Network Neutrality

Net neutrality is a cult. This political cult is funded by Internet companies who are afraid that ISPs would block them. Google funds net neutrality in order to prevent ISPs from blocking Gmail and forcing their users to use their own e-mail application instead. I probably agree that the *current* ISPs would block their competitors, because of the current ISP monopoly. But if the consumer has hundreds of ISPs to choose from, they can just switch to another ISP if one ISP block its competitors. The current regulations disfavor the creation of new firms. (See http://mises.com/forums/p/460/3548.aspx) Some people would legalize net neutrality as a solution. They would not think about repealing the regulations that caused the ISP monopoly at the first place. Another similar situation is the legalization of cell phone unlocking. Legalization of this makes cell phones more expensive. There is always a cost when you get something cheaper. This law that allows unlocking of cell phones is just another failed anti-monopoly regulation. Why not just deregulize and encourage the creation of new competing firms so the user can have a selection of "innately" unlocked cell phones to choose from? This unlock legalization law is like the government limiting a "dichotomy" between cell phone services and physical cell phones. This market socialist regulation limits innovation. Examples of how this coercive dichotomy limits innovation is that it limits the creation of new, more efficient protocols for a specific cell phones. It also inhibits the creation of new, high bandwidth cell phones that are able to download movies and music from the internet. It inhibits the creation of cell phones that does not just transfer sound, but also transfers video simutaneously. Likewise, the Internet was invented by private companies and the government almost prevented the creation of the Internet. http://www.prospect.org/cs/articles?article=innovation_regulation_and_the_internet A perfectly rational person cannot support net neutrality. Net neutrality has benefits in this market-socialist economy, but there would be MUCH more benefits if the government deregulized the economy.

Yep. It's the Union Pacific Railroad all over again. The ICC was created to establish price floors for the railroads so that the inefficient Union Pacific, which many politicians were invested in, could survive.

Net Neutrality is just another form of price floor. By preventing ISP's from charging higher prices to some customers they are preventing lower prices for other customers. 

 

How is network neutrality the same thing as a price floor? It doesn't say anything about setting a standard price for Internet access; in fact, as far as I can tell it doesn't make any statements which could be weighed economically. Rather, it prevents the yet-unplumbed prospect of competition for Internet bandwidth, which isn't a market if the ISPs don't decide to make it into one. Not criticizing you, just curious.

Avery:

How is network neutrality the same thing as a price floor? 

 

Because it makes it illegal to give customers higher priority in exchange for more money. 

Avery:

How is network neutrality the same thing as a price floor?

Here's an article talking about the whole network neutrality thing.

 Check out my one-minute case against net neutrality.

JonBostwick:

Because it makes it illegal to give customers higher priority in exchange for more money. 

But currently, there is no market for priority... instead of a price floor, imagine a big red X over the entire supply-demand chart. "NO MARKET ALLOWED"

HeroicLife:

 Check out my one-minute case against net neutrality.

As far as I can tell this does not explain why it is the same thing as a price floor.

"Regulation stifles innovation"-- true! If you're arguing for net neutrality you don't want innovations in packet flow. The argument about gaining control of Congress to create favorable legislation is meaningless because that's the way things work regardless of whether the law is currently working the way you want it.

"Consumers fed up with expensive cable and DSL services are demanding more government controls over the pricing and behavior of their ISP’s."-- This has nothing to do with net neutrality which is about preventing the creation of a market which currently doesn't exist. If there is no such thing as a "fast lane" bandwidth market, then there is no competition to be stifled. There is an existing market for providing Internet service, which I agree should have fewer regulations.

"The great thing about capitalism is that it also gives people the freedom to decide whom they want to do business with."-- Joining the Internet backbone is a market with a high barrier to entry. A new business cannot simply pop up to answer consumer complaints. The government has both the right and the responsibility to make sure such non-ideal markets do not get out of control.

