Although this probably won't get discussed much in the blogosphere, it actually bothers me more than the recent reversal of the Title II classification for ISPs, over which so many electrons were spilled. In my view, actual competition from municipal fiber would produce better outcomes than we could ever get with Net Neutrality regulation. That Pai's FCC is moving in the wrong direction on this front as well is very disheartening, albeit, alas, unsurprising.
Although this probably won't get discussed much in the blogosphere, it actually bothers me more than the recent reversal of the Title II classification for ISPs, over which so many electrons were spilled. In my view, actual competition from municipal fiber would produce better outcomes than we could ever get with Net Neutrality regulation. That Pai's FCC is moving in the wrong direction on this front as well is very disheartening, albeit, alas, unsurprising.
If there were actually competitive markets for ISP services, we would be having a different conversation. Not that the ISPs could ever just be trusted to 'do the right thing' as Pai seems to believe (we have regulations precisely because corporations cannot be trusted to do the right thing), but it would be harder for ISPs to unilaterally restrict services. Practically speaking, the only option now is muni broadband.
I am bothered by it, but I don’t think lack of regulation is going to fix the issue, because an ISP is a natural monopoly. The rights they have acquired from the government and from the private sector to lay all those wires provide too big a hurdle in the absence of regulation, and passing laws to make to easier to lay wires for competition would have to have all sorts of negative externalities for property owners and cities, not to mention the inefficiency of building the infrastructure twice. So that leaves regulating the current ISPs as a public utility, like is done successfully in much of the world, or leaving the market in the hands of monopolists.
ISPs—in the sense of providers of last-mile connectivity—are a natural monopoly. They have inherent anti-competitive properties no matter what their ownership structure. The important question is whether being owned by a national corporation or by a local government or by a local association allows for more effective regulation of that monopoly in practice; it indisputably needs regulation.
The competition that's actually worth caring about and encouraging and protecting is competition for backhaul connectivity to CDN nodes and peering points, and services offered on top of the internet connection (email, VoIP, TV content, etc.). Trying to make things fair for two competitors putting trenches along the same street is a fool's errand and obscenely wasteful.
Whatever, there should better be competition. If one ISP (a big corporation or a municipality) does it a way you don't like and you can't switch to another one that's sad.
Unfortunately the Net Neutrality 'debate' was another lose-lose situation for the United States. What we wanted wasn't for the big telecom duopoly to be forced to either run their business as a tiered service or as a regulated utility. What we wanted was for the US Government to exercise its Anti-Trust capabilities and bust the universally hated Comcast and Time Warner into a bunch of small companies, and set "Goldilocks" regulation so that it's easy for small and new ISPs to compete on both price and service. Additional laws preventing corporations from discriminating by content, protocol, or customer may also have been nice, but would have been that extra nice something.
Are Comcast and Time Warner going to be somehow less shitty now? Are they going to monitor our communications less? Are they going to provide better prices and better customer service? Are they going to cease fraudulently charging customers? No.
Of the two options the FCC chose the better one. But it's America's fatal flaw that all problems have two political solutions, neither of which address real issues or people's needs.
I'm not sure how this is relevant; yes, more proper competition would be great, but we had that, for a long time, and the competition merged/consolidated. Merger after merger happened until cities were left with two competitors that made deals to stay off each other's sides of the tracks. The market naturally consolidated without government regulation allowing such things to occur.
Besides, this is a tangential issue; it's related in someway, but such competition doesn't help consumers when it comes to what their ISP can and cannot do. Even without city contracts, it's really expensive in the US to start an ISP; we've seen countless stories about ISP start-ups here on HN which show the difficulty of such a venture, and it's why we don't see more of it. Heck, Google with its deep pockets could not make it work even in cities that were happy to bend over backwards for them.
Even if we were to have more last mile ISPs, how does that help when the rest of the upstream is plagued with ISPs that are deprioritizing traffic based on their preferences? What good is it to have an ISP at the last mile in Seattle if the route to Seattle de-prioritizes this traffic?
Net Neutrality is equally important to the striking down of the city-wide contracts ISPs have managed to get. This was a state by state thing and the story was the same each time; the ISPs promised far more than they delivered to the states, and the states just ate the bill while the ISPs fought in court each and every time. I don't believe for a moment that the ISPs should be able to use our Tax Payer money to have laid cable like this then bend us over a barrel for it.
