There is always a vested interest in the US that will trump up with the exact opposite opinion of everyone else, and say it’s in the cause of freedom and the American way. Which is how we are viewing the loud statement issued this week from the American Consumer Institute, well named because it clearly wants to institutionalize American consumers.
It says that Net Neutrality is a bad thing. And why’s that? Well quite clearly it will hurt private investment and impede innovation. How’s that work then? The Institute claims that this is the result of a ‘study’ which is another world for it’s a political opinion which I’m paid for.
The study supposedly took in available data and literature. We’re not sure that studies can read that well. Anyway the thrust of the complaint to the FCC over its proposed method for dealing with Net Neutrality, is that it is the broadband network providers who are the leading source of innovation and investment in Internet infrastructures. And concludes that since there has been no regulation so far on the internet, it is best left well alone because otherwise it would restrict technology advances, innovation and job growth.
These are all topics close to the heart of every American (actually to everyone right now). So such logic tugs on the heartstrings.
‘All indications are that these well intended regulations would dampen both incentives and opportunities for firms in the Internet ecosystem to continue to invest and to embed new technologies in core networks on which downstream applications and content providers depend,’ said Larry F Darby, co-author of the study.
Darby claims there were other findings and then just blathered on about the same old things, repeating them ad nausea and asking the question whether there is any proof that net neutrality would work. That’s a bit like asking for proof that shooting yourself in the head kills you. You can’t do it and then change your mind.
It is true that in the US, the RBOCs are now so strong that they need breaking up all over again. AT&T refused to invest in fiber before it had some kind of concessions that CLECs would not be able to hijack it, and used the US courts to prevent the FCC imposing pricing on wholesale and unbundled connections. As a result, the US has fallen way below the top ten broadband countries in the world and will continue to fall. This is not voluntary innovation. This is the RBOCs insisting on legislation in its favor before it will finally, petulantly, agree to investment.
Net Neutrality offers the same opportunity ‘ AT&T and Verizon might take the view that major internet businesses such as Google should have to pay it extra money ‘ a kind of internet taxation on innovation ‘ in order that its traffic is not slowed down for AT&T customers. That would be no problem if those customers had 2 or 3 other sources of broadband to flock to, but there is usually only one other source available at most points in the US, the cable operators, and they feel just the same about Net Neutrality ‘ they hate it. If you have no competition in basic internet connectivity, and content wants to travel over the internet, then the RBOCs and Cable operators become gatekeepers, and can charge what they like.
This debate is massive. If the US does not create some form of stand, in favor of Net Neutrality, then few other civilized countries will have the stomach to enact such legislation, though probably the European Commission will. The result would mean that all network owners end up owning all content, or at least take a cut out of every piece of content that is sold on the internet. They might work with companies like Google, but they will remove the flat playing field that there is right now on the internet.
Already in many European and Asian countries, operators use traffic shaping or deep packet inspection to stop competitive video services, and this means that they will automatically gain a monopoly in content services. The European Commission has taken a stand on it, but it remains a dark area where many operators are dragging their heels.
If we allow this then we might as well give all the major operators a share in the internet and tell them to run it as their pet project. Next thing you know video would be taxed or banned on the internet and that’s hardly innovation.
The study concludes: ‘Our review finds no market failure attributable to insufficient innovation in networks or superior innovation outside network infrastructures.’ Except of course that the US is lagging behind on connectivity so dramatically that the US government has called for a national broadband plan to put it right. We think that’s enough of a market failure to prove the point.
We’ll leave it to US investigative journalists to establish a link with vested interests and this group, but we’re fairly sure this can be established, as no-one in their right mind who was not an AT&T or Comcast shareholder, should even think about blocking net neutrality.