Today in Salon.com, Farhad Manjoo has a typically excellent article that frames and discusses why network neutrality is such a critical issue clearly and concisely: The corporate toll on the Internet: "Telecom giant AT&T plans to charge online businesses to speed their services through its DSL lines. Critics say the scheme violates every principle of the Internet, favors deep-pocketed companies, and is bound to limit what we see and hear online."
LA Times: Phone, Cable May Charge Dot-Coms That Want to Race Along the Internet: "As Internet traffic starts to clog, the telephone and cable companies that control the nation's telecommunications networks are considering charging dot-coms such as Google Inc. and Yahoo Inc. extra to make sure their data gets special treatment -- zooming along faster and more reliably than anyone else's."
Here are the three key points about why network neutrality is critical to the information age:
- A neutral internet is cheaper.
A preferential, proprietary internet requires more expensive routers that move preferred packets into an HOV lane. As bandwidth gets cheaper and cheaper, it is probably cheaper and more cost effective for the individuals, small businesses and large companies who use the internet to pay for wider information superhighways than adding an HOV lane to the existing networks. Unlike with real highways, creating more bandwidth does not take away from existing real property. Wheres there is a fixed amount of land available, the world of networks is not zero-sum. - Internet access has monopolistic characteristics.
Consumers may have the choice of access through a cable provider or a telephone (DSL or fiber) provider. Currently, the internet access market generally relies on incumbent wireline infrastructure. Satellite has enough drawbacks that it is an acceptable substitute for other broadband in remote areas. Broadband over power lines may exist as a third option, but again, it relies upon the local power monopoly. Wired access may in fact be a natural monopoly and as such needs to be regulated. A free market in internet access may not be competitive. - Neutrality promotes free speech
The threat of a non-neutral internet is that monopolistic local access providers could charge a premium for major content and service providers to connect to their network. If Google wants to reach its customers who use Verizon, AT&T and Time Warner customers over a non-neutral internet, Google could have to pay a connection fee to Verizon and to AT&T and to Time Warner in addition to the fees it pays to its own internet access provider. Tony Soprano would be proud. And this wouldn't just affect Google, or Apple or Microsoft. It would affect Homestar Runner, YouTube, Typepad, the Internet Archive, the New York Times and everyone who is sending bits of information to the internet at large.
Network neutrality is not just a question of telecommunications policy, but a question of the freedom of speech.
Comments
I'll address you three points, one at a time.
1) The telcos would use the money gained from access fess to pay for the routers. If they do pass the costs onto consumers, consumers would simply abandon the service.
2) Monopolies exist when only one carrier serves a current market. In virtually all markets, a monopoly doesn't exist. Duopolies and triopolies are not forbidden.
3) Actually, net neutrality promotes Google, Microsoft, and Amazon, who are seeking government involvement to preserve their business interests. Why should the government be charged with picking sides on this issue?
Posted by: lessgov | April 17, 2006 10:08 PM
Ok "lessgov,"
1. Consumers would abandon non-neutral broadband for what alternatives? If the choice is between a discriminatory incumbent cable provider and a discriminatory DSL/fiber ILEC how do individuals abandon those services?
The fact that the Compuserve, Prodigy and AOL "walled-garden" services failed when competing with ISP's offering service to the true internet is not relevant when considering net neutrality policy, because those competitive ISP's were able to reach individuals over the common carrier POTS network.
2. An oligopolistic market with significant barriers to entry often reaches an equilibrium that resembles a monopoly. In these situations, targetted government regulation can prevent market failure or monopoly premiums. Government should engage in regulation to encourage competitive markets.
3. The government should be charged to "pick sides" when one is clearly in the public interest. If the net neutrality question was simply a battle between AT&T/Time Warner/Verizon and Google/Microsoft/Amazon then it wouldn't be such an important issue. The fact that the issue also puts core First Amendment principles in conflict with mere business profit concerns is why the government needs to "pick sides" on this issue.
Posted by: Andrew | April 17, 2006 10:27 PM
Clearly this is a complex issue and valid points are made on both sides. Having said that, it is inconceivable to me that Microsoft, Apple and Google (among others) could ever be "victimized" by the telcos. It seems to me that if the telcos demand payment for the privilege of being carried, these behemoths could simply refuse. The financial and market strength of Google (et al) make it impossible for the telcos NOT to carry them. Consumers would not tolerate an internet experience without them. So if there is any hostage-taking, it'll be by the software giants, not by the telcos. At the end of the day, the market will sort this out. We don't need burdensome Congressional regulation.
Posted by: EEC | April 18, 2006 6:22 AM
I just wanted to voice my support for lessgov's response. It is well thought out and right on the money. I couldn't have said it better myself.
Posted by: pkp646 | April 19, 2006 2:25 PM
Count me among the folks that get queasy when anyone suggests that government is the answer here. We've been doing this for years without it (with tremendous success), and there are no instances of an ISP attempting the shenanigans that you outline above. We'll be better off if we keep the status quo here - why fix a problem that doesn't yet exist?
Posted by: The Decider | April 19, 2006 10:33 PM
It is very likely that in this term or next, Congress will pass a new Telecommunications act that constitutes a significant revision to the 1996 Telecom Act and could substantially change the regulatory landscape. The ILECs and cable companies will be lobbying for a version of the act that encourages proprietary, discriminatory services. Congress is going to intervene in this space to regulate in the near future. The question is not whether we want to keep the status quo of an open internet or not. The question is what regulations are going to give us the best result of an open internet?
For any future commentors, please use your real name or add a url of a site where you write under your pseudonym. It's good to know who is commenting, as it helps to provides context.
Posted by: Andrew | April 19, 2006 10:52 PM