Tag: net neutrality

Advocates of Regulation Are to Charlie Brown as Washington, D.C., Is to Lucy

This morning on WNYC in New York City, I debated Josh Silver of the pro-Internet-regulation group Free Press. It was a healthy exchange of views, except for a few barbs and innuendos thrown by Silver, who is obviously frustrated by his group’s lack of progress in seeking a “government takeover of the Internet.” (He wanted to debate in simple, ideological terms like that, so I indulge here.)

What was most interesting to me was how unsophisticated Silver is with respect to government and regulation. Take a look at his plea:

What we’re asking for—what we need are regulatory agencies that are not captured by industry and that actually act on behalf of the American public. And that’s what they were created to do. The FCC—1934, with the advent of radio—was created to make sure that the public interest was protected. And what we’ve seen is industry capture of regulatory agencies has made those agencies fail again and again and again.

And the only thing that’s gonna work is if the Obama administration and the FCC stand up and say, “No more business as usual. We are going to protect net neutrality. We’re going to protect competition, and make sure there’s choices for consumers. And we’re going to end the status quo in Washington that has really broken our entire political system.”

The Obama administration and the FCC did stand up and say “no more business as usual,” but that’s what politicians do to seduce voters. Then, once in power, they go about business as usual. Lucy always yanks away the football, Charlie Brown.

Silver is not alone in having these sweet, sad “good government” sentiments. Many of my interlocutors, with whom I often share outcome goals, believe strongly in achieving those goals by remaking governmental and political systems so that they finally “work.” They believe so strongly in this approach that they seem to think it’s just around the corner—if only we prohibit some speech here, some petitioning of the government there. Y’know, “take the money out of politics.”

Hopefully this fantasy will never come true, because it requires reversing fundamental rights such as free speech in all its instantiations—a handover of power from people to the government and elites that run it.

In the absence of that perfected, all-powerful government—thank heavens—we must organize the society’s resources using the best machine we’ve got for discovering consumers’ interests and delivering on them: an unhampered marketplace, now energized and enhanced by the Internet.

What Was That Ronald Reagan Line Again?

The Washington Post editorializes this morning on the “Google-Verizon” proposal for government regulation of the Internet:

For more than a decade, “net neutrality” — a commitment not to discriminate in the transmission of Internet content — has been a rule tacitly understood by Internet users and providers alike.

But in April, a court ruled that the Federal Communications Commission has no regulatory authority over Internet service providers. For many, this put the status quo in jeopardy. Without the threat of enforcement, might service providers start shaping the flow of traffic in ways that threaten the online meritocracy, in which new and established Web sites are equally accessible and sites rise or fall on the basis of their ability to attract viewers?

What a Washington-centric view of the world, to think that net neutrality has been maintained all this time by the fear of an FCC clubbing. Deviations from net neutrality haven’t happened because neutrality is the best, most durable engineering principle for the Internet, and because neutral is the way consumers want their Internet service.

Should it be cast in stone by regulation, locking in the pro-Google-and-Verizon status quo? No. The way the Internet works should continue to evolve, experiments with non-neutrality failing one after another … until perhaps one comes along that serves consumers better! The FCC would be nothing but a drag on innovation and a bulwark protecting Google and Verizon’s currently happy competitive circumstances.

I’ll give the Post one thing: It represents Washington, D.C. eminently well. The Internet should be regulated because it’s not regulated.

“If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”

And Don’t Trust Politicians With Government Either

Senator Al Franken (D-Minn.) sent out an email today suggesting that WiFi is threatened by the Google-Verizon “deal” on ‘net neturality regulation.

The Google-Verizon framework was written so as not to apply to wireless Internet services,” says Franken. “If you use wi-fi or access the Internet on your phone, this is a serious problem.

This doesn’t exhibit a basic understanding of the technologies. WiFi is a wireless technology, but it’s not what they’re talking about when they say “wireless.” They’re talking about the communications services provided by wireless carriers. iPhones switch back and forth between AT&T’s service and WiFi pretty seamlessly, so the error is forgiveable—unless, say, you’re someone who claims authority to regulate these technologies.

