What Airlines, The Mafia And The Law Of Unintended Consequences Can Teach Us About Net Neutrality

Mar 7 2014, 8:47am CST | by

`Net neutrality’ is a loaded term that means different things to different people. For companies whose business model relies on using somebody else’s Internet network as a distribution system, it means maintaining the Web as a common carrier like the old long-distance telephone system. For companies like Comcast, it means heavy-handed regulation that stifles investment in faster networks. For engineers, it can all seem like a distraction from the real job of getting America up to the gigabit speeds of other nations like Korea. This guest post is by Leonard A. Giuliano, a Working Group chair at the Internet Engineering Task Force (IETF), coauthor of “Interdomain Multicast Routing: Practical Juniper Networks and Cisco Systems Solutions” (Addison-Wesley 2002) and a Distinguished Engineer at Juniper Networks.  Giulano’s modest proposal is that carriers simply pick one way of carrying traffic and disclose it. The opinions expressed in this work are solely those of the author and do not reflect the position and was not approved, authorized or in any way sanctioned by any of the organizations with which he is affiliated.

By Leonard A. Giuliano

The most interesting aspect of the Net Neutrality debate is that both sides are essentially right.  Large carriers argue that differentiating traffic is vital to provide a good customer experience- treating voice and video differently than bulk data transfers, for example, is a fundamental precept in good network design.  After all, airlines offer priority class services to customers willing to pay a premium for which they receive a larger seat and a friendly flight attendant eager to deliver a refreshing glass of champagne and a warm towel (and in the process, cross subsidizing lower fares for coach class passengers).  But there are other models for service differentiation.  The Mafia, for example, offers “priority protection services” to customers with the implication that refusing to pay may result in bodily harm.  Carriers claim they should be able to provide the same type of service differentiation that airlines provide.  Content providers fear those differentiation services will inevitably evolve to resemble the Mafia model, where carriers will demand “protection money” to prevent their packets from being kneecapped.  Service differentiation could bring more choices, lower prices and a better experience for consumers… or it could bring an end to the Open Internet as we know it.

Worse yet, any solution of new rules or guidelines, whether enforced by the FCC or legislated by Congress, will most likely render the Neutrality medicine worse than the disease.  Even with the purest, most benevolent intentions, it is practically impossible to construct verbiage that wouldn’t have either the worst of unintended consequences or be totally meaningless.  Armies of lawyers on all sides stand at the ready to exploit any new rule or law along these two extremes.

One simple alternative that avoids these risks is transparency.  Carriers should be allowed to differentiate traffic however they desire as long as they disclose exactly what they are doing.  Additionally, carriers must provide a uniform policy of differentiation in all markets.  With these two simple rules, consumers will be empowered to decide the matter themselves.

Guidelines for transparency actually do exist and indeed were upheld in a recent court ruling.  But disclosure alone is insufficient without service uniformity do to the current competitive landscape for broadband services throughout the US.  In most markets, there are two broadband options, typically provided by the traditional phone company and the traditional cable company.  However, these carriers do not overlap in all areas.  For example, in some markets, Comcast competes with Verizon for broadband subscribers, while they compete with AT&T in other markets.  Likewise, Verizon competes with Comcast in some markets and Cox in others.  Further, in some markets only one broadband provider exists.  By mandating a carrier must provide a uniform set of traffic differentiation policies in all markets in which they operate, a carrier is prevented from offering a predatory differentiation policy in an area in which they might be the only game in town.  With this requirement, all carriers essentially compete with all other carriers, rather than the current monopoly/duopoly situation that exists in the vast majority of markets today.

Competition and a truly free market can only exist if consumers are informed and empowered to decide amongst competing providers.  To illustrate how this would work, imagine Carrier A competes with Carrier B in a particular market.  Carrier A decides to start throttling the throughput of popular third-party services like Netflix and Vonage, perhaps to bolster their own competing video and phone offerings.  With disclosure of such throttling, Carrier B can now attract Carrier A’s customers in this market with the promise of offering unfettered access to Netflix and Vonage.  Of course, Carrier B could also collude with Carrier A and deploy the same throttling policies, but Carrier C, which competes with Carrier B in a different market, could then steal Carrier B’s customers away.  In this way, Carrier A and Carrier C (and indeed all other carriers) compete with one another even though they may not be present in any of the same markets.  Again, there is the theoretical possibility that all carriers could collude and deploy the same throttling policies, but the number of broadband carriers, while most agree is smaller than ideal, is still large enough to make this unlikely.  The incentives are far stronger for, say, smaller carriers desperate to steal customers away from much larger carriers, to tout their ability to deliver the best experience for Netflix and Vonage users.  Finally, carriers may find dubious (shady) policies are not worth the negative publicity they may generate when they are disclosed, and thus prevent their practices in the first place.  “Sunlight is said to be the best of disinfectants.”