More competition would be great, but this alone doesn't solve the issue. How big of a price tag does a BenevolentISP have before it's an offer too good to refuse? Why even give them the power to use our money to screw us even further?
I disagree in terms of regulation: there is plenty of regulation on broadband internet, except it tends to discourage competition against broadband providers.
This isn't a problem that is going to be solved by placing regulations on the industry. Your example of past subsidies provides an excellent argument for this: given the political clout these entities hold and have in the past used to stilt legislation in their favor, what leads us to believe we're going to do any better with new regulations?
At the end of the day, the market is demanding better internet service. While telecommunications providers are certain to wage war against the injection against honest competition into their sector, things are actually looking pretty good in my mind. The FCC sees market demand and is working to tear down anti-competitive legislative barriers [1]. Smaller efforts such as Google Fiber are doing the hard work of convincing the public that better service is within reach.
In the last ten years, I've lived in 6 different localities and have had a total of 4 options for ISP, never more than 2 at any given time. In at least some of those cases, I've watched as potential competition to those options was shut down by ISP-lobbied local regulation. At whatever point there's a possibility of competition in this space, I'll readily buy the free-market argument that they should be de-regulated.
That is the alternative way to achieve the desired outcome. The thing is, to get real competition, we need to have regulation on ISPs as well -- line sharing rules. We used to have line sharing rules for DSL service, and back then we had dozens of competing services and few regions where competition was scarce. Then one day the line sharing rules were dropped and almost overnight we wound up with the situation we have today, with local monopolies or duopolies throughout the country.
Sadly, Pai's proposal does not have any concrete plan for increasing competition, and mostly seems to be based on the false assumption that there is already an ISP market in America (i.e. that Americans can choose among several ISPs). His only proposal so far, separate from the net neutrality rollback, to improve competition is to streamline the process for attaching cables to utility poles, which is not even close to enough to create a competitive ISP market.
I'm more disappointed that "regulating telecom" apparently means Net Neutrality these days. In the United States, the telecom industry engages in quite a bit of anticompetitive practices, specifically MSOs (multiple system operators) like Comcast and Spectrum.
They frequently have agreements to be the only registered cable operator for a given geographic region. They frequently become the only provider for a given apartment complex or multi-tenant location. We're not allowed a la carte programming due to bundles of channels these companies have a large stake in because of distribution rights. Rates have been outpacing cost-of-living and previous profit margins year-over-year since the 90s. Consumer broadband internet is still slower than most other developed nations, and we pay more for it at all pricing tiers. The only time I remember seeing speeds increase while rates dropped were when Google started building out fiber, and that only happened in a couple microcosms.
I think there's a serious need for trustbusting, but the tech industry at large doesn't seem to be a good target yet.
You’re not alone. Many Americans – especially those far from major cities -- have only a single ISP available, others have only two ISPs. That’s why competition is more limited in the market for broadband than in other markets (because consumers can’t “vote with their feet” by switching to a competitor), and that’s a major reason I believe the existing net neutrality regulation under Title II is needed.
Perhaps. I'd prefer it not to--I'd rather have an ecosystem with private and public competition, and one with net neutrality regulation. But it seems to me the discussion is generally really lopsided, with little to no acknowledgment of what ISPs get from the public. If the ISPs really want unfettered competition, then I say fine--but I think, as you say, if we really took competition seriously the consequences would be far more dire for them than I think people realize. The problem is the scope of what real competition would entail is often obscured, because what they get from the public is just sort of assumed to be a given and off the table.
I agree wholeheartedly. IMHO all of these proposed legislative efforts are band-aids. The real problem is that the market isn't even remotely competitive or healthy.
I don't think I would mind a universe where there are lots of providers, some of whom are net-neutral and some of whom aren't.
On the other hand, that kind of universe presents some troubling social issues (only those who can afford a neutral internet will have access to it).
Is this due to the FCC reclassification of internet as a common carrier?
I wondered a little bit about this, myself, when Fiber was launched. They have a lot more motivation without network neutrality as a matter of regulation because it'd open up the ability of ISPs to penalize their products[0].
