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Thread: Issue: Internet: FTC abandons net neutrality

  1. #1

    Issue: Internet: FTC abandons net neutrality

    Ok, here's one of those times where I don't have an answer and would like to try to learn more about a subject by discussing it.

    http://www.vnunet.com/vnunet/news/21...net-neutrality

    The Federal Trade Commission (FTC) has decided to abandon net neutrality and allow telecoms companies to charge websites for access.

    The FTC said in a report that, despite popular support for net neutrality, it was minded to let the market sort out the issue.

    This means that the organisation will not stand in the way of companies using differential pricing to make sure that some websites can be viewed more quickly than others. The report also counsels against net neutrality legislation.

    "This report recommends that policy makers proceed with caution in the evolving dynamic industry of broadband internet access, which is generally moving towards more, not less, competition," FTC chairman Deborah Platt Majoras wrote.

    "In the absence of significant market failure, or demonstrated consumer harm, policy makers should be particularly hesitant to enact new regulation in this area."
    Now the thing is, the FTC is saying that there is no evidence that there would be harm to consumers, but there might be some serious harm to small websites trying to get their word out.

    People who run websites already have to pay for bandwidth, so what new charges will they have to pay?

    I never did entirely get the net neutrality argument or why huge internet content providers started going ape$#@! recently.

    If I were starting up a website and wanted to offer customers some sort of content, why should I be worried about this FTC ruling?



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  3. #2
    This is definitely bad news because denying Net Neutrality will only help the "power players" while increasing the barriers to entry for the newcomers. Basically, if you're planning to start an internet business that may pose competition to popular websites, I.S.P.'s will handicap you by making you or the consumer PAY to view your content. At least thats what I've understood from this issue.

    - D.O.

  4. #3
    So by "pay" you mean pay separate fees, apart from the monthly user fees of the consumer and the bandwidth fees of the content provider?

    I mean everyone already pays to use and access the internet. What other fees will they tack on?

  5. #4
    The telcos want a tiered pricing model, where people can pay more or higher speed and less for less speed. Thats generally a smart thing to do for both customers (in general) and business. The real fear is of course that they will rip people off. But there is already anti-trust legislation in place to deal with that, the whole net neutrality thing isn't really as much of an issue as people make it out to be.

  6. #5
    Quote Originally Posted by Mesogen View Post
    So by "pay" you mean pay separate fees, apart from the monthly user fees of the consumer and the bandwidth fees of the content provider?

    I mean everyone already pays to use and access the internet. What other fees will they tack on?
    I don't know the details of it off the top, but I wrote a lengthly piece on my blog that explains everything and what it means for the average net surfer.

    - D.O.

  7. #6
    I liked it when you had the black background better. It's much easier to read.



    There are many articles online about this. This was from today or yesterday on boingboing.
    http://www.boingboing.net/2007/07/08...delaminat.html


    Quote Originally Posted by Gee View Post
    The telcos want a tiered pricing model, where people can pay more or higher speed and less for less speed. Thats generally a smart thing to do for both customers (in general) and business. The real fear is of course that they will rip people off. But there is already anti-trust legislation in place to deal with that, the whole net neutrality thing isn't really as much of an issue as people make it out to be.
    Websites already pay for bandwidth. You pay more for more bandwidth and less for less bandwidth.

    You are saying they will charge what they charge now for low speed and low bandwidth and charge even more if websites want to keep their current speed and bandwidth. All the while, there are no competitors to run to because of the monopolistic system put in place with the help of the government.

    People keep saying "let the free market work itself out," but there is no free market when it comes to the internet or telecommunications.

  8. #7
    Quote Originally Posted by Mesogen View Post
    Websites already pay for bandwidth. You pay more for more bandwidth and less for less bandwidth.

    You are saying they will charge what they charge now for low speed and low bandwidth and charge even more if websites want to keep their current speed and bandwidth. All the while, there are no competitors to run to because of the monopolistic system put in place with the help of the government.

    People keep saying "let the free market work itself out," but there is no free market when it comes to the internet or telecommunications.
    Yes, but there are already laws in place that can deal with that without having to regulate internet protocols and ISP pricing schemes. They've always been able to charge more money anyways, the availability of a tiered pricing scheme doesn't suddenly give them the power to rip people off.

