The FCC is planning new net neutrality rules. And they could enshrine pay-for-play. - The Washington Post

Mon Apr 28 19:30:14 UTC 2014

>The network op in me thinks double-dipping; the businessman
>in me (hey, gotta make a living, no?) thinks I need to get a piece of
>that profit, since that profit cannot be made without my last-mile
>network, and I'm willing to 'leverage' that if need be.

...which turns the eyeball network provider into a gatekeeper.  I think
the clearest comment on this so far has been from Kristopher Doyen in the "What 
Net Neutrality should and should not cover" thread, which goes into players 
abusing their position in the market to extract additional revenue with stuff 
like this.

Packets are packets are packets; aside from a sense of entitlement, why should 
the eyeball network provider get "a piece of the action" simply because the 
packets are revenue-generating for a 3rd party?  This incurs a massive 
additional barrier to entry for any business that depends on the internet for 
their income, as now their revenue has to not only cover their own overhead and 
profits but also need to fund additional profits for ANY eyeball network 
provider that believes they're entitled to a "piece of the action".  Why should 
I subsidize your business?

E.g. I sell a widget on my website.  An eyeball network provider's customer 
visits my website to purchase some widgets.  "Hey", says eyeball network 
operator, "you're making money off of packets traversing my network! Pay up!"

I know I've shifted this a bit from revenue-generating streaming content to a 
generic e-commerce situation, but how is that different except for the scale of 
traffic?  If the eyeball network provider sees fit to charge Netflix $x/Gbps 
because of the $y/Gbps that Netflix is making from that traffic, the call on 
when to charge rests solely with the eyeball network operator.  If my widget 
ecommerce store makes $1000y/Gbps because the traffic is small but revenue 
high, getting "a piece of the action" could mean $1000x/Gbps because there is 
more value "per packet".

--
Hugo

On Mon 2014-Apr-28 10:05:06 -0700, Lamar Owen <lowen at pari.edu> wrote:
>On 04/27/2014 06:18 PM, Jay Ashworth wrote:
>> ----- Original Message -----
>>> From: "Hugo Slabbert" <hslabbert at stargate.ca>
>>> I guess that's the question here: If additional transport directly
>>> been POPs of the two parties was needed, somebody has to pay for the
>>> links.
>> And the answer is: at whose instance (to use an old Bell term) is that
>> traffic moving.
>>
>> The answer is "at the instance of the eyeball's customers".
>>
>> So there's no call for the eyeball to charge the provider for it.
>>
>>
>
>Now, Jay, I don't often disagree with you, but today it occurred to me
>the business case here (I've had to put on my businessman's hat far too
>frequently lately, in dealing with trying to make a data center
>operation profitable, or at least break-even).  This should be taken
>more as a 'devil's advocate' post more than anything else, and if I
>missed someone else in the thread making the same point, my apologies to
>the Department of Redundancy Department.
>
>Sure, the content provider is paying for their transit, and the eyeball
>customer is paying for their transit.  But the content provider is
>further charging the eyeball's customer for the content, and thus is
>making money off of the eyeball network's pipes.  Think like a
>businessman for a moment instead of like an operator.
>
>Now, I can either think of it as double dipping, or I can think of it as
>getting a piece of the action. (One of my favorite ST:TOS episodes, by
>the way).  The network op in me thinks double-dipping; the businessman
>in me (hey, gotta make a living, no?) thinks I need to get a piece of
>that profit, since that profit cannot be made without my last-mile
>network, and I'm willing to 'leverage' that if need be.  How many
>mail-order outfits won't charge for a customer list?  Well, in this case
>it's actual connectivity to customers, not just a customer list.   The
>argument about traffic congestion is just a strawman, disguising the
>real, profit-sharing, motive.
>

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