FCC and Net Neutrality

[Zarathud]

John Oliver's rant is worth watching again.

[Alefroth]

You're all over the place here. I guess I should ask you what you think Net Neutrality is, before we continue.

Charging different content-providers different prices for the same data handling.

It's easy to get it backwards.

[stessier]

You're all over the place here. I guess I should ask you what you think Net Neutrality is, before we continue.

I think this still needs to be answered.

Say I use Comcast. Is it okay that I get degraded speed when trying to download a Netflix movie? I paid for 60 mbps down, but only get <5 when downloading Netflix but get the full 60 when I download a Comcast movie.

This is what they did to people in NY city.

[raydude]

You're all over the place here. I guess I should ask you what you think Net Neutrality is, before we continue.

I think this still needs to be answered.

Say I use Comcast. Is it okay that I get degraded speed when trying to download a Netflix movie? I paid for 60 mbps down, but only get <5 when downloading Netflix but get the full 60 when I download a Comcast movie.

This is what they did to people in NY city.

Speaking of which I found a nice little article about that regarding measured internet speeds in NY during the time of the Comcast/Verizon/Time Warner/ATT mob shakedown of Netflix.

From the last paragraph in the article:

According to M-Lab, performance remained strong on ISPs that weren't involved in the money disputes.

"In New York City, Access ISP Cablevision customers did not experience the same degradation symptoms as Comcast, Time Warner Cable, and Verizon customers when connecting across the Cogent network," M-Lab wrote. "Similarly, in Dallas and Los Angeles during the relevant time period, customers of Access ISP Cox did not experience a significant pattern or degree of degraded download throughput when connecting across Cogent sites."

When the only thing slowing down the packets is a concerted effort by a few ISPS colluding to extort and hold ransom those packets from their customers, that's a shakedown. Mob style.

P.S. For PLW the cliff's notes for Net Neutrality:

people for Net Neutrality don't like mob shakedowns and want to ensure they don't happen.
people against Net Neutrality think mob shakedowns are the cost of doing business.

[PLW]

You're all over the place here. I guess I should ask you what you think Net Neutrality is, before we continue.

Charging different content-providers different prices for the same data handling.

It's easy to get it backwards.

And I did. I was saying what I thought "Not-Neutrality" was. Neutrality is a government-imposed rule to charge all data suppliers the same price for the same data handling.

[PLW]

You're all over the place here. I guess I should ask you what you think Net Neutrality is, before we continue.

I think this still needs to be answered.

Say I use Comcast. Is it okay that I get degraded speed when trying to download a Netflix movie? I paid for 60 mbps down, but only get <5 when downloading Netflix but get the full 60 when I download a Comcast movie.

This is what they did to people in NY city.

Is it OK? Or should there be a law against it? It sucks for you and for Netflix. If you think Comcast breached your contract, sue them.

[Chaz]

The problem with assuming that when ISP's costs go down, price will go down ignores that that's true only in an open market with competition. In a large majority of markets, ISPs don't really have much competition. In the last two places I've lived, I had exactly one option for reasonably fast internet, and that was Comcast. I could get much slower DSL too, but that wasn't really an equal option.

When the ISP knows that their customers can't go anywhere else to get service, there's no incentive to drop their prices.* When costs go down, the only reason to drop prices instead of increasing profit margin is because they're afraid of getting undercut. No fear of that, no price drop.

Interestingly, two apartments ago, I lived in an area that actually did get serviced by both Comcast and RCN. Prices on those two were definitely better than other places I lived. In fact, when I moved out of there, I had Comcast and was moving to a Comcast-only town. My cost for the exact same service went up by a not-insignificant amount. But that's probably a coincidence.

* "Out of the goodness of their heart" isn't a phrase ISPs are familiar with.

[PLW]

Not with a monopoly.

If the marginal cost of production of a monopolist falls, his profit will increase even more if he also lowers his price. Proof: At a high cost, I choose price until my reducing it until the benefit of lowering the price a little bit (sales increase ) equals the cost of lowering the price a little bit (the revenue loss from the price drop on the units I've already sold plus the cost of production on a few more units). If the cost of production falls, the cost of lowering price falls (I still lose some revenues, but the cost of extra units is smaller) , while the benefit of lowering price a little bit doesn't change. Since they were equal before, now the benefit of lowering prices is bigger than the cost. Thus, I should lower my price to reap some additional profits.

