What is "net neutrality" and what are the issues surrounding it?

I wasn’t that familiar with it either, but apparently some companies are trying to keep competitors out of their service networks or charge them fees for access. I’ll be interested to see the details.

One side effect of net neutrality that I think was uninteneded is that it keeps wireless carriers from managing their networks for traffic flow, which would have very bad side effects. Here is a white paper that explains that side issue.

It is the opposite of censorship.

Net neutrality means your internet provider gives you the same service regardless of how you use the bandwidth.

Without network neutrality, AT&T could cut a deal with Google and charge you extra for visiting Yahoo. Or CNN could join with Comcast and block FOX from Comcast Internet customers.

Here’s an illustration of what your Internet service pricing might look look like without net neutrality:
http://images.appleinsider.com/netneutrality091808.png

Oh -so limiting it could engender a situation like that of the cable companies’ fights with the broadcasters and them holding each other hostage?

@janbb it is a very good question. The question I have for you or the others that answered is, what issues are pending in Congress regarding “net neutrality?” I mean, do you have the wording of the bill or a resolution number that Congress is considering?

I’m with @bkcunningham – this is an amazing question, partially because corporate influences are actually putting out misinformatino that it is government regulation that threatens net neutrality.

This site gets you some good basic information. The communications industry is attempting to prevent FCC regulation of the internet, stating that it threatens the internet. However, it is the potentially novel regulation that would prevent “tiered” network sales – you pay for the internet, and then you pay for how much of the internet you use. See this about “fake” net neutrality.

So upsetting.

Here’s another background article from Bill Moyers and PBS.

This is my answer from This Question
First off, I need to remind you all that I work for AT&T. If I don’t, someone will yell about it.
Okay, I work for a company with a stated position, but I also have a lot of work experience around fiber optics (nearly 23 years), and cell site transmission.
Net neutrality is an accepted practice on wired (or fibered) lines. The issue that everyone is screaming about is the lack of net neutrality on a wireless signal.
A wireless signal just can’t pass information like a fiber can. The difference is like a tricycle and an Indy car, and that isn’t hyperbole. Fiber can deliver signals 25,000,000mbs, while wireless can run about 100mbs.
Because of the limited data-delivery speed, some companies (mine included) are controling which data to pass faster than others. If Billy down the street is trying to watch Inception in HD on a wireless device, AT&T might drop his download speed so that everyone else can access Facebook without waiting 5 minutes for it to load. (that is a pretty simplistic example, but magnify it over the population in an urban area).
On it’s face, anti-Net Neutrality seems evil, but it’s really just trying to be reasonable using today’s technology.

@filmfann – That’s not entirely accurate. The concern over net neutrality is the threat to the accepted practice over the broadband, wired-based services.

Net neutrality is the idea that data should not be discriminated against. Doesn’t matter if it’s gigabytes of word documents, video streaming, or whatever. Data is data, and that more or less is how things currently is.

In a world without it, you’d have situations like: Trying to watch netflix on Comcast’s network but then finding out the Comcast throttled (choked) access to Netflix because they are trying to hawk their own Video on demand service to you.

Or turning it into something much like tiered cable packages. Do you want to search the internet? Purchase the “Reference and Education” package which includes access to Google, Bing, Wikipedia, and Fluther for $10/month!

And on the seedier side, the providers will try to start double dipping in costs. They’ll go up to a big website like Amazon and say… “hey, you get a lot of traffic, and if you pay us $x million bucks, we’ll give “priority” speed to your website from our customers.’

It’s a very very nasty situation to get into consdiering the internet is more and more important in everyone’s daily life and the big internet providers are very much wanting to be the gatekeepers of it because of the massive profits and power to be had.

@iamthemob

Your article is interesting but a bit distorted. They seem to base all their arguments on the last mile (DSL or Cable). That’s not where the congestion problem exists. Since the inception of broadband to the home, we’ve been paying different rates depending on what service you want. Cable talks to upload and down load speeds, DSL provides different levels of bandwidth depending on the level of service you want. Nothing new there.

What has changed is the way we use the backbone and there are a plethora of backbone providers. The whole concept of the Internet is shared usage and over subscription. Not everyone is hitting the CR at the same time. When you do, you get a large burst and otherwise, you’re using very little bandwidth. The implementation of voice and video has changed that. When you use Voice over the Internet (VoiP) you require priority. The packet have to be sent without delays otherwise the voice is unintelligible. Same thing happens with video streams. In other words, the data has to arrive in consecutive packets to keep the voice or video flowing smoothly. That means that other data must be delayed while your packets get priority. This priority scheme has distorted the Internet and as it grows, it places a new level of bandwidth on all of us. You can either tier the bandwidth or you can force everyone to pay for the bandwidth required for this bursting. It has nothing to do with the content but rather with the type of data being transmitted. Voice and video simply require more bandwidth on the backbone. You last mile doesn’t change.

The concept is really quite simple. If you provide a service that gobbles a lot of bandwidth, you pay for more bandwidth. If you provide a more traditional service that doesn’t have this dedicated bandwidth requirement, you don’t have to pay for it. I think the Internet is evolving just fine without this government manipulation. And how much delay to innovation will the government involvement produce. Government acts or reacts, much more slowly than private enterprise.

