Two Tiered Internet

Wed Dec 14 05:02:49 UTC 2005

>>One might argue that in such a situation, the end user is getting
>>less value than they
>>did previously.  End users might then either demand a price break or
>>might vote with
>>their connectivity.
> 
> 
> the last 2 times this has come up I think there was the suggestion that
> given other options at reasonably close to the same end cost users might
> switch to alternate access methods. That works as long as there are
> alternate access methods, and as long as the telecom's don't 'cabal' and
> all do the same hideously bad thing...
> 

There are a few things that this trend would get involved with.

1) It pushes the "cost" of "peering" to the content providers, 
essentially bypassing the underlying upstream/transit networks. The 
upstream/transit networks that are essentially getting disenfranchised 
might react by not peering with "premium" networks that are trying to 
pull their customers from using their network.

2) The only way this scenario (prioritization) makes any difference is 
when there isn't sufficient capacity within the "premium" network. If 
there is sufficient capacity, this is no real issue. However, for 
example, assuming this were enabled today, a network would have no 
incentive whatsoever to upgrade its networks -- provided that the 
customer pain/deprioritized network traffic is low enough. (A ratio that 
can be experimentally determined).

In the example where end users get 6Mb/s for $50/month. It is 
conceivable that as part of this "upgrade/premium" service for end 
users... they'd get 60Mb/s downstream for $50/month. The network could 
provide this service at no increased operational cost because it only 
expects to push (whatever they currently push) of deprioritized traffic. 
(say 6mb/s assuming no over subscription).

They could then cover the costs (and profits) of this 60mb/s premium 
service through the fees of the so-called premium content pushers. And 
thus, they could make the argument that no one is being harmed and in 
fact the end users gain....

Except that as the non-premium traffic levels of their end users 
grows... they suffer. The network's answer? Pay for premium access aka 
paid transit aka level-2 peering..

3) The good news is that the RBOCs haven't learned how to run IP 
networks cost-effectively. Their costs of implementing this so-called 
"tier-2" network will far exceed the fees their model tells them they 
will get from it. Remember when they first got into the Internet Access 
business? They all tried to create their own premium content-portals, 
search engines, what-have-you. Then they outsourced/sold that function 
to networks like MSN. I doubt the majority of their users even care. AOL 
tried to keep their network proprietary. Didn't keep them swimming either.

    They can do anything they want with their own bits on their own 
network (eventually, the FCC will concede). The problem is that anytime 
you deprioritize the traffic of others for no other reason than because 
it isn't yours... well that smells a lot like restraint of trade. The 
RBOCs become gate keepers not underlying bit pushers.

    What about the censorship issues? If they won't accept *insert bad 
site here [porn, hate, etc]* /premium/ network's payments to push 
traffic across their network, but they will accept it (as they currently 
do) on a deprioritized level??

    Its a mess and they'll spend billions and it will cause some pain, 
and it'll eventually be abandoned. [My prediction based on what little 
is known about this thing today and history].

DJ