'Net neutrality' nets out to government control

American Thinker ^ | November 03, 2009 | Lee Cary

[LearsFool]

That's where a little problem comes in. There's no real competition in many places.

Despite government interference in the market, there's no pressing need for greater competition just yet. Let the much-feared censorship begin, however, and competitors will be popping up like mushrooms, vying for the "no-censorship" crowd's business. (Whether the government will permit such free, consumer-oriented competition is another question altogether.)

When the final tallies are in, competition benefits the consumer - and even more so when government doesn't step in to "help". No, the benefit won't be perfect, and it won't be immediate. But only the government can get away with promising immediate, perfect solutions, then utterly fail to deliver, and still be in business.

[antiRepublicrat]

Try streaming a two-hour high definition video over the telegraph. Doesn't work? That doesn't matter.

Same concept, just newer technology. The law prevented the operators from giving some private traffic advantages over other traffic.

[zeugma]

Try streaming a two-hour high definition video over the telegraph. Doesn't work? That doesn't matter. Your little ISP is required by the federal government to provide that service to whoever wants it, and you have to charge the same price that you would for a two-line telegraph message.

Sorry. That analogy doesn't work. 

If you want to bring telegraphs into it would be like this

A --------- B ---------- C ---------- D

Alice sends a message to David

Charlie wants to charge Alice for forwarding the message along to David. --- Or Charlie will pass a message along to David from Bob right away, but if it comes from Alice, it gets delayed.

Net neutrality is what we have now, but you have ISPs like Comcast and ATT trying to bully Google into paying them to allow Alice, Bob, Charlie, or David to go to Google, by claiming that Google is getting a "free ride", even though Google pays for their bandwidth the same as Alice, Bob, Charlie, and David do.

These large ISPs don't want to be in the business of providing a commodity (bandwidth) to the market because margins on commondities are small. If they don't want to deal in commodities, they need to get in another line of business.

[VRWCmember]

Net neutrality is what we have now, but you have ISPs like Comcast and ATT trying to bully Google into paying them to allow Alice, Bob, Charlie, or David to go to Google, by claiming that Google is getting a "free ride", even though Google pays for their bandwidth the same as Alice, Bob, Charlie, and David do.

If net neutrality is what we have now, then there is no need for a law to turn control over the internet to the FCC and its regulators.

[discostu]

Net Neutrality = the FCC CAN.

Bottom line.

[antiRepublicrat]

There is STILL a more competitive market even in those areas because of the availability of cable internet, phone company broadband internet, and wireless broadband internet.

Many localities throughout the country only have one option. Even with the competition that exists in most areas, it would take only about five companies in the US to implement this policy to cover probably 90% of users in the country.

The major ISPs shouldn't complain about this. They were more than happy in the 90s to take billions in tax breaks and other considerations on the promise of 40 Mb/s to the curb. They haven't delivered, and now they want to siphon more money off of existing commerce.

internet is the exception that will finally prove that a federal government solution to a non-existent problem is what we really need.

This issue really has two parts.

The first is on the back-end. A few years ago the ISPs started talking about how Google and other content providers were "freeloading" on their networks, and started making plans to degrade the services of those who don't pay them.

The "freeloading" argument was of course total BS. The content providers pay their ISPs millions each (Google over a million a day), and consumers together pay tens of billions of dollars a year to their ISPs. The ISPs just want to get paid twice, and they're willing to destroy the basic premise of the Internet -- the free flow of data -- in order to do it.

This will also create a higher barrier to entry in Internet markets, discouraging investment and innovation. One thing that drove all those Internet billions is that anybody can start up, yet have the same presence as a billion-dollar company. Non-neutrality kills that -- the billion-dollar company can afford the ISP's extortion fee, but the startup can't.

Yes, extortion. They'll degrade your traffic, and thus your ability to do business, if you don't pay.

