
Dear FCC: Thanks for Listening to Team Internet - DiabloD3
https://www.eff.org/deeplinks/2015/02/fcc-votes-net-neutrality-big-win
======
300bps
As a fiscally conservative technology person who got my first modem in 1985, I
could simultaneously not be happier with how things turned out with the FCC
and horrified how fellow conservatives seem to interpret it.

It is disheartening how much FUD is being spread by conservatives on the anti-
NN side.

~~~
rayiner
Why do you dismiss the anti-NN concerns as FUD? Conservatives are worried
about what impact NN will have on infrastructure investment, and the fact that
reclassification gets us one step closer to rate setting, etc, and other
powers under Title II. Both concerns are more "real," more rooted in actual
observable practice, than the specter raised by the pro-NN people of a tiered,
pay-for-pay internet.

The incentive concern is real. What incentive will telecom companies have to
build the wireline networks that enable next-generation of web services if
they can't make enough money to justify the investment? The liberal response
to this point is either myth or fantasy. Myth, in that they assume that
wireline is insanely profitable, and that fat Verizon shareholders will just
have to squeeze their belts a bit. In reality, the operating margin of
Verizon's wireline division is 2-3%.[1] Fantasy, because they alternatively
posit that municipal systems will take up the slack. How states and cities
that are broke, crushed under liberal public union pension obligations, will
pay for these municipal networks is up in the air.

The worry of further regulation is also real. Telecom is already a morass of
regulation, largely to fulfill liberal concerns. For example, there is already
rate-setting. Municipal governments require cable companies to offer basic
cable at low regulated rates. Since it doesn't cost appreciably less to offer
basic cable than more expensive packages, this sets an important constraint on
the economics of the network. Huge amounts of wealth transfer from urban to
rural areas are already baked into the system at the federal and state levels.
And build-out restrictions, preventing upstart competitors from stealing away
lucrative tracts of incumbants' service areas, are already stifling
competition. The HN crowd acts like NN is being added on top of an otherwise
pristine regulatory regime, but in reality it's just one more straw on a giant
pile of hay.

None of this is FUD. The fact that these points are also raised by the telecom
companies, who have a monetary interest in avoiding NN, does not make them FUD
any more than the pro-NN points are FUD because they're raised by web-tech
companies.

I'm not an ideologue. I'd be fine with, for example, the U.K. approach. But
what that would mean, which most people on HN don't know, would be putting
AT&T back together and letting them enjoy monopoly profits. Take a look at BT
Openreach's financials sometime: [http://www.digitallook.com/news/news-and-
announcements/retai...](http://www.digitallook.com/news/news-and-
announcements/retail-and-openreach-stand-out-at-bt-margins-rise--update--
dl20468319.html). Their EBITDA margin is a staggering 45%, double that of
Verizon wireline, significantly higher than Comcast's whole operation, and
higher than AT&T and Verizon's wireless divisions.

[1]
[http://www.verizonwireless.com/news/article/2012/01/pr2012-0...](http://www.verizonwireless.com/news/article/2012/01/pr2012-01-24.html).

~~~
jackmaney
"What incentive will telecom companies have to build the wireline networks
that enable next-generation of web services if they can't make enough money to
justify the investment?"

Regulation forcing them to build the networks or be heavily fined. Given their
profit margins, I'm weeping...hold on...taking careful count...carry the
seven...zero tears for them.

~~~
hga
Which will cost less: sending political money to the current party controlling
the Administration, or those build outs?

Comparatively speaking, politicians individually are cheaper by, say, 3-5
orders of magnitude, as a whole, maybe 2.

------
joelgrus
"We won! A free tiger! But now we face the really hard part: making sure the
tiger doesn't eat us."

------
jasonjei
_Even better, the rules will apply to wireless and wired broadband in the same
way, so you don’t have to worry that your phone switching from Wi-Fi to a 4G
network will suddenly cause apps not to work or websites to become
inaccessible. Lots of people use mobile devices as their primary way of
accessing the Internet, so applying net neutrality rules to both equally will
help make sure there is “one Internet” for all._

Does this mean Apple cannot enforce "must use over wifi restrictions"? As it
stands now, I can't use LTE to download large apps, media, or stream on the
iPhone or iPad. Would the FCC have any authority to force Apple to change
these restrictions?