But perhaps Senator Franken does not hold himself out as having that authority. What struck me about the missive is Senator Franken’s somewhat inverted take on power arrangements in the federal government:

This evening, I’ll be speaking at an FCC hearing in Minneapolis. I’ll urge the commissioners to reject the Google-Verizon framework, stop the Comcast/NBC merger, and take action to keep the Internet free and open.

Folks, Article I, section 1 of the United States Constitution creates the United States Senate, with section 3 describing the Senate’s makeup and some procedures.

The Federal Communications Commission is not a constitutional body. The best view is that Congress has no authority to establish an FCC like we have today. The better view is that Congress should not maintain the sprawling FCC we have today. And the only correct view is that FCC is a creation of Congress, beneath it in every relevant respect.

Senator Franken is supposed to oversee the FCC, not act as a supplicant, “urging” it to do x, y, and z.

Does it matter a lot? No. Senator Franken is mostly making a symbolic appeal to gin up constituent support. But he’s also symbolizing the abasement of the legislative branch to an independent agency that has no constitutional pedigree.

Cato’s Constitution Day conference is September 16th. Obvious issues like “Senator or Independent Agency: Who is the Boss of Whom?” won’t be on the docket….

Net Neutrality and Unintended Consequences

Google and Verizon’s proposed framework for net neutrality regulation has provoked cries of protest from advocates of aggressive regulation at places like Free Press and Public Knowledge. Some of the loudest objections have concerned the distinction between the “public Internet,” which (at least for wireline broadband) would be subject to neutrality requirements, and vaguely defined “differentiated” or “managed” services—presumably things like IPTV or digital telephone service—which would not. This, according to the pro-regulation camp, would amount to a massive loophole that defeats the purpose of imposing neutrality rules. As Public Knowledge writes in their press release:

Thus, it is conceivable under the agreement that a network provider could devote 90% of its broadband capacity to these priority services and 10% to the best efforts Internet. If managed services are allowed to cannibalize the best efforts Internet, whatever protections are agreed to for the latter become, for all intents and purposes, meaningless.

This may be right. But if so, it sounds like a reason to be chary of the whole regulatory project. Neutrality or no neutrality, after all, there are a variety of ways to get digital content from producers to subscribers. Traditionally, the cable running to your home comprised separate dedicated channels for cable TV and broadband Internet traffic—though the trend now is toward a more efficient model where the TV content is also delivered as packet-switched data. If you’d rather watch Jersey Shore from the Jersey Shore, you can stream your video to a mobile device like a tablet or smartphone via Internet, but that’s hardly the only way to get your Snooki fix: There’s also, for instance, Digitial Video Broadcasting Satellite to Handheld (DVB-SH) or Qualcomm’s MediaFLO operating on their own dedicated frequencies.  Imposing neutrality rules on wireless broadband (as the Google/Verizon proposal would not – again, to the dismay of regulation fans) shouldn’t affect these services.

My concern, then, is that if neutrality rules foreclose the possibility of cross-subsidy from the providers of subscription-based video streaming or VoIP services, these alternatives become more attractive. Maybe Netflix or Hulu Plus want to be able to offer a deal where your subscription price includes priority delivery of their packets to your smartphone or tablet, making non-WiFi video streaming feasible even if you haven’t sprung for that kind of top-shelf bandwidth for all your wireless data. If neutrality regulation forbids that kind of deal, even with respect to these kinds of “managed services,” one possible effect is to skew investment away from building out next-gen IP networks and toward these kinds of niche services, which strikes me as inefficient. Indeed, it’s precisely the effect Public Knowledge seems to fear, and there’s no obvious reason to suppose that it’s going to be a big problem within IP-based broadband services, but not affect the choice between alternative modes of digital content delivery.