The other end of this was sparked by P2P throttling, but P2P itself isn't the point. ISPs of course have the right to control traffic from users that is disrupting their networks. For example, they've cut off users whose computers had been turned into members of DDOS botnets.

But ISPs that advertised a large fixed bandwidth with no maximum transfer started throttling user's P2P traffic to reduce the load on the network. IMHO, that was a violation of contract, or at least false advertising. You advertise 7 Mb/s 24/7, you damn well better be able to provide that to all of your customers. Instead the ISPs built their networks to handle only a fraction of that load, then complained when some people actually used what they had paid for.

The net neutrality aspect of this is the very concept that an ISP would limit the consumer's use of legitimate applications (yes, P2P in itself is legit). The consumer protection aspect is offering a service, then penalizing those who use the service as advertised.

The basic rules of the FCC are meant to keep the status quo from before the ISPs got greedy and decided they didn't like people using the whole service offered.

One day there may be real ISP competition. But until then millions of people have no real choice for broadband, and are at the mercy of the ISPs.

[antiRepublicrat]

Let the much-feared censorship begin, however, and competitors will be popping up like mushrooms, vying for the "no-censorship" crowd's business.

Do you realize what the barrier to entry is for that? A company would have to lay cable to millions of homes in order to compete, and that's in markets where the current ISP doesn't have a legal monopoly already -- the price the locals paid in order to get that service in the first place. In many places the ISPs didn't want to lay out the cash to serve communities unless they were guaranteed profit in the form of a monopoly. That is actually reasonable, as such a rollout is a big financial risk to a company, but getting a monopoly from the people comes with responsibilities to those people. It doesn't just create a captive market for a company to abuse.

[steve-b]

If net neutrality is what we have now, then there is no need for a law to turn control over the internet to the FCC and its regulators.

The regulations are in response to repeated incidents of goverment-franchised ISPs abusing their government monopolies to suppress competition, e.g.:

One important aspect which will be affected greatly in the not-so-far future is independent Voice over IP. Independent VoIP is competing against Comcast Digital Voice, Time Warner Digital Phone, and other such Cable VoIP offerings which typically cost 3-4 times what independent VoIP providers charge, and almost as much as a regular phone would. In today's internet situation, consumers barely feel the difference between indy VoIP and cable-provided VoIP. It's pretty much all the same quality-wise.

Recently however, an alarming news came from Comcast when they circulated the following message among it's users:

"As part of our ongoing efforts to continuously improve the quality of our service, we are switching to a new network congestion management technique by the end of the year. It is focused on managing network congestion only when and where it may occur. It will also replace the current technique and will help ensure that all of our customers receive their fair share of network resources..."

Comcast's FAQs proceed to indicate that Comcast VoIP Service will NOT be affected by this "network management" technique. So far all good, right? Wrong. What happens if you're using an independent VoIP provider? you guessed right - it's your problem, not Comcast's! If you get flagged for throttling, not only will your internet connection slow to a halt, should you dare to use a competing independent VoIP provider, your phone will also be affected and range from bad quality to completely unusable.

[VRWCmember]

One day there may be real ISP competition. But until then millions of people have no real choice for broadband, and are at the mercy of the ISPs.

There is enough competition right now that I would rather be at the mercy of the ISP's - where I still have choice about the services I buy - than at the mercy of the FCC. Turning over more control to the FCC will prevent rather than accelerate the day when we all have "real ISP competition" and rainbow stew.

[steve-b]

There is enough competition right now

Obviously there is not, or the incumbent ISPs would not have dared to attempt the abuses that prompted these regulations in the first place.

[antiRepublicrat]

Have you actually read the FCC guidelines?

[LearsFool]

You’re assuming the network effect is a constant, aren’t you? That the cost of providing service to a single customer, for instance, is so prohibitively high that no company will undertake the job without a guarantee of recuperating the cost via monopoly?

