Can You be Neutral on Net Neutrality?

[krosenth]

I had the privilege of attending and presenting at the CTIA IT and Entertainment Conference earlier this month -- you may have seen my Tweets from the show -- and I walked away with some key learnings, some reinforced opinions, and a few lingering questions I'd like to pose to the Community. 

First off, this was not my first technology event, but it was my first CTIA conference, and I must say, I was very impressed.  The organizers did a great job recruiting interesting speakers (with the notable exception of yours truly), organizing logical and reasonable tracks, and really thinking through the event logistics (although holding an event right across the street from a ballpark the day after the season ends is just plain cruel, imho). 

My questions stem primarily from the keynotes, most notably the virtual "point-counterpoint" keynotes presented by FCC Chairman Julius Genachowski, and AT&T President Ralph de la Vega.  I really appreciated Genachowski's straightforward and forward-looking presentation.  Genachowski's proactive approach to telecom regulation is what you would expect from a person of his entrepreneurial background (fyi: don't read his bio unless you're looking for an inferiority complex -  impressive.)  In plain-speaking terms, Genachowski oulined his four-point plan for mobile broadband: (1) "Unleash" spectrum to close the spectrum gap; (2) Remove physical and legal obstacles to 4G deployments; (3) Open the Internet through fair and common sense policies; (4) Empower consumers with an open, transparent marketplace. 

De la Vega's keynote, on the other hand, had a strong "if it ain't broke" message.  De la Vega (equally impressive bio, btw; check out his new autobiography.) defended carriers' right to manage the networks they paid for, built, and operate at great expense.  De la Vega backed up his argument for unregulated competition by pointing out that U.S. consumers pay approximately 60% less for mobile service than users in other countries, while using their mobile devices more. 

So that's where I'm stuck.  As a former employee of a U.S. service provider I know first-hand how much blood, sweat, and tears go into building the best network possible for the sole purpose of providing the best customer experience possible.  On the other hand, as a typically selfish mobile and broadband user, I don't want my service provider managing my data traffic in any way, shape or form.  On the other, other hand, I eagerly await the Mbps-era of Mobility, and if that means putting up with additional restrictions or costs, I may be willing to tolerate that to get the experience I want. 

So where do you stand on net neutrality and why?  Convince me.  As always, I look forward to your thoughtful opinions, comments, and experiences. 

[krosenth]

BTW, you can view video highlights from Genachowski's and de la Vega's keynotes here.  Enjoy!

[sreed]

I look at it this way.

The local Broadband ISP is a Utility just like the Phone Company (Some times they ARE the phone company) or the Power company.

I 'contract' to purchase a connection of a given bandwidth, say 10 MB x 2 MB, and within reason I feel they are not abiding by our 'contract' if I don't get the total bandwidth I 'contracted' for.

Here is a comparison.

You and I 'contract' with the local power company for x amount of electrical service. For simplicity let's say its 200 Amps of single phase 220 VAC.

What would your reaction be if they suddenly started restricting you to 25 amps, so you can only turn on 3 lights or one burner on the stove.

Another comparison

How happy would you be if suddenly the phone company sent you notice that from 4 pm to 8 pm you are only allowed to get or make 1 phone call to ensure proper sharing of their capabilities/equipment.

This harks back to the days of party lines where we had to share the line with p to 9 other homes.

Or you suddenly it gets to the point where only a third of the time you attempted to make a call you are able to complete it.

OR

because they or someone has decided a phone number connects you to a company who's business model/service they don't agree with BUT is not doing anything illegal, you can't call that number or that you can but you will only be able to hear every 10th word either direction or you can only call it between midnight and 3 AM.

[tonyharr]

While SReed's comments are valid and represent an important Point of View on this issue - his analogies don’t hold up to scrutiny – although I am sure there are other analogies that would further the arguement.

My contract with the power company, charges me more for each additional power amount I use. In fact, in Northern California, much more per unit, beyond my “fair share” in order to encourage conservation (a good thing in my mind). Further – there are times where everyone is asked to conserve even more in order to avoid a strain on the grid. And in extreme cases – rolling black-outs occur. While that saves the grid from going down, it isn’t seen as a “success.”

Similarly, my phone contract, while it offers “unlimited long distance,” has a “fair usage” clause as well. If I suddenly start running applications that use my long distance 24x7, I’m sure I’d get notified by the phone company that I’ve violated this.

Basic economic theory has a whole area of expertise on rising demands of a shared public good (like grazing lands, managed national forests, etc. I think this theory would enlighten this discussion as well.

[MikeDemler]

It is interesting to compare FCC Chairman Genachowski's speech at CTIA to his appearance at the Brookings Institute just two weeks earlier.  With all of the wireless operators represented at CTIA (and even sharing the same stage), he took much more of a position of appeasement to the industry.  This is particularly evident in his comment that "In fact, I believe that that the biggest threat to the future of mobile in America is the looming spectrum crisis."