[raydude]

Not with a monopoly.

If the marginal cost of production of a monopolist falls, his profit will increase even more if he also lowers his price. Proof: At a high cost, I choose price until my reducing it until the benefit of lowering the price a little bit (sales increase ) equals the cost of lowering the price a little bit (the revenue loss from the price drop on the units I've already sold plus the cost of production on a few more units). If the cost of production falls, the cost of lowering price falls (I still lose some revenues, but the cost of extra units is smaller) , while the benefit of lowering price a little bit doesn't change. Since they were equal before, now the benefit of lowering prices is bigger than the cost. Thus, I should lower my price to reap some additional profits.

This business model doesn't work with US ISPs who have already shown that they have the capacity to give you high speed internet, they just make it prohibitively expensive for you, thus you settle for the lower priced model. How else does one explain that in Hong Kong consumers can get 500Mps for $25/month whereas in the US we pay upwards of $115/month for 100Mps? Except and ONLY IN areas where Google Fiber has a presence, where the lucky bastards who live there pay $70/month for 1Gpbs.

The ISPs charge what they can charge because the American consumer has been conditioned to bend over and take it. Only those of us who are irate enough to call customer service and complain get the price dropped. And even then not to the levels of Google Fiber customers.

[raydude]

You're all over the place here. I guess I should ask you what you think Net Neutrality is, before we continue.

I think this still needs to be answered.

Say I use Comcast. Is it okay that I get degraded speed when trying to download a Netflix movie? I paid for 60 mbps down, but only get <5 when downloading Netflix but get the full 60 when I download a Comcast movie.

This is what they did to people in NY city.

Is it OK? Or should there be a law against it? It sucks for you and for Netflix. If you think Comcast breached your contract, sue them.

Translation: if you have enough money, sue them. Otherwise bend over and take it.

[PLW]

I think the costs of mob shakedowns are overstated, and might be worth the benefit of increased flexibility in contracting practicing in a dynamic and innovative industry.

So far, the best evidence of the cost of non-neutrality I've seen is a $1 increase in the price of Netflix that doesn't even apply to all their customers. They starting saying publicly that the price increase was coming in April, suggesting the decision was made before that. It seems a little early to have been (entirely) the effect of the shakedown. They also raised prices internationally a little before they raised them here, and I doubt that was a Comcast-effect. So, let's call it some fraction of a dollar/month increase in the price of a service the quality of which has been constantly improving.

That's not enough for me.

[raydude]

You're all over the place here. I guess I should ask you what you think Net Neutrality is, before we continue.

Charging different content-providers different prices for the same data handling.

It's easy to get it backwards.

And I did. I was saying what I thought "Not-Neutrality" was. Neutrality is a government-imposed rule to charge all data suppliers the same price for the same data handling.

That sentence sounds confusing and make me think the government wants a cut. Which is worrisome to me because that may be what some opponents of NN are thinking when they read a sentence like that. I believe a more properly worded sentence would be:

Net Neutrality is a government-imposed rule to make all data suppliers treat all data on the Internet equally, not discriminating or charging differentially by user, content, site, platform, application, type of attached equipment, or mode of communication.

The above sentence does not imply that government is demanding a cut from data suppliers nor does it imply that all data suppliers have to charge the same price. It merely says the likes of Comcast has to treat the cost of data equally. It can certainly charge less than ATT, but it can't throttle or extort packets on the basis of the packets' popularity (a la Netflix).

[J.D.]

John Oliver's rant is worth watching again.

I love this. He nails it.

[GreenGoo]

This business model doesn't work with US ISPs who have already shown that they have the capacity to give you high speed internet, they just make it prohibitively expensive for you, thus you settle for the lower priced model. How else does one explain that in Hong Kong consumers can get 500Mps for $25/month whereas in the US we pay upwards of $115/month for 100Mps? Except and ONLY IN areas where Google Fiber has a presence, where the lucky bastards who live there pay $70/month for 1Gpbs.

The ISPs charge what they can charge because the American consumer has been conditioned to bend over and take it. Only those of us who are irate enough to call customer service and complain get the price dropped. And even then not to the levels of Google Fiber customers.