~~~
gojomo
There is less competition in smartphone OSes (2 dominant providers) than in
most localities' high-speed internet (2 wired and 3+ wireless providers). So
the same market-power rationales used for FCC regulation of ISPs could be used
to justify strong federal regulation of the Apple & Google platforms.

~~~
rhino369
App and data neutrality should be next. Apple shouldn't be able to monetize
the phone they already sold me by extorting 30% of all apps I buy.

Google shouldn't be able to horde all the data. Make google a dumb pagerank
index!

------
bougiefever
One of the immediate benefits for consumers is that companies can no longer
block tethering apps on your phone or make you pay an additional fee for it.
Sprint wanted me to pay an extra $30/mo when I was with them to be able to
tether. Of course, I just rooted my phone and tethered anyway. (now I have
Ting -- so much better)

~~~
programmarchy
You'll still be paying for this, except it will be through federal taxes for
corporate subsidies instead of a bill, so you won't know the real price.
Usually things you pay for indirectly are much more expensive than they would
be if you paid for them directly, so you'll probably be paying more in the
end.

------
programmarchy
Regulation has a history of locking in incumbents, and locking out potential
future competitors. It will be much harder for challengers to enter the market
now because of the increased cost of compliance, something only the big
incumbents can afford. What's worse is that the costs for Title II companies
will be subsidized by government. So they may appear to have low prices, at
least for awhile, but the real price will be hidden in a nebulous cloud of
federal taxes. You won't even really know how much you're actually paying due
to price distortions caused by corporate welfare. It's sad that people have
such a short term memory about these corporate welfare cons, and just fall in
lockstep with the propaganda. This will be very bad for consumers in the long
run.

~~~
TheCowboy
Would you mind supporting your statement by explaining how this actually
applies here? It comes across as generic anti-regulation-no-matter-what
astroturfing, but would be more interesting if the details of your argument
were fleshed out.

~~~
programmarchy
What details would you like me to flesh out?

Maybe I can offer an example. I'm sure you will be able to poke technical
holes in this, but let's say a company comes up with a new technology (i.e.
not cable) that can handle small packets very efficiently in a small locality.
It's super cheap to do this, and it's great for networking small communities.
But, video traffic really slows down the network so it's filtered out and thus
it can't effectively treat all data equally. Instead of being able to quickly
start up and offer their services, first they have to register with the FCC.
Then they have to pay an inspection fee, and account for yearly audit fees.
Plus, even though their prices are cheap, they're not much cheaper than cable
because all the cable infrastructure is subsidized by taxpayers so their
prices appear to be less competitive. All these extra costs to comply with the
regulations add up to the point where the capital needed to even start this
business is way too high and way too risky, so this technology just won't even
have a chance of existing. It is effectively crowded out by the heavily
subsidized and protected cable telecoms.

For a real historical reference, take the railroads for example, where these
types of regulations began. The railroad businesses got huge subsidies from
the government in the form of land and tax breaks. This allowed the railroad
companies to effectively cartelize the industry because it crowded out more
decentralized forms of transportation like the small rail and networks of
canal systems. Even though these localized, less capital intensive systems
could have served people better than railroads, we'll never know it because of
the opportunity cost of central planning: the railroads used the state to
force the public to pay for and subsidize their infrastructure. These crowding
out effects are the unseen consequences of regulation.

Big business has a long history of using the power of the state to impose
regulatory barriers on future competitors as a way to preserve their monopoly
power. It started with the railroads, continued through the Progressive Era,
and continues today with policies like "Net Neutrality". And they always use
the same public relations con, too, appealing to the common good and fairness
to get public buy in. They say that these policies will protect the consumers,
but really in the end these policies will protect big business from
competition. This creates artificial scarcity and allows big business to
charge consumers higher prices.

