Richard Bennett, NANOG posting, and Integrity

Mon Jul 28 19:02:16 UTC 2014

On Jul 27, 2014, at 9:08 PM, Richard Bennett <richard at bennett.com> wrote:

> I don't think it's conflation, Joly, since the essence of NN is for the eyeballs to pay for the entire cost of the network and for edge providers to use it for free; isn't that what Netflix is asking the FCC to impose under the guise of "strong net neutrality?" Professor van Schewick is pretty clear about making the users pay for the edge providers in her tome on Internet architecture and innovation.

This is as absurd as the people you shill^wpoopy-head (per your request) for.

The users pay either way.

Either the content provider(s) pay the carriers and then bill the users (at a mark up) or the users pay directly (hopefully without the markup).

We are, after all, not talking about data that Netflix wants to inflict on the unsuspecting user. We are talking about data that the user REQUESTED from Netflix.

Saying “Content providers should pay” sounds great, because it sounds like it gives the end-user a free ride, but the reality is a little different.
Let’s have a look at the unintended consequences of such a policy:

	1.	End users get billed more by the content providers to cover this additional cost.
	2.	Content providers have to mark up what they are charged by the end-user’s ISPs, and they want to charge a uniform
		rate to all customers, so the most likely result is that they bill end users based on a marked up rate from the most
		expensive eyeball ISP they are forced to pay.
	3.	As a result of these additional charges, you create barriers to competition in the content space which begins to turn
		content into more of an oligopoly like access currently is. Its a giant step in the exact opposite direction of good.

Frankly, I give Netflix a lot of credit for fighting this instead of taking the benefits it could provide and screwing over their customers and
their competition.

> Competition is a wonderful thing where it can work, but it's not a panacea, especially for the poor and for high-cost, rural areas. Communication policy has pretty much always relied on some form of subsidy for these situations, that's the universal service fee we pay on our phone bills.

How would you know… Let’s _TRY_ it and see what happens? Subsidy for those situations is probably necessary, but so far, subsidy has always been structured to subsidize monopolies and block competition (at the request(demand) of the very people you shill^wpoopy-head for).

If we changed the subsidies a tiny bit so that all subsidized infrastructure was built in a manner open to multiple higher-level service providers (e.g. subsidized open fiber builds to serving wire centers with colocation capabilities) and made those facilities available to all service providers on an equal footing (same cost, same ToS, same SLA, same ticket priority, etc.) I bet you’d see a very different situation develop rather quickly.

> Susan Crawford explicitly complains that American ISPs "gouge the rich" by charging more than the OECD norm for high-speed (50 Mbps and above) service, but she fails to point out that they also charge less than the norm for low-speed (15 Mbps and below) service.

Whatever… The bottom line is that overall, throughout the US, even in the most densely populated areas, we are far behind what you can get in places like NL, KR, SG, SE, etc. and paying generally more for it.

> I think it's easy to create unintended consequences if you don't look at how specific regulations affect real people, no matter how high-minded and principled they may appear at the surface.

OK, so please tell me what are the horrible unintended consequences of making layer 1 an open platform available on an equal footing to all competing L2+ providers that want to compete? As you point out, most L1 has been built with taxpayer money and/or subsidy, so what’s the horrible downside to letting it actually work or the taxpayers instead of the oligopolistic law firms masquerading as communications companies?

