Sunday, June 04, 2006

Net Neutrality and Christopher Yoo's Paean to the Carriers

The carriers and their apologists gleefully point to Vandy professor Christopher Yoo's recent paper as "academic" proof that net neutrality need not be regulated. His article, entitled "Promoting Broadband Through Network Diversity," argues that carriers should be permitted to "experiment" with various network architectures.

Ignoring the fact that the cable industry reportedly funded the paper (which should tell us all we need to know about its assertions), its flagship example should send chills down most readers' spines:

One of the best current examples [of network competition] is the manner in which direct broadcast satellite (DBS) provider DirecTV is using an exclusive programming package known as “NFL Sunday Ticket” to enhance its ability to compete with cable television. Indeed, it appears that exclusive access to NFL Sunday Ticket constitutes one of the major factors helping DBS emerge as a viable competitor to cable.

The frightening aspect to this is that Yoo's key example is a pay-per-view-style (PPV) offering, the content and delivery of which are controlled by enormous corporations and not at all relevant or analogous to the democratic platform represented by the Internet.

Yoo's grand idea is apparently just that: turn the Internet into a model proven out by the cable companies. This would give a handful of corporate leviathans control of which content is permitted to reach consumers. And, using Yoo's example, there are very few choices in last-mile television. If we're lucky and happen to live in an urban environment, we've got a single cable provider to choose from and several satellite choices.

One need not be an academician to contrast cable TV, where a select few choose the approved "channels", with the most democratic media dispersion instrument in history: the Internet.

But Yoo's not finished with that bizarre analogy. Here's another gem:

Broadband policy would be better served if such efforts were directed towards identifying and increasing the competitiveness of the last mile, which remains the industry segment that is the most concentrated and protected by entry barriers.

Very true. Odd, then, that Yoo fails to mention the carriers' unceasing efforts to reduce competitiveness at the last-mile. Yoo carefully ignores: carrier suppression of municipal wireless roll-out efforts; heavy lobbying by the carriers to transfer local control of cable networks from municipalities to states; and the checkered history of the carriers' various promises of high-speed networks (that never seem to get fully deployed) in exchange for deregulation.

In other words, competition among last-mile offerings, which Yoo claims to endorse, has been hampered at every turn by a juggernaut he dares not mention.

Yoo also posits that investment in last-mile technologies won't be forthcoming if net neutrality is mandated:

In the process, network neutrality risks dampening incentives to invest in new last-mile technologies to the extent that it cements the existing last-mile oligopoly into place. Although such a policy might be justifiable if entry by alternative network capacity were impossible, it is indefensible when 3G, WiFi, WiMax, broadband over powerline (BPL), and other technologies are actively searching for capital to support their deployment and when what represents the state of the art in transmission is undergoing rapid technological change.

Funny, then, that all of these technologies have received significant and increasing investment over the last decade... all under the auspices of FCC-enforced net neutrality. Not much of a dampening effect, eh?

In fact, Yoo's paper strikes me as carrier-funded jibber-jabber that fails to address the most important components of the net neutrality discussion:

First, we have indisputable proof that the net-neutral Internet has created the most valuable and open communications architecture in the history of the world. Strike one: Yoo's paper fails to address this simple, irrefutable fact and instead points to cable as an aspirational example. That his paper was apparently funded by the cable industry is not the point. Does Yoo truly believe that cable is an examplar of network diversity principles when compared to the Internet? Presumably, he would permit tampering with this fragile value-creation machine for a model proven to reduce consumer choice.

Second, the carriers' efforts to suppress last-mile competition flies in the face of Yoo's core tenet. Strike two: Yoo's paper advocates last-mile competition and then studiously ignores its biggest stumbling block: the carriers themselves.

Third, last-mile investment has been on a massive upswing in spite of the carriers and the current state of net neutrality. The momentum for BPL, muni-wireless, content-provider wireless (e.g., the Google/Earthlink pairing), carrier wi-max, and related technologies has never been better. It will be quite a while before they are viable options for most Americans, but the pace of investment flies directly in the face of Yoo's assertion. Strike three: the mighty Yoo has struck out.

No comments: