Fair vs. Foul in Net Neutrality Debate

Earlier this month, Comcast — the nation’s largest cable broadband company — was caught doing what any good Internet Service Provider (ISP) should do, i.e., manage its network to ensure that the online activities of the few don’t interfere with the online activities of the many, or in the words of Comcast EVP David Cohen:

Comcast does not, has not, and will not block any Web sites or online applications, including peer-to-peer services, and no one has demonstrated otherwise. We engage in reasonable network management to provide all of our customers with a good Internet experience, and we do so consistently with FCC policy.

As the FCC noted in its policy statement in 2005, all of the principles to encourage broadband deployment and preserve the nature of the Internet are ‘subject to reasonable network management.’ The Commission clearly recognized that network management is necessary by ISPs for the good of all customers.

Granted, I’m biased. I work for a company in the same industry. Regardless, knowing what I know about that industry, I think Comcast’s position is a reasonable one. Not everyone agrees:

Several consumer groups are challenging federal regulators to stop Comcast from interfering with Internet traffic on its network.

The groups, including Free Press, Public Knowledge and Media Access Project, filed a petition with the Federal Communications Commission to take action against the cable giant. Comcast has been criticized for interrupting Internet access to subscribers who are using popular programs like BitTorrent to download and exchange songs, movies and software programs.

The petition … will serve as the first test of the FCC’s position on the issue of net neutrality, which has become a hot-button topic among technologists and policymakers in Washington. Net neutrality refers to measures that would bar Internet providers like Comcast and phone companies from giving preferential treatment to content on their networks.

The roots of the “net neutrality” issue can be traced to two separate and largely unrelated developments, both chronicled in BusinessWeek. The first occurred in November 2004:

Traveling on business in Tennessee, [Doug Herring] … phoned his wife at their Elberta (Ala.) home. Herring had just signed up with Web-phone provider Vonage Holdings and was pleased with the service. But this time, he couldn’t get through. He switched Web-phone providers, but still couldn’t make calls.

Frustrated, Herring contacted Madison River Communications, the rural phone company that provides his digital subscriber line (DSL) connection. The company said it was blocking calls from Internet phone companies. Outraged, Herring and Vonage complained to federal regulators.

“For me to get the Internet where I live, [Madison River] is the only provider,” Herring fumes. In March the Federal Communications Commission fined the company $15,000, and the carrier agreed it would no longer block Internet-calling services.

The second centers on a November 2005 interview with Ed Whitacre, who at the time was CEO of SBC (which is now AT&T and helmed by Whitacre’s successor, Randall Stephenson):

[BusinessWeek:] How concerned are you about Internet upstarts like Google, MSN, Vonage, and others?

[Whitacre:] How do you think they’re going to get to customers? Through a broadband pipe. Cable companies have them. We have them. Now what they would like to do is use my pipes free, but I ain’t going to let them do that because we have spent this capital and we have to have a return on it. So there’s going to have to be some mechanism for these people who use these pipes to pay for the portion they’re using. Why should they be allowed to use my pipes?

The Internet can’t be free in that sense, because we and the cable companies have made an investment and for a Google or Yahoo! or Vonage or anybody to expect to use these pipes [for] free is nuts!

While the Madison River case demonstrated the ability of one organization to make a remarkably stupid decision, it also proved that the current regulatory regime works. The FCC has the necessary authority to identify and punish stupidity. And the controversy probably would have stopped there, if Whitacre hadn’t entered the fray.

From several fleeting encounters I had with the man a half-dozen years ago, I can assure you Whitacre’s physical stature and sledgehammer style of communication are quite enough to strike fear in the hearts of most people. But I’m also relatively sure it was neither of those traits that fueled the ensuing outcry over his remarks to BusinessWeek. No, it was not Whitacre’s person who caused the uproar, it was a combination of (a) his position in the captain’s seat of what would soon after that interview become “the largest communications company in the nation,” and (b) his awakening by name of the (until then) sleeping giant we know as Google.

