

EFF Warns That FCC Net Neutrality Rules Are a Bad, Bad Idea - grellas
http://www.techdirt.com/articles/20110204/23560912976/eff-warns-that-fcc-net-neutrality-rules-are-bad-bad-idea.shtml

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grellas
A recent HN thread had a spirited discussion on this a short while back
(<http://news.ycombinator.com/item?id=2033261>).

My comment there makes the point now being emphasized by EFF:

"The FCC is way out of its league on this one. Basically, it is a creature of
statute. It can do whatever Congress has authorized it to and no more. Nothing
in its authorizing statute expressly permits it to impose the rules now known
as net neutrality. Therefore, it sought to justify its ability to do so under
the doctrine of so-called 'ancillary jurisdiction,' meaning that it had an
implied power to do so in aid of its expressly granted powers. Unfortunately,
a definitive federal appeals court ruling held that no such ancillary
jurisdiction existed, leaving the matter for Congress to decide. Rather than
deferring to Congress, the FCC chose to adopt a new rationale for its
assertion of this authority. Congress overwhelmingly balked at the idea of any
broad assertion of such authority and, in the back and forth, the FCC came up
with the toe-in-the water approach just adopted to the satisfaction of almost
no one. Even this assertion of jurisdiction will certainly be challenged in
the courts in cases that will take years to decide, leaving this whole issue
in a pathetic state of uncertainty for all concerned. Nothing good will come
of this except for lots of employment for the lawyers who will be litigating
whether this or that action is 'reasonable' and whether the internet is really
like a public utility or not. All in all, a royal mess."

~~~
adelevie
Perhaps the FCC should have just reclassified Internet service as a Title II
Telecom service--something it clearly has the authority to do.

The Internet was initially classified as Title II by the FCC, then
reclassified by the FCC. Congress has never classified the Internet in terms
of its common carrier status.

------
adelevie
The TechDirt article advocates real competition as a much better solution than
net neutrality regulations. But, as the market exists, we're not going to see
widespread competition amongst ISPs. Most Americans have a choice between one
or two ISPs.

So that leaves the author with three choices: government-imposed competition
(open access regulation), government-imposed net neutrality (network
management regulation) or laissez-faire (which he implies is problematic in
its current state). Pick your poison.

~~~
SeanLuke
> So that leaves the author with three choices: government-imposed competition
> (open access regulation), government-imposed net neutrality (network
> management regulation) or laissez-faire (which he implies is problematic in
> its current state). Pick your poison.

Well, there's network regulation and there's network regulation. For example,
what would happen if the FCC simply declared all ISPs and cellular broadband
companies to be common carriers?

~~~
adelevie
Then the ISPs would be forced to sell wholesale Internet access to new,
competing ISPs. The mechanism for determining the rate-setting process is
likely pretty cumbersome. It's not so clear that Title II reclassification
would be less "regulatory" than net neutrality regs.

------
abrenzel
I agree that net neutrality, as the FCC is currently trying to impose it
anyway, isn't a good idea.

On the other hand, I disagree that some things the major ISPs have done is a
simple result of lack of competition. Of course, the ISP market is in bed with
the government. Of course, they get away with things they probably wouldn't in
a less monopolistic market.

On the other hand, if the market were more open, who's to say favoring content
or metered billing or whatever wouldn't emerge as optimal strategies. There
are "private content network" companies out there who do precisely that -
favor content on their networks - and the idea does not strike me as an
inherently bad one.

Look at the problem posed by Netflix. They are a key driver in many of these
discussions, because the bandwidth consumed by their online video services
almost certainly is more costly than what they actually pay (and hence they
can get away with charging customers far less than the cost of delivery). Yet,
the government says ISPs can't "discriminate" against Netflix traffic by
charging Netflix higher rates. What will end up happening is that the ISPs
will just charge all of their users higher prices to make up for the bandwidth
Netflix is using (see here for a good discussion:
[http://seekingalpha.com/article/238107-netflix-now-we-re-
coo...](http://seekingalpha.com/article/238107-netflix-now-we-re-cooking-the-
business-model?source=commenter))

Is that really the best solution? What if users had the ability to access an
ISP who solely provided Netflix content and perhaps a few other services, and
blocked traffic for anything else? In that case, they might pay for a basic
internet subscription, and then some amount more for access to the private
network. At least in that case, only the users who want access to Netflix
content would pay more for it. I am sure the commenters here could think of
many other problems with that business model, but it would be better than
having everyone pay higher rates so that high bandwidth users can avoid
"discrimination."

~~~
wippler
I am pretty sure that Netflix pays to ISP's properly for all the outbound
traffic from their data centers, problem mainly originates when a bunch of
users from same area hog up the network with streaming services - then they
might want to charge those users.

And I don't understand why they want to do that also. They are enjoying near
monopoly and are getting paid by the mild users also. ISPs should monitor
spikes in usage and adjust the infrastructure accordingly.

~~~
abrenzel
Well you're right in a sense that Netflix probably pays the appropriate amount
purely for what's outbound from their servers, but that last cost _does_ count
and the cost will be borne by someone - either by what Netflix pays the ISP
for its data in particular, or by the users that use it. The problem with Net
Neutrality is that you're basically saying "everyone should pay for what some
content providers provide to some users." Either ISPs "discriminate" against
the content provider or the end users, or everyone ends up paying more.
Currently IMO, the best world would be to allow the ISPs to charge Netflix
properly for the total cost of providing it, which would build in to Netflix's
subscription price and properly reflect to end users the true cost of
Netflix's services.

~~~
orangecat
_Currently IMO, the best world would be to allow the ISPs to charge Netflix
properly for the total cost of providing it_

How is that better than charging customers directly for the bandwidth they
use? The problem with the recent Canada fiasco wasn't (IMO) the concept of
metered billing itself, but trying to charge hundreds of times the actual
cost.

~~~
abrenzel
It may be more of an aesthetic preference, but the pricing signal makes more
sense to me on a per-service basis than it does on a tiered internet service
basis. Tiered bandwidth plans are inexact - should I buy the 250 MB plan or
the 5 GB - and require a lot of thought as to what you will actually use. If
the charge is per-service, you know exactly what you're buying with each
additional service you consume. That's my thinking anyway.

~~~
orangecat
_Tiered bandwidth plans are inexact - should I buy the 250 MB plan or the 5
GB_

That's still more accurate than charging you a Netflix access fee whether you
download one movie or 20. And charging per-service opens the door to all sorts
of anti-competitive agreements.

 _and require a lot of thought as to what you will actually use._

That seems like a feature. The alleged problem isn't "customers accessing
netflix.com", it's "customers using lots of data". If you want to use pricing
signals to correct that, then charge directly for the scarce resource.

------
wmf
Reading between the lines, it sounds like the EFF has given up on net
neutrality and has arrived at the same position as the TLF crowd: since any
regulation will inevitably be captured by ISPs, better to just give up.