And this is exactly the same behaviour (but far worse) you see with cel phone service providers (some of which overlap with home internet service as well). You guys are getting absolutely screwed over by your cel phone guys. We're getting screwed too, but not as hard, although they sure are trying. I am appalled at what your celphone guys are trying to do.

And here's a true story about ISP in the states that will surprise absolutely no one.

Co-worker's snowbird dad is down in Arizona, his ISP package is 3 Mps. That's absurdly slow, but fine for a old guy and his email account. The price was almost twice what I'm paying for 28 Mps, and that's not even comparing download caps.

I see an ad on TV that is probably from the same ISP where they are advertising 3 Mps as HIGH SPEED! and shows a family sitting around on a couch, all 4 using their devices to stream video. I have a family of 5, all of which have their own tablets. I can tell you that my family would CRUSH that connection until Google starts to explain to us why our streaming is slow/non-existent.

And this package was for some low, low price of <insert absurdly expensive plan>.

I'm not even sure you can get a plan as slow as 3 Mps up here from a major supplier up here (I jest, but man...). It's like dial up for the modern age. It should cost less than phone service, it's free money and neglible load on the network.

Rant rant rant rant....

Rant.

[GreenGoo]

That sentence sounds confusing and make me think the government wants a cut. Which is worrisome to me because that may be what some opponents of NN are thinking when they read a sentence like that. I believe a more properly worded sentence would be:

Net Neutrality is a government-imposed rule to make all data suppliers treat all data on the Internet equally, not discriminating or charging differentially by user, content, site, platform, application, type of attached equipment, or mode of communication.

You need to include that this is for delivery of the exact same product, otherwise it sounds like socialism

I know you mentioned treat all data the same but what might not be clear to a lot of people is that all data *IS* the same. It's all 1's and 0's. All of it. If I send you a pile of 1's and 0's and someone else sends you a different pile of 1's and 0's but with the same total number of digits, why on earth would anyone think it's valid to charge me X dollars and someone else Y dollars? Are they charging by the ratio of 1's to 0's?

All data IS the same, so it should cost the same to deliver, on a per unit basis.

[GreenGoo]

RANT!

[RunningMn9]

Neutrality is a government-imposed rule to charge all data suppliers the same price for the same data handling.

Sort of. Net Neutrality has been the status quo of the internet for two decades, all without government regulation. Until last year, when ISPs started colluding to get ransom money from Netflix.

What happens when private businesses start colluding and doing shitty things? We have to regulate them.

[RunningMn9]

Thinking of analogies for PLW to illustrate the point, since "data bits" and internet infrastructure aren't always easy to conceptualize.

Let's say I buy something from and online retailer and UPS charges me $29.99 to take it from warehouse A to my door. I buy some other product which comes in a package that is identical in terms of size and weight and is stored in the same warehouse, but I instead buy it from some other online retailer (they happen to share warehouse space). UPS charges me $29.99 to take it from warehouse A to my door.

This is the principle of net neutrality. I pay UPS $29.99 to take identical things from warehouse A and deposit them on my doorstop.

UPS notices one day that Online Retailer B is selling a whole lot of identical packages to UPS customers. They get an idea. In addition to charging their own customers $29.99 per delivery, they figure that they can also charge Online Retailer B a premium to ensure prompt service. UPS knows that Fed Ex and DHL don't ship to their customers, and so if Online Retailer B wants to reach the set of customers that can only get packages from UPS - they will pony up some cash money.

Online Retailer B thinks that this is crap, and refuses to pay. Suddenly packages from Online Retailer B to customers of UPS start getting lost and delayed in shipping. But only packages from Online Retailer B. The UPS customers? They're still paying $29.99 per delivery and their starting to get pissed. Every time they order a package from Online Retailer A, the package arrives promptly and safely. Every time they order the same package from Online Retailer B, it's delayed for weeks and shows up all banged up and damaged.

There's no *actual* reason for the delay or damage. It exists solely because UPS has chosen to do this to Online Retailer B because they won't pay what amounts to a protection fee. Online Retailer B needs those UPS customers. So eventually Online Retailer B capitulates. I could not possibly give two shits what the cost/price fallout is over the capitulation.

The fact remains that I paid UPS $29.99 for two-day shipping of a product and it arrived two weeks late and busted because they were trying to extort money from the retailer that I chose to do business with.

