& cplSiteName &
Comments
Threaded  |  Newest First  |  Oldest First        ADD A COMMENT
Mitch Wagner
Mitch Wagner
10/29/2014 | 2:46:35 PM
Downside
Hard to see a downside to this unless you're a video content provider trying to create artificial scarcity for your product. 
TomNolle
TomNolle
10/29/2014 | 3:21:43 PM
Re: Downside
I think it's the right move for the FCC, but there is a risk.  The difference between traditional cable or satellite and OTT video is that the latter is going to be streaned over the broadband facilities that in many cases are provided by companies that offer their own cable/TV services.  The FCC can order them not to discriminate based on type of content or competitive source, but it can't order them to upgrade their plant to make competitive video better unless the ISPs see a financial return.  That could end up reducing broadband investment, or at the minimum putting pressure on the FCC to adopt a neutrality policy that doesn't mandate investing at a very low rate of return.  It's probably going to get complicated here!
jasonmeyers
jasonmeyers
10/29/2014 | 4:17:38 PM
Re: Downside
Tom - doesn't that also make a strong case for other network providers, like muncipalities and utilities, to enter the fray? Many of them might not have the desire or resources to be a competitive video provider, and just want to provide high-speed broadband. That could both provide an alternative capable of streaming video from all players and incentivize other providers to be more competitive. I realize that's a bit idealistic and there are regulatory hurdles, but....that's all part of the complexity you mention. 
TomNolle
TomNolle
10/29/2014 | 4:31:29 PM
Re: Downside
The only thing that really drives competition is opportunity.  If the ROI on broadband access is low, nobody wants to get into the business no matter what regulatory framework you set.  Municipalities could decide to become ISPs if they want to tax-subsidize things, but unless they do they have to buy the same equipment (at a lower economy of scale than a big carrier or cableco), deploy the same labor resources, market the same, pay the same interconnect charges...you get the picture.

I think regulators could navigate the issues here.  Most cable and telco video providers are hoping to stream traffic to mobile users or even to home computers, for example.  That could prevent them from throttling video traffic as a class.  But the question would remain; is the value of fast broadband primarily its ability to deliver streaming video?  If yes, then it's going to be hard to reconcile a policy of letting anyone stream over your broadband with your desire to invest to make it better.

You might also see this driving video off IP delivery and into linear RF again.  If it's not on the Internet at all, neutrality rules don't apply.  As we've both said now--it's complicated!
sam masud
sam masud
10/30/2014 | 4:53:35 PM
Re: Downside
Tom:

 

Don't you think it's past time the FCC designated ISPs as common carriers? Wouldn't that solve a lot a problems...although it would probably raise some new problems, probably more so for the ISPs and the OTT folks?
TomNolle
TomNolle
10/30/2014 | 5:16:15 PM
Re: Downside
I think that "extreme neutrality", meaning measures to prohibit settlement among ISPs, premium handling paid by the content provider, or specific statutory guarantees of QoS or availability will simply kill investment.  If the purpose of Title II classification is to do these things, I think it will kill the industry if it goes forward.  If Title II would also mandate wholesaling of infrastructure/services as we have with voice, it would be even worse.  But the FCC almost certainly wouldn't do that, they would follow Waxman's proposal and apply Section 706 to "forebear" from applying some sections.  The big problem would be that any move like this would take years in writing the order and appealing.  My view is that we'd be better off doing absolutely nothing.  The FCC can prevent real abuse of neutrality, and anything more than that is just an invitation to attend court sessions.
brooks7
brooks7
10/30/2014 | 5:46:18 PM
Re: Downside
Why would Net Neutrality prohibit settlement...it exists in the voice world.

 

seven
TomNolle
TomNolle
10/30/2014 | 5:53:46 PM
Re: Downside
In the original FCC Neutrality order (which the DC Court of Appeals voided, starting our current flap) the FCC said that they believed that any payment/exchange/settlement other than "bill and keep" by the ISP that owns the user, is non-neutral.  I agree this conflicts with reality, but that was never much of a barrier to politics and regulations!
brooks7
brooks7
10/30/2014 | 7:00:08 PM
Re: Downside
The challenges are definitely larger than they are in the voice world, where routes were predetermined.  I was thinking of settlements around the assymetric peering that have been in vogue lately.  It seems to me that the original rules did not anticipate the rather assymetric nature of a service like Netflix.  

