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Net Neutrality

Net Neutrality Moves Are as Futile as Trump's Comb-Over

Like the UK's looming withdrawal from the European Union (EU), and the mechanics of Donald Trump's daft hair, net neutrality in the US seems likely to be a talking point for years. And as with Brexit and the Trumpian rug, the debate may ultimately resolve little.

Brexit will happen but without delivering the "freedom" from EU rules its supporters crave. Trump's much-photographed comb-over will continue to perplex, despite Michael Wolff's "revelations." Net neutrality, or its abolition, will not make the behemoths of telecom and the Internet any less dominant or more powerful than they already are. Silicon Valley's technology giants will extend their empires and influence over our daily lives, but not because of any net neutrality moves. (See Net Neutrality Is Not a Rational Debate.)

Bad Hair Life
Donald Trump's administration is tearing up its predecessor's rulebook on net neutrality.
Donald Trump's administration is tearing up its predecessor's rulebook on net neutrality.

The issue continues to arouse much stronger feelings in the US than in Europe, though. Placards decrying the abolitionists have become a familiar sight outside the US Federal Communications Commission (FCC) building in Washington, DC. Reuters on Tuesday reported on the latest legislative developments: 21 state attorneys filing a petition to challenge the FCC's anti-net-neutrality moves.

Earlier this week, Democrats also said they had secured the backing of 50 senators in the 100-person chamber for a repeal (the machinations are well explained in this news analysis from Mari Silbey). Net neutrality rarely grabs such headlines in Europe, whose politicians are as enthusiastically pro as the FCC is purposefully against.

That leaves Europe's net neutrality supporters with little cause for protest, of course. But the contrasting positions of the US and Europe are counter-intuitive, to say the least. Basic broadband competition is non-existent across swathes of the US, due partly to regulatory shortcomings. Most European countries are awash with broadband retailers, even if there is concern about the lack of "gigabit" offerings. Attempts to block, discriminate against (note the emotive language) or charge more for content are much likelier in markets with few, or even zero, broadband alternatives.

Curiously, Europe's broadband buzz partly explains why Netflix, which has recently trumpeted its support for net neutrality, may be on a more precarious footing there -- as it slowly ratchets up its prices -- than in the US. In its domestic market, there is a clear gulf between a monthly Netflix Inc. (Nasdaq: NFLX) subscription of around $10 and a cable deal of around $100. In Europe, where the competitive bundling of broadband, TV and mobile services is relatively commonplace, the differential is less obvious. As it further diminishes, so may the incentive to plump for Netflix over the "cord."

This situation would not change were European regulators to sour on net neutrality. But if anywhere does need that protection, it is surely not Europe but the US.

In the short term, however, the US might not get it. As Reuters points out, even if Democrats can muster a Senate majority (which seems very possible), a repeal would need support from the House of Representatives, where Republicans are stronger. Trump might also veto it.

Winsome Winfrey
But when he loses the 2020 presidential election to Oprah Winfrey, or another TV celebrity turned politician, Democrats may be able to roll back the FCC's Trumpian legislation, just as Republicans have torn up the Obama rulebook. Any fretting by the net neutrality fanatics might, essentially, be over how much damage gets done in the meantime.

What everyone seems to forget, however, is that the Internet thrived for years without net neutrality protections. The regime that FCC boss Ajit Pai wants to dismantle has been a short-lived affair. It dates back less than three years, to when the Obama presidency was growing old. And it was never a clear-cut certainty under Tom Wheeler, Pai's predecessor at the FCC, whose flip-flopping on net neutrality matches that of Theresa May, the UK's prime minister, on Brexit.

The explosion in Internet video traffic since then means net neutrality protections are now more urgently needed, say Pai's opponents. In the absence of real broadband competition, this assertion may hold some truth. As Internet telephony and messaging have undermined traditional voice and SMS services, operators have given up that fight. Indeed, it seems inconceivable that any successful operator would today try blocking WhatsApp or Skype. Video is a different story altogether: It gobbles up valuable megabytes and could be seen as a threat to operators' own content services.


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None of that justifies the current hysteria, though. The migration of services to healthier mobile markets, the evolution of networks and the growing telco realization that "walled gardens" are dark and barren environments should guard against the worst Internet abuses. The abused may also have recourse to older competition laws, as in the pre-Wheeler days.

With or without net neutrality protections, the Internet looks set to become a less diverse place as its giants swallow or squeeze out the minnows. Amazon.com Inc. (Nasdaq: AMZN), Google (Nasdaq: GOOG), Facebook and Microsoft Corp. (Nasdaq: MSFT) are destined to grow stronger, nourished by non-technological network effects and consumers' willingness to give away their personal data for free. And while more broadband rivalry would be the ultimate safeguard against any blocking or throttling of Internet services, net neutrality protections would not spur that competition. The obsession with net neutrality is diverting attention from this much bigger issue, with all of its ramifications for customer service.

Whatever the scaremongers say, the alternatives of Wheeler's regime and Pai's do not represent a choice between utopia and Armageddon. And the latter could turn out to be as ephemeral as the former.

