

FCC to Mandate Net Neutrality for the Web - jrwoodruff
http://mashable.com/2009/09/18/fcc-net-neutrality/

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bokonist
_While we understand the arguments of the ISPs, the simple truth is that the
web will not work if a few Internet providers control what can and cannot be
streamed to your computer. Without net neutrality rules, they could decide to
shut off YouTube, Hulu, or any other website for whatever reason they choose._

As long as there is even a modestly competitive market for internet hookups
(more than one firm), then ISPs will compete to serve the interests of the
consumers. Comcast isn't going to shut off Hulu unless it's massively
unprofitable. If there is not a competitive market, then that is the real
problem that should be addressed. You shouldn't limit people's ability to
enter into contracts to buy services. If we want bandwidth to expand, and if
we want fast, low latency video and voice connections, cable companies will
need to be able to charge premium prices, both to consumers and content
providers. Instead, we are beginning the long process of binding the internet
in a layer of legislative gray goo, despite there being no evidence of ISPs
acting against the interest of consumers.

~~~
natrius
I think you're underestimating the amount of competition needed for a healthy
market. I have two choices: Time Warner Cable or AT&T DSL. It's easy to see
how they could both decide that, for instance, crushing Hulu is in their best
interest. Both of these companies provide television service. If they did this
_before_ Hulu got popular, it'd be even easier to avoid angering customers.

ISPs are free to charge premium prices for premium services, but it is
dangerous to allow them to discriminate between sources of traffic when there
are so few competitors.

~~~
bokonist
Then, as I said, fix the competition problem. Don't add some new regulation
that doesn't fix the underlying problem, and that causes new problems of its
own.

~~~
sammcd
Isn't the only way to fix the competition problem more administrative grey
goo? I have worked in this industry. There is a nice history of buying up all
competitors... Especially when the competitors used to be parts of you.

Did you forget the governments attempt to break up AT&T already?

~~~
Gormo
Or you could go the opposite route, and remove existing administrative grey
goo that acts as a barrier to entry.

AT&T and Time Warner may be the only companies with cables running into your
house, but why isn't there a viable market for satellite/wimax/local wireless
mesh/cdma? Why can't other organizations that want to compete run new cables?

I hope at some point we'll stop making quasi-permanent decisions that affect
the long-term development of a particular area of society based entirely on
people's perceived fears about the status quo at the present instant.

~~~
Kadin
I'm about as much of a free-marketer as you're going to find, but it's not
administrative red tape that's stopping you from choosing between bunches of
wireless ISPs: operating one is _really hard_. The startup costs are immense.

Satellite? You have to launch satellites. You have to get spectrum allocations
(which aren't going to disappear in any regulatory environment; the results
would be chaotic and bad for just about everyone, except maybe the purely
wired services). You have to either subsidize receivers, because they're going
to be more expensive than most consumers will ever buy outright, or you have
to manufacture millions of them to get the per-unit cost down. And, of course,
you have the backhaul problem.

WiMax is probably the closest to being practical, along with cellular-type
services, but it still has a very high natural barrier to entry: you have to
get spectrum, you have to rent space on towers in the areas you want to serve,
you have to somehow ensure that enough people are going to have WiMax
equipment to be able to use your service at all. Again, lots of natural
barriers to entry.

Wireless mesh networks have significant scalability problems if the content
most nodes want to access isn't evenly distributed around the mesh. A lot of
people put a lot of effort into getting community mesh networking working back
in the late 90s, and nobody could really make it work. And this was using
802.11 equipment (mostly) that didn't have any regulatory burden at all.

3G and 4G cellular are competitive, at least in some ways, with wireline
services, but in many markets they're owned by the same company that owns one
of the wired services! (That'd be Verizon.) So even if you have the choice
between cable, DSL, and 3G cellular, your choice of companies might still be
Comcast or Verizon.

It's not regulation that's stopping these alternatives from existing, it's the
inherent complexity and expense of offering high-speed data service. The
regulatory burdens should certainly be kept to the bare minimum, but they're
not to blame for the lack of choice in Internet access. Even in some sort of
perfect, minimally-regulated market, you'd still be dealing with a very Hard
Problem.

------
tlrobinson
Great, but "the Web"? Or "the Internet"?

Call it a pet peeve, but I hate when people (especially technical ones talking
about it in a technical context) forget that the Web is a subset of the
Internet.

~~~
lutorm
Only port 80 traffic is bound by net neutrality... ;-)

~~~
weaksauce
Don't forget port 443 or else you will not get your encrypted stuff equally
served.

~~~
thorax
I'm going back to port 70, guys, sorry.

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reedlaw
What I don't understand is why a bunch of entrepreneurial types (or at least
this blogger for a web start-up site) would be in favor of more government
regulation.

~~~
jsz0
Because many existing laws & regulations are bought and paid for by big
business to preserve their dominant position through the use of legally
sponsored anti-competitive tactics. You can't undo the past but you can make
new laws & regulations to level the playing field some.

~~~
bokonist
Then you should unwind the existing laws and regulations, not add a new
regulation that will inevitably favor narrow interests. And if you cannot role
back the existing detrimental regulations, what chance of success do you have
making new positive regulation?

~~~
natrius
I can pretty much guarantee that eliminating the regulations that led to the
current telecommunications oligopoly will not result in Bell competitors
sprouting up all over the place. It's a done deal.

~~~
reedlaw
Why shouldn't it? Didn't Mint successfully take on Intuit? I don't understand
this lack of faith in entrepreneurship in such a place as HN. Not just picking
on the parent, but my downmodded question and the general fervor towards
legislation such as "net neutrality".

~~~
natrius
Telecommunications is one of the most capital intensive industries in
existence. Intuit is nothing like AT&T.

~~~
reedlaw
What about after the airlines were deregulated? Didn't we get great prices and
service from lots of newcomers? Would you rather we go back to airline
regulation?

~~~
mechanical_fish
What about after the electricity market in California was "deregulated" a few
years ago? Didn't my employer lose millions of dollars by having to shut down
its factories during the ensuing rolling blackouts, which in turn were caused
by successful efforts to create artificial scarcity and extort billions of
dollars from the public?

But you shouldn't read too much into that example either. The lesson here is
that buzzwords aren't always useful for understanding the world. The word
_deregulation_ means different things in different situations. Airlines are
still a heavily regulated industry: Health and safety regulations, security
regulations, labor regulations, international treaties, state and local
regulations. (You think you're going to be allowed to launch a jet helicopter
from your suburban backyard? Your neighbors think otherwise.) But there was a
moment when a few of those regulations were removed or changed in a useful way
that permitted the market to work better, and that event was _named_ "airline
deregulation".

Which does not imply that every action called "deregulation" is going to be
equally successful, or even that such actions are especially similar to each
other. The devil is in the details. What matters is what the regulations are,
and what the situation is.