I should close with the caveat that I haven’t looked very closely at the economics here, so while I think the effect I’ve just sketched is theoretically plausible enough, I couldn’t say with any confidence how significant it’s going to be in practice. That said, given that the case for neutrality regulation seems to rest on a smattering of genuine cases of bad behavior by providers and a whole lot of dire speculation about consumer-unfriendly practices that might emerge, I’ll permit myself a little extra latitude to deal in hypotheticals.

Internet Regulation: How About This Ad Hominem?

The New York Times starts its commentary on proposed Internet regulations with a clever ad hominem argument: “The Republican attack on the Federal Communications Commission’s proposal to classify broadband Internet access as a telecommunications service sounded a lot like the G.O.P. talking points on health care reform.”

The GOP are being like themselves. Accordingly, Times readers should think their viewpoint is yucky. It’s not the most substantive argument you’ll come across today.

There are good reasons not to encumber the Internet with regulations designed for the telephone system. Here are four: The Internet is not like the telephone system, and the FCC  doesn’t have the institutional ability to manage a changing, competitive system of networks. Extending “universal service” telephone taxes to the Internet will drive down adoption and frustrate universal service goals. The FCC is subject to capture by the very interests from which the Times thinks regulation would “protect.” The Internet’s large cadre of technologists and active consumers will do a better job than the FCC of protecting consumers’ interests. 

But ad hominem is more fun. So let’s ask why the New York Times didn’t disclose that, as a content provider, it has a dog in the fight? Net neutrality regulation would act as a subsidy to content providers like the Times, ultimately paid by consumers as higher prices for Internet access.

The FCC Doesn’t Have Authority to Regulate the Internet—and Shouldn’t

In the fall of 2007, word emerged that Comcast had degraded the Internet traffic of some customers, whose use of a protocol called BitTorrent interfered with other Comcast customers’ Internet access.

Comcast handled it badly, and sites like TechLiberationFront covered the “Comcast Kerfuffle” extensively. Consumers prefer unfiltered access to the Internet.

By springtime, Comcast had sorted things out and made a deal with BitTorrent to develop a neutral traffic-management protocol.

Four months later, the FCC weighed in, finding that Comcast had acted badly and telling Comcast not to do that again. Today the U.S. Court of Appeals for the D.C. Circuit concluded that the FCC exceeded its authority and reversed the FCC’s order against Comcast.

The court’s decision marks another turning point in the debate over whether the federal government should regulate Internet access services. What’s entertaining about it is that the problem was solved two years ago by market processes—sophisticated Internet users, a watchdog press, advocacy groups, and interested consumers communicating with one another over the Internet.

The next step will be for advocates to run to Congress, asking it to give the FCC authority to fix the problems of two years ago.  But slow-moving, technologically unsophisticated bureaucrats do not know better than consumers and technologists how to run the Internet. The FCC’s “net neutrality” hopes are nothing more than public utility regulation for broadband. If they get that authority, your online experience will be a little more like dealing with the water company or the electric company and a little less like using the Internet.

As I’ve noted before, Tim Lee’s is the definitive paper. The Internet is far more durable than regulators and advocates imagine. And regulators are far less capable of neutrally arbitrating what’s in the public interest than most people realize.

The FCC doesn’t have authority to regulate the Internet. Congress and the president shouldn’t give it that authority.

‘Search Neutrality’ Regulation?

For more technical audiences, I wrote recently on the Tech Liberation Front blog about Google’s claim to favor “openness” when, in fact, its crown jewels—search and ad serving—are closed systems.

Google is “free to be wrong about philosophy, of course,” I wrote. “It doesn’t matter at all—except when Google tries to impose its philosophy on others. And in the debate over ‘net neutrality’ regulation it has done exactly that.”

Now Google is in the sights of those proposing public utility regulation of Internet search. It would be entertaining ironic comeuppance for Google, but “search neutrality” regulation would ossify an innovative business and deprive consumers of the benefits of competition.