"Why do 'net neutrality' advocates ridicule politicians for comparing the Internet to a 'series of tubes,' and then trust them to regulate it?"-- You'd better watch who you're quoting! That comparison was made by Ted Stevens arguing against network neutrality. If you're saying one person can speak for all people in a group, that goes both ways!

 

Mises.org article

This article talks about regulation of existing markets but doesn't say what the effects of net neutrality would be.

The government has both the right and the responsibility to make sure such non-ideal markets do not get out of control.

 So now there is a 'right' (of the government, no less) to have 'perfectly' competitive markets (the joke being that perfect competition is a conceptual tool, used for neoclassical economic analyses)?

Inquisitor:

 So now there is a 'right' (of the government, no less) to have 'perfectly' competitive markets (the joke being that perfect competition is a conceptual tool, used for neoclassical economic analyses)?

I didn't say that government should fix the markets, just that when limited choice affects consumers, the government should make sure that oligopoly does not cause exploitation.

Avery:

Inquisitor:

 So now there is a 'right' (of the government, no less) to have 'perfectly' competitive markets (the joke being that perfect competition is a conceptual tool, used for neoclassical economic analyses)?

I didn't say that government should fix the markets, just that when limited choice affects consumers, the government should make sure that oligopoly does not cause exploitation.

No, the government should not restrict oligopolies. Restricting oligopolies is bad. (see http://mises.com/forums/p/460/3548.aspx) Intellectual property oligopolies create innovation. But the coercive ISP monopoly would be exploiting unless telephone and cable companies and telephone cables are completely deregulized. So the best thing is to deregulize the whole economy, not to price fix the oligopolies.

Instituting a monopoly to deal with monopolies is hardly the wisest thing to do - especially considering how this monopoly tends to facilitate the creation of other monopolies. The appropriate number of firms in a market is for the market itself to determine, rather than nonsensical models of 'perfect' competition (I don't know if you hold to those Averos, but most anti-trust arguments hinge crucially on the economics behind it.)

Avery:

But currently, there is no market for priority... instead of a price floor, imagine a big red X over the entire supply-demand chart. "NO MARKET ALLOWED"

I think part of the problem is it isn't really a price floor but one price for all traffic. They want to force the ISPs to charge the same price for the first packet that they do for the ten-billionth packet. One effect would be that the high bandwidth customers would be subsidized by the people who only check their e-mail and read a few websites here and there instead of running movie torrents 24/7. The very business model of the supporters of net neutrality depend on bandwidth being charge the same for all customers because their 'products' require high bandwidth to operate.

Just imagine how many people would visit youtube on a regular basis (and generated ad impressions) if it constantly pushed them over their lower priced tiered bandwidth plan.

Avery:

"Regulation stifles innovation"-- true! If you're arguing for net neutrality you don't want innovations in packet flow. The argument about gaining control of Congress to create favorable legislation is meaningless because that's the way things work regardless of whether the law is currently working the way you want it.

No, they want all the customers to pay for innovation that only a fraction will see the benefit from. I don't see anyone arguing for favorable regulation but for *no* regulation -- including getting rid of current regulations that exist to prop up the telco monopolies.

Avery:

"Consumers fed up with expensive cable and DSL services are demanding more government controls over the pricing and behavior of their ISP’s."-- This has nothing to do with net neutrality which is about preventing the creation of a market which currently doesn't exist. If there is no such thing as a "fast lane" bandwidth market, then there is no competition to be stifled. There is an existing market for providing Internet service, which I agree should have fewer regulations.

The market does infact exist. You can get dialup, crappy DSL, good DSL, really good DSL, and whatever is above DSL coming down the exact same set of wires.

The market you talk about not existing is charging variable prices for packets to enter the commons. The more the bandwidth improves through technology the more high bandwidth applications come online to use up the newly available bandwidth so it's a constant struggle to keep people from putting too many sheep on the commons and eventually hurting everyone.