If there’s any industrial sector in which unpredictable innovation has turned traditional rules of business on their heads, it’s information technology. Typical entry barriers, such as the network effect and economies of scale, are often surmounted with surprising ease.

Note that wireless and satellite internet service do not require the same infrastructure as cable. And who can foresee what data delivery technologies will be developed to obsolete the current ones? If only the market can be freed up - so that purveyors of these new technologies can make their pitch and discover what’ll sell and what won’t - risk-taking, inventive genius will continue our technological advancement.

Yes, some will succeed and some will fail. That’s risk; nothing new here. Yet some communities, in order to persuade companies to provide the service, promised guarantees against that risk. Such communities, in so doing, assumed the risk themselves, and are now paying the price.

Well, as I noted earlier, competition’s benefit to consumers is neither perfect nor immediate. So-called “early adopters” face risks too, whether it’s an individual buying too soon or a community guaranteeing a monopoly market. (This isn’t much different from signing a 2-year cellphone contract, only to find 6 months later that the average-market per-minute charge has dropped dropped by 70%, and you’re still locked in at full price for another year and a half.)

More often than not, someone will indeed build a better mousetrap if he’s free to market it. The question is, will he be permitted to market it? Or will the government dictate what sort of mousetraps we can and cannot use?

[VRWCmember]

Have you actually read the FCC guidelines?

I read the summary of the bill at the article linked to this thread:

7/31/2009 -- Introduced. Internet Freedom Preservation Act of 2009 - Amends the Communications Act of 1934 to set the policy of the United States regarding various aspects of the Internet, including access, consumer choice, competition, ability to use or offer content, applications, and services, discriminatory favoritism, and capacity. Makes it the duty of each Internet access service provider to:
(1) not block, interfere with, discriminate against, impair, or degrade the ability of any person to use an Internet access service;
(2) not impose certain charges on any Internet content, service, or application provider;
(3) not prevent or obstruct a user from attaching or using any lawful device in conjunction with such service, provided the device does not harm the provider's {sic} network;
(4) offer Internet access service to any requesting person;
(5) not provide or sell to any content, application, or service provider any offering that prioritizes traffic over that of other such providers; and
(6) not install or use network features, functions, or capabilities that impede or hinder compliance with these duties. Requires the Federal Communications Commission (FCC) to promulgate related rules. Prohibits construing this Act to prohibit an Internet access provider from engaging in reasonable network management. Requires the FCC to:

(1) promulgate rules to ensure that an Internet access service provider does not require a consumer, as a condition on the purchase of any Internet access service, to purchase any other service or offering; and
(2) take certain actions, including regarding private transmission capacity services.

The official Open Congress summary is here.

I have also read opinions on this legislation by Dr. Thomas Sowell and other economists of his ilk. Let's take a look at some of the supporters and some of the opponents of this legislative attempt to rein in the freedom of the internet:

Co-Sponsors:
Rep. Lloyd Doggett [D, TX-25]
Rep. Anna Eshoo [D, CA-14]
Rep. Maurice Hinchey [D, NY-22]
Rep. Jay Inslee [D, WA-1]
Rep. James McDermott [D, WA-7]
Rep. Joe Sestak [D, PA-7]
Rep. Henry Waxman [D, CA-30]
Rep. Lynn Woolsey [D, CA-6]

Supporters:
Sen. Al Franken [D, MN] [5]
Sen. John Kerry [D, MA] [4]
Sen. Kirsten Gillibrand [D, NY] [3]
Sen. Olympia Snowe [R, ME] [3]
Sen. Barbara Boxer [D, CA] [3]
Rep. Ronald Paul [R, TX-14] [8]
Rep. Barney Frank [D, MA-4] [2]
Rep. Dennis Kucinich [D, OH-10] [2]
Rep. Bobby Rush [D, IL-1] [2]
Rep. Barbara Lee [D, CA-9] [2]