— Iain Morris, News Editor, Light Reading

brooks7 1/19/2018 | 9:20:26 AM
Re: If there is so much demand for Net Neutrality.... Iain,

Let me add that there have been three concerns.

First, is the notion that ISPs will block content.  Under all administrations and all rule sets this has been against the rules and shot down pretty quickly.

Second, there is the notion that ISPs will slow content.  This comes in three forms.  First, that ISPs will not build networks fast enough (which in fact is not a Net Neutrality issues).  Second, that they will actively slow disfavored content .  Which outside the Netflix-Comcast case - again shown to be Cogent - is a potential issue but it would mean the deployment of a crapload of equipment to make the service worse.  Three, is the possibility that they will prioritize favored content which seems to be the most likely here.  I think we need to think about this a bit more (see paragraph below).

Third, there is the notion that in combination with number 2 that the ISPs will start selling prioritization.  I have always found that notion absurd.  The reason is pretty simple:  If you sell me something, I want something in return for the money.  You can't just sell me a "trust me it will be better".  It better work - ALL THE TIME.  Given the communications involved in Adaptive Bit Rate - EVERY streamed video service can measure connection quality and report problems to users who then will have data to get reimbursed for missed SLAs.

Finally, back to priorization of favored content.  We already have it.  To me, we have a bit pipe into the home and companies split that bandwidth between services.  Linear Pay TV is given essentially infinite priority.  We could have much better Internet Service if all TV service was OTT.  Then the pipes into the home will be used more efficiently.

seven

 
iainmorris 1/19/2018 | 3:55:46 AM
Re: If there is so much demand for Net Neutrality.... The point about demand is interesting. It seems to me that net neutrality is a fairly esoteric issue. If you asked the average, non-tech person, they probably wouldn't know what it means (although I'm not sure most people would say they want an unfettered Internet). 

The tech giants aren't building a "net neutral" Internet because they know that net neutrality is not really going to hurt them. And the markets agree. If Pai's legislation is such a threat to those companies, why are shares in both Alphabet and Facebook up around 40% since this time last year?

If it's going to hurt anyone, it's the Internet "long tail" -- the smaller players that don't have the resources of the Googles and Facebooks. But those players will struggle even without net neutrality protections as network effects drive more traffic toward Google and Facebook, which will also continue to buy any companies they see as a particular threat. This is why net neutrality is such a crock.

There is an interesting piece in today's Economist, incidentally, which covers some of the same points about the growing might of Google and Facebook. Net neutrality gets a passing mention.

https://www.economist.com/news/leaders/21735021-dominance-google-facebook-and-amazon-bad-consumers-and-competition-how-tame
iainmorris 1/18/2018 | 1:14:15 PM
Re: Ad Hominem And that's one of my more flattering photos. You should see me at MWC after a late night out.

Still going to keep making fun of Trump's hair, though. 
Austin Idol 1/18/2018 | 1:10:31 PM
Re: Ad Hominem Agreed. Too often these authors/bloggers show their cards and lack of expertise and don't focus on the facts.
rgrutza600 1/18/2018 | 12:52:40 PM
Ad Hominem If I looked like the author of this article, I would refrain from attacking the appearance of others.  Maybe your points and arguments don't have much merit, if you choose that route.
Gabriel Brown 1/18/2018 | 10:13:58 AM
Re: If there is so much demand for Net Neutrality.... I'm scared to click that YouTube link in case it's a rick-roll.

You make some good points about GAFA (as the new borg has become known). I'm not sure that their current dominant positions are as secure as they look today. Facebook already looks over. No one goes there anymore. 
Austin Idol 1/18/2018 | 8:30:32 AM
Re: If there is so much demand for Net Neutrality.... Excellent Video on Net Neutrality:

 

https://www.youtube.com/watch?v=EI923Y_Er_4
Austin Idol 1/18/2018 | 8:21:20 AM
If there is so much demand for Net Neutrality.... Obama fancied Google, Facebook, Netflix, Amazon etc....They were in his ear and he thought he was hip and cool. Prior to Obama and Wheeler the FCC was a very autonomous commission and the government kept their hands off and let them do their work without influence. But Obama had Wheeler on strings like a puppet. Remember Wheeler was a former Cable lobbyist. The internet wasn't broken in 2015 but the Democrats wanted a fox in the henhouse and they got their wish with Net Neutrality. Anyone ever ask why those 4 tech companies worth north of $1.5 Trillion don't pool their resources and build their own dedicated Net Neutral Network where they can have it free and clear? If there is so much demand for this Net Neutral Network and it is so important surely these tech companies could join forces and kick in $100B+ to build the network that with all this demand can pay for itself very quickly and garner even more profits for the tech companies. Simply a power grab by Obama and Democrats to control the people. Having the internet treated like a utility would be disastrous long term. Do you see major innovations coming from the water company?(They still read my meter manually sending a guy around in a truck) Innovation from the electric company? Innovation from my Natural Gas Provider? Net Neutrality is some buzz word as usual to scare the masses that big bad business is going to curtail their inernet and free speech? I don't see ATT, Verizon, Comcast influencing free speech but I do see that coming from Twitters, Google/Youtube, Facebook etc...The Democrats want control and the Tech Companies want their free ride on the internet pipes....plain and simple.
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