There are only two ways to prevent the tragedy of the commons, government regulation and private property rights -- we just need to determine if the collection of independently operated networks are 'private' or 'public' property.

Avery:

"The great thing about capitalism is that it also gives people the freedom to decide whom they want to do business with."-- Joining the Internet backbone is a market with a high barrier to entry. A new business cannot simply pop up to answer consumer complaints. The government has both the right and the responsibility to make sure such non-ideal markets do not get out of control.

Well yeah if you have to compete with government granted monopolies you are going to have nothing but a high barrier to entry. But let's say the people of Springfield get fed up and set up a private mesh wireless network. With net neutrality their network is soon to be flooded by youtube and bittorrent pron packets and it would be illegal for them to do some traffic shaping or charge higher prices for the bandwidth hogs. One price for every packet is the rule.

Oh, and what exactly is a non-ideal market? The only one I can think of is one with government using their 'right and responsibility' to stifle competition and help one market actor benefit at the detriment of all the others...which is what net neutrality is all about.

Avery:

"Why do 'net neutrality' advocates ridicule politicians for comparing the Internet to a 'series of tubes,' and then trust them to regulate it?"-- You'd better watch who you're quoting! That comparison was made by Ted Stevens arguing against network neutrality. If you're saying one person can speak for all people in a group, that goes both ways!

Isn't that the whole point of us having a democratic republic, so that one person can speak for a whole group -- congressional districts in this instance.

How many Congresscritters are more knowledgeable than Ted Stevens? How many have taken the time to research the issue and verify the claims being made by the various lobbyists? How many will vote to help the people instead of helping their chances of re-election?

These are the problems you run into when you trust a political class to regulate industry.

libertarian:

the consumer has hundreds of ISPs to choose from

That is the dumbest thing I've heard today, perhaps all month.

SonicBOOM:

libertarian:

the consumer has hundreds of ISPs to choose from

That is the dumbest thing I've heard today, perhaps all month.

Most consumers have one cable provider, one to four DSL providers, satellite, and more dial-up providers. Soon wireless MANs will be available. In the vast majority of areas, there isn't a monopoly on the last mile.

Agreed, but options aren't panoply ("hundreds") as the OP puts it. It is only prudent to censure ourselves when we hear each other start talking in hyperboles like 7th grade children. When we make the free market sound utopian -- without growing pains, we are being dishonest to ourselves and others. While we feel it is a better overall system, we have to speak rightly. Also we seem to be skipping how AT&T, and others telecoms, have been acting as arms of the DOJ. Or how traffic data bias effects more than the last mile. The OP over-glorify the private network and has a very parochial view of what the internet is. I have a private network and its pretty dull. I have a few services running but after a while it gets old. I want access to the public network.

SonicBOOM:

I want access to the public network.

There's no such thing as a public network.

What you have is a bunch of interconnected 'private' networks that work together to route packets from the source to the destination. *All* of these independent networks are owned by someone.

Your logic is the very reason the network neutrality debate is happening in the first place...well that and the government seems intent on regulating and controlling everything that has the misfortune of existing.

People are already starting to apply the 'public good' arguments to the internet so everyone can freely access the 'public' network because, ya know, it's a market failure that 100% of the population doesn't have broadband access. Doesn't seem like such a good idea to encourage them.

Or perhaps the 'public network' statement was meant as hyperbole... 

Perhaps you should start by looking up 'internet' in a dictionary.

SonicBOOM:

Perhaps you should start by looking up 'internet' in a dictionary.

 

You're wrong. For the internet to be a public good, servers would have to be. Its often free, its never public.

SonicBOOM:

Perhaps you should start by looking up 'internet' in a dictionary.

From the wikipedia:

It is a "network of networks" that consists of millions of smaller domestic, academic, business, and government networks...

So a network is private property but a 'network of networks' is public property, is that what you're trying to say? 

