Net Neutrality Astroturfs Pushing Hard
In the resent weeks AT&T has been at the forefront of some curious decisions. They along with Apple have prevented companies like Slingbox from placing Apps on the iPhone that would stream video over 3G, but then allowed Major League Baseball, whom they have close ties, to introduce an application that would stream live baseball games. Then this week came the news that Apple and AT&T denied a Google Voice app from being placed on the iPhone that would allow users to use the app for VoIP calls or cheap international calls, which may have been part of the reason that Google’s Eric Schmidt resigned from Apple’s board. The Google application is similar to Skype, but the currently available Skype app can only be used on WiFi.
The various incidents brought clamors of Net Neutrality violations back into public lime light. An area of concern usually focused on traditional Internet networks. The situation brings up new questions about what networks should be allowed to manage packet delivery in the world of the “end-to-end principle” and whether a company should be allowed to control the applications available on its networks. The cell industry is a new realm for this debate, and the questions surfacing may be hard to tackle. A company like Apple and AT&T who are selling a product and service in this particular arens may have a decent claim that certain applications usurp their business model on the very thing they are selling and negate their ability to generate revenue. Cell phone companies have traditionally operated in models that are essentially silos. But the ever evolving nature of the phone market place essentially putting tiny computers, rather than simply stand alone phones in consumers’ pockets is opening questions pertaining to consumer rights.
In what has to be the worst timing possible for Apple and AT&T’s antics was the introduction of the Internet Preservation Act of 2009 by Reps. Edward Markey (D-Mass.) and Anna Eshoo (D-Calif.) on July 31st. The situation certainly is causing the drum beat for the bill to be loud and clear. But who is beating that drum and why?
Some of the major groups pushing for Net Neutrality include The New America Foundation, a group heavily backed by Google who also retains Google’s CEO as its chairman. Lobbying operations that receive money from Google including FreePress, SavetheInternet.com, Public Knowledge, and Media Access Project are also heavily engaged. Additionally, Lawrence Lessig, whom I have great admiration for but disagree with his Net Neutrality stance is a hard charger in this area and also backed by Google.
So why is Google so interested in Net Neutrality as law and especially at the width and breadth of this new bill when Google VP Vint Cerf was quoted as saying,
A lightweight but enforceable neutrality rule is needed to ensure that the Internet continues to thrive.
There are probably a variety of reasons. One may be that Google can simply speed up their traffic and avoid the end-to-end principle by edge caching. Essentially they make deals with telecos to place their servers all over the country (and world) and can deliver the data as cache speeding up the transfer of bits to the end user. Cache isn’t considered “network management” by most standards and therefore their bits travel faster while they pour money all over regulation that will prevent anyone else from having their Internet traffic be able to keep up.
Additionally, while Net Neutrality advocates claim that the current situation causes barriers to entry into the broadband marketplace for new broadband companies and technologies, the argument in reality couldn’t be further from the truth. Five years ago this was a decent argument. Today, new options are cropping up all over the country. And in a few years time, most consumers in metro areas should have at minimum five choices. My home town of Atlanta currently has seven plus options for high-speed broadband access at the moment, from copper, fiber, and satellite to WiMax with Broadband over Power Lines (BPL) soon to follow suit as well. But with government controlling broadband, and creating regulation for how companies manage their networks, the entry barriers will more than likely only worsen.
As Tim Lee puts it,
New regulations inevitably come with unintended consequences. Indeed, today’s network neutrality debate is strikingly similar to the debate that produced the first modern regulatory agency, the Interstate Commerce Commission. Unfortunately, rather than protecting consumers from the railroads, the ICC protected the railroads from competition by erecting new barriers to entry in the surface transportation marketplace. Other 20th-century regulatory agencies also limited competition in the industries they regulated. Like these older regulatory regimes, network neutrality regulations are likely not to achieve their intended aims. Given the need for more competition in the broadband marketplace, policymakers should be especially wary of enacting regulations that could become a barrier to entry for new broadband firms.
And along with barriers for entry in regards to new ISP’s, it may also create barriers for entry for new ideas like new advertising models. This may be another reason why Google and its lobbyist are pushing hard for this bill. [Make no mistake, Google is an advertising company, not a search company.] Additionally it could create barriers for entry for new technologies and services in the ISP market. The Internet is still in its infancy. While it has reached a point where the average user probably does not remember life without it, it is still a growing, evolving beast. What we imagine is not possible or that no one would be interested in today may be laughable tomorrow. The future of the Internet may become a customizable personal experience where individuals may specifically choose an ISP that is solely built for a specific purpose.
What if for instance Limelight Networks, a content delivery service for the likes of Apple’s iTunes, Microsoft’s Xbox Live, Sony’s Playstation Network, and Netflix decided they would create last-mile networks instead of simply connecting to a last-mile network? This would provide end users connected to the service the ability to have all time sensitive content like high definition movies, music delivery, downloadable content, and online gaming priority over non-time sensitive content like email or casual Internet surfing. The possibility of product specific entertainment oriented high speed networks is absolutely not out of the question for the future of the Internet. But if this bill passes, things like this would no longer have only the current barriers of entry, they would have additionally have the government to determine entry.
As Richard Bennett, a network architect who has testified before the FCC, describes it,
In its essence, the Internet is a resource contention system that should, in most cases, resolve competing demands for bandwidth in favor of customer perception and experience. When I testified at the FCC?s first hearing on network management practices last February, I spent half my time on this point and all other witnesses agreed with me: applications have diverse needs, and the network should do its best to meet all of them. That?s what we expect from a ?multi-purpose network?, after all.
Net Neutrality backers are currently scarred that ISP’s will take advantage of them in some way. But the free market traditionally has a way of correcting itself. James G. Lakely, managing editor of Infotech & Telecom News and a research fellow at The Heartland Institute recently argued in the The Bulletin in favor of the free market when it comes to the Internet,
The ordered chaos of market forces may scare those who don?t understand it. But the market is efficient, quickly responsive to the needs and wants of consumers, and?in the proper sense of the word?free.
This couldn’t be better stated. Neutrality proponents love to point out situations like last April’s fiasco with Time Warner Cable’s move to metered billing. And they continue to harp on the issue to this day as a reason to enforce Net Neutrality. But what happened in that case? The market reacted with grand outcry. [More than likely because they didn't understand it, and the truth is that metered billing would probably save 95% of broadband Internet users a huge chunk of change.] Within days of the outcry, TWC pulled the plug. The market didn’t want it, and the company responded to the market.
Which ultimately begs the question, will the government react in only days if the Internet Freedom Preservation Act of 2009 has a negative market impact? If the 60 year period between updates of the Telecommunications Act of 1934 is any example, we’re in for trouble. Trouble that will only allow for other countries to continue passing us by in broadband innovation and delivery.
-nick
