News Is Net Neutrality Really Necessary?

[Greg Bernhardt]

The rules were just approved
http://online.wsj.com/article/SB10001424052748703581204576033513990668654.html

 

[JaredJames]

EDIT: Ah, wrong part of article.

So now providers can't restrict access?

 

[xxChrisxx]

Well this is going to create a ****storm.

Hang on I may have misunderstood, that article is confusing me (it's late and it's been a long day working). Is this passing a good or bad thing?

EDIT: You need a better profanity filter.

 

[JaredJames]

Seems like a good thing to me, stops the ISP's interfering with your web access.

 

[xxChrisxx]

Seems like a good thing to me, stops the ISP's interfering with your web access.

It appears you made the same mistake I did :)

 

[Evo]

Seems like a good thing to me, stops the ISP's interfering with your web access.

It's a shame.

The new rules:

Wireless providers would be allowed to block other applications, however, that they say could take up too much bandwidth on wireless networks.

So anything you wish to download or view on a wireless device can now be legally blocked.

The rules would allow phone and cable companies to offer faster, priority delivery services to Internet companies willing to pay extra.

That's fine, it's always been that way, but this was a big deal when the whole "net neutrality" thing started. Net Neutrality advocates didn't want this.

We have now given the Government control of the internet in the US.

 

[Al68]

If the alternative was no access at all, then yes, people would buy it.

Of course that's true, but that's not the situation I was referring to. I specifically said:

As long as there is competition and freedom from regulation...

As long as there is demand for general WWW access, and government doesn't restrict it, there will be a company to sell it. There is no reason to believe that every company in the country would coincidentally and inexplicably refuse to offer a profitable product.

 

[JaredJames]

We have now given the Government control of the internet in the US.

Well let's be honest, would you prefer it to be the government or a private company?

The former answers to you (or is supposed to). The latter doesn't answer to anyone.

 

[nismaratwork]

Of course that's true, but that's not the situation I was referring to. I specifically said:As long as there is demand for general WWW access, and government doesn't restrict it, there will be a company to sell it. There is no reason to believe that every company in the country would coincidentally and inexplicably refuse to offer a profitable product.

I tend to agree with this. If the USA actually DOES anything with this, they'll just be shooting themselves in the foot... assuming that any law born of this isn't struck down in the courts with an injunction. The government simply can't afford to do what some of their interests want, and there are competing interests with huge clout who want things to remain MOSTLY open (see google).

 

[nismaratwork]

If the alternative was no access at all, then yes, people would buy it.

If there's no alternative then that person lives in an area where this is unlikely to effect them, or we're living in the aftermath of a nuclear holocaust. I'm sorry Greg, but "no alternative" in this case is a fantasy. That said, in your restricted and unreal scenario, yeah, people would tend to take something over nothing, but how do you not see something else emerging from that?

 

[Evo]

Well let's be honest, would you prefer it to be the government or a private company?

The former answers to you (or is supposed to). The latter doesn't answer to anyone.

Consumers would drive the competition in the market. Remember when the WWW started, you paid by the hour. Consumer backlash forced flat rate pricing. Competition and consumer behavior greatly affects the success of what a company tries to do. I, for one, don't want the government dictating to me what my choices are.

This ruling should have been delayed until more details were hammered out and the public had more input. Why it was rushed through the way it was so some politician could get his name on it isn't right, IMO.

 

[nismaratwork]

Consumers would drive the competition in the market. Remember when the WWW started, you paid by the hour. Consumer backlash forced flat rate pricing. Competition and consumer behavior greatly affects the success of what a company tries to do. I, for one, don't want the government dictating to me what my choices are.

This ruling should have been delayed until more details were hammered out and the public had more input. Why it was rushed through the way it was so some politician could get his name on it isn't right, IMO.

Yes, but now it's going to be in the courts for god-knows-how-long until it's eventually struck down. In the meantime... nothing... I'm OK with that.

As for the last bit... yeah, that isn't right, but it's essentially the heart of politics, or so it seems.

