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Summary:

The proposed network neutrality rules the FCC is settling on don’t appear neutral at all. Here’s the conversation we should be having if the FCC really thinks our network policies need a rewrite.

With its latest plan to twist the concept of network neutrality into something that appears to be the opposite of neutral, the Federal Communications Commission has revealed that it believes the public can’t understand the issues — or that it is so in thrall of the companies it regulates that it doesn’t care what ordinary people think.

The FCC’s plans for implementing network neutrality came to light Wednesday in a Wall Street Journal article. The plans took the hallmark of network neutrality — the notion that ISP shouldn’t discriminate between the traffic flowing over their networks — and turned it on its head. Under the proposed framework for so-called net neutrality, the FCC does away with the concept of non discrimination and instead offers up a new standard designed to prohibit “commercially unreasonable” practices.

Is this the pay-to-play internet model?

Tom Wheeler, pictured standing to the right of the president.

Tom Wheeler, pictured standing to the right of the president.

Most net neutrality advocates have understood the FCC’s decision to mean that the agency will allow ISPs to charge content companies for better traffic flow provided it isn’t “commercially unreasonable.”

It’s important to note that the FCC Chairman Tom Wheeler came out a few hours after the Journal article (and others) appeared to respond that the media has his policy plans “flat out wrong.” The statement, offered below, neglects to address the crucial aspect of his proposed change: the idea that there’s room for any commercial practices in delivering a customer’s network packets.

Here’s Wheeler’s statement:

“There are reports that the FCC is gutting the Open Internet rule. They are flat out wrong. Tomorrow we will circulate to the Commission a new Open Internet proposal that will restore the concepts of net neutrality consistent with the court’s ruling in January. There is no ‘turnaround in policy.’ The same rules will apply to all Internet content. As with the original Open Internet rules, and consistent with the court’s decision, behavior that harms consumers or competition will not be permitted.”

Whether or not you think this is a good idea, inserting any sort of commercial relationship into delivering last mile web content –outside of what the end-consumer pays the ISP — is not network neutrality. So let’s stop calling it that.

Turning a technical argument into a commercial one

The FCC should man up and say exactly what it is doing here: It is implementing a double-sided market for the internet that could allow businesses to enter into commercial relationships with ISPs — who do not operate in a competitive market in the U.S. — for faster delivery of their content. And because capacity on broadband networks is limited, the flip side is that companies that don’t pay will see their content delivered more slowly.

Many will see this as a battle between the Netflix’s of the world and the smaller video providers who might not be able to pay. But this is actually about differentiating between different classes of content. For example, if you are a streaming video provider, those faster speeds will probably affect the user experience. You’ll need to pay up, because your competitors certainly will and eventually the best effort access isn’t going to cut it — especially as traffic on networks increase.

Photo by Thinkstock/wx-bradwang

Photo by Thinkstock/wx-bradwang

However, if you are a backup company like Dropbox or Carbonite that can train users to send their files overnight, then you may not care about slower speeds. Because this is true: Not all web content is created equal. As we put more content online, many people knowledgeable about network infrastructure point out the ridiculousness of trying to build out an ever-expanding network that’s capable of handling Netflix traffic as if it were the same as a downloading software.

It’s like trying to build a highway that can handle Lamborghinis, Chevy Volts and bicycles all driving in the same lane. Instead, these network experts argue that we need to figure out how to divide the lanes of traffic while ensuring that all vehicles can travel on the road without discrimination. That’s actually a completely fair and legitimate debate to have, but I’m not sure that is the debate we’re going to be having if the FCC’s plans go through.

Where is the burden of proof in this standard?

That’s because instead of discussing the real challenges of managing the growing amount of traffic on the web that has different delivery requirements, the FCC is going to let the ISPs decide — not just how those lanes are divided, but also the rules that govern who can travel where and how much they should pay. It has said it will not allow blocking and that ISPs must be transparent, but this “commercially unreasonable” framework strikes me as putting the burden of proof on the consumer or injured party to complain to the FCC long after the horse has left the barn — or their packets have failed to reach the user.

