FCC Network Use Study

FCC Network Use Study

March 23, 2007 0 Comments

The FCC today took a shocking step when they decided to actually gather information about a topic before they make a rule saying how they are going to regulate it.

They approved an inquiry exploring how companies that provide high-speed Internet service manage Web traffic, and whether consumers of such broadband service are adversely affected.

The issue, of course, is the so-called net neutrality issue. A group of content providers including Google and EBay want Congress to pass laws imposing price controls on their distributors. I testified in Senate hearings on the subject a few months ago that it was a dumb idea that would reduce investment in high-speed networks we need to be competitive.

It’s a simple idea masquerading as a complex subject. People’s use of the interneet is shifting from exchanging emails and data to downloading movies, watching HD TV programs, and other heavy traffic. The switch is fast gobbling up available network capacity. Somebody is going to have to invest a lot of money to build the network. The big content providers are running businesses with 70-90% gross profit margins. They would like Congress to make sure they don’t have to fork over any of that margin to the content distributors. I say let them duke it out.

Here is a pretty good YouTube video on the subject.


John Rutledge


  1. Goumindong

    March 23, 2007

    That is an unfair characterization of the issue. Net Neutrality is not a price control, net neutrality is more akin to anti-discrimination policy.

    Due to internet protocol, there is a single comodity on the internet, bandwidth. What net neutrality seeks to do is return the internet to the current regulation regarding the other broadcasting regulations after a court ruling that the law did not apply to the net. This regulation enforces that companies when charging for bandwidth may not charge differently for the content of the bandwidth or depending on who is using it, they may only charge based on how much bandwidth you use.

    This means it doesnt matter whether or not you want to send video or a text file, if they are the same size, they will be treated similarly and charged similarly. Without net neutrality, the backbone companies, which are regional monopolies, would be able to filter and control content based on personal corporate policy.

    On the surface this isnt terribly bad, but after a bit of examination it clearly is. A bit of History, the United States payed these companies to build the infastructure in the first place, and they essentialy have government granted monopolies over the infastructure that we payed them to build[incidentally, when we payed them to expand and lay a comprehensive fiber network, they did not do the work, it is not in the interest of these companies to increase bandwidth supply unless they are the sole content provider or able to manipulate traffic, more on that a bit later].

    Despite Ted Stevens quirky ramblings, i am going to pull an an analogy from him. Except where he said the internet isnt like a truck, I will say the opposite. The internet is like the U.S. highway system, there are main lines to everwhere that intersect each state, slower roads that branch off from these highways into less populous areas and then driveways into individual houses. Packets are like trucks that run on the road, and packet size is the weight of the trucks. Net neutrality is the law that says to the States "you cant restrict driving on your roads unless the cargo is illegal, if you charge tolls, it may only be based on the number of cars, or the weight of the car". The infastructure clearly has a traffic maximum, but this maximum has nothing to do with what is inside the packet.

    What would happen if States were able to restrict on their own iniative, any cargo type or drive that they wished from another state or their state on their roads? It would increase traffic congestion as restricted cargo would have to move around the state and cargo passing through would need to be searched[packet sniffing]. The same thing happens on the internet.

    Now what happens if those States also run shipping companies? Well, the states start charging shipping trucks more, just because they are shipping companies. If you had been astute in your reading on the issue, you would know that there are clear conflicting issues regarding internet backbone holders and secondary communications methods. Such as phone lines. Vonage, which has had issues since the ruling with the companies that hold the backbone treating their packets differently than others packets. This reduces their call quality, reliability and is done for no other reason that Vonage competes with land line phone services or voip services run by the line holders. But the load on the system that Vonage creates is no larger than the load on the system that any other similar bandwidth using service uses.

    Without net neutrality you allow these regional monopolies to set costs for the content providers, which reduces competition from within content providing. There isnt ever going to be competition in land line services, basically no one has the capital in order to lay the lines and open a competing infastructure. The Lease we can do, however, is allow competition in content providing, and without net neutrality, whether or not that happens, who does it, and how much it costs, is entirely up to the backbone holders.

    There is a myth that these companies such as Google and Vonage and Yahoo do not pay for bandwidth, and this is false. They do pay for bandwidth, what they dont pay, is a prememium over the bandwidth use of others because of the type of content they use.

    It should stay that way. We shouldnt let backbone holders leverage their monopoly power, especialy over infastructure that was payed for by U.S. tax payer funds.

  2. HandsOffPlease

    March 27, 2007

    Thanks for chiming in on the subject Dr. Rutledge.
    Goumindong has it wrong. It's not at all about discrimination. It is about ensuring a robust and responsive internet to handle the up and coming applications like Joost and downloadable movies from netflix, for example.

    I am proud to be working with the Hands Off the Internet Coalition to let people know that net neutrality will hurt every internet user. We have enjoyed many years of internet success. Why stop now?

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