  9. #8
    What are people getting so upset about then?

    By "people" I mean google, yahoo, amazon, etc.

    Why are these people so worried? They know how the internet works and they are afraid of something. What is it?



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  11. #9
    Quote Originally Posted by Mesogen View Post
    What are people getting so upset about then?

    By "people" I mean google, yahoo, amazon, etc.

    Why are these people so worried? They know how the internet works and they are afraid of something. What is it?
    I think the people who use huge amounts of bandwidth might end up paying more for it, like google, amazon and yahoo. I'm not entirely sure. One thing I do know is that it is odd to discuss regulation for something before you even know what is going to happen (i.e., the solution is being put before the problem).

  12. #10
    I'm not saying we need net neutrality regulation right now.

    I'm trying to figure out what the big problem is (or would hypothetically be).

    It seems like a battle between big content providers and big telcos, both of whom are putting out spin and disinfo to make their case.

    That's why I don't get it. They speak in generalities and I'd like to learn some specifics. That would give me a better idea. I try to look for articles or websites that will give me some details, but I just get vague generalities.

  13. #11
    Basically, the problem is this: Network providers like AT&T don't like to build more network capacity, because it costs them money. So lets say they have a 45MBit T3 line to the internet and on that line they have, I don't know, 200 customers with 1.5MBit DSL lines. So obviously these customers can't each be using the full 1.5MBit at once, because 300MBit > 45MBit. That's okay though, because not all 200 customers will want to be using the full bandwidth of their connection at the same time. As long as the total usage during peak hours is less than 45MBit, AT&T doesn't have to spend money to install a faster pipe to the internet.

    However, over time network usage tends to go up. When DSL first came around, it was replacing dialup and everybody was just visiting web pages that had text on them. Now everybody is visiting Youtube and using BitTorrent to distribute Ron Paul videos and people are using more bandwidth. Now the problem is, if the amount of data its users are transferring exceeds the capacity of its connection to the rest of the internet, they have to drop some packets. When they do that, the endpoints just resend them, but then they take longer to get there. This is especially a problem with interactive stuff like streaming video. In that case the video gets choppy and customers start complaining. The proper course of action is then for AT&T to open its wallet and build a faster pipe to the internet so that customers will have the bandwidth they paid for.

    Except that AT&T *hates* to open its wallet. So what they want to do is, instead of expanding capacity to meet demand, they want Youtube to pay them for priority so that their videos won't be choppy. So then Youtube pays AT&T to keep from going out of business, and instead of dropping Youtube packets, AT&T drops some other packets instead. This makes the problem even worse for anyone who isn't paying this AT&T extortion fee, because now even more of their packets are getting dropped. So all the big companies on the internet, who already paid for *their* internet connections, now have to pay every ISP for *your* internet connections, even though *you* already paid for it. Worse, all the little guys who can't afford this toll get most of their traffic dropped -- and that includes all P2P traffic. So now when you want to go download that Ron Paul DVD using BitTorrent, instead of it taking 4 hours to download, it takes 2 months. And that little company that would have been the next Google can never get started because nobody can use their service when 80% of the packets get dropped.

    People keep saying "let the free market work itself out," but there is no free market when it comes to the internet or telecommunications.
    That's exactly the problem. The cable companies and telcos often have exclusive rights to the right of way, and even when they don't, the government has given them hundreds of billions of dollars in subsidies to build their networks. The rest of the market can't compete with that level of government interference. And when you have a government-created monopoly, the government needs to either regulate it or eliminate it. Net neutrality is choosing to regulating it. Sad as it is, that's probably easier than eliminating it -- at least in the medium term. In the longer term, converting more wireless spectrum to internet access and providing easier access to the public right of way may give competitors an incentive to come into the market, but building anything of that sort would require years of roll out, assuming anyone is even interested in competing with telcos that have already received hundreds of billions of taxpayer dollars in subsidies.

  14. #12
    Quote Originally Posted by Mesogen View Post
    I liked it when you had the black background better. It's much easier to read.