Of course, when it comes to transparency, the devil is in the details.  For disclosure to be of any value, it must be clear, simple and meaningful to typical consumers.  Meaningful disclosure might look something along the lines of “We place Netflix traffic in a special class which receives lower priority for bandwidth resources than the class used for standard Internet traffic.”  Transparency in these clear and simple terms would provide the consumer a basis for comparing services between different carriers.   From a technical perspective, the mechanisms operating under the covers to provide traffic differentiation and prioritization can be extremely complex, however, the resultant behaviors can generally be explained in the kind of clear and simple terms described in this example.  Some carriers may claim that such information is proprietary and divulging these details puts them at a competitive disadvantage.  However, explaining to customers what terms of service they can expect, especially with regard to thorny issues that approach the boundaries of predation, should not be considered a competitive disadvantage.  It can also provide carriers inoculation from false claims that they discriminate against certain traffic when in fact other conditions like network congestion or overloaded servers run by content providers are to blame for poor performance.  Moreover, this level of disclosure is far less onerous and potentially harmful to their business than some of the legislative options being pondered, especially given that all their competitors would follow these same rules.

“Don’t be evil” has become a popular motto, but the line between sound network design that provides the best experience for users and evil predatory practices can become blurry and difficult to judge.  With the simple requirements of transparency and service uniformity, the most powerful and just judge of all, the consumer, would get final say over the matter.

Source: Forbes Business


Don't miss ...


<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.


blog comments powered by Disqus

Latest stories

Finnish scientists identify new type of black hole
Helsinki, Oct 31 (IANS) Finnish researchers have discovered a new type of low-mass black hole, which is a bright celestial body that emits X-ray, the University of Turku has said.
Union Carbide ex-chief Warren Anderson is dead
Washington, Oct 31 (IANS) Warren Anderson, former chief executive officer of the Union Carbide Corporation, is dead, a media report said Friday. He was 92.
Himalayan Viagra fuels gold rush for local Tibetans
Washington, Oct 31 (IANS) Overwhelmed by people trying to find the prized medicinal fungus known as Himalayan Viagra, two isolated Tibetan communities have managed to implement a successful system for the sustainable harvest of the precious natural resource, suggests research.
Oceans were always there on Earth: Scientists
Washington, Oct 31 (IANS) Debunking previous theories that water came late to Earth well after the planet had formed, researchers have significantly moved back the clock for the first evidence of water on Earth and in the inner solar system.

Latest from the Network

Julia Stiles and Ray Liotta cast in Go With Me
Julia Stiles and Ray Liotta have been added to the cast of Anthony Hopkins' new film 'Go With Me'. The action-drama, which will begin shooting in mid-November, tells the story of a young woman who returns to her home...
Read more on Movie Balla
Seth Rogen to star in Steve Jobs biopic
Seth Rogen is in talks to star in Sony's Steve Jobs biopic. The 'Bad Neighbours' star is in negotiations with the studio to take on the role of Apple co-founder Steve Wozniak - who created the Apple I computer and co-...
Read more on Movie Balla
Jennifer Lopez has struggled to love herself
Jennifer Lopez say she's spent much of her life beating herself up for not being good enough. The 'Dance Again' hitmaker, who has six-year-old twins Max and Emme with her third ex-husband, Marc Anthony, puts a lot of...
Read more on Celebrity Balla
Julianne Hough's teary tribute to sister
Julianne Hough broke down in tears while praising her older sister. The 26-year-old singer/songwriter made an emotional speech in which she praised her older sister, Sharee Wise, admitting her sibling inspired her to...
Read more on Celebrity Balla
Tom Parker vows to look after Lindsay Lohan
Tom Parker has vowed to look after Lindsay Lohan. The former Wanted star is keeping a watchful eye over the 28-year-old actress as she performs in play 'Speed-the-Plow' in London because he wants to help the flame-...
Read more on Celebrity Balla
Kaley Cuoco-Sweeting fell for husband over animals
Kaley Cuoco-Sweeting knew her husband was 'The One' because he loves animals. The 'Big Bang Theory' star, who married tennis player Ryan Sweeting in December after just six months of dating, admits she fell in love with...
Read more on Celebrity Balla
Orson Welles last film to be released
Orson Welles' final movie will finally be released next year. The acclaimed filmmaker had worked on 'The Other Side of the Wind' - which chronicles a temperamental film director battling with the Hollywood establishment...
Read more on Movie Balla
Game of Thrones stars get pay rise
'Games of Thrones' cast members will be paid $300,000 an episode. Five of the shows biggest stars - Peter Dinklage, Kit Harington, Lena Headey, Emilia Clarke and Nikolaj Coster-Waldau - have landed bumper payrises after...
Read more on Celebrity Balla
Mike Tyson: I was abused
Mike Tyson claims he was sexually abused as a child. The 48-year-old retired boxer was ''snatched'' off the street when he was seven by an ''old man'', who he never saw again after the shocking one-time incident....
Read more on Celebrity Balla
Amanda Bynes released from psychiatric facility
Amanda Bynes has been released from a psychiatric treatment facility. The 'Easy A' actress was spotted walking around Sunset Strip, West Hollywood, last night (30.10.14), 19 days after she was admitted to the hospital...
Read more on Celebrity Balla