I'm generally of the opinion that government over-regulates, but I was in support of the whole "Network Neutrality" situation because broadband services availability for many/most in the US is limited to one provider and that one company is also usually either AT&T or Comcast, known more for how much they suck than for the services they provide. It's not too hard to believe that if common carrier status were removed, AT&T or Comcast would lower their caps and start offering services that are exempt from those caps (especially Comcast - suddenly Hulu or anything NBCUniversal is all-you-can-consume, but Netflix/Amazon Video/YouTube are not).
In a world like that, Google does have more motivation to roll out an ISP that does the opposite with their own services (or more likely just doesn't discriminate with anyone's traffic). Fiber resulted in a sudden expansion by many other ISPs to service with higher performance (and in many areas that are not even on the future Fiber cities list), so they've kind of accomplished the goal that has the greatest benefit to them -- more eyes on their products at a speed that makes them more useful.
At the end of the day, though, I'm not so sure that the FCC reclassification is much more than a tiny bullet point in favor of not spending the money required to do a fiber roll out. They are certainly aware that Republicans are itching to dismantle this reclassification and their nominee has promised to do so IIRC. And though the Democrat's nominee has indicated that she'll keep that reclassification, I'm not willing to take her at her word on that. If that were their main reason for allowing fiber to "transition" to whatever new option they're looking at that (hopefully) costs a lot less to roll out but still doesn't exist in the places they want to roll out to, I'd be pretty surprised.
[0] I'm not advocating that network neutrality be dismantled to give Google more motivation.
Thanks for the links. I haven't read through all of them, but my first impression is that Pai is underestimating the impact of structural changes in the ISP industry. He keeps saying he wants to go back to how things were in the 1990s, but I don't think that's possible. The degree of industry consolidation, and of regulatory capture by the largest ISPs, have changed the landscape, and the approach that worked well until maybe 2007 won't necessarily work anymore.
I do appreciate that he's at least trying to increase infrastructure investment, and I guess I'll have to think some more before I have an opinion on whether the proposed rules are likely to do that. I do know of one small ISP that supports his approach.
As others have said here in discussions like this one, I think that net neutrality is something of a second choice. What we really need is meaningful competition among ISPs. I would be happy if we could take all this political energy being spent opposing Pai and channel it instead toward removing barriers to municipal broadband.
The FCC has made its share of mistakes, but that doesn't necessarily mean this will be one.
"Title II regulation was designed for the plain-old-telephone-system monopolies, where there was even less choice (one provider!) than the very worst of current local broadband markets."
My mom has one ISP to choose from (and dismal service.) More than half the population of the US have access to a single broadband provider.
"The internet, without any FCC rules, thrived and completely eclipsed that slow-moving regulated market."
When behemoth broadband providers began openly plotting to predatorily damage some of the things that had helped provide for the internet's success, it was clear to most that some kind of regulations were needed.
"new federal rules will limit what ISPs can offer and charge, regardless of what paying customers prefer."
I have yet to hear from a single paying customer that actually wanted what the ISPs were plotting.
"Upstart services offering novel cross-subsidized speed/latency improvements will require federal pre-approval or risk outright prohibition."
Yeah, they would need approval if they wanted to offer that particular service, though I am not sure how to find that disappointing.
"This is not a victory for either the internet or the "little guy"."
Perhaps, why not see what actually happens before making broad speculative declarations, though?
Which I think illustrates how NN is just nibbling at the edges of the problem. Competition is the real solution. If we could get the same lobbying efforts and grass roots passion behind removing local barriers to entry in the ISP market as there is behind NN, I think we'd be much better off.
What's this great innovation in the wireline broadband space being stifled by overeager regulators? Presumably there's some concrete example of what our friends the competitive ISPs want to do and are unable to because of the regulations. Or even, what they _used_ to be able to do: Title II reclassification is obviously very recent and the prior "Open Internet" or net neutrality orders weren't long before that. I suspect that the "innovation" they're looking to provide won't be of the kind most people are interested in fostering.
I'm generally amenable to the argument that robust competition is the best solution and that we should be aiming to reduce those barriers but... unbundling was very unpopular with the ISPs and didn't really work and is dead, and as you said the big last-mile problems are local.
Knowing that the FCC isn't actually successfully creating the robust competitive local broadband markets they say they'd prefer, doesn't it make sense for them to do what they _are_ able to do and keep the existing (already "light touch") regulations?
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