New FCC Chairman Wheeler has leaked a proposal to allow ISP’s to charge for higher-speed “fast lane” access to their networks. This is an abomination. It is pathetic. It is a betrayal of the public trust by the Obama administration. And it is totally unnecessary. The only thing it does is further the cause of crony capitalism.
What exactly is the problem(s)? The provider’s obvious incentive is to DEGRADE regular service to force traffic onto their “premium” lanes. A “fast lane” only makes money if the other lane runs slower. The slower it is made to run, the more money comes in….
Why is this an abomination?
- It is technically unnecessary – the “slow” lane runs just as fast as the mooted “fast” lane. A broadband line is NOT a usage sensitive thing like a water line or an electricity line. It doesn’t “cost” anything more or less to pump more or fewer bits through a system. Those little router chips don’t wear out any faster running at 1 megabit, 10 megabits, or even 1 gigabit (1,000 megabits). Total system capacity is limited at some point, but those limits start to happen in the gigabit-per-home range, 1,000x faster than the megabit-per-home range we are in today. And the system-wide capacity required to keep each end-point connection running “fast” is a trivial investment relative to the profits earned ($millions vs $billions).
- It is competitively unnecessary. The ISP’s make good money on Internet service today. They have made enough money to pay for incremental speed upgrades. More to the point, they made/make enough money to just as easily pay for truly massive speed upgrades. Why push a policy that gives them every incentive to stop upgrading?
- It snatches defeat from the jaws of victory. There was/is a real risk of competition breaking out again in this market. Per my (hopeful) post just a few days ago, the telcos are starting to throw in the towel on poky DSL service and at least start marketing the “gigabit” that Google has so deftly set as the new broadband standard. (Google Gets Us the Gig(abit). Brilliantly Played.) In the meantime, more and more municipalities are starting to make serious efforts to secure high-speed Internet as a competitive differentiator. And the FCC itself is about to consider the Comcast Time Warner merger. This would have enabled the FCC to make all sorts of enforceable demands that would preserve Net Neutrality and increase broadband speeds.
Even more worrying is the so far deafening silence of the traditional defenders of the Internet. Where is Google? Where is Amazon? Where is Yahoo? Where is Facebook? I have a bad feeling they are starting to come around to a “fast lane” as a super-excellent protective barrier for their own businesses. “Hmmm, if we create a false impression of scarcity we can jack up the cost of getting decent service and prevent anyone from challenging us. And it won’t really cost us anything since we can just pass along those costs to the end consumer.“ Although I am hoping their PR types realize they have to line up against this. Or their HR types; the smart developers don’t generally want to work for Darth Vader.
Wheeler’s assurances about the FCC’s aggressive regulation and “commercially reasonable terms” language are transparently horse-pucky. But even if meant honestly, that just puts the FCC in an endless round of refereeing. More important, it leaves the door open for a future FCC to give away the store.
Having said all that, this is in some ways not that big a deal in practical terms.
- I STILL think that the cost and pain of paying for that “special access” will drive the vast majority of Internet services to develop solely for the “slow lane” version. Especially anyone seeking global reach. It would be an administrative nightmare to try and negotiate separate “fast lane” agreements with the literally tens of thousands of Internet providers out there. Which is arguably another great barrier to entry for those who can afford the lawyers (Google, Facebook, Amazon), but still a raving pain for all concerned. As a metaphor, it’ll be easier to just ride in the regular lane vs juggling literally thousands of different electronic toll tags.
- The “fast lane access” model would probably mostly end up applying to wide-distribution video streaming (ie. TV and Netflix-esque services). That still sucks, but “the Internet” and “content” is a whole lot more than just video.
- There will be a huge economic incentive to evade the fast lane – especially if it really starts to make money (becoming a real cost). There are many creative technical ways to get around this rule. For example, delivering video from a terabit-sized local hard drive that is recharged overnight versus via direct streaming. Its worth remembering that Internet video first took off as downloading (remember BitTorrent?). It can very easily return to its roots.
- I still think “the Gigabit” cat is out of the bag. The false impression of bandwidth scarcity has worn too thin. And too many people understand that more bandwidth does not mean “more expensive” bandwidth – e.g. everyone who bought that gigabit home router at Best Buy for $10 more than the megabit version. The emperors remain naked.
So I think the Internet will survive. It is more disturbing as a painfully naked exercise in crony capitalism. This move has nothing to do with the public good. It is just a give-away from those in power to those in power.
Obama came in making a lot of promises about preserving the open, innovative Internet. Six years later, his ex-cable-lobbyist FCC chair serves up this shit sandwich. It is probably less bad than whatever Romney would have put on our plates. But that just means less fragrant smeared less thick.* We deserve better.
* Of course, Obama also made a lot of promises about standing up to Wall Street, reining in surveillance, and blah blah blah so maybe I shouldn’t be so surprised. And he was probably still probably “better than the alternative.” But I am getting tired of that rationalization.