Sunday, April 27, 2014

Neutrality? What Neutrality?

When all is not what it seems ...

There's quite a buzz going around about net neutrality, so much so that it feels like my head is going around in a buzz. In the end I've come around to quite a different position than where I started out. Allow me to explain.

In a nutshell, the problem arose because Internet Service Providers like Comcast and AT&T became concerned about the amount of bandwidth being consumed by their customers to stream data from Content Providers like Netflix and Youtube. In the merry old wild-West days of the Internet this was not a problem, because, well, let's face it, dialup modems were not up to dealing with songs, let alone HD movies (which did not exist yet).

But now we're in the age of high-speed always-on connections, and soon will make the leap into superfast fiber optic connections. Increasingly this puts the ISPs in the position of providing a free transport mechanism for anyone with a digital product to distribute. To be clear, the transport mechanism is being paid for by the consumer (us) on the receiving end, and in many cases the content is also being paid for by the consumer. So what's their beef?

Depending on your point of view, the issue is either clarified or muddied by the fact that the ISPs "like" Comcast and AT&T are also content providers, so what they're really uncomfortable about is having to provide the highway for their competitor's trucks to deliver on while the money for the product goes to someone other than them. So you can understand their concern. Their poor shareholders are being deprived of an even bigger piece of the pie because of some stupid rule left over from the dark ages.

That rule is the "net neutrality" policy that began as a sort of gentleman's agreement between all the carriers that they would treat all traffic equally in the interest of creating the environment that gave rise to email, the World Wide Web, ecommerce, and the whole dot-com splurge that soon followed. Naturally enough, the ISP's would now like to treat some traffic differently. If they can't sell you the content, they would like to be able to charge someone else for delivering it. Plus, they'd like the right to give preferential treatment to their own content if you're buying from them so you'll have a more pleasant consumer experience.

All the hue and cry results from the fear of a domino effect. Once this precedent is established, people fear, we will head down the road that leads to a dual standard, with huge wealthy companies paying one another for the privilege of high speeds, while the rest of us muddle along on footpaths. I understand this argument, too. I've even signed petitions begging the FCC or anyone else in a position of power to KEEP THE INTERNET FREE, for all users to be treated equally, etc.

Now I've changed my mind. The problem is, the issue has come up not because of services "like" Netflix and Youtube -- it really IS Netflix and Youtube. As much as we all love them, these guys are running the public network into the ground. Netflix alone is said to account for over 30% of all internet traffic, and Youtube half again as much. With the advent of 4K video we can expect another huge jump. Add to that all the other providers that are flooding the net with song streams and videos (subliminal: Pandora, Facebook) and you can see that what the rest of us are doing amounts to a hill of beans.

Pushing the old highway analogy, it's as if we built a network of 2-lane highways across the country so we could take a Sunday drive, and now a few mega-trucking companies have flooded it with semi-trailers. The highway builders have to add more lanes, and someone has to pay. Guess who?

You got it. We asked for it, we demanded it, we're watching it and listening to it, and we're gonna pay. But the real insight that changed my mind is that we're asking the Internet to do something beyond what it was designed to do. It's high time to create a separate channel for all those huge commercial loads. Consider it a turnpike to take the load off the county roads. Whatever makes you comfortable. With this bottleneck behind us then the REST of the Internet can remain neutral.

And as far as how equal we are? Here's the technical reality: You may not have noticed the fine print in your contract with your ISP, but you are prohibited from running a website from your home computer. This is related to the speed you're getting. The A in ADSL stands for "asynchronous," which is a thousand dollar word that means you download ten times faster than you upload. The whole system is designed around the reality that you are consuming several DVDs worth of videos each day while sending a few emails and making a couple of Facebook posts.

If you do want to create a website, you rent space on a rack somewhere in the cloud and hang out your digital shingle in cyberspace. But read the fine print of that contract also. You'll note the limits on traffic that came with your 9.99 or 6.99 per month of service, with rather huge fees for excessive overage. If you're really trying to run a start up digital service, you'll quickly find your measly shared server is overwhelmed by demand. As you scale up with success, you'll move to your own managed server, then maybe to a cluster of them, and you'll pay a distribution service such as Cloudflare or Akamai to be able to handle all the thousands and millions of hits you'll be getting. You may even end up building your own massive data centers the way Google, Amazon, and Microsoft do. It will end up costing you a fortune and you'll either be burning through a pile of investment capital or, if you're lucky, already managing to monetize your service and make it profitable.

So my question is, how much will the loss of net neutrality alter this picture? My instinct tells me, not much. Unless of course you are someone "like" Netflix and Youtube.


  1. Hm. Lost me at "poor investors".

  2. My tongue is hurting from being in my cheek.

  3. And here's a common sense position from none other than the head of the FCC:

    TechCrunch: FCC Chairman Promises To Regulate The Internet As A Utility If Needed To Protect Net Neutrality. http://google.com/newsstand/s/CBIw_ubMmx8

  4. Still not convinced? How about this argument -- neutrality might be better served through competition. If some ISPs begin charging providers for higher speed, might they not prefer one that doesn't do that? What if that one is a company "like" Google? http://www.zdnet.com/google-backs-net-neutrality-on-its-own-google-fibre-network-7000029786/?s_cid=e539&ttag=e539&ftag=TRE17cfd61