@Jaxk – I think the Internet is evolving just fine without this government manipulation. And how much delay to innovation will the government involvement produce. Government acts or reacts, much more slowly than private enterprise.

The above statement, though, is a distortion of what government involvement means in this situation. Technology has developed to improve streaming capabilities and customers have taken advantage of it. The regulation involved is an attempt to maintain the situation as it is for the customer. Without it, service providers could limit as they saw fit access to the internet…whereas now there is no limit. This article on the Level 3/Netflix/Comcast situation is an example of the potential problems.

The regulation, therefore, would protect content providers and consumers, preventing the access providers from making their own decisions, which could end up favoring their separate content providing ventures over those of competitors. In essence, it’s a defense against potential vertical integration monopoly scenarios. This is an attempt to protect private enterprise as opposed to govern it.

@iamthemob

There is and have always been applications that require more bandwidth than others. I was Operations manager at NetCom for several years and this disparity consumed many sleepless nights. You end up with two choices, either make those that consume the capacity pay for it or make everyone pay higher rates to provide the extra bandwidth. Either way we will need more bandwidth and those streaming applications will gain priority to make them work.

As you give bandwidth to a streaming video or voice packet that means you are delaying other traffic. At times of large traffic volumes you need incredible amounts of bandwidth to handle the load. For voice it may be in the afternoon on mothers day. For streaming video it may be at the release of a new movie such as Avatar. As these streaming applications gobble up all the bandwidth data traffic suffers. It’s simply the way the network works.

So do we make everyone pay for these peaks, or do we make the applications that use an order of magnitude more bandwidth, pay? Net neutrality makes everyone pay. I can understand why the providers of streaming video would want net neutrality.

Frankly I’m on the fence about this since I expect to use some of the streaming video. But at the same time, I’m reluctant to let the government get their hooks into the Internet. It generally doesn’t bode well for the general public when that happens.

@Jaxk – Does everyone pay for it now? I feel like they do…and if that’s the result of net neutrality, that’s fantastic.

The argument is totally valid about practicality if somehow service providers are unable to handle traffic. But it seems that they are…so, I’m on the fence in terms of practical aspects. In this case, though, regulation is to ensure we all have equal access to the internet.

These are the principles net neutrality regulations stand on:

On September 21, 2009, Communications Commission (FCC) Chairman Julius Genachowski outlined the concrete actions he believed the Commission would have to take to preserve a free and open Internet. He said, “The Internet is an extraordinary platform for innovation, job creation, investment, and opportunity. It has unleashed the potential of entrepreneurs and enabled the launch and growth of small businesses across America. It is vital that we safeguard the free and open Internet.”

The commissioner presented six principles that we might use to craft these new rules:

1) Consumers are entitled to access whatever lawful Internet content they want.
2) Consumers are entitled to run whatever applications and services they want, subject to the needs of law enforcement.
3) Consumers can connect to networks whatever legal devices they want, so long as they do not harm them.
4) Consumers are entitled to competition between networks, applications, services and content providers.
5) Service providers are not allowed to discriminate between applications, services and content outside of reasonable network management. 6) Service providers must be transparent about the network management practices they use.

This week the Chairman spun his position a bit. He is now in favor of bandwidth metering to allow Internet service providers to charge based upon actual usage (a “pay for what you actually use” as opposed to an “all you can eat” model) (which would be completely possible in an unregulated model and against all principles above).

Net neutrality is the diorect opposite of Republican values, which say let free market pricing and pressures control everything. By that philosophy, Enron did nothing wrong in deliberately creating rolling balckouts in Califirnia so they could artifically jack up energy rates. Likewise, the only reason Wall Street Casino Capitalism blew up was too much regulation. People like Bernie Madoff never do wrong, so cede all power to them/

In the case of Net Neutrality, it is data flow over the Internet. Comcast and Verizon in particular want to charge large, corporate users premium prices for fast connectins, and slow all the little people back down to dial-up service which will still cost what your broadband costs today.

That said, it is highly questionable whether Net Neurtality will stand a court challenge which will certainly come. It will, after all, be decided by the Roberts court that recently gave corporations unlimited spending rights to control political camp[aign advertising. This Republican dominated court has made it clear that corporations are first among equals; having rights individual citizens lack, but all the rights they enjoy.

@ETpro

You should not try to present Republican or conservative values. You obviously don’t understand them. You give two examples both which landed people in jail. One even hung himself and in the other his son hung himself.

As for the Internet, likewise if you don’t understand it, you should refrain from telling us how it works. All the content providers pay for bandwidth to connect to the Internet. It has been this way from the beginning. The more bandwidth they need the more they buy. The end users pay for the backbone to transport this data through access fees (DSL, Cable, dial-up, what ever). Since the advent of streaming video and voice the Internet protocol changed and added bits in the header to prioritize those packets. It is imperative that this be done so that the packets flow smoothly. So, now that these services are beginning to consume vast quantities of bandwidth, should that additional cost be born by the provider of those services or by the end user (whether they consume those services or not). Net Neutrality would have us all pay for the bandwidth needed for voice or streaming video. The network providers believe this cost should be born by the providers of these high speed priority services.