( http://www.fiercewireless.com/press-releases/prepared-remarks-chairman-julius-genachowski-federal-communications-commission-0#ixzz0UmIAD3P6)

I believe that this "crisis" is a fabrication that is intended to apply pressure to the FCC while diverting attention from the operators themselves. If there is a crisis, why is AT&T not aggressively preparing deployment of the 700MHz spectrum they acquired in the 2008 auction?  AT&T CEO de la Vega's speech at CTIA was nothing but defensive on this issue, employing meaningless statistics regarding a forecast for availability of LTE devices. AT&T is lagging in 4G rollout to Sprint/Clearwire and Verizon, and they are complaining the loudest on net neutrality issues.

Keep in mind that U.S. radio spectrum is a public resource, just like the national parks.  Licensing the spectrum is akin to logging rights. The operators obviously need spectrum to run their businesses, and it is in their best interest to acquire licenses as cheaply as possible. Hence the "crisis" and opposition to net neutrality. It is right for the FCC to act in the best interest of American consumers by enforcing net neutrality rules, so that OUR spectrum is utilized in OUR best interests.

-Mike Demler

[knagesh]

Thanks for sharing your thoughts on this important, but tough topic!

Frankly, it is easy for over the top players to be for Net Neutrality as the benefits for them are very obvious.

On the other hand, it is a challenge for operators to build out massive scale of their infrasructure if the business underpinnings are weakened. We can make a case for differentiated services be a critical component for enabling new, compelling, personalized broad band services. May set the stage for win/win collaboration within the value chain, without undermining the customer. So long as there is competitive market that spurs innovation, accelerates delivery of new services, and offers innovators (SPs, application developers, etc.) methods for monetization, then, the market forces will do the right thing.

Would you agree? What do you see as win/win in this hot debate? Is it enough if market based structures are in place and FCC only intervenes on an exception?

Nagesh

[sreed]

I concur with Mr Harris's reply however he doesn't quite understand my point.

I guess the power company analogy isn't necessarily the best as they will always Usage Bill and unless you are a HUGE customer would never Flat Rate bill.

I agree that as I put more demand on the electrical distribution system it will cost me more. However at any instant the cost is strictly based on the kilowatt-hours of demand. Yes, there can be different time-of-day rates.

For the sake of discussion lets assume I have an account with the Power company for a Facility to provide 200 Amps of 220 VAC electrical power.

Definitions to aid understanding:
1000 watts for 1 hour, that's a kilowatt-hour
Calculated by VAC * Amps demand * Power Factor = Kilowatts Unless your and Engineer we can ignore the Power Factor.

Typical Air conditioner (whole house, cooling only, 3 ton, 10 SEER) running for 10 hr continuous = 5.0 KW-Hrs

If my demand today @ 1202 PM is for 25 KW-Hrs it costs - "X cents/KW-Hr * 25 = z total cost".

If yesterday the demand at that same time was 200 KW-Hrs then the cost is still calculated by  "X cents/KW-Hr * 200 = z total cost"

Now if those same demands were at 1202 AM the cost per KW-Hr will be different.

The cost difference at different times of day is a demand charge. It is PREVIOUSLY agreed in the contract in attempt to 'motivate' the customers to level the overall demand. I have no problem with these cost differences/charges as they are OPENLY presented up front when I made the contract. They were not implemented AFTER we made our contract without notice.

Yes there are occasions of rotating black-outs etc but it is totally different than what the "Big' ISPs are trying to do. The Power company views these as 'failures' on their part to provide the contracted service AND they do not charge me for the service during that outage period.

At no time would the Power company 'tell' me that I can't draw up to the allowed 200 Amps of service. Nor do they tell me that the "AC draw" is OK but the 'CFL draw' is not OK so I can't use my CFLs.

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Your comment about the Phone company also isn't quite correct

There isn't any fair usage” clause in any of the telephone system service contract I've read and I've read a lot of them as I am a Telecoms Consultant. There are clauses that define residential and commercial usage.

If you have a "unlimited long distance" Residential Contract and suddenly were using the Long distance 24x7, their system will 'flag' your account for review. If you can 'justify' the usage AND show that it is 'temporary/transient', Example major family crisis and are you are limiting your calls to a Very limited set of numbers (2 or 3 MAX) then they probably won't require any changes nor will they Stop you from using the phones.

If you can't then most likely you are violating the terms of the contract and trying to use your Residential Account under the Commercial definition. IE YOU violated the terms not them.

In this case they are just forcing You to comply with the previously Contracted Requirements. They are not suddenly 'changing' the 'contracted services'.

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In neither case do the providers get the option to 'change' the terms of the contract by making zero notice changes in the service provided. Yes they can make contractual changes BUT those changes must be published, reviewed, and approved prior to implementing. This gives the customer time to comment, time to negotiate different contract terms, or to find a replacement vendor.

This process also prevents a single person from deciding that something is unacceptable and putting it on the Prohibited list.

These are the points I view as important in the 'Net Neutrality' debate. The ISPs 'agreed' to these terms when they accepted  their 'franchise' terms in order to gain some degree of area monopoly. If they want to change these conditions then they have to give the proper notice and be willing to 'give up' the area monopoly that they enjoy. They must also allow time for their customers to find a new provider and must also give up the early term penalties as they are the party changing the previously contracted service conditions so there fore they are the violating party and should lose this penalty recourse