FCC Position May Spell the End of Unlimited Internet

FCC Chairman Julius Genachowski’s unsurprising affirmation of support for network neutrality is a victory for the high-minded principle of open, unfettered internet access. Too bad it means the days of all-you-can-eat, flat-rate internet access are probably over.

Net neutrality sounds like a good idea. After all, it’s the internet’s openness to any and all users, applications and content that gave it such a resounding victory over closed networks like AOL, CompuServe and Prodigy. And there’s no question that as a general business and networking principle, “anything goes” is both desirable and beneficial, to users and network operators alike. Over the long run, the most open networks attract the most customers and will be the most successful — and the most profitable.

But somewhere along the way, this principle of good network architecture turned into a political tenet that, according to some true believers, is almost equivalent to the Bill of Rights in importance.

The argument goes like this: Internet service providers have such strong motivations to restrict access to content or applications that they don’t like that the government needs to step in to ensure a level playing field. For net neutrality’s true believers, Comcast and Verizon no longer get to decide how best to configure the networks they spent billions building: Their networks are so ubiquitous, and so critical to the common good, that the government has a responsibility to ensure they are managed fairly.

It’s easy to see the merits of the argument, and when we’re talking about ISPs that are near-monopolies built in large part on the basis of government subsidy or exclusive federal licensing, it seems downright un-American to argue against net neutrality.

Unfortunately, there are at least three big problems with making net neutrality a federal mandate.

First is that bandwidth is not, in fact, unlimited, especially in the wireless world. One reason ISPs are averse to neutrality regulation, they say, is that they need the flexibility to ban or mitigate high-bandwidth uses of their network, like BitTorrent and Hulu.com, which would otherwise run amok. Take away their ability to prioritize traffic, the ISPs say, and overall service will suffer.

“As long as there have been networks, people have had to engineer them to ensure that congestion doesn’t occur,” Carnegie Mellon professor and telecom expert David Farber said Monday (he’s the co-author of a cautious anti-net neutrality opinion piece published in 2007). Farber is especially concerned about the impact of the FCC’s position on wireless networks, where bandwidth is already very limited. “When you’re operating that close to capacity, you have to do a very tricky job of managing your spectrum. If you have unconstrained loads being dumped on you, something’s going to have to give.”

Case in point: AT&T has repeatedly stumbled in its ability to provide 3G wireless capacity, thanks to the unexpected popularity of the iPhone. Those difficulties lend credence to AT&T’s (and Apple’s) reluctance to allow apps like Skype and Slingplayer unfettered access to the 3G network: If the network can barely keep up with ordinary demand, just imagine what would happen if we were all live-streaming the Emmy Awards over our iPhones at the same time.

Take away ISPs’ ability to shape or restrict traffic, and you’ll see many carriers running into AT&T-like capacity problems. Their response will almost certainly be to make consumers pay for what they’re actually using. Want to BitTorrent all 6.7GB of the uncompressed Beatles catalog via 3G? Fine, but you’ll have to pay for the bandwidth you’re taking away from your neighbor.

Second, enforcement of neutrality regulations is going to be difficult. Comcast may not be able to block Skype traffic altogether, but what’s to prevent the company from slowing it down relative to other traffic it carries? Such preferential “packet shaping” is easy to turn off and on, as network demands ebb and flow. By contrast, proving such infractions of neutrality will be complex, slow and difficult. It sets up a classic “nimble, resourceful criminal versus slow-footed, underequipped cop” scenario.

Third, the new regulations create an additional layer of government bureaucracy where the free market has already proven its effectiveness. The reason you’re not using AOL to read this right now isn’t because the government mandated AOL’s closed network out of existence: It’s because free and open networks triumphed, and that’s because they were good business.

Now the FCC is proposing taking a free market that works, and adding another layer of innovation-stifling regulations on top of that? This may please the net neutrality advocates who helped elect the current administration, but it doesn’t add up.

Net neutrality regulations make sense in closed, monopolistic situations. But outside of small, rural markets, most of the U.S. offers a high level of competitive choice. Don’t like Comcast cable internet? Switch to SpeakEasy, Astound or SBC, or look into satellite internet. Don’t care for AT&T’s spotty 3G wireless network? Try T-Mobile or Verizon. Need help finding an alternative? Check Broadband Reports’ interactive ISP finder.

That’s why the FCC should take a very cautious, careful approach to implementing its brave, new principles. Free, unfettered innovation has been the secret to the internet’s explosive growth over the past two decades. Let’s not let a well-meaning attempt to preserve that innovation wind up doing exactly the opposite.