    There are many articles online about this. This was from today or yesterday on boingboing.
    http://www.boingboing.net/2007/07/08...delaminat.html




    Websites already pay for bandwidth. You pay more for more bandwidth and less for less bandwidth.

    You are saying they will charge what they charge now for low speed and low bandwidth and charge even more if websites want to keep their current speed and bandwidth. All the while, there are no competitors to run to because of the monopolistic system put in place with the help of the government.

    People keep saying "let the free market work itself out," but there is no free market when it comes to the internet or telecommunications.
    Thanks for the tip, I changed it because some of the text was black and might confuzzle the reader.

    And I believe you are correct, internet and telecommunications is not a free market, it is a service used to reach a market.

    - D.O.
    Last edited by Defining Obscene; 07-10-2007 at 11:37 PM.

  15. #13
    Does Ron Paul have a position on this? I think he's been asked and admitted this was an issue he didn't know much about.

  16. #14
    Quote Originally Posted by Montana View Post
    However, over time network usage tends to go up. When DSL first came around, it was replacing dialup and everybody was just visiting web pages that had text on them. Now everybody is visiting Youtube and using BitTorrent to distribute Ron Paul videos and people are using more bandwidth. Now the problem is, if the amount of data its users are transferring exceeds the capacity of its connection to the rest of the internet, they have to drop some packets. When they do that, the endpoints just resend them, but then they take longer to get there. This is especially a problem with interactive stuff like streaming video. In that case the video gets choppy and customers start complaining. The proper course of action is then for AT&T to open its wallet and build a faster pipe to the internet so that customers will have the bandwidth they paid for.
    This is where I get lost. At this point why not just charge more for internet access? If people on average are using more bandwidth then shouldn't the price go up? ISP's are giving away more product.. a simple cost increase should follow. Now that they have increased revenue they can afford the needed upgrades and keep up with demand.

    It doesn't make any sense that a content provider should be charged more for giving away more product per person (don't we charge more when we give more?), the cost should go to the consumer who is consuming more of the product.

    In a truly free internet market hosts wouldn't pay for bandwidth at all eliminating barriers to entry to bring the most products to compete in the market.

    The tiered system and fees should be on the consumer and should be an expansion of what is in place now. 56k, cable, dsl.. but in addition you get X download gigs per month. So you can have dsl with 5 gig, 10 gig, 50 gig a month options, etc. and repeat for each access speed.
    Last edited by SwordOfShannarah; 07-11-2007 at 12:07 AM.

  17. #15
    Quote Originally Posted by Montana View Post
    Basically, the problem is this: Network providers like AT&T don't like to build more network capacity, because it costs them money. So lets say they have a 45MBit T3 line to the internet and on that line they have, I don't know, 200 customers with 1.5MBit DSL lines. So obviously these customers can't each be using the full 1.5MBit at once, because 300MBit > 45MBit. That's okay though, because not all 200 customers will want to be using the full bandwidth of their connection at the same time. As long as the total usage during peak hours is less than 45MBit, AT&T doesn't have to spend money to install a faster pipe to the internet.

    However, over time network usage tends to go up. When DSL first came around, it was replacing dialup and everybody was just visiting web pages that had text on them. Now everybody is visiting Youtube and using BitTorrent to distribute Ron Paul videos and people are using more bandwidth. Now the problem is, if the amount of data its users are transferring exceeds the capacity of its connection to the rest of the internet, they have to drop some packets. When they do that, the endpoints just resend them, but then they take longer to get there. This is especially a problem with interactive stuff like streaming video. In that case the video gets choppy and customers start complaining. The proper course of action is then for AT&T to open its wallet and build a faster pipe to the internet so that customers will have the bandwidth they paid for.

    Except that AT&T *hates* to open its wallet. So what they want to do is, instead of expanding capacity to meet demand, they want Youtube to pay them for priority so that their videos won't be choppy. So then Youtube pays AT&T to keep from going out of business, and instead of dropping Youtube packets, AT&T drops some other packets instead. This makes the problem even worse for anyone who isn't paying this AT&T extortion fee, because now even more of their packets are getting dropped. So all the big companies on the internet, who already paid for *their* internet connections, now have to pay every ISP for *your* internet connections, even though *you* already paid for it. Worse, all the little guys who can't afford this toll get most of their traffic dropped -- and that includes all P2P traffic. So now when you want to go download that Ron Paul DVD using BitTorrent, instead of it taking 4 hours to download, it takes 2 months. And that little company that would have been the next Google can never get started because nobody can use their service when 80% of the packets get dropped.

