The Warring States of NPF - Net Neutrality and Bottlenecking the Internet

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Net Neutrality and Bottlenecking the Internet

This is something that's sort of been picking up steam behind the scenes for a while now. Pretty much the shorthand version is cable co's and other broadband providers want to be able to charge Internet content providers - The Googles and Ebays all the way down to your favorite webcomic auteurs - for carrying their content to users, as well as the ability to decide which content it is willing to carry.

At Stake: The Net as We Know It

Google et al fear broadband carriers will tie up traffic with new tolls and controls. Ultimately, it could mean a world of Internet haves and have-nots

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The Internet has always been a model of freedom. Today the Web is flourishing because anyone can click to any site or download any service they want on an open network. But now the phone and cable companies that operate broadband networks have a different vision. If they get their way, today's Information Highway could be laden with tollgates, express lanes, and traffic tie-ups -- all designed to make money for the network companies.

That prospect is the worst nightmare of Internet stars such as Google (GOOG) , Amazon (AMZN), and eBay (EBAY). They're gearing up for a clash with the phone and cable giants early next year as Congress begins to redraft the telecom laws for the broadband era. The Internet gang fears that unless they get lawmakers to intervene, the network operators will soon be able to put a chokehold on the Web. "The issue is about the future of the Internet," says Alan Davidson, Google's Washington policy counsel.

BLOCKED OUT. Doug Herring, 48, got a glimpse of that specter last November. Traveling on business in Tennessee, the General Electric (GE) sales manager phoned his wife at their Elberta (Ala.) home. Herring had just signed up with Web-phone provider Vonage Holdings and was pleased with the service. But this time, he couldn't get through. He switched Web-phone providers, but still couldn't make calls.

Frustrated, Herring contacted Madison River Communications, the rural phone company that provides his digital subscriber line (DSL) connection. The company said it was blocking calls from Internet phone companies. Outraged, Herring and Vonage complained to federal regulators.

"For me to get the Internet where I live, [Madison River] is the only provider," Herring fumes. In March the Federal Communications Commission fined the company $15,000, and the carrier agreed it would no longer block Internet-calling services.

INTERNET FIEFDOMS? Most phone and cable companies are no longer content just to sell Web access to consumers. After investing in high-speed pipes, they also want to peddle more lucrative products, such as Internet-delivered TV programs, movies, and phone calls. "Building these networks is expensive," says Link Hoewing, vice-president for Internet policy at Verizon Communications (VZ). "If I can find new ways to pay for this network, it's gravy for everyone."

But selling those extras puts the phone and cable companies in competition with Web services big and small. The network operators could block consumers from popular sites such as Google, Amazon, or Yahoo! (YHOO) in favor of their own. Or they could degrade delivery of Web pages whose providers don't pay extra. Google's home page, for instance, might load at a creep, while a search engine backed by the network company would zip along.

"This new view of the world will break apart the Internet and turn it into small fiefdoms" divided between the network providers' friends and foes, says Vonage Chief Executive Jeffrey Citron.

LOBBYING HEFT. That's just crying wolf, retort the Bell and cable operators. The Web companies' push for rules requiring "network neutrality is a solution in search of a problem," says Daniel Brenner, senior vice-president for regulatory policy at the National Cable & Telecommunications Assn.

But recent court and regulatory rulings have given the carriers more room to discriminate. In June, the U.S. Supreme Court ruled that cable broadband services were almost free of regulation. Two months later, the FCC granted the same liberty to the Bells' broadband services. The FCC made two newly merged megaphone companies -- created from AT&T (T) and SBC Communications and Verizon and MCI (MCIP) -- vow to keep their Internet lines open to all for the next two years. But FCC Chairman Kevin Martin favors a light regulatory touch until he sees widespread abuse by the networks.

Lawmakers updating the telecom laws are more likely to act. The House Commerce Committee will probably vote early next year on whether to require Net neutrality. And while Google and its Internet brethren are the darlings of Wall Street and a Web-wild public, these New Economy powerhouses could find themselves outgunned in Washington. After decades as regulated carriers, the Old Tech phone and cable companies employ legions of lobbyists and funnel hefty checks into Congress's campaign coffers. Google, by contrast, just hired Davidson, its first lobbyist, in June.

