Whose Internet Is It, Anyway?
The FCC’s new “net neutrality” rules only muddle the picture.
By Jack ShaferPosted Tuesday, Dec. 21, 2010, at 5:42 PM ET
Even the staunchest net neutrality advocate will concede that net neutrality is a fuzzy concept. No network can be purely neutral. If the current Internet didn’t prioritize some traffic at the expense of other traffic, the whole enterprise would grind to a halt like Manhattan’s streets when the stoplights stop working.
So the basic question here is who will set the Internet’s priorities, the government or the providers. That I have an innate distrust for government should surprise no regular readers. Traditionally, the state censors and marginalizes voices while private businesses tend to remain tolerant. Even at the height of the rebellions of the 1960s and early 1970s, political radicals and social radicals could always find printers to publish their most sordid, seditious, and sensational material. But that’s only because there was no FCC control over who could own and operate a printing press, no control over what prices they could charge for their services, and no state commandment that they had to accept any print job. The only times the FCC has spurred debate and commentary have been when it has stepped out of the way.
If the FCC is as keen about encouraging Internet innovation and entrepreneurship and forestalling censorship as its chairman claims to be, there is a smarter policy framework to pursue. First, the FCC should avoid cementing the current broadband monopolies and duopolies into place by encouraging new entrants. One way to encourage new land-based Internet providers would be to replace municipal- and state-franchise laws, which extract concessions and cash from cable systems and telephone companies for the right to string line, with a federal-franchise system that simplifies the process—and can’t shake the new entrants down or otherwise impede them.
While I dread the hassles and unintended consequences of corporate control of the Internet, I dread the intended consequences of a controlling FCC much, much more.
Any government ruling that has liberals griping about too much corporate control and the Wall Street Journal growling about a left-wing coup might not be a bad compromise.
Considering that the Federal Communications Commission had few good options last week, its new rules affirming “Net neutrality” were at least a stab at fairness. This particular problem isn’t simple to say, much less to solve, but here it is in a nutshell:
DAN GLEITER, The Patriot-News
As Netflix, Hulu, Skype and other bandwidth monsters become more common, Internet service providers such as Comcast or Verizon want to charge them for the access. Their reasoning is that it costs the ISPs more — they have spent billions on bandwidth — so they should be able to recoup their investment.
The problem is that ISPs are biased. Video companies and Skype don’t simply use the Internet like your friend’s cooking blog; they are competitors. Netflix and Hulu sell access to movies and premium TV shows just like Comcast. Skype provides phone service just like Verizon. So consumer groups have demanded that ISPs treat all content the same.
Each side has demonized the other, but they are both right, and they are both wrong. Net neutrality boosters talk about the Internet as though it were a natural phenomenon like sunshine. How dare big bad corporations limit our access to what we have always enjoyed free and clear?
This misses the point. While the Internet belongs to no one, you need a connection to it, and those connections are not free. Comcast spent $12 billion in 2007 and 2008 alone upgrading its system to handle increased traffic.
Consumers pay more for a faster web connection, but why should we pay the entire cost? The ISPs want to make bandwidth gobblers such as Netflix pay some of the freight, too. At the same time, web geeks are absolutely correct that abandoning Net neutrality would have a chilling effect on free speech.
The problem isn’t Hulu or Netflix, which had revenues of $1.7 billion in 2009. Netflix hardly needs our sympathy. If Netflix and Comcast want to fight over their profit margins, the government should not be taking sides. The problem is that, without Net neutrality, an ISP could slap high charges on an indie or high school rock band trying to reach fans with its music videos.
The Internet is the great equalizer. It allows independent musicians and filmmakers direct access to their audience without going on their knees to some big corporation. It allows a grassroots political group a voice alongside the wealthiest lobbyists. That isn’t going to change. The commission reaffirmed the basic principle of Net neutrality. Verizon or Comcast cannot block, or even slow down, high bandwidth content such as streaming video. They have to treat all online content equally. Score one for us.
However, they can charge the bandwidth monsters more. In other words, the Internet is no longer a one-price-all-you-can-eat buffet for content providers. Like consumers, they can be charged more for faster speeds. This could be fine if it is applied to a content provider’s total usage. A Harrisburg indie band is hardly going to consume bandwidth by the terabyte.
More troubling, the FCC denied the principle of Net neutrality for mobile devices, allowing an ISP to block or slow streaming video to your smart phone, for example. It reasoned that mobile bandwidth is much tighter than online bandwidth.
That’s true, but it ignores the whole direction of the Internet and, indeed, of society. As one critic put it, the FCC did a great job of protecting access to the Internet of the 1990s, but not to the Internet of tomorrow. The only thing that the FCC did for certain last week was to set the stage for lawsuits that, ultimately, will flesh out exactly how the new rules can be applied.
Meanwhile, just when you thought you no longer needed to pay for HBO, get ready to pay more for that streaming movie. For all the talk about freedom of speech, much of this is a tussle among corporate behemoths — Comcast and Netflix, Verizon and Google — for profit share.
And one way or another, that often means the consumer pays the bill.
FCC’s Net Neutrality Rules Spark Debate
Should the government regulate Internet access? Tuesday the Federal Communications Commission (FCC) decided it should, by voting 3-2 in favor of establishing rules for Internet service providers. The guidelines aim to preserve unfiltered broadband access to all lawful Web sites and services, a term dubbed “Net Neutrality.” The specifics are unknown since they have not yet been made public, though the FCC did state wired ISPs would be more tightly regulated than wireless ISPs. Here’s what the staff of PCMag thought of the decision.
