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

Mali confirms two new Ebola cases
United Nations, Nov 26 (IANS) Mali has confirmed two new cases of Ebola, bringing to total number of cases in the West African nation to eight, days ahead of the opening of a new UN Ebola response office.
 
 
Merkel warns of recession in Europe
Berlin, Nov 26 (IANS) German Chancellor Angela Merkel Tuesday warned that Europe could slide back into recession, media reported.
 
 
India, Nepal ink nine deals; Modi inaugurates trauma centre, bus service (Roundup)
Kathmandu, Nov 25 (IANS) Nepal's happiness "gives us joy", Prime Minister Narendra Modi said here Tuesday on his second visit to the Himalayan country in 100 days as both sides inked nine agreements, further cementing their close ties.
 
 
India, Nepal ink 10 deals; Modi inaugurates trauma centre, bus service (Intro Roundup)
Kathmandu, Nov 25 (IANS) Nepal's happiness "gives us joy", Prime Minister Narendra Modi said here Tuesday on his second visit to the Himalayan country in 100 days as both sides inked 10 agreements, including on $1 billion assistance to Nepal.
 
 
 

Latest from the Network

Taylor Swift cautious of fake friends
Taylor Swift has no time for fake friends. The 'Shake It Off' hitmaker says she's not interested in being friends with people who are only keen on spending time with her because she's rich and famous. She explained: ''...
Read more on Celebrity Balla
 
Cyber Monday Deals better than Black Friday Deals?
Black Friday 2014 Sales are underway. We count over 12 Black Friday 2014 sales that either have fully launched or offer a selection of the advertised Black Friday deals. Each year there is discussion about if Black...
Read more on Black Friday Countdown
 
Shia LaBeouf abides by plea deal
Shia LaBeouf is abiding by the plea deal he reached with Manhattan prosecutors after his drunken meltdown in June. The 'Fury' actor appeared in Manhattan Criminal Court earlier today (25.11.14) to submit proof he's been...
Read more on Celebrity Balla
 
The Best Laptop Deal in Black Friday 2014
Black Friday 2014 is here and the first Black Friday 2014 Sales are already underway. The full push of Black Friday 2014 deals happens on Thanksgiving Day. So there is still a little time to make your shopping lists. If...
Read more on Black Friday Countdown
 
Cheryl Fernandez-Versini blasts Simon Cowell over weight comments
Cheryl Fernandez-Versini has blasted Simon Cowell for commenting on her weight. The 31-year-old beauty said it was ungentlemanly for a man in his 50s to suggest she'd gained weight prior to her brief appearance on the...
Read more on Celebrity Balla
 
Nick Cannon denies links to Amber Rose
Nick Cannon has denied having any romance with Amber Rose. The 34-year-old entertainer recently separated from Mariah Carey, whom he married in 2008, and has since been romantically linked to Amber Rose, 31, who filed...
Read more on Celebrity Balla
 
The Best TV Deals on Black Friday
Black Friday is one of the best times to buy TVs. It is the best time to get your hands on bargain TV deals like a $79 32-inch TV or a $119 40-inch TV. You see such deals never during the year. You also do not see such...
Read more on TV Balla
 
The Best Black Friday 2014 iPad Deals
The Amazon Black Friday 2014 Sale has been released. The Amazon Black Friday 2014 begins earlier than ever before. In past years the Amazon Black Friday deals week started on Sunday.Besides Amazon, Walmart has kicked...
Read more on Apple Balla
 
Early Access Target Black Friday Sale is Wednesday
Best Buy is offering 20 Black Friday 2014 Deals in an early access sale and tomorrow it is Target's turn. Target will release a selection of advertised Black Friday 2014 deals on Wednesday, Nov. 26 online and in stores....
Read more on Black Friday Countdown
 
Algeria steps vigillance on Libyan border over terror threat
Algiers, Nov 26 (IANS) Algerian army have stepped up vigillance along the borderline with Libya over reports of potential terror attacks, a security source revealed Tuesday. The source specified that both Algerian and...
Read more on Politics Balla