Frankly if NetFlix wants to use the Internet to deliver these streaming video services they consume much more bandwidth on demand than a Google or Ebay that transports data. And Netflix is much more bursty in it’s operation. Sites that interact with users have a much more even traffic flow and are much more predictable. I don’t know if you even realize you are still arguing for corporations just the ones that provide the content rather than the ones that provide the service. It’s hard to tell who you hate when you throw around the corporate label since they’re all corporations. Except us, the end user. And that’s who you seem to want to stick with this bill.

No, Jaxk, Republicans think I should not try to present their values because I do unsterdant them. And as to understanding the Internet, I was on it before anyone outside engineering and scientific circles knew how to access it, or even cared that it existed. I have been a web developer for 15 years. So I do know a thing or two about Net neutrality. And I definitely can see in move after move that Republicans are all for the rich., Their job is to figure out how to get poor and middle-class voters to constantly vote against their own economic interests. Think tanks such as the American Enterprise Institute, The Heritage Foundation and the Cato Institute employ right-wing PR and psychology operatives to craft wedge issues and spin into easily digested bumper-sticker talking points that let them pull off this slight of hand.

I don;‘t hate corporations, but we have had Net Neutrality up to now, and if it ain’t brokle, don’t fix it at Comcast’s bequest.

@ETpro

Obviously you understand conservative values about as well as you do the Internet. I’ve run X.25 networks, Frame relay, ATM (cell relay) and Internet. They all operate the same basic way and all provide priority for voice and streaming traffic (except the X.25, voice traffic wasn’t around when X.25 was popular). And just for drill, I’ve been using E-Mail since 1974 (even though it wasn’t called E-Mail back then).

The bottom line is once again, who pays for the extra bandwidth, the provider or the end user. Net Neutrality would have the end user pay in higher access fees (that means all of us). Maybe if you let go of your right wing fantasies, you could look at this logically.

You and I both walk into a library.
We’ve both been charged the same entry fee upon entering.

You check out one book on cooking, two books on automotive repair, and one on herbal medicine.

I check out one book on sushi.

Communication companies would like to charge you more based on the amount of information you’re accessing.

The argument for Bandwidth rivals that of the white spaces arguments from 2008. They don’t want competition and they don’t want it to be easy to access information when it’s so much more valuable to treat content as a commodity. Their arguments for network priority are flawed as well. Essentially, these problems occur because of the tiered framework of the previous communication channels; Radio, Broadcast, Cable, Telephony–not because of the new advancements.

Fragmentation is a scary thing when commodities are fundamentally built around scarcity and exclusivity. It’s economics 101.

Boo-his. Equal access to information and the speed at which it’s delivered. ;)

@marcrapp

You need to listen to your own argument. You and I both walk into a library and both of us have a limit on the number of books we can check out. What you want is no limit and you don’t want to pay for the extra books the library would have to keep. Even worse you want to guarantee no limit on the books and the library must have books available at all times. You ask too much and don’t want to pay for it.

@Jaxk – you are right–that is exactly what I’m saying. Your argument against the analogy doesn’t make much sense to me. Tangible-physical-goods would most certainly require additional costs for stock, distribution, resell. However, data is disseminated. It’s transport, in the case of net neutrality, is governed by the switches/nodes at the end of each cable. Not the capacity of the cables themselves. And yes, I want no limit on the amount of information available to someone. If someone has an inclination to learn more about something, they should every opportunity. No matter how long it takes them, no matter how much they want to learn. It needs to be equal geographically, economically and socially.

The main argument against net neutrality doesn’t even revolve around the capacity of their networks, despite that being their strongest argument. It’s the ability to continue a controlled manner of content distribution. The networks they speak of were laid in the ground (in the US) in the early 90’s. They were well aware of the potential need for scaleable architecture. We’ve all waited on hardware to catch-up. Those pathways haven’t changed much.

The web is young. An infant still. A big operating system, that anyone can program on, contribute too, or simply experience. An amazing invention that shouldn’t be hindered by greed.

–anyhow, based on what has just been passed by the FCC, neither one of us will see either end-result.

@marcrapp

I’m not sure I can get much further with this without writing a book but thee are a few concepts that need to be understood. Bandwidth is neither free nor cheap. Networks are based on shared usage which means that hundreds even thousands of users share the same pipe. That’s how they get the economies of scale. If you have a 1 megabit pipe to your house, it may ride a a 1 megabit pipe that goes into the network. There may be hundreds or even thousands of people all with a 1 megabit connection riding on that backbone link. It is possible because not everyone is downloading data at the same time. Look at your data light on you dataset, it flashes.

If however, you start using the link at capacity Voice or streaming video may do this, the bandwidth required goes up exponentially.Bandwidth pricing has come down over the past couple of decades and the usage has climbed. Websites get more complex, bandwidth usage goes up. Until recently the reduction in bandwidth pricing and the increase in data volume have compensated each other. So that what I paid for a dial up line for connection in the early 90s is about the same as I pay for a DSL connection now ($20—$40) but it is several hundred times faster. Backbone bandwidth has expanded the same way.

Now enter streaming video. It not only consumes more bandwidth (an order of magnitude more) but it must be delivered in consecutive packets. The largest link I ever had to deal with was an OC12 (622 Mbps). And that was back in the 90s. Even then there were larger pipes available. But with the advent of steaming video, these pipes are woefully inadequate.

