Wednesday, December 03, 2014

NET NEUTRALITY: Which set of crony capitalists do YOU prefer?

Net neutrality is not the simple "government intervention versus laissez-faire" debate so depicted by both Republicans and Democrats. Net neutrality, once you peel the onion, is really a dog-eat-dog battle between the incumbent cable/telephone monopolies (often referred to as "the duopoly") and Internet application providers, ranging from Google to the smallest start-ups.

Put simply, net neutrality pits one set of crony capitalists against another.

The question Americans need to ask is: which crony capitalists benefit consumers more: a second-generation Ma Bell monopoly or the entire ecosystem of Internet start-ups, the list of which would require an Access database to track.

In fact, net neutrality really involves a couple of fairly simple questions that require a deeper analysis than the 12-second soundbite that today's consumers often demand.

Should the cable-telephone duopoly be permitted to speed up and slow down the Internet traffic of different application providers in order to extract more revenue? Or should they instead be required to ask consumers to pay for faster bandwidth in an application-agnostic way?

The crony capitalists on the cable-telephone side insist that the government let them do what they want to application providers. This would allow Comcast, for instance, to slow down Netflix delivery to consumers so that either the video provider pays extra fees... or else. Further, Comcast could launch its own competitive video service while degrading Netflix.

Conversely, the crony capitalists among the Internet application providers -- from Google to Lyft -- want the government to ensure a level playing field. They believe that the likes of Comcast should not be allowed to pick-and-choose winners and losers; consumers should.

This begs the question:

Is Internet service a utility, like energy, water or sewer lines?

Given heavy lobbying by the duopoly at the local level, most American consumers have only one choice when it comes to high-speed Internet access. A relatively small percentage of households, even those in heavily populated areas, have only two distinct choices for Internet access.

The duopoly asserts that cable and telephone companies are simple, private entities and should not be regulated in regards to Internet traffic.

Alternatively, the Internet application community contends that Internet pipes are indeed a utility and deserve similar treatment.

What is the duopoly really after?

Best I can tell, cable-and-phone companies seek to turn the Internet into a cable-style offering. They intend to pick and choose winners and losers, extract tariffs, create their own competitive offerings, and -- in general -- make the Internet miserable to use.

I say that because of their track record: in their industry "Comcast was ranked the worst and Time Warner Cable was rated the second worst in customer service."

What are the Internet application providers after?

Again, from what I can deduce, Internet application providers are after a level playing field. They want the Internet to remain free from discrimination by the duopoly to ensure that the next Google, or AirBnb, or Uber, can grow unimpeded.

I bring all of this up because Comcast and Time Warner are busy "re-educating the public" about the advantages of a merger between the two giants.

You can just imagine what customer service will be like if that happens.

And what of those who say that the duopoly would never, ever degrade traffic because it would be bad for business?

Comcast was among the first and worst when it comes to throttling users' internet connection. It long justified this claiming that it was only throttling heavy torrent users, content which it argued was mostly illegal. But court documents in opposition of the merger filed by Netflix, Inc. (NFLX) asserted that Comcast used heavy throttling to prevent users from open access to legal paid streaming video.

After its service was degraded to sub-VHS (less than 480p) quality, Netflix was eventually forced to pay Comcast additional fees for access, which has raised the cost of Netflix's services. Comcast could succeed in such extortionist tactics thanks to its size and dominance of many regional markets. And if it could do that with its current market share, imagine what it could do if it tacked on TWC and grew 50%.

Think of Tony Soprano uttering, "That's some nice traffic ya got there, Netflix - it'd be a real shame if anything happened to it on the way to the consumah."

What is the real "net neutrality" decision for Americans?

It boils down to one question: who do you trust more? Do you trust the cable-telephone duopoly, which has a horrific record of customer service, to do the right thing?

Or do you trust the Internet ecosystem, which has thrived and created trillions of dollars of value for the American economy?

Hat tip: BadBlue Tech News. Relate: Enforcing net neutrality with a two-by-four.


Anonymous said...

The internet in many cases has become a bathroom wall, it has given respectability to the uninformed opinion. When Goobermint queers this manipulable milieu with taxes I'll walk away.

Anonymous said...

This one is so easy its ridiculous.

You have the federal government wanting to control the internet and fearmongering all the horrible things that will happen if you don't give them control.

All you have to do to destroy that argument is point out that there is no federal control of it now, so why haven't all those horrible things already happened??

Simple enough even some liberals might pause before resuming their love for government control of absolutely everything.

You can approach it the other way too - pretty much everyone loves the internet, right? 'Do you like the internet as it is now?' yes 'so, why would you risk it by giving the feds control of it?'

You can come at liberals using their hatred of capitalism against them: just point out the corporations that are funding the push for net neutrality.