i right now have a power cord, gas pipe, phone cord and cable running to my house. one of those i have literally never used. and yet i don’t feel like my house has a mess of wires on the outside. Are we really saying we can’t have, say, 3 cable companies in a given area? that there isn’t enough ground to allow it?
Of course as wireless becomes more and more important broadband will become less. so maybe this is really a transitional technology, like fax machines. sure we have them, but if you want to send a document instantly, you use a pdf scan, not a fax. The fax exists and has a place, kind of, but you can see that someday it will go bye-bye. same with broadband cable.
I know. Let’s ask Algore. He invented the Internet, didnt he? I trust business first, a dead tree stump second and the government last to do anything with the Internet.
What isn’t being discussed at all is the fact that bandwidth is the only price consideration being discussed but what is being left out is that without the heavy bandwidth content there would not be a demand for bandwidth. There is also a silly little thing that it does not cost the provider any more to have thier pipes full, half full, or empty. It is not like electrical production and distribution. The backbone is fully fiber optic and once the cable is energized the costs are relatively fixed.
Google, I-Tunes, U-Tube already pay a premium for connection and bandwidth but ISP’s who do not even connect to them want more money. The entire thing is a false issue being propogated by the ISP’s who are not capable of delivering their promised services because they over promised and under delivered.
None of this will be solved until the entire backbone has been upgraded, the ISP’s have built capacity to deliver on their bandwidth promise and the last mile is fully fiber optic. There is only so much Radio Spectrum and once it is used up it is used up. When we run out of spectrum with fiber optics we power up another cable.
Yes, anything would be ‘a step to be taken only with great trepidation’.
Don’t confuse/confound the issue with the mention of private company concerns. Government intervention (regulation) will not help anything.
If you can remember phone ‘party lines’, you can remember regulation of those was quickly overtaken by improved technology provided by the ‘evil’ phone company.
The initial round of concerns that gave rise to the entire question of a need for a Net Neutrality Act were as far as I’m concerned, rendered a non-issue almost ten years ago. I do remember the blowhards that used to run AT&T were making all kinds of well-publicized noises about asking the content providers to ante up but those same arguments have far less weight than they did when they were first introducted.
An effective case for regulation and heavy-handed oversight requires that at least of one of several fundamental conditions be present in the broadband industry:
1) Demonstrated scarcity of a vital resource.(Scarcity? Broadband access is much more plentiful and cheaper than it was when Net Neutrality was first discussed)
2) A preponderance of end-user complaints over industry business practices and/or allegations of widespread deception. (Broadband customers are overwhelmingly happy with their service; so much so that it has become for many a necessity they feel they could not do without.)
3) A compelling case that there exists a virtual monopoly and serious restraint of trade within a vital industry. (There are more providers of broadband service now then when the NN discussions began – the technological advances in wireless broadband alone have increased competition and mitigated any concerns about the rise of monopolies.)
In fact, to arrive at the right conclusion one only needs to answer this question: Do you believe broadband networks and network capacity will become both faster and more plentiful over time?
1. Scarcity of a resource? Not an issue