Fair enough. Which should we trust more, a big money ISP who already has questionable business practices and ethics, or politicians who have questionable practices and ethics? Way I see it is the less absolute power we give either of them, the less likely they are to abuse it, or at least will have a bit more eyesight towards abuse. Put them at odds and neither win.

Also as I said, I think municipalities and small providers should get an exception. That would be great for the ones complaining about overhead (literally the only argument against NN far as I've heard) while securing consumer protections. I believe access to information is key to our future as a society.

Repeal of Net Neutrality
 

The big money ISPs are in on the scam. It would shut down competition so they could divi up the market like cable and cell providers do and price fix to their hearts content. Politicians want in for the taxes they swear wont happen.

The fear mongering over free access is made up.

An answer to a problem that never was.


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Can you define how internet service is fundamentally different from cable or cell service and should be treated differently? Fwiw, cable tv has been completely disrupted by streaming services.

He has no clue, but I can tell you. Municipalities allow wire companies to run their services along public rights of way. The ONLY "rent" they can collect for this priceless access is from cable TV service, in the form of cable franchise fees. Telephone is a different class of service. For telephone, the municipality can recover the costs of providing 911 service and regulators can recover their costs. But under current federal and state rules, "data service", including video provided via Internet access, rides for free. Got it? Three classes of service are delivered on the same physical connection: one pays for the right of way, one pays for certain police and regulatory services, and the third pays zip.

The wire line companies have both feared and coveted the "free ride" enjoyed by Internet video. In theory, it allows "cord cutters" to access video services more cheaply than traditional cable. As cord cutting has become more popular, the various providers of Internet video have been gradually increasing their charges, in effect, collecting the municipality's rent as their own profit. The customer pays about the same, or even more if the service is unbundled. But the municipality loses it's revenue.

With net neutrality, the cable company really couldn't move into the cord cutter market in any major way, because it's product would be undifferentiated. But remove net neutrality, and they can dip into the revenue of the independent video sources. That frees them to offer Internet video to cord cutters and capture the "municipality rent". Competitors could do the same, BUT they would also have to pay a premium to the cable company. The cost can only be passed to their customers. So the cable company would take the municipality's rent and part of their competitors revenue. That's why AT&T has invested in DirectTV. And that's what this is all about. The big losers will be municipalities (because residual CATV customers will be migrated to net video) and individual consumers. And the alternative providers will be priced out of their own market. Repealing net neutrality is about as anti-competitive as it gets.

Repeal of Net Neutrality
 

Sure Frank, assume I don't. It changes nothing. The infrastructure was already there and its being used in a way it was not designed at the fault of the designers. Data can also be transmitted over the air.

The "rides for free" doesn't apply if existing networking is being used and isn't being interrupted. I pay for my power and phone to be connected to my house. What I do with it is irrelevant. So your saying anyone who has a server in their house should have to pay access fees? They already are. To the phone and power companies.

Take it from the "utilities" perspective (as Dubyagee has pointed out is really a legal monopoly granted by the government to a company).

As a freemarketeer, I don't mind monopolies at all except when they play footsie with the government. You know, when a private company (say, Ma Bell) is granted special privileges. Is it any wonder the glacial pace of innovation under Ma Bell, and the fantastic explosion of communication since the breakup?

So that's my bias. Free market. So yeah, I do have a side.

OTOH, I find the argument about net neutrality not so simple to understand. Media companies are getting into the provider business and providers are getting into media.

Somebody once tried to explain it to me as a pipeline, in which the pipeline company squirts whatever product at some price per unit pumped. As I understand the argument, net neutrality wants all product pumped at the same rate and price while the other folks want the pipeline to set prices based on market demand.

Is that a fair description?

Given that it has nothing to do with what "the internet" is and has been since it's conception its not a description at all.

- Peter.

So substitute a better analogy. And/or describe where the above analogy fails

Asserting it is wrong is easy.

The best analogy would be as what it always was concieved of. An information superhighway. Analagous to the autobahn or interstate. Users of which are presented with a level playing field because no particular entity is allowed to grab ownership of them. That will not be the case with the repeal of net neutrality when the internet ceases to exist and becomes the private preserve of profit driven corporations.

- Peter.

Repeal of Net Neutrality
 

It has always been at the control of companies who provide access. It was "the internet" then as it will always be. No supervision required. Fear mongering is all this NN is.

The data belongs to the authors. The infrastructure is already there. This "super highway" exists because of the people using it. You make it sound like its all going to collapse without the governments help.

No, market demand has nothing whatsoever to do with setting access rates. In your model, imagine that the pipeline company is a common carrier, with a legal obligation to provide transport to all comers. But it also owns most of the oil wells. With "pipeline neutrality", the pipeline company has to set the public rate to be comparable to it's internal chargeback rate. Without "pipeline neutrality", the pipeline company can use it's rate structure to crush the business of competing oil producers.

By accident of history and technology, a wireline provider delivers it's own products...telephone and TV, on the same physical wire as Internet. For decades, phone and TV paid the cost of the wire, and net connection was just a bit of added revenue. The regulatory regime that's grown over the last 70 years or so barely addresses net services, and so cost recoveries are an afterthought. But technology and bandwidth now allow TV and phone to be delivered over the net, and companies like Amazon, Netflix, Hulu, and Vonage have been providing phone and CATV replacement services. That's called competition. But every customer that turns away from traditional telephone or CATV threatens the revenue and cost structure of the physical network, that's the other side of competition. So the wireline provider wants to recapture that revenue, and the way they want to do it is to use access pricing to increase their competitor's cost. Repeal of net neutrality allows them to do that, it's about as anti-competitive as it gets. If you're really a free marketer, then you should be outraged.

(As a side note, there are no legal monopolies. It was recognized in the 20's that telephone networks devolve naturally into defacto monopolies because interconnection is difficult, plant is expensive and the customer pool is finite. So a regulatory regime was established where the phone companies were gently treated from the viewpoint of anti-trust, but rates were set in an adversarial hearing process. In fact, there was never a legal guarantee against anti-trust prosecution, see MCI vs ATT, Carterphone, etc)

I see what you mean. But I think the highway analogy fails because Interstates are public property and networks are not. Isn’t that correct? Well, I guess if we include the electromagnetic spectrum then we know that the gov regulated aspects of the EM. I guess that is analogous to the highway. But wait, I’m losing track here. What is analogous to the provider?

No, the interstate fails.

What was wrong with the pipeline analogy?

thanks for the detailed explanation. I have not thought that deeply. It will take time.

Concerning utilities vs monopoly, what you wrote is an explanation of why the government grants a legal monopoly. Personally, I don’t give a damn if competitors overbuild and go broke. I benefit because prices drop.

Your description does not present an inherent difference between a monopoly and a utility other than government sanctioning. Exactly my point. Lots of companies compete for the same infrastructure. Like say, cellphone companies. Cellphone towers are expensive. From a monopolist (or utility) perspective, oodles of money could be saved by granting regional monopolies. Same with airlines. We have too many serving the same routes. Etc.

Government has created a legal monopoly that benefits the monopoly, not the citizen.

Nobody has a legal monopoly. AT&T was broken up in '83, after legal action that went all the way back to '49. The government tolerates defacto utility monopoly only where there is a transparent, adversarial process for setting rates. But in the last 40 years, there has been a rolling deregulation experiment which tries to introduce limited competition to allow market based rates. It hasn't worked very well, in my opinion.

The tell of a true monopoly is the rate setting process. Market rates imply a relationship between supply and demand. In the case of telecom, the supply is essentially infinite, so rates are set for every reason under the sun. But the hoped for supply/demand effect isn't among them.

You say nobody has a legal monopoly and then say the gov tolerates de facto monopolies. There's a tortured logic in there trying to escape.

The general solution to the a problem created by regulation is less regulation, in my opinion.If partial deregulation is floundering then deregulate and let the market determine how it reforms.

I heard an NPR interview of the FCC chairman concerning this issue. He argued that "net neutrality" is a misnomer. The regulations, in his opinion, stifle innovation on the provider side He argues that the best way to get networks into underserved communities is to allow a free-for-all fight among providers to wire the last remaining underserved areas: some metropolitan neighborhoods and rural areas. According to him, "net neutrality" provides no incentive to wire underserved areas.

The issue of the pipeline company also owning refineries and oil wells is a good point. For some reason, oil production companies don't like owning pipelines but do like owning refineries. I don't get it. Concerning pipelines, I think they actually will transport any fluid from any origin compatible with their infrastructure. Many of the local ones are dedicated -- to or from a particular refinery. But the big pipes from say, Texas to NJ carry multiple products from various sources. I do not know their pricing structure but I bet it is like an electric utility, which has one price for small customers and decreasing prices for larger customers.