I don’t think that’s the way this conversation should play out. The FCC and ISPs may argue that because the ISPs built the original roads (their underlying network infrastructure) that it is the ISP’s right to decide the rules of that road and how much people will pay to access it. But at some point since the FCC first declared that broadband was an information product and not subject to the common carrier rules at the heart of today’s network neutrality fight, broadband has become a utility for consumers and businesses.

The idea that we would let ISPs make decisions that could lead to ISPs setting commercial terms that would impose taxes on startups and existing companies all without ensuring any sort of lowered price for consumers or network upgrades from the ISPs, is ridiculous. Broadband networks are not a public utility, but they are the foundation for our economy.

And as such we owe it to all participants to have a real debate about how we’re going to deliver the exponential increase in network traffic over our private networks. That’s a debate that the FCC must referee, not after the damage has been done, but in advance. Instead of calling its efforts net neutrality when they clearly aren’t, it should be honest and point out that it thinks neutral networks won’t work given the technical demands we’re placing on the internet. Then we can have a conversation about if that’s the case, and then what we should do about it.

We can’t let ISPs operating in a duopoly just set the rules for us.

Absent competition, the proposed rules look like a way for ISPs to get more money, set rules that will affect the shape of what is developed on the internet, and do all of these things with no guarantees that consumers or the broadband economy get anything in return. I don’t find that reasonable at all.

  1. You nicely summarize the current challenge. Undoubtedly, the smaller companies do not have the same lobby so their voices are likely not even being heard by decision makers. It will be interesting to see how this plays out; and more importantly, what the real implications will be for small and mid-sized companies.

    Shannon Harmon

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    1. Digital Pants Thursday, April 24, 2014

      Wheeler, a career lobbyist for the cable TV and wireless carrier industry and big-time campaign contribution bundler is no different than any other politician.

      You can bank on the fact that no matter what Wheeler and his political and business pals claim to be their motivation and proposed outcomes, the EXACT OPPOSITE will happen.

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    2. Amazing how many people have been duped into believing this is all about protecting the little guy. Yet, who is leading the charge for “network neutrality?” Netflix, which consumes about 1/3rd of all Internet traffic, and earns $2 million in profit per employee. If this ruling is going to help well established businesses lock out the small startups, wouldn’t Netflix, Google, Facebook, etc. be big proponents? You figure they are good guys that just want to see a democratic network? No, this is all about trying to strengthen their bargaining positions with the ISP’s. With all of its monopoly power, Comcast is worth only 7 time as much as Netflix, while employing 50 times as many people.

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      1. The ONLY opponents to net neutrality are ISP’s, arguably much bigger than Google, Netflix, or Facebook, combined. You really know nothing if you think those who support net neutrality are out to “strengthen their bargaining positions with ISPs.”

        You gave absolutely no evidence why net neutrality proponents have some kind of secret agenda to gain more power over ISPs other than the number of employees two arbitrary companies have. That’s all.

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  2. Scott Brownstein Thursday, April 24, 2014

    Of course, you are assuming that there is no competition in the ISP market. In most places there are at least 2 providers (cable and phone) who provide access. If that is not the case then I would disagree that in those areas, the ISP has actually become a public utility and should be treated as such.

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    1. Phone based broadband is about as competitive as having a minor league baseball team compete in the baseball playoffs. Competition implies a level playing field or one that is regulated to allow for a level playing field. This decision is not made in a vacuum, one only needs to look at the actual competition available in the UK to understand the FCC has completely folded to the cable companies instead of protecting citizens from price gouging.

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      1. Same here in the states. Sure in KC we have 2-3 providers for every area, but they don’t offer the same services or level of service. Each one fills in where the other leaves off so either you pay the rate or you do without.

