Wednesday, February 25, 2015

The Internet and The FCC

My response to a post on Facebook. It's based on this article, and then responding to these comments:

Comment 1: "“What it comes down to is, the net has worked,” Mark Cuban said. “We’re not in an industry where the technology has become stagnant and there’s no more enhancements so we need regulation to try to make things happen. We’re not there. And so as long as the technology is allowed to advance, we’re OK.”"

Comment 2: "I think a law or two are warranted to prevent mischief, but regulating the Internet under Title 2 is a massive overreaction to a problem that doesn't exist."

My thoughts:

Except, Cuban, who I admire and think is a thinker, has a conflict here. He's right in that things have worked, but I'd argue the last couple years we have changes, with the telcos/ISPs starting to interfere with traffic, and potentially causing issues with QoS.

That's where monopoly, which many have in their local area, starts to cause issues. They monetize the monopoly to the detriment of consumers. We often do have business models that work well for a long time and then start to fail when the field narrows, or choices get suppressed by consumers.

I do think we have some issues in the US, and a lack of competition. We've seen far too many companies fail and leave us with just a few choices, or one, in many localities. The idea of having multiple access to lines from different companies, with different levels of service has declined for consumers. Businesses still get some choice, but I see less companies that are competing as colocation providers, renting space and bandwidth from larger companies and reselling it. While we can argue this is the cyclical nature of business with economies of scale, I do think we see a trend here that will hurt consumers over time.

I don't think every aspect of Internet access and ISPs need to be regulated, but we have a lack of information and choice now, so I think the FCC can set some wide limits, and perhaps have more local entities regulate businesses to ensure we have fair competition. We want to allow smaller companies to have the chance to use the Internet.

I do agree with Cuban that we can't prevent NetFlix or Google, or large companies from buying larger pipes to ISPs for their content. That's what I can do as well. I can pay more for more bandwidth.

What I don't think is acceptable, or even moral, is to allow Netflix to pay for higher priority than Hulu in terms of traffic. We accept packets in the order they are received. Larger pipes send more packets, but ultimately we don't decide which packets to drop based on the source. Only the capacity of the devices.

There are problems here as well, though I can't solve every one and don't want to. I would like to see, however, competition preserved, with a minimum of 3 providers allowed in each market. I'd also like to require some level of maintenance in facilities. I don't think we can force investment, but the market will handle that, IF we allow multiple companies to exist. We can't allow a Verizon or Time Warner to crush local competition in a market.

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