Posted by
John on Wednesday, July 12, 2006 1:05:04 PM
I've been talking to several people / blogs / myself about Net
Neutrality. It might be handy to get all of the pieces in one place, in
case anyone is interested.
Bruce Stewart at
O'Reilly has a brief piece on the opening shots. Sort of a playbill.
NRO has a good editorial which is terse but helpful.
Hillary has weighed (ahem ...) in.
Ars Technica
here and
here. These are excellent pieces.
Here is a pretty good wrap up of Senator Stevens speech on regulation vs. non-regulation, with responses.
CNET's search engine on Net Neutrailty - there are 3 or 4 good pieces here on the pro-neutrality position.
My take is this. Net Neutrality is a manufactured issue, aka a solution
in search of a problem. It would appear that it started as an effort by
AT&T and other ISPs to get legislative protection for their
bandwidth. This makes sense: as
Michael
was saying, the internet doesn't support the kind of nano-economics
that are required to siphon money away from end users for users.
There's too much content and no way to meter it. The counterattack was
an attempt by businesses / freedom activists / internet anarchists to
lay claim to other company's infrastructure.
The anarchists are pretty much of the opinion that the Internet is
free, or should be free, or is at least free to use, and that the usage
trumps any costs (which they only acknowledge in the negative). Google,
Amazon, and other companies and individuals who have created successful
businesses and have future plans are rightly threatened should the
companies that own the pipes begin to restrict them for whatever
reason. But of course, the Internet was (and is) not free to build -
there was a huge infrastructure cost.
The flip side is this - AT&T want you to believe that the Internet
was created out of some altruistic notion that their board came up with
over the weekend, and only now are they realizing their mistake. The
truth of the matter is that the Internet was the necessary buildout for
what are now known as ISPs because they were in the same spot 30 years
ago as Amazon is in now. Faced with mediocre revenue models and stellar
technological plans to improve communication, they deemed it worthwhile
to create their own markets. You can't have VOIP without the IP, you
know? The Internet for them is a sunk cost. They opened it up so that
government regulators couldn't break up Ma Internet the same way they
destroyed Ma Bell, salving the pain of that decision by thinking that
they would be near the top of the food chain as the iNterthingy
proliferated.
Instead, as so often happens in America, business models and revenue
models grew that were a step ahead of the intended target. Where ISPs
felt that they were the top of the food chain, companies that were
content specific, instead of delivery-driven, sprang up, effectively
shortening the usage model. The Internet is an aside to Amazon's
business - it could work on a LAN if the LAN was only big enough. So
the next round of AT&T execs, faced with falling revenues and a
lack of innovation, are trying to put the monster back in the box to
attract revenue for the next ten years.
That's not to say that the Internet should be free, and in fact, it is
not. No more infrastructure is built that isn't tied to revenue and/or
income. AT&T, Qwest, et al make money by delivering the "last mile"
(cable modems for the home and business), which is revenue that
wouldn't exist without the first 999 models. As router and server
hardware has come down in price, the cost of delivering service has
consequently fallen, the more so because there is more demand. And, off
the top of my head, I can think of three or four other models that are
pushed by ISPs that are similarly leveraging their previous sunk cost
in building the Internet.
That's where we stand now. So why do I call this a manufactured issue?
First, because net neutrality is a shibolleth for both sides to save
their business models. Second, because indeed, everyone's revenue
models are safe and secure. Third, and much more importantly, this is
an issue that the market will respond to. If bandwidth is truly the
problem, some megalithic company will come up with a way to make money
on increased / dedicated / metered bandwidth. In fact, the stirrings
are already out
there.
In other words, the government is once again being lobbied to "do
something" (hands waving frantically). Now the trick is to make sure
they don't screw something up in the drive to take credit.