So, I get where you are getting the notion that payments are not part of Net Neutrality.  I just think that things have changed as well.

seven

 
TomNolle
TomNolle
10/30/2014 | 7:28:29 PM
Re: Downside
They have, and the original model of Internet pricing and settlement came about more by accident than by policy.  In the days of dial-up modems and everyone with a modem bank being an ISP, people didn't worry about settlement because the financial world was valuing ISPs at $50k per customer so it was a land rush.  Unlimited usage and no settlement was the result.

About 1996 it started to become clear that there would be issues in areas like QoS if there wasn't some formal settlement.  I co-authored an RFC on "Brokered Private Peering" that proposed settlement, and Boardwatch at the time actually called for FCC intervention to establish some sensible model.

What killed sense was the advent of the OTT players and the VC and private-equity windfall that was created.  FCC Chairman Genachowski (who championed the neutrality order I referenced) was from that group and he simply articulated his own sensibilities.  But there was no statutory framework for the FCC to order anything relative to settlement UNLESS you ruled the ISPs were common carriers, which is what got us to where we are.
kjsing
kjsing
10/29/2014 | 5:54:39 PM
OTT is no longer OTT
We should realize that OTT is no longer OTT, but is growing in adoption as primary means of video consumption. The Internet Protocol is doing to the broadcast industry what it has done everywhere else it's gone before: getting rid of stagnant industries, creating exponential innovation and providing tremendous economical benefits. The NCTA and its cohorts would be wise to get with the program or become entirely irrelevant as legacy TV broadcast is quickly becomming the new OTT.

It simply does not make sense to operate a diverse set of network technologies to deliver video. To an IP network video is just another packet of data. The amount of innovation that is unleashed by IP-fication is simply too large to even surmize that video traffic surge would force a return to non IP networks. Video compression technology is also being improved in leaps with each new standard being introduced, i.e., HEVC.

Let us keep in mind that the traditional PayTV providers would have gladly kept us at a standstil while increasing subscriber fees and goosing up their profits. No one asked Cable to enter the broadband subscriber business. They did this because they saw they could make an extra buck. So Cable better innovate or die now that they are trapped in an all IP world.

So too for the broadcasters. They received costly and sparse spectrum to reach rural homes, but scantly invest in a proper RF retransmission network. leaving many areas with abismal reception, so satellite filled the void. It is high time that all this spectrum is released for IP networks - think white space and 4G LTE and beyond. Aereo showed the way. Hopefully lawmakers are finally waking up as well.
brooks7
brooks7
10/30/2014 | 10:42:38 AM
Re: OTT is no longer OTT
 

I think your mistake here is that the existing network is ready to provide all the video that is being consumed.  Its not.  If you think about the very small number of Netflix subscribers (in the grand scheme of people), it should give you pause.  The video distribution network for cable is already built, where as the ISPs might have to multiply their capacity by 10x to replace it.

They are not going to do so without some incentive to do so.   Right now they don't.

seven

 
kjsing
kjsing
10/30/2014 | 11:38:04 AM
Re: OTT is no longer OTT
I did not claim that the network is ready today to absorb a full transistion. Some thinkering is needed, but the good news is that nothing new needs to be invented. It can be done with existing technology, by proper architecting core vs edge, through proper deployment of CDN and edge transcoding technologies.

On a side note: On the horizon are new fiber technologies that can absorb today's entire Internet trafic in a single cable - see the following astonishing feat http://www.bandwidthblog.com/2014/10/30/255tbps/.

As for incentives, we'd never have seen current rampant innovation in the distribution of live programming and VoD if we'd have had to rely on the establishment (Cable and Telco).

My point is two-fold: (1) the network technology is here today to make full IP-fication of video possible, and (2) once you are playing in an open field, you have no choice than to evolve to compete, and do it quickly; IP-fication creates that open field.

K Jsing
brooks7
brooks7
10/30/2014 | 11:52:55 AM
Re: OTT is no longer OTT
I think you are missing the point.

