Net Neutrality, Policy, Economics and Intelligent Engineering

Posted on April 13, 2010  Comments (3)

I believe net neutrality should be championed to prevent decay of the usability of the internet. It seems to me internet connectivity is a natural monopoly that economic theory says should be a regulated monopoly. Smart countries have invested in providing much better internet connectivity that the USA has at much lower prices. Now in the USA we have companies that seek to control internet connectivity and then use that monopolistic control to favor higher margin efforts. So force those that have resources available on the internet to pay or the ISP threatens to degrade the connectivity to their resources.

chart showing internet connectivity speed (USA 18th)

The investment in equipment and fiber that allows internet connectivity has to be paid for. If those regulated ISPs wanted to set bandwidth use pricing that is fine with me. If we decided it is best to have one low price say $30 a month for access at a similar perforance of 10 other countries (Japan, Germany, South Korea, Canada, United Kingdom…) and then charge extra for individuals those that use more than some amount fine. But I think it should not be tied to whether you use service that haven’t paid the ISP money to be favored. The USA is currently 18th and slowed down, while others continue to speed up.

The 2008 ITIF Broadband Rankings show the USA in 15th place, out of 30 OECD countries, for broadband adoption, speed and price. In 2001 the USA was in 4th place.

If ISPs don’t want to be in the business they should be in – providing internet connectivity. Fine, get out of that business and go into the business they want to be in. But don’t try to take control of a natural monopoly and then use that control to extort money from those that rely on the natural monopoly.

Google accused of YouTube ‘free ride’

Some of Europe’s leading telecoms groups are squaring up for a fight with Google over what they claim is the free ride enjoyed by the technology company’s YouTube video-sharing service. Telefónica, France Telecom and Deutsche Telekom all said Google should start paying them for carrying bandwidth-hungry content such as YouTube video over their networks.

I can understand why they would think that way. But isn’t it equally valid to say hey those that pay you for internet connectivity really want to use YouTube. If you need to make more investments in your infrastructure to support your customers use, then do so and raise the prices. I completely disagree with the ISP negotiating what content users can see. But if that were to happen why couldn’t Google instead of paying say, hey your customers really want YouTube – if you don’t pay us we won’t let you deliver it to your customers?

Net Neutrality: This is serious by Tim Berners-Lee

When I invented the Web, I didn’t have to ask anyone’s permission. Now, hundreds of millions of people are using it freely. I am worried that that is going end in the USA.

Yes, regulation to keep the Internet open is regulation. And mostly, the Internet thrives on lack of regulation. But some basic values have to be preserved. For example, the market system depends on the rule that you can’t photocopy money. Democracy depends on freedom of speech. Freedom of connection, with any application, to any party, is the fundamental social basis of the Internet, and, now, the society based on it.

Let’s see whether the United States is capable as acting according to its important values, or whether it is, as so many people are saying, run by the misguided short-term interested of large corporations.

I hope that Congress can protect net neutrality, so I can continue to innovate in the internet space. I want to see the explosion of innovations happening out there on the Web, so diverse and so exciting, continue unabated.

Google’s Traffic Is Giant, Which Is Why It Should be Your ISP

as Arbor Networks measures it, if Google were an ISP, it would be the third largest in the world and the fastest growing — if you are measuring the amount of traffic passed from its network to another.

Moreover, Google has been deploying banks of servers inside those same networks, so traffic to Google’s servers never has to leave an ISP, cutting down on lag time and transit costs. Arbor estimates that more than half of the ISPs in Europe and North America are home to a bank of servers known as a Google Global Cache.

Very wise. Google knows about the value of intelligent engineering. And they will do what they can to reduce system costs and speed up the internet. And Google is perfectly able to see how the USA’s internet connectivity is continuing to lag far behind the rest of the world and is trying to help fix that problem. I own stock in Google.

How Big is Google?

an estimate of the average percentage of Google traffic per month using direct interconnection (i.e. not using a transit provider). As before, this estimate is based on anonymous statistics from 110 providers. In 2007, Google required transit for the majority of their traffic. Today, most Google traffic (more than 60%) flows directly between Google and consumer networks.

Net neutrality and the benefits of caching

Google has offered to “colocate” caching servers within broadband providers’ own facilities; this reduces the provider’s bandwidth costs since the same video wouldn’t have to be transmitted multiple times. We’ve always said that broadband providers can engage in activities like colocation and caching, so long as they do so on a non-discriminatory basis.

All of Google’s colocation agreements with ISPs — which we’ve done through projects called OpenEdge and Google Global Cache — are non-exclusive, meaning any other entity could employ similar arrangements. Also, none of them require (or encourage) that Google traffic be treated with higher priority than other traffic.

Save the Internet

Who wants to get rid of Net Neutrality?

The nation’s largest telephone and cable companies — including AT&T, Verizon, Comcast and Time Warner Cable — want to be Internet gatekeepers, deciding which Web sites go fast or slow and which won’t load at all. They want to tax content providers to guarantee speedy delivery of their data. And they want to discriminate in favor of their own search engines, Internet phone services and streaming video — while slowing down or blocking services offered by their competitors.

These companies have a new vision for the Internet. Instead of a level playing field, they want to reserve express lanes for their own content and services — or those of big corporations that can afford the steep tolls — and leave the rest of us on a winding dirt road. The big phone and cable companies are spending hundreds of millions of dollars lobbying Congress and the Federal Communications Commission to gut Net Neutrality, putting the future of the Internet at risk.

Related: Verizon Executive Calls for End to Google’s ‘Free Lunch’Tim Berners-Lee on Separation, Standardization, Openness, Neutrality Across the NetMonopolies and Oligopolies do not a Free Market MakeIs Net Neutrality a FCC Trojan Horse?Google Server Hardware DesignInternet Undersea Cables

3 Responses to “Net Neutrality, Policy, Economics and Intelligent Engineering”

  1. Julien Couvreur
    April 13th, 2010 @ 5:25 pm

    As mentioned in the wikipedia article you cite regarding natural monopolies (see section entitled “Doing Nothing”), I think that natural monopolies do not exist. The only monopoly problem is when competitive forces are hampered by government regulations (or other kinds of illegal coercion, eg. mafia).
    There is no such thing as “monopolistic control”. Even temporarily dominant companies are vulnerable to competition and ultimately to consumers.

    If you think that the broadband market is not competitive enough in the US, I would encourage you to look for the historical root causes.

    If internet service is so bad in the US, then new services will inevitably pop up to satisfy customer (unless regulations somehow prevent it). We’ve seen that happening with wireless internet access and the announcement of the Google fiber project. In the market, there is pressure for incumbent to either innovate (or at least keep up with new entrants), otherwise new entrants will replace them.

    I wrote a general article on monopolies, going into some more details about this analysis: http://dumky.posterous.com/monopolies

    Also, Sean Malone has a good article explaining the effects of regulations such as net neutrality: http://seanwmalone.blogspot.com/2010/04/liberty-1-fcc-0.html

  2. Curious Cat Science and Engineering Blog » Fiber to the Home
    July 2nd, 2010 @ 11:13 am

    [...] Broadband Gap – Next steps for Google’s Experimental Fiber Network – Net Neutrality, Policy, Economics and Intelligent Engineering – How Do You Fix an Undersea Cable? by curiouscat   Tags: Engineering, Technology [...]

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    [...] USA has extremely poor broadband service (compared to other rich countries). It is slow and expensive. Those that support economic policies more in line with the USA than [...]

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