To make matters worse - UPS owns Online Retailer A.

[El Guapo]

RANT!

Yeah, I agree - the slowness of internet connections here should be more of a political issue than it is. I assume the main reason that it's not is that most people don't know how bad it is compared to other advanced countries.

And really, I would be far less concerned about net neutrality if there were effective competition amongst ISPs - that would provide *some* constraint against ISPs screwing customers via non-neutrality. If we're not going to require ISPs to compete, the minimum we can do is control their behavior via net neutrality (and other regulations).

[Rip]

Then take it to the next level and look at what these ISPs do when they are faced with the possibility of actual competition. When the local government utility decided to start providing fiber to the home they did everything undeer their power to stop it and have done so in other places that tried the same.

http://en.wikipedia.org/wiki/LUSFiber

In 2004, the city announced its proposal for a municipal fiber network providing broadband internet, cable TV telephone services to the City of Lafayette. 70 percent of residents, and 80 percent of businesses responded positively to a market survey conducted by LUS. This was not a scientific poll. The questions asked and the raw results of the telephone poll were requested by interested parties in the public but were never released. The announcement of the project came within 4 months of Durel's inauguration, just one day after the closing of submission of new bills in the state legislature. This would presumably prevent a challenge in the state legislature by the incumbent phone and cable provider, as there are many laws on the books regulating phone and cable TV providers, but no laws regulating a local municipality entering such business sectors.

Representatives from the ILEC (Incumbent Local Exchange Provider) Bellsouth (now AT&T) were able to lobby representatives in the legislature to modify an existing bill (since new bills could no longer be submitted) to establish rules that would allow some regulation over a municipal entity entering into telecommunications. Prior to this, there were no laws on the books preventing a municipal entity from subsidizing a telecom business with proceeds from a true monopoly utility system (such as the monopoly utility system operated by the City of Lafayette). This bill, negotiated between representatives from Bellsouth, Cox Communications, LUS and reportedly Governor Kathleen Blanco herself became the Local Government Fair Competition Act of 2004.

As per the requirements of Local Government Fair Competition Act (LGFCA), LUS conducted a Feasibility Study and presented the study in November 2004. The Lafayette City-Parish Council voted to adopt the study and proceed with the sale of bonds by resolution in December 2004 and opted to forgo a referendum. This resolution resulted in a petition for a referendum in January 2005 and a subsequent lawsuit in February. The petition was conducted by a non-profit group calling themselves Fiber411.com. The group was founded by 3 citizens of Lafayette who spoke out at the public hearings against the Feasibility Study and later joined by other volunteers and concerned citizens. While some accused the group of being shills for Bellsouth and Cox, the three were of backgrounds in oil and gas leasing, home building and oilfield engineering respectively, had never met prior to November 2004 and had no ties to the communications industry nor local government.

They tried to fear monger and they even tried political sabotage. In the end they couldn't stop it and surprise, all the bad effects they warned of never happened. I pay almost as much for 5mbps at home with Cox as I get 50mbps at the office for from LUS.

[stessier]

You're all over the place here. I guess I should ask you what you think Net Neutrality is, before we continue.

I think this still needs to be answered.

Say I use Comcast. Is it okay that I get degraded speed when trying to download a Netflix movie? I paid for 60 mbps down, but only get <5 when downloading Netflix but get the full 60 when I download a Comcast movie.

This is what they did to people in NY city.

Is it OK? Or should there be a law against it? It sucks for you and for Netflix. If you think Comcast breached your contract, sue them.

Contracts have to comply with laws to be enforceable. Where did those laws come from? Why is this more onerous than those?

[LordMortis]

You're all over the place here. I guess I should ask you what you think Net Neutrality is, before we continue.

I think this still needs to be answered.

Say I use Comcast. Is it okay that I get degraded speed when trying to download a Netflix movie? I paid for 60 mbps down, but only get <5 when downloading Netflix but get the full 60 when I download a Comcast movie.

This is what they did to people in NY city.

Is it OK? Or should there be a law against it? It sucks for you and for Netflix. If you think Comcast breached your contract, sue them.

I agree with you in spirit. Specifically, I think Level 3 had an unfair relationship and lack of reciprocity with the rest of the ISPs putting the burden of costs to maintain infrastructure on the other ISPs. However, in practice I find ComCast, ATT, and Verizon to name the big three are sleeping too much with Government to allow them to choose throttling or boosting while working with the DoJ and FCC. It feels a little too Chinaish.