    That's exactly the problem. The cable companies and telcos often have exclusive rights to the right of way, and even when they don't, the government has given them hundreds of billions of dollars in subsidies to build their networks. The rest of the market can't compete with that level of government interference. And when you have a government-created monopoly, the government needs to either regulate it or eliminate it. Net neutrality is choosing to regulating it. Sad as it is, that's probably easier than eliminating it -- at least in the medium term. In the longer term, converting more wireless spectrum to internet access and providing easier access to the public right of way may give competitors an incentive to come into the market, but building anything of that sort would require years of roll out, assuming anyone is even interested in competing with telcos that have already received hundreds of billions of taxpayer dollars in subsidies.

    That explains a lot...
    Live Free or Die...

    "I Killed The Bank!" -Andrew Jackson
    "I Killed The Bank Again!" -Ron Paul

  18. #16
    Quote Originally Posted by Devil_rules_in_extremes View Post
    That explains a lot...
    It does but not totally. Why does AT&T have the option to simply tier service rather than expand to meet overall demand?

    They are the backbone, they get tons of money to help them be the backbone. Why aren't they required to keep up? Most monopolies are created to provide a service everyone needs and to keep up with public demands. If we were running out of water they wouldn't start charging more for assured access, they would find a way to deliver more water. Why isn't this the same?
    Last edited by SwordOfShannarah; 07-11-2007 at 03:00 AM.



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  20. #17
    Quote Originally Posted by Montana View Post
    Basically, the problem is this: Network providers like AT&T don't like to build more network capacity, because it costs them money. So lets say they have a 45MBit T3 line to the internet and on that line they have, I don't know, 200 customers with 1.5MBit DSL lines. So obviously these customers can't each be using the full 1.5MBit at once, because 300MBit > 45MBit. That's okay though, because not all 200 customers will want to be using the full bandwidth of their connection at the same time. As long as the total usage during peak hours is less than 45MBit, AT&T doesn't have to spend money to install a faster pipe to the internet.

    However, over time network usage tends to go up. When DSL first came around, it was replacing dialup and everybody was just visiting web pages that had text on them. Now everybody is visiting Youtube and using BitTorrent to distribute Ron Paul videos and people are using more bandwidth. Now the problem is, if the amount of data its users are transferring exceeds the capacity of its connection to the rest of the internet, they have to drop some packets. When they do that, the endpoints just resend them, but then they take longer to get there. This is especially a problem with interactive stuff like streaming video. In that case the video gets choppy and customers start complaining. The proper course of action is then for AT&T to open its wallet and build a faster pipe to the internet so that customers will have the bandwidth they paid for.

    Except that AT&T *hates* to open its wallet. So what they want to do is, instead of expanding capacity to meet demand, they want Youtube to pay them for priority so that their videos won't be choppy. So then Youtube pays AT&T to keep from going out of business, and instead of dropping Youtube packets, AT&T drops some other packets instead. This makes the problem even worse for anyone who isn't paying this AT&T extortion fee, because now even more of their packets are getting dropped. So all the big companies on the internet, who already paid for *their* internet connections, now have to pay every ISP for *your* internet connections, even though *you* already paid for it. Worse, all the little guys who can't afford this toll get most of their traffic dropped -- and that includes all P2P traffic. So now when you want to go download that Ron Paul DVD using BitTorrent, instead of it taking 4 hours to download, it takes 2 months. And that little company that would have been the next Google can never get started because nobody can use their service when 80% of the packets get dropped.