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    2. Franklin Pierce Thursday, April 24, 2014

      By numerous credible studies, 70% of Americans have only one choice for high-speed internet service: Their local cable system monopoly. Twisted-pair copper cable (the phone company) cannot deliver the 10’s of Mbps required for multiple HD video streams. Only coax cable (or fiber) can do that. AT&T and the other phone companies have shown over and over that they simply won’t invest. Satellites would have to be as big as battleships to be able to carry 100’s of thousands or millions of simultaneous high-speed streams. Never happen.

      So, assuming that there is no competition in the ISP market is the correct assumption.

      What other countries have done (and are laughing at us because we haven’t) works: Break off the “last mile” of coax (or fiber or whatever) and make that a carefully regulated utility–with no other businesses–no “ComcastFlix” or NBC. Then, allow -any- player to “hook” on and provide competitive services that users can choose from. In countries where this has been done, there are LOWER prices, higher speeds, much more choice, and the technology is advancing beyond us. This is in countries where the cable companies don’t own the FCC.

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      1. Americans aren’t interested in what other countries do, otherwise we would also have affordable health care and sensible gun controls,

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  3. Dr. DarkCloud Thursday, April 24, 2014

    If the net was truly neutral, the cost of supporting the additional bandwidth explosion due to services like Netflix and so forth would otherwise drive up the general cost of internet access for the rest of us.
    So if you don’t watch Netflix, you would still end up paying for the masses of others who do, which is the crux of this problem. It would be like healthcare…
    It’s a question of, who is going to pay for this bandwidth?
    Internet providers know they are expensive enough as is it.. customers would balk of they peanut buttered 100% of that cost to all of them with their monthly bill.
    Upgrading infrastructure is expensive. Plus, they also make money from wholesaling bandwidth to various sectors. Online media streaming has crossed the threshold for its intended domain for the pricing model, and they need to find a solution.
    Aren’t you glad they are just not billing you for that extra bandwidth use?
    Effectively, they put the ball in the Netflix of the world’s hands to decide whether or not they should now charge you for more, because they are fronting the cost of that bandwidth.
    That I think is the intent of this transaction.

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    1. “So if you don’t watch Netflix, you would still end up paying for the masses of others who do, which is the crux of this problem.”

      I must respectfully disagree. If I don’t watch streaming video I’ll pay for a slower connection. Since I do watch streaming video, I pay a premium to my ISP for the bandwidth I require to do so.

      If the ISP’s have to pay for more infrastructure it’s only because they’ve been charging their premium customers like me for something they’ve never been able to deliver. Now they’re afraid that they’ll be required to deliver what they’ve been charging for all along and they’re unhappy. For some reason I don’t feel sorry for them in the least.

      (If this appears twice I apologize – it looks like my first attempt didn’t take.)

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      1. Jon Christensen Thursday, April 24, 2014

        I think the lack of choice is well documented for the large majority of the US population — its cable. The major/minor league baseball analogy is apt. Internet is a utility and should be treated as such. If I am paying for a certain amount of bandwidth, I should be able to get the amount I’m paying for, regardless of where I choose to get it. If this model is troublesome, I would also be willing to pay a fair price based on the amount I use, e.g., if I use Netflix or streaming video regularly, I’ll pay for that, you don’t have to. In either case, everyone should have internet access and a system that allows them to freely choose the content of their choice.

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    2. Franklin Pierce Thursday, April 24, 2014

      You would be correct if internet service was like groceries or gasoline or electricity–in other words, the more you use, the more it costs the supplier. It is not like that. Multiple credible studies have shown that the incremental cost to deliver a gigabit of data is nearly nothing–less than a penny. The real cost to the provider is the basic system–the cable and cheap commodity hardware in the centers–which they have spent relatively little on in the last decades, despite their claims. And you pay for that “capacity” with your basic monthly fee, say, $450 to $750 a year paid by every house up and down your street, and every apartment in your building. Very profitable to the cable monopolies. Internet service is the most profitable product the cable monopolies sell–by far.

      The cable industry has made breathless claims that “House of Cards” made the lights dim at their data centers and put such a load on their systems that they have to charge us more. Monopolies throughout history create artificial scarcity in order to keep prices high and increase prices to make more profit. They do NOT innovate or do new things–except in billing systems.