Owen

> 
> RB
> 
> 
> On 7/27/14, 7:08 PM, Joly MacFie wrote:
>> 
>> Conflating zero-rating with NN is not necessarily helpful.  I somehow doubt that is ultimately what convinced all those groups to suddenly come out against NN at the last minute.
>> 
>> The EFF did recently address the issue.
>> 
>> https://www.eff.org/deeplinks/2014/07/net-neutrality-and-global-digital-divide 
>> 
>> <quote>
>> 
>> However, we worry about the downside risks of the zero rated services. Although it may seem like a humane strategy to offer users from developing countries crumbs from the Internet's table in the form of free access to walled-garden services, such service may thrive at the cost of stifling the development of low-cost, neutral Internet access in those countries for decades to come.
>> 
>> Zero-rating also risks skewing the Internet experience of millions (or billions) of first-time Internet users. For those who don't have access to anything else, Facebook /is/ the Internet. On such an Internet, the task of filtering and censoring content suddenly becomes so much easier, and the potential for local entrepreneurs and hackers to roll out their own innovative online services using local languages and content is severely curtailed.
>> 
>> Sure, zero rated services may seem like an easy band-aid fix to lessen the digital divide. But do you know whatmost <http://www.oecd.org/sti/broadband/more-competition-essential-for-future-of-mobile-innovation.htm>stakeholders <http://a4ai.org/policy-and-regulatory-best-practices/>agree <http://www.itu.int/net/pressoffice/press_releases/2013/27.aspx>is a better approach towards conquering the digital divide? Competition—which we can foster through rules that reduce the power of telecommunications monopolies and oligopolies to limit the content and applications that their subscribers can access and share.  Where competition isn't enough, we can combine this with limited rules against clearly impermissible practices like website blocking.
>> 
>> </quote>
>> 
>> 
>> 
>> 
>> 
>> On Sun, Jul 27, 2014 at 8:28 PM, Richard Bennett <richard at bennett.com <mailto:richard at bennett.com>> wrote:
>> 
>>    So we're supposed to believe that NAACP and LULAC are phony
>>    organizations but pro-neutrality groups like Free Press and Public
>>    Knowledge that admit to collaborating with Netflix and Cogent are
>>    legit? Given their long history, I think this is a bit of a stretch.
>> 
>>    It's more plausible that NAACP and LULAC have correctly deduced
>>    that net neutrality is a de facto subsidy program that transfers
>>    money from the pockets of the poor and disadvantaged into the
>>    pockets of super-heavy Internet users and some of the richest and
>>    most profitable companies in America, the content resellers,
>>    on-line retailers, and advertising networks.
>> 
>>    Recall what happened to entry-level broadband plans in Chile when
>>    that nation's net neutrality law was just applied: the ISPs who
>>    provided free broadband starter plans that allowed access to
>>    Facebook and Wikipedia were required to charge the poor:
>> 
>>    "A surprising decision in Chile shows what happens when policies
>>    of neutrality are applied without nuance. This week, Santiago put
>>    an end to the practice, widespread in developing countries
>>    <http://techcrunch.com/2014/05/29/twitters-emerging-market-strategy-includes-its-own-version-of-a-facebook-zero-like-service-called-twitter-access/>,
>>    of big companies “zero-rating” access to their services. As Quartz
>>    has reported
>>    <http://qz.com/5180/facebooks-plan-to-find-its-next-billion-users-convince-them-the-internet-and-facebook-are-the-same/>,
>>    companies such as Facebook, Google, Twitter and Wikipedia strike
>>    up deals
>>    <http://qz.com/69163/the-one-reason-a-facebook-phone-would-make-sense/>
>>    with mobile operators around the world to offer a bare-bones
>>    version of their service without charging customers for the data.
>> 
>>    "It is not clear whether operators receive a fee
>>    <http://techcrunch.com/2014/05/29/twitters-emerging-market-strategy-includes-its-own-version-of-a-facebook-zero-like-service-called-twitter-access/>
>>    from big companies, but it is clear why these deals are
>>    widespread. Internet giants like it because it encourages use of
>>    their services in places where consumers shy away from hefty data
>>    charges. Carriers like it because Facebook or Twitter serve as a
>>    gateway to the wider internet, introducing users to the wonders of
>>    the web and encouraging them to explore further afield—and to pay
>>    for data. And it’s not just commercial services that use the
>>    practice: Wikipedia has been an enthusiastic adopter of
>>    zero-rating as a way to spread its free, non-profit encyclopedia."
>> 
>>    http://qz.com/215064/when-net-neutrality-backfires-chile-just-killed-free-access-to-wikipedia-and-facebook/
>> 
>>    Internet Freedom? Not so much.
>> 
>>    RB
>> 
>> 
>> 
>>    On 7/27/14, 5:07 PM, Joly MacFie wrote:
>>>    Now, this is astroturfing.
>>> 
>>>    http://www.thenation.com/blog/180781/leading-civil-rights-group-just-sold-out-net-neutrality
>>> 
>> 
>> 
>> -- 
>> ---------------------------------------------------------------
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>> --------------------------------------------------------------
>> -
> 
> -- 
> Richard Bennett
> Visiting Fellow, American Enterprise Institute
> Center for Internet, Communications, and Technology Policy
> Editor, High Tech Forum