All that the ISPs have to do to kill OTT is not spend money.  All the innovations you are describing are going to be spent by organizations that would do so to get neither cost reductions nor incremental revenue.  In fact you are proposing that these firms spend a lot of money so that they can earn less revenue and profit.

What I am pointing out is not a technology challenge its a business challenge.  You can not force anybody to deploy new technology to enable their competition.  If you want to see how the ISPs are evolving around this, see what is going on in Wireless with bandwidth caps.

These types of caps have been possible on the wireline side as well, but not greatly enforced.  That can be a solution, but I think people are holding their breath around what happens with Net Neutrality regulation first.

So, yes lots of video and OTT are the long term future....but it is a LONG time until the existing broadcast networks go away.  As a parallel, I suggest you look at Class 5 switching.  The switch that is happening slowly is coming from failure of existing equipment and not anything else.  

seven

 
kjsing
kjsing
10/30/2014 | 12:20:22 PM
Re: OTT is no longer OTT
I did not miss the point. You are postulating under a false assumption that there can be no other players than incumbents. Market realities are different. Time in time history has shown that open markets prevail and lawmakers and businesses have no other choice than to follow suit.

Caps are only there because of a network architecture that was designed without scalability in mind. Incumbents are not caught flat-footed on increasing Inetrnet traffic. Reports have been out and continue to come out periodically.

Comcast rather preferred to charge Netflix access to its broadband subscribers than allowing Netflix to add CDN capacity. Verizon choose the same path rather than adding a couple of extra 10G ports that Level 3 was even willing to pay for (http://www.telecompetitor.com/peering-dispute-level3-says-fix-cost-verizon-grand-per-10g/).
dwx
dwx
10/30/2014 | 3:16:29 PM
Re: OTT is no longer OTT
I think you are proving his point with your examples.  There is little incentive for incumbent providers to continue upgrading their networks just so people can consume services they already offer from other people.  Last-mile Internet access is really expensive and the people operating it aren't making much money selling just Internet access.  There is also little incentive for other people to build last-mile Internet access networks unless they can do so cheaply, like municipalties or utilities who have the infrastructure, right of ways, etc. in place already.      

Caps are there because adding bandwidth is expensive, it has little to do with architecture.  You can't architect more bandwidth out of thin air.  CDN works to an extent but it still takes space/power/interfaces/management no one seem to want to pay for.  We haven't seen real enforced bandwidth caps on fixed networks but it doesn't mean we won't.   Sure you can subscribe to video provider X streaming at 4K, but the quality may end up being poor or it will cost you in BW overages.  Right now it's okay for the MSOs/telcos and wireless providers to not count their own services against BW caps, Comcast already does that with their X1 IP video product.  

The MSOs and telcos already have the infrastructure in place to deliver video to customers via IP and are all doing it.  They all stream their content, even local channels, to alternative screens and the delivery is all IP.  They've built transcoding headends, CDNs, etc. which can easily be built to scale to support their customer base.
brooks7
brooks7
10/30/2014 | 3:31:49 PM
Re: OTT is no longer OTT
kjsing,

Actually, there have no entrants into residential service for a very long time.  There won't be now.  It takes Billions to build new residential networks and to do so for little or no profit will not draw in investors.  See - CLECs.

To add capacity at a peering point does not build out the network between the peering point and the customer.  That costs money that nobody, to date, has been willing to pay for.  Thus the challenge with the business.

seven

 
kjsing
kjsing
10/30/2014 | 5:43:15 PM
Re: OTT is no longer OTT
Seven and DWX,

Good discussions. All good points and very appreciated. I would love to continue the discussion again 5 years into the future. It will be interesting to see how the broadcast industry has evolved by then.


K Jsing


Featured Video
Upcoming Live Events
October 1-2, 2019, New Orleans, Louisiana
October 10, 2019, New York, New York
October 22, 2019, Los Angeles, CA
November 5, 2019, London, England
November 7, 2019, London, UK
November 14, 2019, Maritim Hotel, Berlin
December 3, 2019, New York, New York
December 3-5, 2019, Vienna, Austria
March 16-18, 2020, Embassy Suites, Denver, Colorado
May 18-20, 2020, Irving Convention Center, Dallas, TX
All Upcoming Live Events