As Farber says, “Whatever you do, you don’t want to stifle innovation.”

Original: FCC Position May Spell the End of Unlimited Internet

FCC Position May Spell the End of Unlimited Internet

4 thoughts on “FCC Position May Spell the End of Unlimited Internet

  1. Andrew Pierce says:

    You’re missing a couple of key points. First, bandwidth is fairly cheap, and getting cheaper all the time. In fact, the expense of monitoring and metering the tubes might actually eclipse the cost of the raw bandwidth. And it doesn’t come to the ISPs in metered form. It comes in an all-you-can eat pipe of a certain width and a fixed monthly rate.

    Second, I think you’re overstating the availability of choices. The number of ISP choices has shrunk significantly over the last few years, and in terms of broadband usually comes down to phone company or cable company. If you subscribe to satellite tv, like I do, you quickly find that you have one reasonable choice for service. And the iPhone service levels should demonstrate rather clearly that the mobile networks don’t count yet.

    Third, net neutrality doesn’t require additional bureaucracy to maintain or enforce. Make the laws, set penalties, and if the laws are violated, let the courts handle it. I’m sure someone’s willing go to court to sue the telecomms into submission.

    I’d also like to point out that in the end network neutrality is actually fairly inevitable — if we need to run unsnoopable TLS encrypted sessions on all intenret connections, if thats what it takes to get our bittorrent or Scype packets through unmolested by our ISPs, we will. Its just we’d rather the telecoms lower their rates or improve their service rather than waste money on trying to lock down the Internet.

    Open, neutral networks don’t stifle innovation, but you can be damned sure the cable companies and the phone companies have a couple of areas of innovation they’d like to use ‘traffic shaping’ to stifle, areas which are competing with their core businesses. As Farber says, “Whatever you do, you don’t want to stifle innovation.”

  2. Sagan says:

    I have to point out a couple of things here. Being in the industry I can say the problem is not bandwidth. It may be, in the short term, and in some areas simply because the companies in question only upgrade when they absolutely have to, the CEOs would rather the money go into their pockets and the pockets of shareholders rather than to update aging data networks…market forces, supply is only given when the demand makes it profitable. e.g. the 20 year old copper DSL line that runs to my house instead of nice new fiber optic. They like to play the wait until the last minute game. That is to say they are reactive instead of proactive. Profit is more important that quality and future planning, I see the results of this mindset every day in my job. So I hear “But they have to pay X amount to run fiber to all houses” True…there is an initial cost, especially with area as large as some of these companies cover, a daunting prospect in and of itself to be sure, and the entire argument is more complex but the point is if we let them meter service because they cry about bandwidth…what about when everything is nice new shiny fiber etc. et al? and the bandwidth is no longer an issue? Do they still get to meter service? We know darn well that once they start metering that it will never go away, not without some serious pressure. We’ll end up with a whole new land of digital have and have not’s as in Tadd Williams Otherland where only the rich and well to do can afford the bells and whistles and the poor and middle class are relegated to sub standard service….sounds like our current culture in general, does it not? It’s a tricky situation, but given the general lean towards massive greed that drives these companies we simply can not leave them to ‘do what is right’. Given the choice they will almost certainly try to screw people for every dime they can manage and we see the results of a similar mindset with the current financial fiasco the world is in.

  3. It's not illegal if says:

    There is very little real competition in the marketplace.

    Almost always the DSL providers are forced to go through the ILEC who make most of the profits in the deal. The ILECs take the profits since they don’t need to compete, they leave competing to the ISPs who struggles to break even.

    So for fixed connectivity there is really only competition between the ILEC and the one local cable company, if you get cable. Satellite is irrelevant due to the latency.

    Competition for mobile data is even more of a joke. There is collusion in the market between the largest carriers who control both the frequencies and the actual network. This is why the data plans for all of the major carriers cost the same. There is no competition because the major carriers have the frequencies locked and they have agreed to keep data rates high.

    I am sure it is only a coincidence that the unlimited data plans from the four major carriers provide 5GB and cost 59.99-60.00/month.

    Sure, it is probably illegal for them to collude on pricing and services, but what is the worst that will happen? They might get a fine for a million dollars. I’m sure they are very concerned.

    Just remember it’s not illegal if you get away with it.

  4. lyd says:

    Accusations of anti-trust violations among the wireless carriers seem paranoid to me. I do not believe there is a cartel problem here.

Comments are closed.