BANDWIDTH ROAD HOGS. For their part, the phone and cable companies protest that they have no plans to use their pipes unfairly. Madison River is the only carrier known to have blocked rivals or degraded their service. "We have no intention of controlling where you can and can't go on the Internet," says Bill Smith, chief technology officer at BellSouth (BLS). "If [phone companies] restrict where people go on the Net, they'd leave in droves" for cable competitors.

Yet in a Nov. 7 interview with BusinessWeek Online, AT&T CEO Edward Whitacre Jr. declared: "What [Google, Vonage, and others] would like to do is to use my pipes free. But I ain't going to let them do that." Whitacre and AT&T argue that they need flexibility to exact a toll from Web services that hog bandwidth.

As broadband use grows, the Bells and cable companies say that intensive users aren't paying their fair share. File-sharers swapping music and movies account for 60% of North American residential broadband use, estimates Dave Caputo, CEO of Sandvine in Waterloo, Ont., which sells technology to manage network traffic. "Your overeaters get preferential treatment over weaker ones," he says.

IT'S OUR NET. Carriers could raise their prices for consumers who clog the network. But when Korean phone giant KT noted that 5% of its users accounted for half of its traffic and floated the idea of volume pricing earlier this year, the public outcry quickly quashed any plan.

So the network operators figure they can charge at the source of the traffic -- and they're turning to technology for help. Sandvine and other companies, including Cisco Systems (CSCO), are making tools that can identify whether users are sending video, e-mail, or phone calls. This gear could give network operators the ability to speed up or slow down certain uses.

That capability could be used to help Internet surfers. BellSouth, for one, wants to guarantee that an Internet-TV viewer doesn't experience annoying millisecond delays during the Super Bowl because his teenage daughter is downloading music files in another room.

WINNERS AND LOSERS? But express lanes for certain bits could give network providers a chance to shunt other services into the slow lane, unless they pay up. A phone company could tell Google or another independent Web service that it must pay extra to ensure speedy, reliable service.

That could result in an Internet of haves, who can afford to pay the network operators more to ensure smooth service, and have-nots. Trouble is, those have-nots may include the Next Big Thing -- whether it be mom-and-pop podcasting or video blogging. The fewer innovative services on the Net, the less reason Web users have to want broadband. Both the network operators and the Internet could lose out in the end.

Fortunately, there's at least a handfull of congressmen who get exactly what's at stake here:

Pols, Web firms, telcos wrestle over 'net neutrality'

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WASHINGTON -- One of the major sticking points over legislation easing phone companies' entry into the video market involves a policy that is little understood by some lawmakers. It's a policy that means different things to different people but has a passionate appeal.

It's called "net neutrality," and the debate over it went into high gear Thursday during a House Commerce Committee legislative hearing. Arguing the issues were executives from network companies like Verizon, Internet goods movers like Amazon and lawmakers from both parties. The legislation is being pushed by committee chairman Joe Barton, R-Texas.

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There might be no clear definition for the term, but loosely translated it seems to mean that there should be clear rules that prohibit the phone and cable companies from using their control of the network of wires and fiber-optic cables over which information travels from disadvantaging the people and companies who use them.

Fear about abuse of this power is driving some lawmakers to fight Barton's bill. Rep. Ed Markey, D-Mass., all but called the language a back-door tax on Internet users.

"We know from public statements from several industry executives that the owners of the broadband wires into our homes would like to start charging fees to Internet content providers," Markey said. "In other words, they want to artificially constrain the supply of Internet-based content and services to high-bandwidth consumers. This represents nothing more than the imposition of a broadband bottleneck tax on electronic commerce."

While language in the bill tells the FCC it needs to figure out what net neutrality is, it specifically prevents the agency from writing net neutrality rules. Rather, it would have the FCC enforce its net neutrality principles as people bring individual cases to the commission, accusing the networks of violating those principles.

"That's neither futuristic nor efficient, that's chaos," Markey said. "In short, the bill imperils the future of electronic commerce and innovation to the 'worldwide whims' of broadband barons and ties the hands of the agency in a way that will legally prevent it from saving something very special."