[PLW]

Is it OK? Or should there be a law against it? It sucks for you and for Netflix. If you think Comcast breached your contract, sue them.

Contracts have to comply with laws to be enforceable. Where did those laws come from? Why is this more onerous than those?

Contracts can bind you to do all kinds of things that you are not bound to do by law. I.e., you could, today, sign a contract with an ISP where they promise not to differentially throttle content, even though there are no such provisions in law. The difference is that contracts are mutually voluntary. Regulation is enforced whether the parties like it or not.

[PLW]

Let me say it again. I agree that there is a real possibility of Comcast and their ilk screwing all their consumers by holding up content providers for a payment. I also think that there is a real possibility that the govt intervening to limit the sorts of contracts that players is the markets can write with each other could hurt consumers. Given that the internet has worked so well so far without intervention, I simply prefer to wait and see some real harms before intervening. Some people maybe paying an extra dollar for Netflix doesn't reach that level, for me.

[Rip]

Let me say it again. I agree that there is a real possibility of Comcast and their ilk screwing all their consumers by holding up content providers for a payment. I also think that there is a real possibility that the govt intervening to limit the sorts of contracts that players is the markets can write with each other could hurt consumers. Given that the internet has worked so well so far without intervention, I simply prefer to wait and see some real harms before intervening. Some people maybe paying an extra dollar for Netflix doesn't reach that level, for me.

That is because until recently the players involved in the internet have honored the concept of net neutrality without regulation. Now they have shown they are no longer willing to do that, you can wait if you like but like healthcare there is likely no going back for a do-over.

Now that being said, there is another solution, and that is opening up the local ISP markets to competition or declare the ones that exist monopolies (which they are) and regulate them to cost-plus.

[RunningMn9]

Given that the internet has worked so well so far without intervention

Which is why the average American has shittier Internet service than 28 other countries. We are a paragon of thriving competition.

[PLW]

Given that the internet has worked so well so far without intervention

Which is why the average American has shittier Internet service than 28 other countries. We are a paragon of thriving competition.

I don't believe that any of those countries have a regulation of the sort proposed.

[RunningMn9]

The Netherlands. And reasonably soon, the entire EU.

[PLW]

The Netherlands. And reasonably soon, the entire EU.

Awesome. Let's wait and see how it works out for them.

[RunningMn9]

A better example of net neutrality working is of course, the US.

As noted, the principles of net neutrality were the status quo until last year. That more or less worked out in almost every respect (except of course in terms of the service ISPs provide their customers, but they have won the PR game on that as most people don't realize how bad Internet service is here in the US in terms of cost and performance).

[RunningMn9]

Waiting to see how corporations are going to screw us seems like a stupid plan to me. We're going to have to agree to disagree.

[GreenGoo]

A better example of net neutrality working is of course, the US.

As noted, the principles of net neutrality were the status quo until last year. That more or less worked out in almost every respect (except of course in terms of the service ISPs provide their customers, but they have won the PR game on that as most people don't realize how bad Internet service is here in the US in terms of cost and performance).

I'll refer you back to the 3 Mps High Speed! for family of 4 being touted in commercials. Commercials aren't exactly bastions of truthiness, but it's complete nonsense, especially at the price. PR is right.

On top of which, I'm not sure what PLW is expecting to see with "let's see how it works out for them". The law is "keep doing what you've been doing". Just look at the last 15 years if you are wondering what the ramifications of net neutrality are.

The examples have been extraordinarily clear.

As a consumer, I pay my ISP for access to the internet. Not access to Hulu but not youtube. I am paying for the whole thing. ISP's, without my permission, are holding me hostage and keeping me from accessing sites I want to access at the service levels the ISP agreed to (assuming good faith that they will actually try to meet those levels, rather than intentionally limited them). It's not just NetFlix, it's me they are screwing over. It's shady as hell.

The only way that net non-neutrality makes sense is if you're a diehard capitalist who refuses to understand that capitalism only works if there is competition. Not the appearance of competition, but you know, actual competition. That doesn't exist, and that's intentional.