      We now have to think of something ordinary people can do to stop this disaster. Law suits? Huge organized public outcry? The rest of the world is laughing at us because of, among other things, our corrupt communications systems. We’re not leading anymore.

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    3. If the issue is ISPs bandwidth being maxed out, how is it that comcast was able to neatly instantly increase Netflix’s streaming speed after being paid? Hardly seems like there was time for them to deploy the capacity upgrades you suggest are necessary.

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    4. This may have been a valid argument some years ago, when high-quality video on demand was some rare and bizarre thing, but nowadays you have millions of people streaming video online at 780/1080 levels, and the system seems to at worst have the occasional hiccup or low-quality buffer. There’s no sign of this obvious bottleneck that will happen if we don’t throttle things right away. We may see what challenges lie down the road as high-speed internet expands to more remote areas, but I would imagine even in those cases it would be a case of the local infrastructure strength.

      We’re actually getting pretty good at transmitting data back and forth these days.

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    5. Alice Redfield Friday, April 25, 2014

      Using healthcare as analogy is poor logic.
      People can survive without Netflix or internet. Seniors normally don’t care about the internet.
      If you feel healthcare and internet users are taking advantage of you. You are free to give up both.

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  4. Micky Salsberg Thursday, April 24, 2014

    Looks like the FCC is just another corrupt govt group on the corporations payroll. Real Surprise!

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  5. Its a good thing there were no lobbyists getting hefty fees chasing the FCC around on this. Whew. (heavy sarcasm).

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    1. The sad part is that, is actually true they’re not chasing nobody since now they run the FCC. Once this passes the head of the FCC will get a nice promotion and go back to the private sector with a “Mission Accomplished” banner.

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  6. What the — FCC to propose pay-for-priority Internet standards — will actually result in, will be the local consumer paying multiple times for a bandwidth rate that they are already paying the local internet provider to have available (local internet providers already charge different amounts for the size of bandwidth that the customer wants to have available). If the new FCC proposal goes through, each time the local internet provider charges an internet content provider for a bandwidth rate (that they are already being paid for by the local customer), the local customer will pay again. The content provider will just pass along the fee as is only logical for a businesses to do. Either charge the provider or charge the local customer, not both.

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  7. First, if this broke in the WSJ, you wonder how much insider trading occurred prior to the news. Second, so I guess now they have weaseled out a way to censor certain content via more of the sleaze capitalizm that has become a hallmark for the times. Regime change here!

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  8. This is only the first step to decimating information transfer amongst the sheeples…us. There will be many steps, just as there has been to corporatizing America, stealing our land, and eventually our constitution. “Silent Weapons for Quiet Wars” , geoengineeringwatch.org , Monsanto gmo spermicidal corn , fluoridated water , vaccines that paralyze, sterilize and murder, and on and on and on — How many bees have to forget where home is before a majority asks, CUI BONO? CUI BONO?

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  9. Everyone has equal access to the Internet, but some (the pigs) are more equal.

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  10. What a stupid analogy. I cant believe you compared internet traffic with a freeway wherr fast cars and bicycles have to share the road. You are ignorant on the subject.

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    1. The author is entirely right with his anology. Clearly you have no idea what he meant. You should not comment on something you do not understand. The internet has these things sent across the internet called packets. These packets are the cars on the interstate. These packets are like cars Volkswagen and Porsche for instance. The Volkswagen is a http packet, the Porsche is a video packet. Clearly these 2 packets are entirely different the only similarity is both packets carry data. The Volkswagen http packet requires minimal overhead and sends across the internet at fairly fast speeds. However the Porsche packet travels at the same speed but video packets require no traffic ahead of it’s packet IE the cars in the same lane. Video can not tolerate slow downs or the video will jump, skip and otherwise be un-watchable. So the reference to cars on the highway is spot on. QOS is what he means which is Quality of Service. GO look it up.

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