Your selection bias is obvious sonny, -- from wikipedia (first sentence!) "The Internet is a worldwide, publicly accessible series of interconnected computer networks that transmit data by packet switching using the standard Internet Protocol (IP)." If certain parts are no longer publicly available then it is not really the internet any more is it? It then becomes what ISP "X" deems the internet as, an extension of their private network. I think your tumescence for the free market is leading you astray. Why don't we fix the economic system first then worry about whether or not small government would work. Otherwise if we put the cart ahead of the horse, for example, remarkably monied interests against gold, libertarianism and austrian economics could blacklist such sites. You'ld be a fool to think it couldn't happen.

SonicBOOM:

-- from wikipedia (first sentence!) "The Internet is a worldwide, publicly accessible series of interconnected computer networks that transmit data by packet switching using the standard Internet Protocol (IP)."

 

 publicly accessible ≠ publicly owned

SonicBOOM:

Why don't we fix the economic system first then worry about whether or not small government would work.

Well, you see, the problem with the economy, as stated by the Austrians, is Big Central Government interference so the only valid option is to 'worry about whether or not small government would work'. 

If I understand the logic behind your argument correctly you are claiming that government regulation is needed in order to keep 'remarkably monied interests' from abusing their ability to use government regulations to blacklist certain viewpoints. So instead of treating the underlying problem, government interference, it is better to use it to keep the potential abusers in line by regulating their actions for the 'public good'. 

The more layers of regulation you apply the more are needed to fix the problems caused by the last round. How does this apply to the subject at hand? The government granted monopoly players have skewed to market(internet) for their own benefit, as you pointed out earlier there is little in the way of competition so they have the ability to block sites and restrict traffic if they chose. There are two ways to correct this, either remove the regulations that prop up their monopolies or add some more regulations to ensure they don't abuse their fiat monopoly status. 

One choice leads to Freedom and the other leads to Serfdom, which would you rather be? 

SonicBOOM:

I think your tumescence for the free market is leading you astray.

You a college boy, ain't you?

Folks, I just looked it up in the constitution, and you know what? The government does not have "regulating internet" as their listed responsibility.

Internet is not public.

Whatever wikipedia says does not matter one thing. 

Whoever own the property shall be free to use it as he sees fit.

A statement "government regulation is needed in order to keep 'remarkably monied interests' from abusing their ability to use government regulations to blacklist certain viewpoint" is a ridiculous one. I may allow one of you to write your message on my car rear window. Where did you get the idea that I now shall be obligated to allow every viewpoint to be displayed there equally? Get your own rear window.

The statement that ISP has a barrier to entry is not an excuze. So what? Save some money!

I can't believe people who are supposedly Misesians, and they want government to "regulate"... 

Network neutrality is pure socialism. 

Anonymous Coward:

You a college boy, ain't you?

Its been a long time since I was in school, but I still read books, sorry if you had to look anything up. What you all are exhibiting is a lack of understanding of how networks best operate, the social benefits of the the internet, as well as your alarmist use of the scare word "regulation". ISP's advertise access to the internet for all intents and purposes consumers expect that to mean something you obviously fall short of grasping. To deliver anything less by blocking access and discriminating traffic is fraud. Also you misunderstand how ISPs want to regulate the networks. I am not a misesian, never claimed to be. I am attracted to some of the ideas of rothbard and austrian economics, but wisely I don't swallow anything hook line and sinker with out thinking -- unlike some.

SonicBOOM:

What you all are exhibiting is a lack of understanding of how networks best operate, the social benefits of the the internet, as well as your alarmist use of the scare word "regulation".

If you have a better word than 'regulation' to describe, um, government regulation then I will happily use it...

Other than the obvious 'public good' argument -- 'the social benefits of the internet' -- you are really not saying anything here. How do networks best operate, as a commons where anyone can pump as many packets across it irregardless of the effects on others or as a collection of independent entities competing for customers based on quality of service?