 

[Al68]

Well let's be honest, would you prefer it to be the government or a private company?.

The reasonable choice is between government or nobody. I choose nobody. Currently no private company has any such power, and as far as I know, nobody supports giving a private company any such power. A private company can only control what they want to sell to me, not what I can or can't buy (from their competitors or potential competitors). Big difference.

 

[nismaratwork]

The reasonable choice is between government or nobody. I choose nobody. Currently no private company has any such power, and as far as I know, nobody supports giving a private company any such power. A private company can only control what they want to sell to me, not what I can or can't buy (from their competitors or potential competitors). Big difference.

The government is as good as nobody in this context... they both will have the same capacity to control the relevant issue.

 

[Al68]

The government is as good as nobody in this context...

Nope. "Nobody" is far better to a libertarian, obviously.

...they both will have the same capacity to control the relevant issue.

Nope. Government can control all access, a private company can only control the access provided by that company. That's as different from "the same" as one can get.

 

[WhoWee]

The government is as good as nobody in this context... they both will have the same capacity to control the relevant issue.

"Nobody" doesn't have the power to tax - Government, on the other hand can first create a new bureacracy - then tax to pay for the expansion -. then find a way to tax to justify the expansion -> then tax the increased fees required to pay for the tax -> then increase the size of the bureacracy in the name of enforcement - etc.

 

[Evo]

Once the FCC gets it's claws into something, it doesn't let go. It's going to be a long, hard, costly struggle to stop this.

Net Neutrality A 'Threat To Internet Freedom'

The Huffington Post

Later this week, the FCC is set to vote on net neutrality rules, which would prohibit Internet service providers like Comcast and Verizon from discriminating in how they handle information traveling over their networks. Both supporters and opponents of net neutrality are unhappy with the FCC's plan, some arguing it is toothless while others asserting that the rules will stifle innovation. Al Franken called the draft regulations "worse than nothing," while McDowell accused FCC leadership of tackling an "imaginary problem."

"On this winter solstice, we will witness jaw-dropping interventionist chutzpah as the FCC bypasses branches of our government in the dogged pursuit of needless and harmful regulation," McDowell wrote. "The darkest day of the year may end up marking the beginning of a long winter's night for Internet freedom."

http://www.huffingtonpost.com/2010/12/20/fcc-commissioner-net-neut_n_798998.html

 

[nismaratwork]

"Nobody" doesn't have the power to tax - Government, on the other hand can first create a new bureacracy - then tax to pay for the expansion -. then find a way to tax to justify the expansion -> then tax the increased fees required to pay for the tax -> then increase the size of the bureacracy in the name of enforcement - etc.

Yep, which is why doing so, or even starting to do so would simply cause an alternative to WWW to emerge, or a WWW centered in another country.

Evo: You're right, but in the meantime I suspect nothing will be done due to injunction.

Al68: You misunderstand, even before this the government could physically cut undersea cables, or take other drastic measures to end service, although perhaps not legally. Beyond that, they really don't have the capacity to monitor their own usage, never mind everyone else's. This is only harmful if the regulation is used to some end, and any end it's used to would be challenged in court. I would bet the challenge wins.

In fact Al, Google could shut down in protest and we'd have no way to get google... the government is all or nothing. In this case, private industry has MUCH more leverage than the government... see facebook.

 

[pantaz]

...
So anything you wish to download or view on a wireless device can now be legally blocked. ...

Do you believe that it is currently illegal to do so?

 

[Al68]

Al68: You misunderstand, even before this the government could physically cut undersea cables, or take other drastic measures to end service...

I don't misunderstand at all. I oppose government doing that as well.

In fact Al, Google could shut down in protest and we'd have no way to get google... the government is all or nothing. In this case, private industry has MUCH more leverage than the government... see facebook.

"Private industry" is not monolithic like government. Saying private industry has "leverage" in this sense is like saying barbers have leverage to determine how long people's hair should be, by each choosing to provide only specific types of haircuts, and therefore would be "the same as" government using force to mandate specific hairstyles. Better the government restrict hair length than barbers who answer to nobody?