The idea of shared bandwidth is not going away. The idea of prioritizing packets is not going away. Hell even back in the 70s we had a system called gouging, which gave you a slightly larger circuit through the network (read prioritized packets). Neither is streaming video nor voice traffic on the net going away. The only thing were are arguing about is who will pay for the extra bandwidth. But I guarantee, someone will pay for it, either you and me or the providers of the streaming video. And the government is the last place I would go for a good business model.

I will grant you that technology has pushed the speeds beyond anything we would have guessed. I can remember when the 28.8K modems came out. There were articles published by very intelligent folks that stated 28.8k was the maximum we would ever get out of twisted pair copper. The next advancement would require pulling fiber to each home. They stated that not only had reached the maximum of the technology but had actually reached the theoretical maximum of copper. Of course shortly there after, we saw 56K modems and shortly thereafter, DSL. Pushing traffic on copper to the megabit range. Maybe technology will handle this problem for us but maybe not. Government involvement makes it less likely, not more.

@Jaxk – your argument above, however, applies only to DSL correct?

@iamthemob

I’m not sure what you mean. The argument about copper twisted pair only pertains to DSL since cable uses coax. The twisted pair story was only an example of the improving technology. Otherwise if that’s not the issue, I’ll need you to be more specific.

@Jaxk – That’s indeed what I was asking about. Coax doesn’t have the kind of volume concerns that you outline in your DSL example, is that right?

@iamthemob

Actually that’s a bit of a misread. The volume concerns are on the backbone rather than the last mile. However cable does have a volume issue in that everyone in a neighborhood has thier data riding on the same cable. Shared much like the backbone. Coax however has much more capacity than copper and operates more like an ethernet. I’m not sure how the cable companies are faring, given the bandwidth explosion. But I would expect their data traffic models are changing.

So there are no volume concerns when it comes to end-users? If they are, then the issue isn’t end-user volume usage right?

@iamthemob

I’m not sure exactly what you’re asking but let me take a stab. The end user bandwidth is already tiered. At least through the DSL lines. Cable has a marketing ploy where they talk to how much bandwidth you get. So in both cases, you get what you pay for. If you want a bigger pipe, at least with DSL, you can purchase a larger guaranteed bandwidth. It has been that way since the beginning.

The real difference here is that you can’t really request priority from your end-user computer. That is set up at the host. They either provide streaming video (or voice) or they don’t. If they don’t you get what I’m sure we’ve all seen, in the way of jerky, startstop video. It’s hard to watch. you could never watch a movie this way. The last mile is not the bottleneck on this it is the backbone where the intense multiplexing takes place.

Since it is the level of service the host is requiring that is driving the expansion of the backbone, I’m inclined to say, that’s where it should be paid. But honestly since I’m expecting to use some of those services, I expect to pay either way (either through an increase in DSL or an increase in Netflix). The real issue is if you just want content, you just want to browse the web as you have always done, should you access fees rise to compensate for the extra bandwidth in the backbone, that you don’t need? Your call. The government seems to think we should all subsidize each other. Seems a bit regressive to me.

(kind of sorry she asked!)

But as the backbone requirements get more demanding…ISPs will build out the infrastructure in order to accommodate, and then pass the cost on to the consumers accordingly, correct?

Absolutely. The issue comes in with these prioritized streams. If the providers don’t have to pay for the expansion more will use it. If they do only those that need it will buy it. It’s the old “if it’s free you use more of it”. So the YouTube videos will start streaming and you’ll lose the start/stop problem you see today. Why wouldn’t they since it doesn’t cost them any more. The tab gets picked up by you and me and we don’t even know it’s happening. We just gripe about the higher cost of network connections and blame it on the telecoms or cable companies. A perfect solution, we still get to hate the guys we already hate.

@Jaxk – I haven’t really heard gripe about the increased costs of internet access. I haven’t seen a noticeable growth in charges.

So I’m not clear on how CSPs (content service providers) should bear the costs of buying the bandwidth they use. It’s not them using the bandwidth, in essence, it’s the end user. They’re managing the use. Therefore, it seems like the regime that you’re talking about seems like double dipping on the ISP part. End users pay for access. CSPs provide content. If it’s content that takes up a lot of bandwidth, that’s because end users are using it or want to access it. The bottlenecking on the backbone is caused because of customer demand on the “last mile.” If we charge the CSPs…well, that cost will be passed to the consumers more than likely as they will have to pay for the site because of the additional bandwidth charges for the CSPs. But it’s the end user that’s pushing the demand.

This is where I’m confused. It’s not the fact that the CSPs are heavy users but the fact that end users are requesting their content that there’s increased bandwidth usage. It’s not “Netflix” it’s the Netflix users. If youtube has to pay for the access for it’s services because consumers are using more bandwidth, then youtube will have to charge. This could kill it. It could also act as a barrier of entry for start-ups attempting to provide content. Further, ISPs are more and more getting into providing content. So, the CSPs owned by the ISPs will be advantaged as it allows them to privilege their CSPs.