SonicBOOM:

ISP's advertise access to the internet for all intents and purposes consumers expect that to mean something you obviously fall short of grasping. To deliver anything less by blocking access and discriminating traffic is fraud.

What's so hard to grasp, they want to institute a tiered pricing structure for a limited commodity, bandwidth, and the people who's business model relies on unlimited bandwidth are trying to institute government regulations laws to ensure this doesn't happen. Of course this simplified model doesn't take into account the 'social benefits' of unlimited bandwidth but in a system where there is healthy competition 'social benefits' get taken care of through consumer preference.

I'm not saying that ISPs should be able to discriminate based on source or to outright block sites, I just don't agree that more regulation laws are needed when another option exists that fits better with my ideals of how a government 'of the people, by the people' should operate.

SonicBOOM:

Also you misunderstand how ISPs want to regulate the networks.

Really? My understanding is based on the lack of competition caused by virtual monopolies in large swaths of the market. Under the current system if a internet provider decides to block access to some resource many, many people don't have the option to change providers. 

How really is the internet any different than the cellphone network when it comes to the 'public good'? Well other than the obvious competitive pricing structure that is seen within the cellphone industry. 

SonicBOOM:

...but wisely I don't swallow anything hook line and sinker with out thinking -- unlike some.

What's up with all the ad hominem attacks? 

Anonymous Coward:

What's up with all the ad hominem attacks? 

First of all, you're right I'll quit with that. I was getting carried away.

Anonymous Coward:

What's so hard to grasp, they want to institute a tiered pricing structure for a limited commodity

BOOM there it is! We already have tiered options. I see absolutely nothing wrong with that what so ever. You pay for faster play -- cool by me. But thats now what Net Neutrality supporters are concerned about. Consumers should be concerned. I'm with you it shouldn't take an act of congress to deter the threat -- but if takes some testifying before congress to generate awareness then great! What I'm trying to relay to you are that the proposed ISP actions are a threat to free speech and free exchange of ideas. And I have faith in the free market, there is rumor about Google building its own internet or could become its own ISP. Thats the network I'd choose as a consumer. Its not a 'cult' its a worthy concern.

Now that is interesting; do you perhaps have any sources on Google's efforts?

 

Of course it is speculative but look here http://www.news.com/Google-wants-dark-fiber/2100-1034_3-5537392.html

    Most ISP's are resellers. They actually just manage someone else's pipes. DSLonly manages a QWEST connection. QWEST charges half the normal rate, you end up paying the other half to the other company(DSLonly). You think you are getting a better connection, or better service, or no blocked ports, or no throttled connection. BS! It's all corrupt. All the telecoms got super-funded through Clinton to build the so called super internet. Expand infrastructure, raise the speed, etc. They just kept the money and did nothing. Companies advertise 8 Mb. down and you will never see anything close to that. They purposely rig speed test sites also. Do they get sued for false advertising or faulty product. No. They are forgiven by the political whores.

   Now, you want to talk about Net Neutrality. The original definition, about companies being charged more for certain codecs or file formats, and certain connections gaining preference. It's all BS. It's all a corrupt game. On all sides. And Mr Consumeraverage Joe is the one who gets the #2 Phillips you know where.

    We got DHS syphoning off backbone traffic with a splitter in every major market, which by the way, all the worlds traffic flows through the USA. How convenient. You have ISP's blocking file formats, throttling traffic, flat out blocking torrent, bouncing mail. You have poor service. You have poor customer service. You have most of the labor for installation being farmed out multiple times through  multiple contractors till the job gets to the starving tech or a Mexican labor group, who aren't going to do a good job because they aren't making squat on the install because too many people took a chunk. You have ISP's logging customer data and selling it off to the private sector ( Choicepoint) who, intern, sells it to the Gov. in order to get by the whole collecting data on your citizens thing. You have Google and Yahoo handing over people's IP addresses at the turn of dime, without court order, over forum postings.