It's fallacious logic to define separate entities as a group, then treat the group as if it were a monolithic entity. And it's fallacious logic to equate the choices of private entities whether to provide a service or not with government using force to prevent/require people to buy/sell a service.

 

[Evo]

Do you believe that it is currently illegal to do so?

No, but now there is a law protecting their right to do it.

 

[NeoDevin]

No, but now there is a law protecting their right to do it.

I haven't seen the text of the rules, but my impression was that it simply doesn't cover wireless. Did they actually include something stating that this is specifically allowed on wireless networks?

 

[Evo]

I haven't seen the text of the rules, but my impression was that it simply doesn't cover wireless. Did they actually include something stating that this is specifically allowed on wireless networks?

Yes, I posted it above.

The new rules:

Wireless providers would be allowed to block other applications, however, that they say could take up too much bandwidth on wireless networks.

So anything you wish to download or view on a wireless device can now be legally blocked.

That is per Greg's link http://online.wsj.com/article/SB10001424052748703581204576033513990668654.html

 

[NeoDevin]

Yes, I posted it above.

Thanks, I missed that post somehow. The text before that reads:

Companies that operate mobile wireless networks would have fewer rules to contend with. Phone companies wouldn't be able to block legal websites from consumers. They also can't block mobile voice or video-conferencing applications. Wireless providers would be allowed to block other applications, however, that they say could take up too much bandwidth on wireless networks.

To me that reads like it could be that the rules don't address blocking other applications, rather than that they specifically state that it's ok.

 

[Evo]

What the new Net Neutrality law means.

Wireless broadband providers, meanwhile, will have the ability to block access to content and services as they see fit as long as they do not offer a competing service. Wireless carriers could, for example, block YouTube if the carrier did not offer a similar video sharing site.

No Torrents For You

Fixed-line broadband providers will not be allowed to discriminate against any lawful Web services you want to use. Did you see that little disclaimer in there? That's right "lawful" Web services, meaning that torrent indexing sites, such as The Pirate Bay, and other sites considered shady could soon disappear from your Web browser.

It will also be interesting to see how the reported FCC rules affect peer to peer torrent sharing programs such as Vuze

Netflix Tax

If you're one of those more than 16 million people -- in the US anyway--you could end up paying a higher broadband bill every month after the Net neutrality rules take effect. Under the new rules, broadband providers would be allowed to enact tiered pricing plans based on how much broadband data you consume every month. The all-you-can-eat data buffet may be over.

http://www.networkworld.com/news/2010/122110-fcc-net-neutrality-rules-what.html?hpg1=bn

 

[NeoDevin]

Under the new rules, broadband providers would be allowed to enact tiered pricing plans based on how much broadband data you consume every month. The all-you-can-eat data buffet may be over.

Sorry, didn't they do that already? I didn't know they were previously required to give everyone unlimited bandwidth.

So far in this thread, everything you've complained about existed before these rules.

 

[Evo]

Sorry, didn't they do that already? I didn't know they were previously required to give everyone unlimited bandwidth.

So far in this thread, everything you've complained about existed before these rules.

AT&T had removed their unlimited data plan, my provider had not.

If you read back to my first post, Net Neutrality was stupid and unnecessary. But what was only being "tested" by some providers to see how consumers would react is now law.

 

[NeoDevin]

If you read back to my first post, Net Neutrality was stupid and unnecessary. But what was only being "tested" by some providers to see how consumers would react is now law.

The law doesn't say that they must stop offering unlimited bandwidth packages, only that they can, which they could already do.

 

[Evo]

The law doesn't say that they must stop offering unlimited bandwidth packages, only that they can, which they could already do.

So, are you agreeing with me that the Net Neutrality law was unnecessary?

 

[Greg Bernhardt]

Interesting email I just received from Al Frankin.