If we’re using actual infrastructure examples…this seems more like highway usage. Roads work on a toll or a free basis. Taxing offers you unlimited access but the price is set for everyone regardless of use. Tolling means that only those using the road will pay, and that will increase the more they use it. So, companies that ship product and require the use of the highways a lot have delivery charges that pass on to the client. Or, someone can drive to the store and get it themselves. If the store attracts a lot of customers, then use of the road will increase. If the roads are maintained through taxes, then this means they may require more upkeep. That cost will get spread generally. If that cost, however, were to be born by the store that everyone was going to…well, the price of the item would go up. People would still go…but not as many…so taxes may still increase, though not as much.

What you’re talking about seems incredibly anti-business to me, but extremely pro-monopoly. The problem with the ISP market is that there are so few choices for the consumer. I can only get one provider in my building, for instance.

I feel that the only issue is broadband consumption and whether the ISP can meet the demand. If it can’t, it has to expand – and I think it’s completely fine if that cost goes to the consumer. But considering the near monopoly held by ISPs, if not absolute, regulation is necessary to prevent anticompetitive behavior.

I’m not set on this point – what I do know, however, is that everything about an anti-regulatory appoach seems built to prevent new user generated content, media start-ups, etc. from being formed. The status quo at this point is innovation on the internet. If ISPs are allowed to freely construct price schemes based on types of users rather than individual customer demands, it seems like a recipe for corporate censorship.

@iamthemob

the road example doesn’t really apply since all traffic moves at the same speed regardless of the toll. It’s more like a shipping company. Say UPS. They don’t create the content, they just move boxes. If you want a package delivered ‘Next Day’ you pay for it. The shipper pays for it. They may hand the charges to the end user but the UPS makes the shipper pay the charge. If you choose to pay the lower fee, you may actually still get it the next day (depending on space available) but it’s not guaranteed to arrive the next day.

Whether you have shipped ‘Next Day’ or slower ground the little truck that delivers the package is the same (the last mile). They don’t need a bigger truck to deliver the package whether it ‘next day’ or ‘10 day ground’. The last mile doesn’t matter. What changes is the number or space required on airplanes (the backbone). In either case UPS doesn’t care what’s in the box (content) they only care how fast you want it delivered.

So say we both order a blender from Buy.com. you ask for next day, I ask for the cheapest shipping I can get. The truck that picks up our package is the same, no bigger no smaller. When our two packages get to the central office some decisions are made. Your package gets on the next flight out, regardless. My package may get on the same flight if there is space available but if not it will be delayed til the next flight or maybe tomorrow. It all depends on space available. When they get to the destination they both go on the same truck for delivery that day The truck is no bigger or smaller and they both ride the same last mile.

Now say, congress decides that we need shipping neutrality. Hell, all packages get on the same planes why should we charge one guy more than the next. And oh by the way, we’ve learned that UPS ships all their internal packages, next day. It’s just not fair. So in our infinite wisdom we pass legislation the says we can’t charge more for next day delivery (no more tiered services). What do you suppose will happen to shipping charges when everything becomes next day service? And in this scenario, the truck that delivers the package to you house doesn’t change, only the backbone has to expand.

We haven’t seen much change in the access fees yet because video on demand is still in it’s infancy. Hell YouTube isn’t doing it yet, you still get jerky videos. The difference is that delay through the Internet is measured in milliseconds, delay through the shipper is measured in days. Otherwise the comparison is real. And in no case is content the issue. No matter how hard we try to make content the issue, it’s not.

@Jaxk – I went on a bit with the metaphor – so it’s expected that it’s been taken in an unintended direction. And of course, no metaphor is perfect. ;-)

My disagreement with your expansion is that I focused on the customer to the store pickup…and this is about the delivery model. But to work in that, considering that everyone pays for the internet to use it, simply to gain access and regardless of usage, we should consider that all involved (tusers) pay for road access. And for these purposes, we have to assume that the roads are privately owned. However, these roads are owned by one or two companies, and you have little choice as to which. The roads are completely able to handle all the traffic on them, and the cost for the maintenance is evenly distributed among those requesting access through the monthly fee.

So, we’ve both paid simply for the ability for access to the roads, and the road’s access to us. Any company delivering has also paid for this kind of access. We order our blenders as you describe above (having option of faster or slower delivery, with associated different prices).

Now, there are no net neutrality regulations. The company owning the roads decides that it wants to get into selling blenders. But buy.com is really good at it, and there are a few start ups getting good too. So, the company decides that it’s going to start reassessing the costs so that those responsible for selling many blenders, and therefore using the roads more, should pay more towards the maintenance (not unreasonable). The more you use the road, therefore, the more you pay.

The blender company owned by the road owners is a wholly owned sub. As the costs are assessed to the blender company sub, if they are prohibitive due to sales (i.e., the company is selling so many blenders that usage of the roads is cutting into the subs profits), the sub may be offering at a net loss, and can carry a tax deduction. However, considering that it’s wholly owned, the corporation is earning all of the charges to the sub…but also the deduction. The startups and the successful, though, are feeling the hit only as a loss. Therefore, they wither have to increase costs so that they are not competitive with the blender sub, or they have to reduce sales to a point that they become less marketable.