Barton defended his bill. He said it strikes the proper balance by giving the FCC the power to figure out what net neutrality is, then attack the problem -- if it becomes one -- on a case-by-case basis.

"The bill before us definitely gives the FCC the authority to enforce net neutrality, whatever it is," he said. "If anybody violated the principles, whoever that villain is, the bill explicitly gives the FCC the authority to punish that villain."

He made his point by having the witnesses on one of the panels give him a definition. While there was some common ground, there were considerable differences.

"We just had eight gentlemen that represent the largest trade groups and the brightest minds in the country, and not one of them gave a concise definition," Barton said. "We're tied up in knots in this bill, potentially over something that we do not yet even have a universally recognized definition of what it is."

Phone and cable company executives contend that they need to be able to charge some companies premium prices if they demand secure networks, virtual private networks or higher speeds for the transfer of movies or other large files. They contend that their pledge not to harm consumer access is enough.

"Our industry has stated that it will not block, impair or degrade consumer access to the Internet, and the FCC has made it clear that it has the authority to enforce its broadband principles," U.S. Telecom Assn. chief Walter McCormick Jr. told the lawmakers. "Therefore, we believe that legislation in the area is premature. Any grants of new regulatory authority or statutory ambiguities could chill innovation and investment."

Despite McCormick's assurances, there are indications that the phone companies are worried about the backlash. Sources said Comcast and AT&T have asked Cisco, Motorola, TiVo and other network-box makers to oppose network neutrality changes at the FCC.

It would be easy to pass off arguments like Markey's, and those of other Democrats, as so much liberal gasbagging. But Markey is one of Congress' most knowledgeable experts on telecommunications. He's been a member since 1976 and serves in a leading capacity on the House Commerce Committee's telecommunications subcommittee. And he has the support of other knowledgeable Democrats like Rep. Rick Boucher, D-Va., and powerful ones like the committee's senior Democrat, Rep. John Dingell of Michigan.

They also have the backing of many of the high-technology industry's darlings, such as Microsoft, eBay, Google and Amazon, as well as consumer groups ranging from the AARP to Consumers Union.

Despite the problems, Barton told reporters this week that he expects the House to vote on the bill in June, with the Senate to follow and the president to sign it into law before the year is out. While there were no takers on his offer to bet against him on passage of the bill, most recognize that there's a long way to go.

Still, the panel's hearing Thursday was a significant step, and even the Bells conceded that they might have to give some ground on the net neutrality issue to get most of what they want in the bill.

"We'll probably have to give up some skin on the net neutrality issue," said one Bell lobbyist. "But I wouldn't count the bill out this year."

Really I don't have too much to add at the moment in terms of my own opinion, at least nothing that I don't think is pretty starkly obvious on the face of the information itself, but I figured it was just worth kicking out there for discussion, as it's something that by its nature affects just about anyone who would happen to be reading this.

What I think might happen is at least one company will not do this if it gets passed. Meaning many many people will flock to said company. That company will gain more money than they know what to do with while the others will face a horrible profit drop. Eventually they will get the message and abolish the rediculous practice, as well as coming up with lots of new "features" that the other company may or may not have, as well as all kinds of promotional crap. Things may eventually get back to normal but the one company will generally always have more simply becasue more people stayed.

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I wonder. It if it really came down to just a few or even ONE company, I'm sure that company would 'change with the times' eventually too...

I doubt it'll ever come to that.

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Originally Posted by Nique

I wonder. It if it really came down to just a few or even ONE company, I'm sure that company would 'change with the times' eventually too...

I doubt it'll ever come to that.

The thing of this is your standard regional market has one, maybe two options for broadband, and both of them are run by someone who loves money, so, you're pretty much hosed. I mean in my area, if you don't want to get broadband from Comcast, you know what you can get? You can get jack shit, that's what you can get.

I'm probably going to get hell for this but I think with something as important as the internet the government should provide a baseline service. It doesn't have to have the bells and whistles or screaming fast speeds but a nation wide, possibily wireless, government funded broad band network would go a long way towards keeping companies honest.