Thumbs up. To me, the rules seem pretty reasonable. Like any legal document, there is a lot to unpack. Indeed, defining what “reasonable discrimination” is, exactly, is perhaps the greatest point and the FCC punts on that a bit. The FCC leaves the door open to tiered pricing and bandwidth throttling, but makes it clear it has the authority to stand up for consumers if these rules are violated. These rules aren’t perfect, but I like the idea that none of the special interest groups are happy with it. That is because they were written in the public interest. —Dan Costa, Executive Editor
Thumbs up, with caveats. In sum, what passed through the FCC ought to encourage consumers. It forbids ISPs from blocking access to sites—sorry, Comcast—and requires providers to disclose how they manage networks—see, Comcast? Even so, what we have now may best be described as Net Neutrality lite: There are plenty of loopholes (e.g. the exemption for managed services), and wireless, the next frontier, is left largely untouched (e.g. mobile app stores remain a huge gray zone). The devil is, as they say, in the details. I’m interested to see how it’s executed and enforced, and whether it survives the inevitable legal and legislative challenges. On balance, however, I believe it’s a step in the right direction. —William Fenton, Junior Analyst for Software & Networking
Thumbs down. “We recognize that there have been meaningful recent moves toward openness, including the introduction of open operating systems like Android.”—FCC Press Release on the Net Neutrality laws. They confused open, unfiltered Internet access with open-source operating systems; they are complete imbeciles. It’s intuitive to think the government should create laws that forbid ISPs from filtering Internet access, and it’s intuitive to think that would protect consumers. But that’s rarely the way it works. Instead, adding more regulation has a track record of adding cost, impeding innovation, and even giving select companies advantages in the market. I’d rather take my chances with no regulation and let the free market work—let the consumers pick winners and losers by allowing them to vote with their dollar. If they like what an ISP is doing, they will reward it with their business; if not, they’ll take their business elsewhere and hopefully the ISP will change its product to win back the consumers’ business. —PJ Jacobowitz, Analyst for Digital Cameras
Thumbs up. Fine with the rules; the more lax attitude about mobile broadband is a head scratcher. —Samara Lynn, Networking and Business Analyst
Thumbs sideways. Fifteen years ago, you had a wide choice of ISPs to get you onto the Internet, including a host of local competitive providers. Now, since people understandably want broadband, it’s either the phone company or the cable company, and outside major metro areas, there’s little or no choice of either. So with two or three companies dominating Internet connectivity, I worry about the openness of the Internet giving way to another TV-like commercial offering that pushes out the little innovative guy who’s made the Internet so vibrant. I would like Internet access to be like electricity or phone service—you’re connected to the supply without restrictions. So I’m all for the FCC saying, “Cable and Telecom ISPs, you can’t pick and choose sites or Internet services to favor or throttle (or even block).” But the announced rules give ISPs too much of an inroad to traffic profiling, especially for mobile carriers. —Michael Muchmore, Lead Analyst for Software
Thumbs up. It was time. While some might say the FCC’s outline of Net Neutrality was just common-sense stuff that essentially prohibits what networks and providers weren’t doing anyway, there’s just too much evidence—both confirmed and anecdotal—that activities like throttling access to specific sites or services have been happening to some degree. And the fact that anyone could possibly be charged $62,000 for downloading a movie that costs $9 at Amazon shows many systems are anything but transparent. The wireless exception is vaguely worrisome, but so is surging demand for wireless data, which shows no sign of being sated anytime soon. It seems reasonable to give wireless networks more wiggle room, at least until 4G is commonplace. —Peter Pachal, News Director
Thumbs sideways. The Internet wasn’t invented by today’s giant broadband providers. They can’t stake a claim and take ownership. On the other hand, if they can’t turn a profit they won’t continue to provide the infrastructure we all rely on. The FCC’s ruling seems to be a reasonable compromise that gives the providers market stability but bans high-handed practices like suppressing or throttling content from competitors. I’d be happier if they actively banned paid prioritization, though, and I fear that with some income opportunities now cut off the providers will look to raising their rates for those of us who use the most bandwidth. —Neil J. Rubenking, Lead Analyst for Security
Thumbs down. The Web is going wireless, and “paid prioritization” is the new frontier for wireless company profits. While I’m encouraged that wireless companies will be forbidden from blocking lawful Web sites or voice services that compete with their own, I don’t see anything in there stopping them from throttling those services or restricting them to low speeds with poor quality of service. I agree that wireless carriers often need to manage their networks by restricting high-bandwidth uses so everyone can get some airspace, but I don’t trust them to stop there. Unless the FCC is vigilant, I worry that we’re going to have a wireless world where almost every use outside your carrier’s walled garden carries an extra fee if you want it to function properly—and that doesn’t sound much like a free and open Internet to me. —Sascha Segan, Lead Analyst for Mobile
Thumbs sideways. It’s fascinating to watch both sides prostrate themselves over how far this order goes or does not go without actually having the details of the order in their hands. What we do know about the FCC’s rules paints them as largely ineffectual pablum that will only be tested when the first ISP tries to change the way it does business. It’s not strong- or far-reaching enough to truly address wireless and appears to do nothing to figure out how all these players might coexist in our handsets and homes. On the other hand, I see it as a necessary first step. I expect the order will be added to and adjusted numerous times over the next few years and, perhaps, will become some sort of wide-ranging, and more powerful act in the future. That of course is when the most libertarian among us should really become concerned. —Lance Ulanoff, Editor-in-Chief
Thumbs up (tentatively). To me, it’s a choice of poisons—corporations, whose actions tend toward self-interest, or government, which can’t seem to run or regulate anything particularly well. The problem is that it’s an inescapable issue. Decisions have to be made, guidelines established. The lesser of two evils, in this case, is limited government regulation. So long as these rules are clear, consistent, and keep the best interest of the general public in mind, I’ll support them. —Brian Westover, Junior Analyst for Hardware