Two cents on Net Neutrality debate

January 20, 2006
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We have Mark Cuban, Jeff Pulver, PhoneBoy and many others posting on the subject of Net Neutrality.

In some sense, they are all right (correct), but fail to get to the root of the problem. The problem isn’t a question of Net Neutrality or Tiered Services. The problem is the end result of several core drivers. The bottom line is that there is no competition at the lowest (first mile) of our Internet pipe. We have the duopoly of Cable vs. Telco and in many cases people don’t even have that choice (broadband is provided by only one or the other).

It starts there. You take the combination of no competitive marketplace, combined with the fact that the duopoly players want to play higher up the stack, above “access” and into “content and applications” and you have a recipe for disaster. If we had competition at the access layer, nothing else would matter. Each of us could then choose the service package that matched our specific goals. No two of us are alike. We each value different things in different ways. There would be no need to speak of Net Neutrality and regulation, because the marketplace would provide a broad range of products and offers, including tiered services, or whatever.

So now back to reality. We don’t have a competitive marketplace at the access level. We have one choice, perhaps two, for access, for the pipes we use to reach the Internet. So now what? We can fight the battle for Net Neutrality, and try to force these vendors to play by some set of rules. The problem there is these are huge companies with decades of experience in working the system — they thrive in that world. Who is going enforce those rules? Like the phone companies are going to care about breaking those laws (assuming anything as concrete as “laws” ever happened). Look at their history. Even if they do lose a legal battle here or there, they will gladly just pay the fines, rather than actually change their ways. And who is going to stop them?

Or we can fight for competition at the access layer. This is working in the UK and in France, countries that started with a far more monopolistic environment than we have here.

Either way it’s a long slog. I just think putting the focus on Net Neutrality takes the focus off the real problem, which is competition at the access layer, giving us choices in “Internet pipe” providers. That is a 20 year battle, but without it, nothing gets fixed, regardless of whether or not there are supposed rules about “Net Neutrality”.

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4 Responses to Two cents on Net Neutrality debate

  1. valeko
    January 24, 2006 at 8:33 pm

    I think the issue really is about net neutrality, though. Even if I have a vast, gargantuan plethora of last-mile access options, what good is it if the fundamental architectural principles of the Internet are not conserved, and each one only allows me to access a segment (perhaps with considerable overlap) of the greater Internet?

    Partioning the Internet and Internet traffic is a vast danger on any competitive scale. I agree that alternative options for end-consumers bear very heavily on this (after all, you’d think the most successful ISP is one that simply provides undifferentiated access to everything), but they are not the end-all. Partioning the Internet in principle is going to be a problem in any marketplace scenario in which it is so permitted.

  2. Brenda K
    February 13, 2006 at 3:31 pm

    I agree – where I live I only have the choice of one broadband provider. This is not the free market, capitalistic ideal! This service provider consistently delivers less bandwidth than agreed, has outages, and raises rates. With no competition, they have no incentive to stop torturing their customers who are very dependent on their service. Hearing that these same service providers may hit VoIP companies with a service fee or surcharge just made my blood boil!!

  3. mark h
    February 14, 2006 at 3:55 pm

    access has become a commodity service. Rates for access continue to decline. Divide a service area up by introducing too many competitors and price wars will drive most of them away.
    Give access providers the ability to source revenue from content providers and they will continue to develop their networks to bring the kind of competition your looking for.

  4. Paulaner01
    March 28, 2006 at 8:02 pm

    I tend to fall into the "don’t mess with a good thing" crowd. Regulation isn’t going to take us where we need to go in the 21st century – we’re falling behind as it is, and more laws will only throw a wrench in the wheels of progress. This can be worked out with more investment, innovation, and expansion, all to the benefit of the consumer.

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