    Spam now counts for most email. The last number was about 85% I believe. You can't even be a kid and talk to your friends in some social site or talk room without the SAVE THE CHILDREN POLICE coming (no pun intended) to the rescue. Windows Media Player's favorite word is "Buffering". Gootube yanked a person's video's off for making a spectacle of police and politicians who went on corruption rampages or tazered someone till they said piggy. You have offshore ( Canada -BC) companies (Hushmail) that sell an email service as encrypted and private, who are handing over users private PGP keys to the USGOV without court order or customer notification.

    I mean, the whole thing is a joke. It's all totally corrupt. It's all worthless. And you wanna boohoo about this company or that company not getting this or that. F'em. It's all broke. The US has fallen way behind the world as far as IT. Through the Uber-Fascist Politicorporation of ADMIN Uncle Sam, the US debt ridden consumer is left with no choice at all.

MrJekyll,

You're absolutely right in your assessment. This is exactly what's going on.

Now, may I ask why?

Because, legislative branch is not doing their job right, executive doing to much and judicial is not doing any job at all.

This is going on, because you can't make Yahoo go broke for selling your e-mail. But you should be able to own that company for a simple thing like that. In a just world, where three branches are doing exactly what they should.

What we see, is a complete disregard for contractual agreements.

 

And how did this started? By government regulation, designed to save the contractual party at fault.

Regulations, designed to save a enterpreneur-loser, who had misjudged the future demand. Designed to save an idiot customer, who just can't say "NO", or  decide what is best for him.

 

Now we want more regulations? Sure this may punish some fat cats. But will it solve anything? Do two wrongs ever make right? You think in the game of corruption and unjustice, joe six-pack will ever win, with any regulation? Look at USSR, at N.Korea. He never does win. Founders knew that, and that is why we supposed to watch out for our three branches, and MAKE them do their work, leaving them equal and weak.

 

There is a choice. Walk away. Do not consume, unless it is on your terms. Starve the beast. Grow rich in the meanwhile.

 

For example, I really do not like the fact that I have to pay for tons of channels on TV, when all I want is History, Discovery, and Dirty Jobs.

What to do? I just yanked the cable and that was that. I won't die without their crap. They will die without my money. I'd rather pile on the other side and grab their content, if you know what I mean. They had a chance to sell it, and they blew it.

 

Now, the only difference between this making sense and not making it is am I alone or not.

 

Stop being sheeps. Pay only for what you want, and how you want it.

 

Now, last question. What if the rest of you don't want to stop being sheeps? What if you enjoy that?

Well then. Be what you want. But should I forcefully change your world? Make a regulation on what channels to sell and to how?

I suppose I could, but then there is going to be regulation on me, as well. I don't know how about you, guys. But I wouldn't call that a life that a human being deserves. At least I, for sure, don't deserve a life where a government rules and regulates in anybody's favor. That is not life but a stinch.

 I forgot one thing. But, it is actually quite important.

Regulation only makes them stronger. Remove all regulation, and you will kill them all. Because free market and their own individual desires and bottom lines will ruin all of their alliances, and aspirations. It will break down any corporation that doesn't pay attention to you, the customer. It will render anything corrupted totaly useless. Because with each new day, there born an enterpreneur who find yet another way to take away from those in power today. The only thing he needs to do that, is not to be regulated.

Our ability to remove any and all regulation is our best weapon. They know this and they fear this the most. This is why they try to confuse us by introducing this or that new regulation, which ultimately, doesn't matter. Any combination of any regulations will have only one result: make fat cats stronger.

We, the people, hold the ultimate sword against them. 

It's only about time we, the ones holding it, realize what we wield in our hands. 

I agree with Thorgold. Individuals need to learn once more how to consume, and instead of blaming big business they need to start attributing to themselves a degree of responsibility for allowing it - and government, the ultimate culprit - to get away with as much as it does.

I've read this whole thread and agree with MrJekyll.