Basically if all other companies switched over to what was outlined in the article then at least there would still be one service nuetral. If the companies got way out of hand people would simply forgo their few extras and use the governments system. This way you don't have to pass any new laws or quality control standards.

Like Fifth mentioned above you internet is handled by people that want to make money and if they are the only option, which they usually are, then can screw you anyway they want. A nationwide free, or maybe really cheap, government run broadband network would force them to play fair and probably also spur them to create new and innovative products to get people to switch over.

Also, this network would really benifit schools in very rural areas that need a broadband connection to keep their students current but can't aford one or have to cut other programs to pay for one. Those same kids would also be able to stay home sick, and if they have computers (Perhaps the money the school used for the broadband connection could be used with grants to get laptops to pass out to at least some students), and still virtually attend class and get homework assignments.

I'm quite sure current telecommunications companies would fight this tooth and nail but really there aren't really any big downsides I can see to this. In a way the internet has become as vitial to life today as the paved road. We don't trust private companies to manage, ok so they repair them but the government hires them and decides who gets the jobs, our road system why should we trust private companies with the future of the internet?

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Originally Posted by Sithdarth

Actually something like this has been going on for a while on the small-scale as a matter of cities offering municipal wireless access, and yeah, the telcos were challenging it every which way they could, everything from courtroom challenges to trying to get federal legislation barring the cities from acting to local advertising saying how cities couldn't be trusted to provide service. Last I heard though the cities were out ahead of the thing, and a few companies had pretty much ceded the fight in favor of bidding on the contracts to put the networks together.

I'll see if I can't dig up some relevant links.

Telcom companies hear the word free and reliable, and they run like crazed men trying to murder whoever is responsible. Despicable bastards.

After I post this I may have no internet.

but seriously folks, in a profit driven market, these guys are worse than OPEC. They will gouge and continue to gouge as long as they can.

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You're confusing the intentions. This != Google providing free Wifi for people. If it were simply, "provide internet to the masses," and the government were funding it...I'd have reservations, but it wouldn't be all that deplorable (until something were uncovered).

This is the 'tiered internet' I spoke of before, and it's absolutely scary how many important CEOs support it. This is something we, as internet denizens, should care about--and the reason they'll "probably" succeed is because not enough people know and not enough people are taking action. These days, it even seems that taking action will do little to convince them.

Some links:

Excellent Summary on the Whole Goddamn Thing on Reel Smart

FCC Chief: AT&T Can Limit Bandwidth If They Damn Well Please

Two More Net Giants Join Tiered Internet Scheme

Republicans Swat Down Net Neutrality Bill

Scariest part of the last link:

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Originally Posted by Da Last Linq

...Over $230 million spent in the last 6 years by AT&T, Verizon, Comcast and Time Warner on lobbyists.

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I'll see if I can't dig up some relevant links.

Fifth--do you mean this sort of thing?

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No no, you're missing the forest for the trees as it were. On the surface of my argument was the good that can come from government run non-profit broadband network. The point I was making that the government could provide a baseline untiered service. Something like a wireless network covering the country providing DSL speeds to anyone that wants to use it. Now all other companies would be free from regulations about network neutrality but the government network would be completely open to anyone that wants to use it for anything.(Anything legal that is but crime prevention should not restrict the file types that can be shared.)

This competely neutral government run network need not be free just really cheap. Thus if a company decides to institute policies like those mentioned above cosumers always have the option to bail out and use the government run network. This way you can prevent abuses by ISPs without giving the FCC a crap load of new powers and making another three books worth of laws. It could also create a sort of competition where none existed before. Thus some ISPs that have never needed to do anything innovative to attract customers would have to get off their buts and do something to make their service better than the government run network. So in the end you have a way to keep the internet neutral as well as keeping up the need for innovation.

In short, I'd much rather have the government dabbling in a piece of the economy then expand its control over the internet. It sounds kind of alarmist but everytime you right new laws and regulation you run the risk of opening the door to greater and greater restrictions. I see no reason to take the risk when a perfectly good alternative is sitting right in front of us. An alternative that has other decent side effects above and beyond keeping the internet neutral.