When corporations want to run roughshod over everyone, there are only two things that can stop them. Competition or the government. We aren't likely to see #1 any time soon, but it is an option. That leaves #2, unfortunately.

I don't WANT government intervention. But the ISP's have left us no choice. Things were working great for everyone, but the need to find revenue streams caused ISP's to drop a toll booth in the middle of a system that was already working fine.

I'd also point out that connection to the internet is so important for the vast majority of people today that treating it like a utility *is* an option. That comes with it own set of problems.

Another point is that even if you're a pure capitalist/libertarian, Net Neutrality laws will not be the end (so there is still hope for those wantng unfettered business). ISPs will seek ways around the laws, look at other revenue streams, look at other ways to squeeze money out of consumers (often while not offering anything additional in return). This won't end with Net Neutrality laws, because corporations are not likely to stop trying to find new ways to generate revenue (which is fine). It would be nice if they offered additional service for that revenue, but as we see that isn't as likely (which is not fine).

[Zarathud]

Even Adam Smith, the founder of capitalist theory, wanted government intervention to stop the anti-competitive acts of monopolies.

[GreenGoo]

Even Adam Smith, the founder of capitalist theory, wanted government intervention to stop the anti-competitive acts of monopolies.

Left Extremist agenda lies!

[PLW]

I learned a lot from this essay, including past examples of non-neutrality in the US and a bit about how other countries regulate their system. Also, I agree with his main argument--- that we really have no idea what will happen if we regulate in the way proposed.

[Crabbs]

You really think it's all about speed of packets & packet equality?

It's a way for the government to get control of The Tubes via FCC regulation. Right now the government has no control over what is pushed onto and through the internet. Once we allow the FCC to oversee and regulate the packets traversing our internet kiss your true freedom of speech goodbye. They will manage to strangle your packets more than you could ever have imagined.

It's amazing how many intelligent people are running right into the arms of government control/regulation to save their precious Netflix..... sigh



I'm sure I'll get labeled a conspiracy nut for thinking nothing but the worst of our gub'ment, but recently I have seen nothing to inspire anything but disdain for Washington.

[Isgrimnur]

You mean the government that already hoovers up our Internet unchecked and stores all that data waiting for the checkbox that is a warrant these days? The ones that already have back doors and buddy buddy agreements with the carriers to give them whatever they want?

Having the carriers play fair with the data isn't the slippery slope of loss of privacy that you think it is. We're already at the bottom of that slope.

[Zarathud]

A government that enshrines the principle that all data is equal is more likely to protect free speech than one which treats data differently based on provider/content.

[RunningMn9]

You really think it's all about speed of packets & packet equality?

Yes, that's what it's all about. And the only reason that we have to bring the FCC into the fight is because shitty corporations started doing shitty things, and unfortunately when dealing with practical monopolies, the only means of defense against their shittyness is the government (in this case the FCC).

The FCC saying "No, you cannot place a toll bridge between your customers and the internet content providers that they are trying to reach" does not result in "Oh, and by the way, your customers cannot post comments that are against the current Administration".

You aren't being a conspiracy nut, but you are presenting a slippery slope fallacy.

[GreenGoo]

I'm sure I'll get labeled a conspiracy nut for thinking nothing but the worst of our gub'ment, but recently I have seen nothing to inspire anything but disdain for Washington.

You're a conspiracy nut. The only thing worse than government is an unregulated corporation.

When RIP calls for regulation, you might want to revisit your position.

And the corporations can solve this themselves. They wouldn't need regulation if they hadn't decided that after decades "something" had to be done about all this data moving around their networks.

This is ridiculous. The ISP's want more money, in exchange for NOT fucking everyone over. That's not free enterprise. That's not capitalism. They aren't offering additional service for the price, they are threatening to take away what we're already paying for unless someone else pays them protection money.

It's a racket. Stop being borderline criminal and the government won't have to get involved.

Worse, the government is trying really hard to regulate on the SIDE OF THE ISPs due to the incestuous nature of the FCC and telecom industry and massive lobby force. Meaning they are trying to enact regulations that FAVOUR the hostage taking of data and slapping a Net Neutrality label on it (the exact opposite of Net Neutrality). It's insane.

And you're insane.

RANT!!

edit: Damn it, Rmn9 and I agree again. Let's get Rip in here and we can cause a fault in the time/space continuum (Heard that on star trek one time )