    That's exactly the problem. The cable companies and telcos often have exclusive rights to the right of way, and even when they don't, the government has given them hundreds of billions of dollars in subsidies to build their networks. The rest of the market can't compete with that level of government interference. And when you have a government-created monopoly, the government needs to either regulate it or eliminate it. Net neutrality is choosing to regulating it. Sad as it is, that's probably easier than eliminating it -- at least in the medium term. In the longer term, converting more wireless spectrum to internet access and providing easier access to the public right of way may give competitors an incentive to come into the market, but building anything of that sort would require years of roll out, assuming anyone is even interested in competing with telcos that have already received hundreds of billions of taxpayer dollars in subsidies.
    This pretty much hits it on the head, probably faster than my blog entry.


    I guess a shorthand way of saying this is, the Internet is becoming like cable television, and people are weary of whether or not they will be getting HBO, STARZ, SHOTIME, etc., or downgraded to basic cable and no alternative, except lots of static.


    - D.O.

  21. #18
    Quote Originally Posted by Defining Obscene View Post
    This pretty much hits it on the head, probably faster than my blog entry.


    I guess a shorthand way of saying this is, the Internet is becoming like cable television, and people are weary of whether or not they will be getting HBO, STARZ, SHOTIME, etc., or downgraded to basic cable and no alternative, except lots of static.


    - D.O.
    So helpful guys- thanks for taking the time to make these posts to help me understand.
    Last edited by SwordOfShannarah; 07-14-2007 at 01:04 AM.

  22. #19
    Just FYI, Ron Paul is AGAINST government mandated Net Neutrality. And I am glad he is.

    Net Neutrality lets the govt gets its greedy little hands on the internet and start regulating it. I don't want that. Ron Paul doesn't want that. It is another example of something that *sounds* like a good idea; but the govt has proven time and time again that they only make things worse.

    But don't take my words for it; here is RP on this subject on the house floor:
    http://www.youtube.com/watch?v=6b7_h_OyTI0

  23. #20
    The ISPs basically want to limit your access to the internet. If ISP A makes a deal with Amazon, they will charge the users additional money to access Barnes & Noble or some other competing website.

  24. #21
    Quote Originally Posted by Montana View Post
    Basically, the problem is this: Network providers like AT&T don't like to build more network capacity, because it costs them money. So lets say they have a 45MBit T3 line to the internet and on that line they have, I don't know, 200 customers with 1.5MBit DSL lines. So obviously these customers can't each be using the full 1.5MBit at once, because 300MBit > 45MBit. That's okay though, because not all 200 customers will want to be using the full bandwidth of their connection at the same time. As long as the total usage during peak hours is less than 45MBit, AT&T doesn't have to spend money to install a faster pipe to the internet.

    However, over time network usage tends to go up. When DSL first came around, it was replacing dialup and everybody was just visiting web pages that had text on them. Now everybody is visiting Youtube and using BitTorrent to distribute Ron Paul videos and people are using more bandwidth. Now the problem is, if the amount of data its users are transferring exceeds the capacity of its connection to the rest of the internet, they have to drop some packets. When they do that, the endpoints just resend them, but then they take longer to get there. This is especially a problem with interactive stuff like streaming video. In that case the video gets choppy and customers start complaining. The proper course of action is then for AT&T to open its wallet and build a faster pipe to the internet so that customers will have the bandwidth they paid for.

    Except that AT&T *hates* to open its wallet. So what they want to do is, instead of expanding capacity to meet demand, they want Youtube to pay them for priority so that their videos won't be choppy. So then Youtube pays AT&T to keep from going out of business, and instead of dropping Youtube packets, AT&T drops some other packets instead. This makes the problem even worse for anyone who isn't paying this AT&T extortion fee, because now even more of their packets are getting dropped. So all the big companies on the internet, who already paid for *their* internet connections, now have to pay every ISP for *your* internet connections, even though *you* already paid for it. Worse, all the little guys who can't afford this toll get most of their traffic dropped -- and that includes all P2P traffic. So now when you want to go download that Ron Paul DVD using BitTorrent, instead of it taking 4 hours to download, it takes 2 months. And that little company that would have been the next Google can never get started because nobody can use their service when 80% of the packets get dropped.

