October 20, 2006  ·  Lessig

So in the comments to my post about the piece in the FT, John Earnhardt, an author on Cisco’s (read: the company that will sell the technology to end network neutrality) “High Tech Policy Blog,” complains about “the rhetoric [I] have used.” In his blog post, titled “How can you tell if a lawyer is lying?” (talk about helpful rhetoric), he writes:

In the FT piece he writes: “Network owners now want to…charg(e) companies different rates to get access to a “premium” internet. YouTube, or blip.tv, would have to pay a special fee for their content to flow efficiently to customers. If they do not pay this special fee, their content would be relegated to the “public” internet a slower and less reliable network. The network owners would begin to pick which content (and, in principle, applications) would flow quickly and which would not.” This is sheer fiction and he knows it. The truth of the matter is that YouTube and Google, the companies he holds up at stalwarts of fair play, apple pie, motherhood and whiskers on kittens actually charge companies to get premium placement on their websites. What’s this you say? Those who own a website or service are allowed to charge money to allow an advertiser to get top placement on their website? I’m shocked and appalled and will be submitted an op-ed to the FT stating the same. What is the difference of a service provider (in his terminology, a “network owner”) of charging a service to get premium placement on their “owned” network? They are not degrading the services of others, but enhancing the service of those who choose to pay for the premium placement.

“What is the difference [between] a service provider … charging a service [fee] to get premium placement on their ‘owned’ network?” Really? The difference is all the difference in the world. No one supporting network neutrality would (or should) say that we should fight discrimination at the edge of the network. That’s the whole point: End-to-end (the bedrock upon with the network neutrality argument rests) is all about facilitating lots of discrimination and preference at the edge; the only place discrimination is a problem is within the network. And again, nothing in my argument is about whether people at the edge of the network are “stalwarts of fair play, apple pie, motherhood and whiskers on kittens” (whiskers on kittens?). The point is not about good vs. evil. The point is about what architectures (whether imposed through technology or business models) will lead to the fastest growth in applications and content. No doubt, some architectures will lead to faster growth in profits for some companies (not to name names); but more profits for some is not the same as faster growth for all.

His second strike is even better:

Here’s another anology: We’re in the throes of campaign season here in the ol’ US of A and television and radio ads play a large role in electing or defeating a candidate. Those candidates who have more money can buy more ads on radio and TV. They can buy them during the most popular shows so that the most amount of voters can see them. If the other candidate has no money and cannot afford to place an ad on television or radio I can only assume that Larry Lessig will offer to pay their way in the name of net neutrality. Why? Because, in his mind, the playing field should be equal for all candidates.

So again, no, whether candidates have money or not is not my concern. They are (in the analogy) at the edge of the network. But let me turn the analogy around. Imagine there are only two television stations in a particular democracy. They both begin to “access tier” — charging different rates to different political candidates. So Dems get a rate 1/2 the rate charged to the GOP; or major parties get a rate that is 1/3 the rate charged to Independents. Does that begin to trouble you?

Now again, as I said in the blog post about the piece, everything here hangs upon market power. So in a truly competitive market for last mile broadband, I wouldn’t care as much (Barbara van Schewick says there’s still a reason to care). But in a world of limited competition, the games the networks can play will both stifle innovation at the edge, and reduce the incentive network owners have to increase performance for all.

  • anonymous

    Respectfully, I disagree with a number of your points:

    1.

    “Network owners now want to change this by charging companies different rates to get access to a “premium” internet. YouTube, or blip.tv, would have to pay a special fee for their content to flow efficiently to customers. If they do not pay this special fee, their content would be relegated to the “public” internet – a slower and less reliable network. The network owners would begin to pick which content (and, in principle, applications) would flow quickly and which would not.”

    The network owners would not pick which content would flow quickly. The ability of the content provider to pay the premium charge would dictate whose content flowed quickly and whose did not.

    This self-selection for premium service is no different a model than that of many other industries. For example, first-class costs more than coach and overnight costs more than regular delivery.

    Would you say that airlines and the U.S. mail discriminates in the same manner as you portray the ISPs as doing?

    2.

    “Network owners say this is worth it as their tax will help fund the development of a faster network for everyone. But will it? When you can charge content providers a premium for access to a premium internet, what incentive is there to improve the rest of the internet? If the regular internet is fast and reliable, why would a Google or YouTube pay for the premium?”

    But the regular (i.e., best effort) Internet is not fast and reliable. When is the last time you were able to watch a DVD-quality streaming video at 8 PM without it slowing down due to network congestion?

    Content providers have an incentive to pay for premium quality because the best effort Internet does not provide them with the quality of service that they are seeking for their content.

    Also, content companies currently pay for higher-quality service with CDNs (content delivery network) providers such as Akamai and Limelight. Why is it OK for content companies to pay a premium to those CDN providers but not pay ISPs for the same improved service?

  • Mark Murphy

    When is the last time you were able to watch a DVD-quality streaming video at 8 PM without it slowing down due to network congestion? Content providers have an incentive to pay for premium quality because the best effort Internet does not provide them with the quality of service that they are seeking for their content.

    If ISP X wishes to charge a premium rate for specific type of content to achieve a specific QoS (quality of service), with a non-discriminatory price schedule, that should be fine. Unfortunately, it’s effectively impossible given the nature of the beast.

    While technically it could be done, it requires total suspension of disbelief in terms of the expected behavior of telco executives. I don’t believe for a second that telcos won’t start:

    • Intentionally degrading service for that same content when transmitted by non-payers. If the QoS of the Internet is normally a 2, it’s one thing to charge a premium for a provider to get to 3, but it’s a whole ‘nuther thing to degrade non-payers to a 1. But they’ll do that, both to help convince more to pay, and to steer their users to view more of payers’ content, thereby further increasing the pressure to pay up. In this direction lies protection rackets.
    • Discriminating in the pricing, by offering sweetheart deals to firms who, for example, support the same political candidates that they do.

    So, when you say:

    The network owners would not pick which content would flow quickly. The ability of the content provider to pay the premium charge would dictate whose content flowed quickly and whose did not.

    I don’t believe it for an instant.

    For example, first-class costs more than coach and overnight costs more than regular delivery.

    And the pricing schedules for these services are reasonable, non-discriminatory, and public…at least for the US Postal Service. Are other delivery services and airlines discriminating? Probably. The value of the Internet to society dwarfs all of them combined, which is why the network neutrality issue gets much more attention than the airline neutrality issue.

  • Andrew

    @Anonymous: In addition to the above concerns by Mark Murphy, some net neutrality advocates are concerned with the effect that a small number of network operators can have on innovation if they are allowed to discriminate between content.

    Imagine I create the next great internet innovation (the next YouTube, perhaps). In a world where network operators are allowed to tier their services, it’s not hard to imagine that the network operators might fatally cripple access to my innovation on all the tiers except those that are prohibitively expensive. Then imagine that the same network offers its copycat service, uncrippled, across all their tiers. Even worse, what if the network operators decide to cripple my innovation on every tier, and don’t even bother to offer a copycat. Either way, I’m essentially muscled out of the market.

    In a world where such bullying is possible, innovation would be chilled. The majority of innovation would come from within a small handful of network operators and very little would come from the fabled “guy in a garage somewhere”.

    Also, there aren’t all that many network operators to begin with. It’s close to a monopoly power in portions of the country. Why should we give additional control to someone who has little competition, and thus little reason to exercise that control responsibly? Would the benefits of giving the network operators that kind of discriminatory power outweigh the possible abuses of that power? Would we all be better off, or would just a few companies who already control the bulk of the market be better off?

  • http://www.hyperorg.com/blogger/ David Weinberger

    It’d be much easier to figure out when discriminating among packets makes the world better for everyone (better end user service, more innovation, more wealth, more freedom…) if we could trust the people given the power to discriminate. But, since the carriers also have a strong incentive to sell us not just bits but services–ones they’ve built or ones from companies they’ve done deals with–how can we trust their decisions to be in our interests?

    So, the argument isn’t over whether all packets must always be treated precisely the same in every circumstance. The question is whether we’re going to trust the incumbents – especially since there’s not enough competition to empower the market’s hand – to make those decisions. And, for the reasons Prof. Lessig and Andrew the Commenter give, I think the answer has to be a resounding No.

  • three blind mice

    The question is whether we’re going to trust the incumbents – especially since there’s not enough competition to empower the market’s hand – to make those decisions.

    well, if you’re asking the wrong question, David Weinberg, it’s not surprising that you arrive at the wrong answer.

    in our flat in stockholm there is no shortage of last mile competition. a plurality of DSL, cable and wireless carriers compete fiercely with each other and the result is that we have the choice of not one, or two, but ten different “last mile” providers.

    it’s very hard to understand why, as william kennard wrote in his NY Times editorial “Since 2000, the United States has slipped from second to 19th in the world in broadband penetration, with Slovenia threatening to push us into 20th.”

    it is also very hard to understand why America’s cellular network is similarly so far behind the rest of the world.

    problems which are difficult to understand generally don’t lend themselves to simplistic solutions like “net neutrality.”

    moreover, dumbing this discussion down to a debate over “net neutrality” does nothing to shed light on the real problems.

  • anonymous

    In reply to:

    Imagine I create the next great internet innovation (the next YouTube, perhaps). In a world where network operators are allowed to tier their services, it’s not hard to imagine that the network operators might fatally cripple access to my innovation on all the tiers except those that are prohibitively expensive. Then imagine that the same network offers its copycat service, uncrippled, across all their tiers. Even worse, what if the network operators decide to cripple my innovation on every tier, and don’t even bother to offer a copycat. Either way, I’m essentially muscled out of the market.

    What you forget is that ISPs get paid on the bandwidth that they sell. If they were to, for example, throttle back all potential new youtubes in favor of their own then they would be limiting the amount of bandwidth they would be selling.

    Keep in mind that the wholesale and hosting businesses of the telcos generate vast amounts of money and those same telcos have been horrible at rolling out their own television services.

    You are placing bullying as an economic motivator ahead of making money. This is obviously not how the telcos act. They act to make money. Could they throttle back everyone one or even just everyone except one? Sure. Would that maximize their revenues? No.

    So, if you believe that the telcos would acts in their own self interests – and you believe that it is to make money – then why would they limit their opportunities to sell as much bandwidth as possible?

    Just to be a bully? Just cause they can? Just cause it’s easier to believe that the big and powerful telcos are gonna put everyone else at a disadvantage because they are big and powerful?

    Those are hardly realistic reasons…