FCC Net Neutrality Flap: Fast Lanes Don't Scare Me - InformationWeek

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5/19/2014
02:23 PM
Rob Preston
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FCC Net Neutrality Flap: Fast Lanes Don't Scare Me

Only the status quo will keep the Internet 'open,' net neutrality advocates insist. But a refined approach may ignite more network investment.

I got an earful from readers last Friday on an Editor's Note I wrote for our "InformationWeek In Review" newsletter. In that 400-word overview of InformationWeek's coverage of net neutrality happenings over the previous week or two, I chimed in on both sides of the issue: Should the FCC relax net neutrality rules or not?

Apparently this issue isn't to be debated: Net neutrality must stand, un-amended... was the consensus from the handful of readers who emailed me on the subject. But I don't see things so cut and dried.

As you've probably already read or heard, more than 100 Internet bigwigs -- Google, Facebook, Amazon, and Twitter among them -- laid into FCC chairman Tom Wheeler's plan to give network providers more freedom to charge customers extra for faster data delivery over their slices of the Internet. The fear, as my colleague Tom Claburn wrote, is that this so-called paid prioritization "will turn the Internet into a protection racket." That is, dominant providers such as Verizon, Comcast, and AT&T would require heavy Internet users such as Google and Netflix to pay extra for "fast lanes" for their traffic -- or suffer the consequences. In the meantime, the reasoning goes, shallow-pocketed commercial Internet users would be put at a competitive disadvantage.

[Overregulation is a pervasive problem for businesses. See Death By A Million Regulations.]

But isn't paid prioritization already an established commercial practice across industries? For example, the US Postal Service charges customers more to deliver packages overnight than it does for two- or three-day service. The airlines charge customers more for classes of service that usher them through check-in, security, and boarding faster. Internet and cellular providers already charge consumers more for faster data speeds. Are such premium-priced services "unfair" to customers who can't afford them or choose not to take advantage of them?

That's only a problem if the supplier degrades baseline service as it improves its premium services -- and there's no reason to assume that will happen on the Internet, now that the FCC has stipulated that it won't allow such network degradation. The FCC still has the authority to police the carriers so that they don't make the slow lane slower. If you don't trust the FCC to keep that promise, then why would you expect it to be any more committed to upholding net neutrality?

The telecom operators already provide priority delivery of certain business customers' Internet traffic through VPN and QoS services. Enhancing that model -- letting them offer gold-standard security for financial transactions, for instance, or guaranteed connectivity for healthcare monitoring -- isn't the end of the Internet as we know it. It's a business opportunity for the carriers. Yes, it stands to make them more money. But it also gives them more incentive to invest in their networks.

Electronic Superhighway by Nam June Paik. (Source: Libjbr)
Electronic Superhighway by Nam June Paik.
(Source: Libjbr)

Tom Claburn refers to an article published in Vox last Monday that claims that broadband industry figures misrepresent network investment as rising when it actually has been falling, a sure sign, critics say, that the dominant network operators are getting fatter and happier and more dominant. But one could look at a falloff in public network investment from another perspective: Perhaps one reason carriers are spending less on upgrades and more capacity is because net neutrality rules have limited their upside. Why plow more money into Internet capacity when you're not allowed to fully profit from it via premium services?

Supporters of the FCC's relaxation of net neutrality rules, including George Foote, a partner with law firm Dorsey & Whitney who has worked with the agency, think there's less here than meets the eye. "The final rules will require a strong baseline level of service," Foote said in a statement. He added: "As for the so-called fast lane, all that does is open the door to better or different service for a fee. The FCC commissioners made it clear that existing law and the threat of heavier regulation should give pause to monopolists."

I'm not arguing that the big carriers are saints. Far from it. They're in business to expand their profits and please their shareholders, just like any publicly held company, and they have abused their market positions in the past. But we have antitrust laws and myriad other regulations to keep anticompetitive behavior in check. If you don't think the antitrust authorities are up to that task, why do you think the FCC regulators are up to it under the framework of net neutrality?

The FCC has decided that it's prudent to move ahead slowly, voting three to two on Thursday to open its controversial proposal to public comment. Good. Let's hear all sides. Meantime, what do you think about the FCC's move to relax net neutrality rules? Hopefully, we can have a civil conversation on this issue in the comments section below.

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Rob Preston currently serves as VP and editor in chief of InformationWeek, where he oversees the editorial content and direction of its various website, digital magazine, Webcast, live and virtual event, and other products. Rob has 25 years of experience in high-tech ... View Full Bio

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RobPreston
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RobPreston,
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5/21/2014 | 1:10:30 PM
Re: Postal Service
Come on, stevew98. You question my critical thinking? I can't even follow your argument. You "wonder why they are fighting so hard to keep the regulation in a state of allowing them to do so"? What does that even mean? The network operators want more freedom to create fast lanes because they want to make money from them. Plain and simple. No one is being duped here. It's quite transparent. Regulation of those operators still exists. The FCC, which was the overseer of net neutrality, has said it will ensure that baseline service is preserved. If carriers look to slow down the traffic of certain content providers or competitors, the FCC is sill there to make sure that doesn't happen. Should it happen anyway under the FCC's watch, there's the hue and cry of the public to also keep the carriers in check. No one is saying the operators can do as they please.
Charlie Babcock
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Charlie Babcock,
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5/20/2014 | 7:42:55 PM
We have the tools...
We have independent Internet monitoring services with different areas of focus. Compuware and Cedexis are capable of measuring ongoing performance of particular sites; AppNeta can measure performance of individual Internet network segments. AppDynamics and New Relic can measure specific app performance over the Web. With such tools, the FCC should be able to monitor that there's no deterioration of general traffic lanes as fast lanes get implemented.
RobPreston
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RobPreston,
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5/20/2014 | 9:24:27 AM
Re: Postal Service
The content providers aren't the customers of the network operators unless they choose to be. No one is forcing the content providers to pay up. And not all the network operators even want to get into the paid prioritization business. The CEO of Comcast has said he's not interested, because, he says, setting up these arrangements would be too complicated. 
Thomas Claburn
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Thomas Claburn,
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5/19/2014 | 7:27:02 PM
Re: Postal Service
My worry about antitrust law is that it only considers consumer harm. If telecom giant X owns video company Y and then decides to charge competing video company Z twice as much as it charges its own subsidiary, that may not trigger antitrust intervention.
Lorna Garey
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Lorna Garey,
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5/19/2014 | 3:25:46 PM
Encourage munis
I'd be more comfortable with allowing pay for priority if the FCC also made it easier for municipalities to stand up services -- and lo and behold, that seems to be happening: http://arstechnica.com/business/2014/04/state-laws-that-ban-municipal-internet-will-be-invalidated-fcc-chair-says/

"In a footnote, Silberman wrote that "[a]n example of a paradigmatic barrier to infrastructure investment would be state laws that prohibit municipalities from creating their own broadband infrastructure to compete against private companies."

 The Internet is infrastructure. Let's treat it as such. 
RobPreston
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RobPreston,
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5/19/2014 | 3:13:23 PM
Re: Postal Service
That's a good point, but Netflix doesn't have to pay more -- it can stay with the standard baseline service. Under the most recent FCC regs, the carriers must provide the same level of baseline service as they have been--the FCC has said it won't abide a degradation of service. If we don't trust the FCC to enforce that stipulation, why would we trust the FCC to enforce net neutrality?
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