That’s the problem I see. All users pay the same. If a company is asked to ship a lot of the data, it’s because they have a good product. Netflix, for instance, has been credited with 20% of internet traffic because its subscribers are requesting their streaming video because they have good content. But if the users weren’t requesting it, they wouldn’t be using so much of the space. Now, if we start charging Netflix along the lines of their use of bandwidth, we’re holding them responsible for customer use. YouTube is free content because there are copyright agreements so that the video is delivered in a way that the quality doesn’t allow for users to violate copyright rights of the owners of the media and get good product at the same time. Netflix charges, but the profits are shared with copyright holders so that there’s no potential violation. That’s a product/content difference – using the metaphor, that’s about getting a shitty blender or a top of the line model, not so much about the shipping. Now, people are paying for top of the line because it’s well worth it. Considering it’s usage of bandwidth, what’s a fair payment for Netflix? Well, considering it’s sending the data requested by users, let’s say that 10% of the entire cost of maintaining the internet paid by the ISP goes to Netflix, and 10% to those users. That could be MASSIVE for Netflix, negligible for users. If Netflix can’t handle that hit, it has to pass it on. Now, the users are paying the entire cost through subscription fees, as well as the use attributed to them by the ISP. This may very well be reasonable.

But consider what that market structure means for the consumer. They are paying for their use. They are paying for Netflix use. Netflix doesn’t realize the subscription as a profit, but it’s a cost of doing business. The cable company realizes the profit from both (or the portion of that charge that will be profit).

If the ISP starts a CSP that has the same service…they will ONLY have to charge or realize the cost of the user traffic. So they can offer a cheaper subscription. Therefore, Netflix is less attractive to media copyright holders, as the content isn’t getting seen. Meanwhile, Netflix charges a subscription fee that’s standard, so if the traffic slows down, it can’t react to the change. And if it does, it may increase the traffic, and subscription increases. In that time, though, it’s lost content because the content has gone to the ISP CSP. Further, because the ISP CSP still has to charge a subscription fee if it wants to cover the cost of licensing fees, but has half the traffic costs, it can charge the consumers more but still come under, potentially, Netflix. This gives it capital to expand, and offer better and better services. Or, it could take a hit on the licensing and be free, paying for the licensing with the fact that after a short time all of the users will abandon Netflix for the free service, and therefore it will be able to realize the profits from all of the increased user costs.

And if that happens, there’s no way for new CSPs to enter the market. It isn’t about what content, you’re right – it’s about the entity providing the content. In a deregulated or ungoverned market, it would be STUPID for an ISP to not create a CSP and start the downward spiral.

How is that stopped without regs?

@iamthemob

I suppose I’m lacking in my explanation of the Internet. And once again it’s not the volume but the speed of delivery. If you look at usage on the internet, you get a sinewave. Very low in the early morning, growing throughout the day and peaking in the early evening. Networks are designed for this peak. The peak usage determines the bandwidth. All other times of the day there is excess bandwidth in the network. Streaming video is an anomoly that changes that peak usage. It not only must be delivered time but sequentially. So if you look at the sinewave from the past, with Steaming video you could easily expect a huge spike several hundred times what would otherwise be expected.

None of this has anything to do with the typical website delivering content. It has to do with the method of delivery and the speed of delivery. I can see your fixated on the ISP. The number and method of delivering from an ISP is not affected either way. There are only a few ways to deliver broadband Internet to you house, cable or DSL (with a few satellite). The entry into this market is cost prohibtive simply because it is expensive to drag wires to every house. The Bell companies already have a legal obligation to resell those physical connections to ISPs and that has been around since the inception of the internet (AT&T divestiture created that ruling in the 80s).

A Netflix might consume 10 times or even a hundred times more bandwidth at peak, than an Ebay or buy.com. Even thought they have simalar or even more traffic that Netfilix. It’s about the peak and the speed of delivery. The network can’t store much data, it’s all about getting it in and getting it out. Just like UPS, they need to keep it moving. But if the plkane is full it can encounter a delay til the next plane. Next day air just like Streaming video, can’t wait for the next plane. It must be accomodated on the first plane.

So basically your arguing that the little guy with normal traffic should pay the same high rates as the big guy with time delivery constraints. You seem to be arguing that if UPS opens a UPS store, they get a competitive advantage over Buy.com, because they can prioritize their own packages. If that happens you simply use Fedex or some other provider. There are hundreds of backbone providers. Hell, you can subscribe to NetZero and get DSL as easily as you can SW Bell. They both have their own backbones.

This is all becoming more clear, @Jaxk.

So. Right now, we have access to every lane. Sometimes we use the slow, sometimes we use the fast. What we’re paying for is access. Is that correct?

@iamthemob

I’ll buy into that. Yes, your paying for the on ramp with your access fees. But if you want to pay the commuter fees, you can use the commuter lane and bypass some of the heavy traffic. Not a perfect analogy but if we have to stick with highway analogies, that’s the best I can do.

No need for analogies. But the status quo is already that we’re all using and working at various speeds, and there aren’t any charges for needing to go faster, right?

@iamthemob

Actually that’s not entirely true. There have been services (sorry I can’t remember the name) from companies that charged a premium for finding the fastest route through the net. You paid a higher price for that service if speed and delay were the issue. The end user never saw that surcharge other than the cost of goods on that service or web site, were higher. A surprisingly high number of companies bought that premium service but most did not. The whole concept has been around from the beginning.