See my other post here [1] if you want a little more historical background on
how this works.

[1]
[https://news.ycombinator.com/item?id=8998958](https://news.ycombinator.com/item?id=8998958)

------
hexis
TIL if you've run a bootstrapped web business for ten years, but didn't
support Net Neutrality, you've just been kicked off Team Internet.

~~~
danielweber
Didn't you vote in the election that gave the EFF the right to speak for us?

------
qwerty85344324
Doesn't Team Internet include Cisco, Intel, Broadcom, Qualcomm, and IBM, and
other tech companies who came out against the NN regulations that were passed
yesterday? Or does Team Internet just include Tumblr and Etsy?

~~~
badsock
Well yeah, those were the companies that were lined up to build the
infrastructure for the multi-tiered Internet. How could you expect them to
take any other position?

~~~
bhauer
While I feel it's clear that you are on the opposite side of this discussion
from myself, I nevertheless would like to pose the following to you.

Proponents of this FCC Title II reclassification have argued that this action
will not curtail investment in network infrastructure and that Internet
bandwidth will continue to improve unimpeded. After all, if they do not argue
that, they would concede one of the points presently being dismissed as FUD
hawked by the anti-Title II people such as myself: that reclassification will
reduce innovation and ultimately hurt end consumers in the long run.

So an underpinning assumption of pro-Title II is that investment in networks
will continue unabated and network bandwidth will continue to increase in
spite of Title II regulation. Why, then, are the hardware companies that stand
to profit from this unimpeded continued investment concerned? Is it because
the regulation will require them or their customers to disable support for
IPv6 Quality of Service flags on packets? That seems like a fairly trivial
configuration change. It seems more plausible that they fear their customers
(ISPs and backbone providers) will see less incentive to upgrade to the next
generation of network gear to continuously improve the aggregate performance
of their network. After all, the hard part of network R&D is steadily
increasing bandwidth/performance at prices the ISPs and backbone providers can
afford. Implementing IPv6 QoS bits isn't going to show up as a significant
line item in the R&D budget or Intel, IBM, Cisco, and Qualcomm.

So yes, these companies were lined up to build the bogeyman "multi-tiered"
Internet, assuming such a thing was ever going to come to pass (aside: we'll
never really know if such a thing might have ultimately been a boon for
consumers, because we took away the opportunity for the market to experiment
with that preemptively). But more importantly, these companies were and have
been lined up to continuously build the always-evolving "next" generation of
Internet network hardware, full stop. And for some reason they are worried
that their profits are now in jeopardy.

I for one find that a bit alarming. I want network companies to get rich
selling my ISP ultra high-performance network gear because that ultimately
improves my bandwidth. I don't want to still be at 30 Mbps five or ten years
from now. I don't want asynchronous connection speeds to persist through my
lifetime. I want more hardware and network innovation, not less.

All that said, I don't suspect much of anything to happen in the next few
years because network R&D isn't a fast-moving process in any event. But in
five or ten years, we should be able to assess whether the pace of innovation
has been curtailed. I worry that in 2020 I'll look back with a tinge of
regret.

~~~
convivialdingo
Well here's the choices I saw personally:

1\. Allow network providers to continue to expand their network, while growing
their own services on top of their own network which will compete with third
party services. If those other services compete heavily with their own, they
will enact tiers or reduce reliability so that their service is
better/cheaper/etc.

2\. Regulate network providers, while still allowing them to grow services on
top of their own networks and allowing third party services to compete more
fairly. Network expansion may be slowed due to the loss of service revenue,
but new service business risk will be lowered as they won't be competing
unequally with their own (or customer's) network providers.

We got into this mess because networks were classified as information services
in the first place. We wouldn't allow the oil companies to own the car
business, nor would we allow the electric companies to own the appliance
business.

Why should we think this would work any different?