    That's exactly the problem. The cable companies and telcos often have exclusive rights to the right of way, and even when they don't, the government has given them hundreds of billions of dollars in subsidies to build their networks. The rest of the market can't compete with that level of government interference. And when you have a government-created monopoly, the government needs to either regulate it or eliminate it. Net neutrality is choosing to regulating it. Sad as it is, that's probably easier than eliminating it -- at least in the medium term. In the longer term, converting more wireless spectrum to internet access and providing easier access to the public right of way may give competitors an incentive to come into the market, but building anything of that sort would require years of roll out, assuming anyone is even interested in competing with telcos that have already received hundreds of billions of taxpayer dollars in subsidies.
    Weren't telcos given $200 billion in subsidies to beef up their infrastructure to something beyond DSL and cable capacity?
    http://www.tispa.org/node/14

    http://www.webpronews.com/topnews/20...lion-goose-egg

    http://www.newnetworks.com/scandalquotes.htm
    By now, according to Mr. Kushnick, 86 million homes should be wired at 45 Mbps - at least 15 times as fast as the best commonly available D.S.L. service. The count of homes wired at that speed so far is zero.

    The phone companies made this promise as Congress was getting ready to pass the 1996 Telecommunications Reform Act, he points out. In return, they received benefits - including tax breaks and changes in state laws lifting limits on their profits - amounting to more than $200 billion, Mr. Kushnick writes. But instead of building the infrastructure, they spent money on more immediately profitable services like plain old copper-wire D.S.L. and hoary long-distance networks, according to the 406-page e-book.
    That alone should be reason enough for the government to demand that the baby bells honor their promises.

    The "pipes" have already been paid for.

  25. #22
    Quote Originally Posted by specsaregood View Post
    Just FYI, Ron Paul is AGAINST government mandated Net Neutrality. And I am glad he is.

    Net Neutrality lets the govt gets its greedy little hands on the internet and start regulating it. I don't want that. Ron Paul doesn't want that. It is another example of something that *sounds* like a good idea; but the govt has proven time and time again that they only make things worse.

    But don't take my words for it; here is RP on this subject on the house floor:
    http://www.youtube.com/watch?v=6b7_h_OyTI0
    The government already regulates telecommunications and this includes the internet.

    This is the root of the problem. You can't have government enforcement of common carrier services, build the carrier infrastructure under government regulation that limits or eliminates competition, then just let go of the reins and hand absolute power over to the companies that you subsidized.

    Would you let private companies take over the interstate system? Now that the system is in place, would you just hand over total control of the highways in your state to one company? Then they could charge tolls for you to use "their" roads, even though it was your tax dollars that built "their" roads.

  26. #23
    Quote Originally Posted by Mesogen View Post
    The government already regulates telecommunications and this includes the internet.

    This is the root of the problem. You can't have government enforcement of common carrier services, build the carrier infrastructure under government regulation that limits or eliminates competition, then just let go of the reins and hand absolute power over to the companies that you subsidized.

    Would you let private companies take over the interstate system? Now that the system is in place, would you just hand over total control of the highways in your state to one company? Then they could charge tolls for you to use "their" roads, even though it was your tax dollars that built "their" roads.
    All in all, the problem is the telco companies have monopolized the industsry (due to government intervention) and if we just hand over the reigns they have absolute control...as you said.

    On the other hand, Government should not be able to tell companies how to offer their service...the market should (and would) do that.

    I think the idea proposed earlier, while still intrusive, would end with the best result. But my next question is, what is to prevent telcos from merging and ending up with the same problem? This is the same problem we now have with MSM....the telecommunications act of 1996 allowed companies like newscorp and clear channel to eat up all the indi stations...now we listen/watch/or read one of six companies...(which is, in my opinion, why American has become so polarized and uninformed).


    Any thoughts?

  27. #24
    This is where I get lost. At this point why not just charge more for internet access? If people on average are using more bandwidth then shouldn't the price go up? ISP's are giving away more product.. a simple cost increase should follow. Now that they have increased revenue they can afford the needed upgrades and keep up with demand.
    And that's what would happen in a competitive market. Unfortunately, in the government-corrupted market we have, it's more profitable to ration scarcity than to expand capacity and eliminate it.

