What matters in net neutrality
August 9th, 2010 | by jz | Published in Future of the Internet | 14 Comments
It’s hard to know what to make of the Google/Verizon deal since until earlier today both companies have denied that there is one. And it’s hard to argue about net neutrality because it means so many different things to different people. I’ve got lots of reading to do to catch up on the newly released set of principles from the companies, but in the meantime here are a few thoughts on the topic.
The core question is this: when Internet Service Providers turn out to have captive audiences of subscribers — either because their customers have few if any alternatives for broadband, or because switching is complicated and cumbersome, or because ISP practices are obscure and thus hard for customers to adapt to — how far should they be allowed to leverage that captivity?
That question arises in the midst of a very confused economy for the movement of bits over the Internet. With telephones the baseline rule was simple: sender pays. On the Internet, it’s more complicated: both sender and receiver pay their respective Internet Service Providers to move their data traffic. Now, suppose these are large ISPs who are considering connecting to each other directly. The ISP who hosts a sender of traffic like YouTube might say to the ISP with lots of individual users who watch YouTube videos: “We seem to have a lot of stuff that your users want, and they’re paying you to get it to them. What will you pay us to pass this stuff efficiently over to you?” The ISP with the individual users might reply with a different point of view: “You’ve got a lot of stuff you want to send to our users, and your corporate customer is making money through advertising or subscription fees when our users access it. What will you and your corporate subscriber pay us to be able to reach our captive audience?” It’s an odd puzzle: both sides benefit from the transaction, so who should pay for it, given that there’s no baseline rule like “sender pays”?
In the past this dilemma between large ISPs has been resolved through peering arrangements that have amounted to simple handshakes: I’ll carry your traffic aimed at my subscribers if you carry mine aimed for yours, and we’ll call it even. Today those deals are more complicated, and their details are typically trade secrets. But we know this much: Verizon, like other broadband providers, already says to its customers: pay us more and we’ll give you faster Internet access. That’s not controversial. So should Verizon also be able to make a similar offer in the other direction, to faraway upstream content providers? Verizon could say to Google: regardless of what you pay your own ISP to get your bits launched on the Internet, pay us more and we’ll make sure your YouTube videos get to our subscribers all the more quickly as they come in for a landing.
Google might well be able to pay — and then leave poorer content providers behind. The next two guys who want to start, say, ShmouTube won’t be able to do it if they’ve got to negotiate business development deals with one ISP after another in order to reach those ISPs’ subscribers. And that’s the real danger: when each ISP can, in effect, speak on behalf of its unwitting subscribers, serving as the troll under the bridge offering up different conditions for access to them, the economics of the Net will start to favor the consolidated, the well-connected, the well-heeled. Verizon and Google each have reason to take the trouble to negotiate with one another to begin with — they’ve both big, and each can offer uniquely desirable benefits to the other. The generative power of the Internet is that it has offered a perch for anyone who wants to plant a flag in the ground. Set up www.mynewamazingwebsite.com, and people the world over can beat a path to it or not as they please. That represented a huge change from the proprietary consumer networks of the 1980s and 90s, where AOL or CompuServe got to say who could have a presence within their gated communities.
It may turn out to be too simple to have a blanket rule against ISPs charging faraway providers for access. There are even some outcomes that make that desirable for consumers — imagine if Internet access were free, with ISPs beating down your door to provide you with broadband, because if you choose them then they’ll get paid by Google et al. for the privilege of sending bits (and ads) to you. That’s a dubious outcome for a number of reasons, but it’s theoretically possible. But much more dangerous is if ISPs get to pick and choose: one deal for Google, another for the New York Times, a third for eBay, and no deal at all for mynewamazingwebsite. In a medium in which so many of the giants were yesterday’s scrappy upstarts — eBay, Google, even the Web itself — it would be a travesty to freeze out the next round of innovation from odd corners by deploying an impenetrable web of contracts and fees. That’s what I take to be at the core of Chairman Genachowski’s comment that “Any outcome, any deal that doesn’t preserve the freedom and openness of the Internet for consumers and entrepreneurs will be unacceptable.”
Update: More thoughts here.
August 10th, 2010 at 4:28 am (#)
[...] Jonathan Zittrain, “What matters in net neutrality“ [...]
August 10th, 2010 at 7:37 am (#)
[...] (Sinngemäß übersetzt und zusammengefasst. Volltext hier. Längere Version hier.) [...]
August 10th, 2010 at 9:49 am (#)
i am reminded of a similar story between microsoft and disney.
microsoft sent some execs to disney in the hopes of licensing wmv to them.
the exchange was something like this:
ms: “so, how much are you willing to pay to use our codecs?”
ds: “no, how much are you willing to pay us for use of out content?”