But in terms of the general community, that doesn’t happen. You’re talking about a premium service. In terms of current usage, though, that’s the case.

In terms of the general community, they wouldn’t know. Just like if Netflix is paying slightly more than buy.com, the general community wouldn’t know. Only the provider of the service would know. All the end user would know is that this web site comes up quicker. or the downloads take less time basically a quality of service issue. And yes in terms of the general community that does happen.

I think I’ve already bored everyone to death with this issue If indeed any one else is even reading this thread, so let me leave you with this point.

A very small number of applications use an inordinate amount of the network resources. Streaming video uses vastly more network bandwidth than normal web traffic. Video on demand typically would get the most usage at peak hours (early evening). If they use 90% of the network, solely because of the way their application works, should they pay the same amount as the 95% (more like 99% but I’m being generous) of the applications that only use 10% of the network. I know you want to penalize the ISPs but your not getting to them either way.

@Jaxk

The general community would absolutely know. You argue that I want to penalize the ISPs. I do not. I want to prevent the ISPs from penalizing the consumer.

(1) ISPs are not subject to market influence a this point. Although you claim that I can choose a broadband provider, I don’t see that practically at work. In searching for a cable internet provider, I have one, only one, that provides service to my area. Therefore, I have only one choice in terms of that provider – which makes it a monopoly, in essence.

(2) Because the ISP is essentially a monopoly, it must be subject to regulation. Otherwise, under nearly any economic model one can think of, it does not set prices efficiently, but to maximize profits at the expense of the consumer.

(3) Because monopolies can discriminate, they will discriminate. It is a poor business decision for them not to, and if they are a public company, they very well would be legally obligated to do so.

(4) Service monopolies will inevitably use market influence in one area to increase it in another. Microsoft attempted to do it in the browser arena, for instance. AT&T when it was Ma Bell did it with telephones. If one company controls the means of access geographically, the consumer loses out as they will be paying more for the access as well as more for associated products, as well as products of a poorer quality than would otherwise be the case as barriers to the market are infinite.

Based on your argument, the individual user at this point does not see any difference because it is standard that there is not a charge on these services (or not one that makes a huge difference). It is not the service, as you continue to argue, that takes up the bandwidth, but the fact that users request this service. ISPs have various monopolies in the area, but now aren’t discriminating in terms of content type (videio, VoIP, document transfers, etc.). Use is good as it is. If, however, they are allowed to reach into the stream and charge the CSPs for their higher usage by shifting them to a “fast lane” and charge for relative use there, the CSP will be forced to pass that cost, more than likely, to the consumer. I’ll analogize to electricity, for instance. If we assume that electricity were like the internet, in that production was constant and therefore increased usage by an end user was the same as an internet user (i.e., if I like to have all my lights on but someone else doesn’t, we’re merely paying for the privilege to have electricity), then it doesn’t matter what we’re using it for. If it’s shown that the majority is used for television watching and refrigeration, the electric company could shift the metered usage for those activities to a higher lane, and then charge the refrigerator and television producers more for that usage. This would increase the costs to the producers. And if the electric company started making refrigerators and televisions, it could do so at less cost than independent manufacturers. This is what would happen with a tiered system that you discuss. Content providers would be charged more because their product is used more. They pass that onto customers (consumer gets screwed). Because it costs more to produce this content and provide it to the consumer using the ISP, there is a barrier to entry for people that business innovators with low capital resource might not be able to overcome (innovation gets screwed AND the consumer gets screwed). An ISP would be silly not to start providing content at a reduced price, but would still charge inefficient prices because it is artificially inflating the baseline cost of providing the service by discriminating in its fees against content providers (innovation, competition AND the consumer gets screwed).

I don’t think you’re following anymore…but please, tell me how the above benefits consumers in any way, and business in any way. If ISPs actually had competition, I would agree with you. If there was insufficient bandwidth to handle current usage, then I would agree that some form of cost shifting would have to take place – but that doesn’t seem to be the case. As it does become the case, however, traffic will increase generally – the ISP will, in general, have to add lanes. If the cost structure reflects that in a manner that makes people who stream more pay a higher rate than others, I can get behind that. But the most appropriate group to pay for that cost would be the end user. If I want to stream video constantly on my computer, and so many people are doing that that the ISP has to expand its infrastructure, then I should have to pay for that. But considering the ISP is a monopoly, the expansion does need to be governed or I’ll get charged an inefficient price for that expansion.

This just seems like standard economics to me. There’s higher demand on services that use up bandwidth at peak. There is only one way a consumer can get those services, generally. If the cost to the provider of the access that allows that service increases because of increased demand, it should pass that cost onto the consumers generally, and tier costs if it needs to based on who wants the service, and who doesn’t. Because of inefficient monopoly pricing, that cost is regulated by the government, or else the consumer gets screwed.

It is basic supply and demand. A higher demand means more opportunity for supply. If the means of supply are taxed, the cost goes up and demand decreases. This requires suppliers to become more efficient to reduce prices. If the means of delivering production, however, can tier charges for production without reason, it is placing economic pressure on the producer that is artificial and external to the market. It raises the baseline cost for provision above that required.

What you seem to neglect is that because it is a monopoly, an ISP (and please, if you can show me how there is competition between cable broadband providers in the New York City area, to any significant degree – like, more than one or two choices but rather six or so – six seems like a good competitive number) please do so, behaves much like a government. The ISP is the government, in essence – it’s the only game in town. That’s why I want it regulated.

Well let me see. I don’t have a phone number so all I can do is supply a few names that serve NYC.

DSL City
DSL Net
New York Connect
There’s another 8 or 9 here
I’d be surprised if NetZero and some of the other big players didn’t offer DSL in new York as well.

All of these guys have a network behind the DSL service and they all interconnect. I’m struggling with why you think there is no competition. Also you continue to believe that streaming video happens at the request of the user. It does not. It happens at the host and is a feature of the host service. A feature they don’t have to use but if they do, it is more expensive.

@Jaxk

(1) the first two are DSL, and not cable.
(2) New York Connect offers it’s service through Time Warner Cable.
(3) The remainder are consultants, search engine type things, or, in fact Time Warner Cable. the search engines I checked listed Time Warner Cable as the provider in my area.

Streaming happens because the user wants to stream video. You’re talking about location. I’m saying it’s a service that people use. If people didn’t use it, it wouldn’t “happen” anywhere.

That’s why I’m saying “no competition” and that it’s the user that drives it. We’re talking about customers. If no one wanted to use the service, it wouldn’t exist.

If you can tell me, again, what I could use besides Time Warner Cable to get cable internet service in manhattan, that would be great.

@iamthemob

I at a loss as to how to explain this any better than I already have. If you think you can turn streaming video on or off from your computer, give it a try. As for the physical wires from either the phone company or cable, the cost of stringing those cables is tremendous. That’s why the courts mandated that that bandwidth had to be made available for third parties. At the time it was MCI that brought the suit. That regulation has been in place since the 80s and Net Nuetrality has nothing to do with it.

At this point I give up.

Here is an elegantly simple illustration of what is involved.

@ETpro Thanks! Now that I grok!

Yes, a free and open internet regulated by the government. Sounds like an oxymoron to me.

@Jaxk Slavery would not have self regulated itself into nonexistence. Corporations are made of men. Governments are made of men. Corporations have making ever greater profits and destroying competition as their prime directive. Governments have satisfying voters and getting reelected as theirs. I fail to see why men in ever larger corporations are inherently more on our side than men in a democratically elected government.

@Jaxk as good as some of your arguments are, they’re still geared towards maintaining the existing infrastructure–which is; Scarcity and exclusivity.

There is absolutely no reason that we do not or can not leave the connection open and uninhibited.

It will be very interesting in watching wi-fi, cable and satellite develop further in the coming years. Despite net neutralities objective in solving the immediate problem, no law passed has ever accounted for the rate at which technology has been advancing and reshaping itself, despite an opposed law. Companies are spending more time, effort and money in attempting to control and regulate the current bandwidth speeds as opposed to providing scaleable hardware and technology in support of it’s growth (technological advancement of hardware–both commercially and privately).

They’re investing in gates and toll booths, not wider roads. And while it is typical for technology to be versioned and introduced within the consumer sector for the sake of educational purposes: Often–products and services fail because we just didn’t get it nor understand the potential of a practical use. So we’re versioned into the technology.

But that isn’t the case with this issue. In-fact, we’ve been milked for almost 15 years now.
Hardware caught up, exceed and is now available privately and commercially. At a low cost.
The internet has paid for itself, several times over. That’s unfortunately the cost of early adoption.

Most of what is being proposed is huge step backward.

Overall, despite the negative/positive or general interest in net neutrality, it is nice to see so many people involved–with well thought out opinions. I appreciate the fact that everyone here is far more knowledgeable than some of our elected officials. ;)

Sorry, I been away for a few days, Christmas, you know. The Internet is the freest most open form of communication ever invented. The cost for using the Internet has decreased at a phenomenal rate over the past couple of decades. Apparently we don’t like that so we invent monsters that need to be dealt with. Getting the government involved will only raise the cost. Regulation is never free.

As usual we have a good thing but are willing to wreck it in the name of fairness. There’s nothing fair about net neutrality, nor will it be neutral. Just a bunch of guys in Washington that don’t know how it works so they think they can fix it. It ain’t broke.

@Jaxk I wonder why the FCC refused to provide net neutrality protections for mobile broadband? I think the broader issue is giving one-sixth of the nation’s economy over to the federal government. Six people on the FCC board and not Congress passing regulations and having this kind of power is wrong.

@bkcunningham

This is only the first step. Once they realize that service actually gets worse, they’ll have to regulate more to try and fix it. Kind of a self perpetuating stream of regulation. And those six guys are under the direct control of the president. There is no oversight, debate, or restraint. Whatever the president wants, he gets. Some would say that’s close to a dictatorship. Fortunately, we only have benevolent dictators.

@bkcunningham I think the issues with mobile broadband are different. There, there is a clear limit on bandwidth the providers can service.We are a long way form a world where every nook and cranny and every provider can have true 4G performance. And even that performance isn’t enough. So that infrastructure and technology still needs to mature before we throw open all limits on bandwidth demand.