    I think the idea proposed earlier, while still intrusive, would end with the best result. But my next question is, what is to prevent telcos from merging and ending up with the same problem?
    The reason why it's a problem with the mainstream news sources is that they were allocated pieces of a scarce resource -- the broadcast spectrum. This limits their competition, because there is only so much spectrum to go around. By contrast, in the right regulatory environment (ie light regulation), competition in the broadband market could be significant enough that even if major players buy each other up, the minute they start doing anything abusive a smaller competitor could show up and provide an alternative.

    I also think there is one thing we should do with the broadcast spectrum: Make it 100% internet. If anything else -- television, radio, police and fire departments, military, anything -- needs to use it, just use IP like every other device on the network. IP radios, IPTV, etc. The network could be configured to give certain types of devices priority for the obvious reasons, but right now we waste a massive amount of bandwidth by dedicating pieces of it to purposes that remain unused 99% of the time. Make it packet based rather than frequency range based and we take a major step in reducing scarcity.



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  29. #25
    I think we all agree that government regulation has led to the near monopoly we have in telecommunications. Government regulation, through the DOJ enforcement of anti-trust laws, helped prevent companies from owning too much of the internet backbone.

    I found a good description of the evolution of the internet backbone here:
    http://www.pff.org/issues-pubs/commu...connection.pdf


    My big question is how do we reverse the monopolistic trend in telecommunications that has led us to the point we are at now?

    Government regulation led to conglomeration of the telecoms, but how do we reverse it without government regulations? Can we just lift present regulations and pray that the advantaged companies play fair?

  30. #26
    Government regulation led to conglomeration of the telecoms, but how do we reverse it without government regulations? Can we just lift present regulations and pray that the advantaged companies play fair?
    In my opinion the most damage the government has caused is in the subsidies they provided. Their intent was to provide these corporations with billions of dollars to build a state of the art network -- which they still haven't built, by the way -- and then regulate fair access to it. We already gave them the money to do it. Now the problem is, there are too few competitors for simple deregulation, and no upstart can compete with an incumbent who has received billions in government handouts to build their infrastructure.

    The government has made a mess and it needs to clean it up. There are plenty of possible solutions, but none that I see are trivial or capable of restoring competition quickly.

    The first thing that needs to be done in any event is to eliminate the distinction and distinct regulations with regard to phone and cable companies. They're both data providers. One provides voice and data over copper and TV over IP and the other provides TV and data over copper and voice over IP. It's all the same, so treat them the same. You might even convince them to compete with each other for once.

    Beyond that, an AT&T-style breakup, but into much smaller pieces and with the stipulation that none of them can ever buy each other again, might be of some help. The point being to make it easier for new competitors. The problem right now is that if you have a company like Comcast who is the cable provider for several states, and you roll out a high speed network in one city to compete with them, they're capable of using the profits they make in other cities to undercut you in the city you build in and then drive you out of business and buy whatever infrastructure you built on the cheap. If you chop them into, say, county-sized parts then it's a lot harder for them to do that. It also gives the new baby bells an incentive to build a competing network in neighboring counties, since they're no longer the same company.

    Another alternative that would no doubt not go down very well around here would be to nationalize them or, better yet, hand them over to the states. The analogies between network infrastructure and roads are too many to list. I know many here believe in private roads, but it is something to consider. The largest drawback would be that stupid politicians would be more inclined to mess with the internet if the infrastructure is government operated -- look at what they do to roads. A different alternative would be to take them out of the profit business. Take the infrastructure, paid for with tax dollars, and give it to an independent not for profit organization with the mandate of charging for fair access and using the money for network maintenance and upgrades. They would not have monopoly status, so if they were doing a crappy job then they would eventually just evaporate as competitors siphon off customers.

    A somewhat more market-based solution would be to demand back every cent in subsidies they've ever received, plus interest. The result would be a certain number of bankruptcies, but their infrastructure would still exist and they would simply end up selling it, preferably in pieces as the above, at market rates to startup companies willing to operate it.

    There are plenty of options, but not really any that can be devoid of government involvement entirely.

  31. #27
    If we put the data networks in state hands, I'm afraid innovation would suffer. In the end total quality of service would most likely suffer as well.

    I dunno. Maybe the conglomerates could just be broken up the way the Bells and ATT once were.

    I just wonder what Ron Paul would have to say about all this. He's the one running, after all.



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