Perceiving Whitacre’s words as a literal declaration of war on their core business model, Google (with some help from its lesser peers: Yahoo, Amazon, and EBay) stirred widespread fears that AT&T and other major ISP’s would soon turn the Information Superhighway into a series of toll roads.

One would hope federal lawmakers and regulators are smart enough to see through this bit of theater — to recognize it as little more than a battle of titans, Google vs. AT&T, both of which are prone to over-state their cases, neither of which needs government assistance. Thankfully, many lawmakers and regulators did recognize the theatrics for what they were, and there was no immediate movement on Google’s concerns. (SBC also got smart and rapidly distanced itself from its CEO’s ill-chosen words, eventually agreeing to temporary but strict rules on net neutrality in order to gain regulatory approval for the mergers that vaulted it to its current market position as the “new” AT&T.)

Meanwhile, Google didn’t give up on its fight and eventually succeeded in accomplishing something AT&T could not. Google convinced the Internet grassroots (including many bloggers) that this issue was not really a fight between titans, but a fight between one group of titans (the major ISP’s) and average people — people who wanted nothing more than to express themselves via the Internet. Thus motivated, the “netroots” (not all of them progressives, in this case) applied a constant drumbeat of pressure on Washington, slowly persuading one lawmaker after another that their fears were real.

Today, their cause is championed by the likes of Barack Obama, a lawmaker and candidate whom I generally respect. Unfortunately, there are at least two problems with proposals like those from Obama. First, they largely fail to distinguish between flagrant censorship and legitimate network management. Second, by curtailing the latter, they could have the exact opposite of their intended impact.

Bandwidth is a finite resource. If a handful of users disproportionately consume that finite resource, the overwhelming majority of other users are either unable, or severely limited in their ability, to access and interact with the sites they prefer.

Look at it as a pipe that 12 people are trying to walk through. Nine of those people weigh roughly 200 pounds each. The other three weigh 600 pounds each. An equivalent weight of 1,800 pounds can fit through the pipe at one time, meaning that all three 600-pound people can go through at once … or all nine 200- pound people … or some other combination of the two weight groups. During times of peak use, when all or virtually all of the would-be pipe walkers want to travel through it, the manager assigned to monitor traffic flow has a choice. To be as fair as possible, he decides to set the traffic-flow policies so that either (a) one 600-pound person and six 200-pound people can go through at one time, or (b) two 600-pound people and three 200-pound people.

And that’s a reasonably fair analogy for what Comcast is doing. The minority of 600-pound people are engaged in bandwidth-intense activities such as file-sharing, while the majority of 200-pound people are engaged in less-intense forays, such as blogging, or participating in online polls, or uploading short videos asking questions of presidential candidates. Hence, what Comcast is doing actually advances net neutrality -– a fair and equitable online experience for everyone.

Here’s another variable to keep in mind. The de minimis fraction of those engaged in bandwidth-ravaging applications (like file-sharing) frequently set up those applications to run automatically or passively, at night or in the background, when the associated users aren’t even at their computers or aren’t otherwise participating in a joint cause. Meanwhile, the politically engaged majority -– who are attempting to share information, sign petitions, email their Congressional officials, etc. -– are doing so in real time, actively and manually. Hence, Comcast’s practice is not only advancing net neutrality, it is also advancing the interests of the politically active, increasing the chances that their interests are not trumped by the interests of those who want nothing more than to swap songs and movies.

For all of these reasons, I’m baffled that certain political factions would argue against what Comcast is doing, when what Comcast is doing is actually making it easier for everyone to engage in the political process.

Of course, some will argue that -– rather than delaying certain users for the benefit of all users -– Comcast should simply build bigger pipes. That argument is naïve. It takes massive amounts of time and capital to build bigger pipes. Comcast has invested and will continue to invest such time and capital, as the demands of the majority increase. But the company can’t justify doing so for a minority of users, unless it dramatically increases the cost of access for everyone.

Bottomline: Before net neutrality can be the subject of a productive debate, the participants in this debate must grow collectively smarter about the details. They must enhance their ability to distinguish between foul and fair play. If they don’t, they could very well regret what they ask for.