Utility companies get public access across the country to install their cables
and pipes. They're using vast public resources. Customers often have few or no
choices.

In my opinion, the only reasonable option is regulation. I don't typically
like regulation, as I think it hurts small business. But the tradeoff here is
that some business will be hurt, while many more businesses should flourish.

~~~
bhauer
Option #1 sounds like what we have today, which for all of the spin does not
seem to be that bad. I don't buy Netflix's stance of no culpability in network
peering deals gone awry. My ISP (AT&T) blocked outbound port 25 as an anti-
spam measure, but at my request removed that block. I have observed no other
interference by my ISP in my daily use of the Internet. Aside from some
buffering on Netflix, what exactly is the mainstream beef with the Internet
today? It's way better than it was 5 years ago, which in turn was better than
it was 10 years ago.

There has been a building fear of some coming changes, presumably related to
implementation of Quality of Service on Internet packets. QoS was originally
considered a _good_ idea by many of us. Now we seem to be collectively
convinced that it would certainly be used for evil. But we've not yet seen how
that might play out. It looks like we maybe never will.

Option #2 sounds like new legislation and not Title II of the Communications
Act of 1934.

Regulation is not always bad, but Title II is broad and current promises of
forbearance should be taken with a heaping serving of salt. I feel that
whatever rational or irrational fears were building, this was not an urgent
matter despite what appears to be a massive amount of astroturfing by Netflix
and its kin to spin the current Internet's tubes as ensnared at every
opportunity by nefarious ISPs. I want a better ISP like anyone else, but
Netflix is no angel here. Whenever a big business (e.g., Netflix) campaigns
for the rules to change in order to smite its enemies—especially when painting
it as a do or die, time-critical matter—my opinion of them is tainted.

Time and deliberation should have been taken to create the proper legislation
for the situation at hand. The US has developed what I see as a dangerous and
wrong-headed distaste for legislative deliberation, what with Congresses being
labeled "do nothing" and frequent complaints of gridlock, as if those are bad
things. They are in large part evidence of no consensus, which means
subverting the legislative process is likely a mistake.

A great side-effect of deliberation in the legislative process is that the
market sometimes creates a superior solution in the meantime. In many cases
doing nothing and allowing things to find a way is precisely the right course
of action.

~~~
dragonwriter
> Regulation is not always bad, but Title II is broad and current promises of
> forbearance should be taken with a heaping serving of salt.

If they are part of the regulatory package, they are as concrete as the Title
II classification itself. They aren't "promises", they either are or are not
part of the regulation.

~~~
bhauer
Good to know. Besides, I should wait to see what specifically shows up in the
package before worrying too unnecessarily.

------
ethana
_" But now we face the really hard part: making sure the FCC doesn’t abuse its
authority."_

I just feel that the EFF didn't do a thorough check this time around.

Also, the decision was made at 10AM and they still haven't release the 200+
pages ruling document. It's most likely that this will head back to federal
court and the process will get more complicated and lengthy before the dust
settle.

~~~
couchand
Wow, you're all over the place with this comment. EFF didn't do a through
check? What did they miss?

The "decision" made at 10AM was to adopt the rules that have been under public
comment for months. If you haven't seen them yet, it's your own fault.

Yes this will go to court. Do you expect any better from America?

~~~
jamoes
> The "decision" made at 10AM was to adopt the rules that have been under
> public comment for months. If you haven't seen them yet, it's your own
> fault.

From what I've read, the 322 page document wasn't released as of 3 days ago
[1]. I'm not sure about the claim that it still hasn't been released, but
regardless - the rules weren't really available for public review before the
vote.

[1] [http://dailycaller.com/2015/02/23/republican-fcc-
commissione...](http://dailycaller.com/2015/02/23/republican-fcc-
commissioners-ask-wheeler-to-delay-net-neutrality-vote-release-proposal/)

~~~
warfangle
The NPRM was published in May.

If it had gone through another comment phase, it would have taken another 9
months... And then another nine months...