Opponents:
Sen. Joseph Lieberman [I, CT] [5]
Sen. Jefferson Sessions [R, AL] [3]
Sen. Richard Shelby [R, AL] [3]
Sen. John McCain [R, AZ] [3]
Sen. Max Baucus [D, MT] [3]
Rep. Michele Bachmann [R, MN-6] [3]
Rep. Nancy Pelosi [D, CA-8] [3]
Rep. Dan Burton [R, IN-5] [3]
Rep. Eric Cantor [R, VA-7] [2]
Rep. Jane Harman [D, CA-36] [2]

Surprisingly Pelosi and Harman even oppose this bill (probably because it would be devestating to the technology sector in their districts).

But maybe you and Franken and Barney Frank and Maurice Hinchey and Jay Inslee and James McDermott and Joe Sestak and Henry Waxman and Lynn Woolsey and Lloyd Doggett and Anna Eshoo and Maurice Hinchey and Dennis Kucinich and Bobby Rush and Barbara Lee are all right and this new overarching government regulation is just what the internet needs to keep it innovative. But I wouldn't bet on it.

[antiRepublicrat]

For reference, here are the proposed rules:

• Consumers are entitled to access the lawful Internet content of their choice
• Consumers are entitled to run applications and use services of their choice, subject to the needs of law enforcement
• Consumers are entitled to connect their choice of legal devices that do not harm the network
• Consumers are entitled to competition among network providers, application and service providers, and content providers.
• A provider of broadband Internet access service must treat lawful content, applications, and services in a nondiscriminatory manner
• A provider of broadband Internet access service must disclose such information concerning network management and other practices as is reasonably required for users and content, application, and service providers to enjoy the protections specified in this rulemaking

Nice and simple, not messing in the internals. Those protections for ISPs that engage in full disclosure are related to:

• Reasonable network management:
  • To manage congestion on networks
  • To address harmful traffic
  • To block unlawful content
  • To block unlawful transfers of content
  • To conduct other reasonable network management practices
• "Managed services," which means things like a contract for a dedicated connection for a specific application only.

That's it. They can manage their network however they want to, as long as they don't do it for purposes of stifling competition and other companies' business or restricting legal user activity. Except for the added protections for the ISPs, these are essentially the same general points the FCC put out years ago under Bush.

This will be complaint-driven, not FCC-monitored. For example, there could be a letter of inquiry issued if a large number of Sprint customers suddenly notice that their non-Sprint VOIP applications aren't working very well. Sprint is in the clear if there is a genuine network management reason behind it, and not an attempt to shut-out other VOIP providers.

[VRWCmember]

Who summarized those rules?
Since that is someone’s sanitized, paraphrased version of the rules which may or may not be the “intent” of the rules as written, they all sound very reasonable and benign.
It is in the actual language of the rules - which includes a lot of phrases like “take certain actions” and “various aspects of the internet” and “certain charges” - that will be subject to the discretion of some FCC bureaucrat to regulate and enforce.

[steve-b]

Opponents.... Sen. John McAmnesty

Might want to soft-pedal that one, LOL.

[antiRepublicrat]

Who summarized those rules?

The FCC came up with the basics years ago. What I gave was very close to their actual text. The bill was supposed to be an implementation of these guidelines.

I never said the Democrats wouldn't screw it up once it got to law form though. I'm for real net neutrality, not necessarily the Democrats' warped version of it.

[VRWCmember]

Opponents.... Sen. John McAmnesty
Might want to soft-pedal that one, LOL.

Outside of immigration reform and campaign finance reform, McCain had about a 50-50 track record of standing up for freedom, which is a HELLUVA lot better than pretty much ANYBODY on the supporters side. You want to stand with the supporters, while I stand with the opponents (including McLame and Peloser)? Be my guest.

[VRWCmember]

I'm for real net neutrality, not necessarily the Democrats' warped version of it.

And the best way to have that is to leave the internet free from most FCC regulation.

[inpajamas]

The next few years aren’t going to be pretty.