August 10th, 2010 at 11:19 am (#)
The real tragedy of this, in my view, is that these big sites (Google/YouTube, Facebook) are fueled by the labor of unpaid people – the users. The users supply all the content. For Google to turn around and try to negotiate faster speeds via ISPs like Verizon is a slap in the face of all the users who took the time to upload, comment on, and tag videos, because it will lead to newer sites, and newer opportunities for users, to be slowed down. If these sorts of agreements go through, the formula will be: capture user labor and value (by dressing it up as “participation”), grow to gargantuan proportions, then shut out all the little sites to protect your ill-begotten profits.
August 12th, 2010 at 2:15 am (#)
[...] As Jonathan Zittrain says about the U.S. market: “And that’s the real danger: when each ISP can, in effect, speak on behalf of its unwitting subscribers, serving as the troll under the bridge offering up different conditions for access to them, the economics of the net will start to favor the consolidated, the well-connected, the well-heeled.” [...]
August 12th, 2010 at 8:13 am (#)
[...] Jonathan Zittrain focuses on Internet startups of the future that might become unable to compete: “Google might well be able to pay — and then leave poorer content providers behind. The next two guys who want to start, say, ShmouTube won’t be able to do it if they’ve got to negotiate business development deals with one ISP after another in order to reach those ISPs’ subscribers. And that’s the real danger: when each ISP can, in effect, speak on behalf of its unwitting subscribers, serving as the troll under the bridge offering up different conditions for access to them, the economics of the Net will start to favor the consolidated, the well-connected, the well-heeled.” [...]
August 14th, 2010 at 7:58 am (#)
Wonderfully clear and compelling, as usual, JZ.
So, where does this leave you on discriminating among packets when the provider is not getting paid by a vendor to do so? Should, say, Verizon be allowed to decide that _any_ packet it can recognize as containing high def video info should take priority over, say, online game packets or voice telephony packets…so long as Verizon treats everyone’s high def packets equally? (This, as you know, is Google’s new position.)
August 15th, 2010 at 8:56 pm (#)
Since the FCC has backed away, or seemlingly so, isn’t this the realm of ICANN, or some other semi-regulatory agency, since there seems to be none. I happen to subscribe to comcast and pay for their “speed boost up to 20 mbps.” I have a degree in economics, and understand information asymmetry. I thought the “wild west” of the aol days and the “old” internet would evolve into compromise between regulators and innovators. New, wireless notwithstanding, I have had enough of the bleeding edge. What has happened?
August 15th, 2010 at 10:09 pm (#)
DavidW — I’m actually OK with consistent discrimination for some types of traffic, although that traffic can be difficult to identify since it may run cloaked. The idea is supposed to be that providers don’t care what a packet’s for. But I acknowledge that reality can be rightfully different.
KeithG — ICANN wouldn’t, and couldn’t, touch this with a ten foot pole! Actually, since it involves carriers who have national identities — subscribers generally exist *somewhere* even when they’re in cyberspace; they have to get a signal to their devices — it’s amenable to national regulation. (Not that regulation is necessarily a good idea …) …JZ
August 17th, 2010 at 7:13 am (#)
[...] Jonathan Zittrain, What Matters in Net Neutrality (The Future of the Internet and How to Stop it) [...]
August 17th, 2010 at 12:17 pm (#)
[...] The topic of discussion for the segment was the Internet policy framework proposed jointly by Google and Verizon last week, and at the end of the discussion, Zittrain—who, I think it’s fair to say, holds a much more favorable view of Net neutrality than I do—raised the possibility that the enhanced services that would be allowed under the proposal could impede smaller competitors. So what if, say, Google can afford to pay for faster delivery for content served by YouTube (which Google owns)? Doesn’t that make it more difficult for smaller entities to enter the market? It’s a version of the case he made on his blog last week: [...]
August 17th, 2010 at 9:02 pm (#)
[...] What matters in net neutrality – Jonathan Zittrain's take on the Google/Verizon net neutrality kerfuffle. [...]
August 18th, 2010 at 7:19 am (#)
[...] (.pdf) setzt sich in einem erneuten Blogpost mit der Verizon/Google-Thematik auseinander (auch den Beitrag davor hatten wir schon empfohlen). In dem als Version 1.0 zur Aktualisierung bezeichneten Artikel setzt [...]
August 21st, 2010 at 12:22 am (#)
Meanwhile as we argue over this, other countries are crushing us in bandwidth available to regular consumers and small businesses.