Al Franken - U.S. Senator, Minnesota

If you saw my op-ed in the Huffington Post yesterday, you know how concerned I was about today's FCC meeting on net neutrality (and, by the way, would you mind sharing it on Twitter and Facebook?).
Chairman Genachowski's draft Order was worse than nothing--and we needed to make sure the FCC didn't approve it today.
Well, there's good news and bad news. The good news is that, thanks to Commissioners Copps and Clyburn--not to mention a nationwide network of net neutrality activists like you--the proposal approved today is better than the original. For instance, the FCC has now stated that it does not condone discriminatory behavior by wireless companies like Verizon and AT&T--an important piece that was missing from the first draft. We made a difference.
The bad news is that, while it's no longer worse than nothing, the Order approved today is not nearly strong enough to protect consumers or preserve the free and open Internet. And with so much at stake, I cannot support it.
I'm still very concerned that it includes almost nothing to protect net neutrality for mobile broadband service--often the only choice for broadband if you live in rural or otherwise underserved areas. And I'm particularly disappointed that the FCC isn't specifically banning paid prioritization--the creation of an Internet "fast lane" for corporations that can afford to pay for it.
But here's the important thing to remember: This fight's not over. The FCC must vigorously enforce these new regulations--and it must follow through on addressing wireless discrimination going forward.
So what now? First, we need to work together to make sure the FCC keeps the promises it made today--just as our movement was instrumental in improving these regulations from the first draft, we'll be critical in ensuring that the regulations are enforced vigorously.
And I'm going to keep working with net neutrality advocates to see if there are legislative or administrative steps that can be taken to strengthen these protections.
But, for today, know that the work we're doing to save the Internet is making a difference. Today, the FCC took a small step forward--too small by my estimation, but forward nonetheless.
Thanks for your support,
Al
Al

 

[Evo]

Interesting email I just received from Al Frankin.

I posted his Huffington post article here already.

I think this was rushed through without enough input from consumers. I'll be interested to see what needs to be done going forward to prevent the things I've mentioned above from becoming law.

 

[nismaratwork]

Interesting email I just received from Al Frankin.

Al is a smart man with a good staff... his point about mobile devices is unassailable, and my arguments about circumvention become moot.

I really believe Evo is right about this being rushed to the detriment of the bill, but to the point where I think it has no chance to survive as law.

 

[NeoDevin]

So, are you agreeing with me that the Net Neutrality law was unnecessary?

No. The parts allowing companies to charge more for more bandwidth (if such things are actually mentioned in the rules, and not just commentary added by the news organizations) are redundant and unnecessary. Companies will still be able to offer unlimited bandwidth contracts if they choose, or offer finite bandwidth packages. This part hasn't changed.

The parts preventing them from charging more for some types of data than others were necessary. This prevents ISPs run by cable companies from using a (near) monopoly to shelter their cable services (or any other such conflict of interest). I only wish they could have covered all mobile bandwidth with the same rules (that you pay for bandwidth, irrespective of what you choose to use that bandwidth for).

 

[Evo]

No. The parts allowing companies to charge more for more bandwidth (if such things are actually mentioned in the rules, and not just commentary added by the news organizations) are redundant and unnecessary. Companies will still be able to offer unlimited bandwidth contracts if they choose, or offer finite bandwidth packages. This part hasn't changed.

The parts preventing them from charging more for some types of data than others were necessary. This prevents ISPs run by cable companies from using a (near) monopoly to shelter their cable services (or any other such conflict of interest). I only wish they could have covered all mobile bandwidth with the same rules (that you pay for bandwidth, irrespective of what you choose to use that bandwidth for).

Go read Greg's post.

 

[Proton Soup]

What the new Net Neutrality law means.



http://www.networkworld.com/news/2010/122110-fcc-net-neutrality-rules-what.html?hpg1=bn

i think providers are already offering metered plans, they just don't refer to it as such and say that this plan that offers more is faster than the other. but yeah, metering on total bytes consumed has nothing to do with what the term "net neutrality" means. metering based on the source of the bytes would violate net neutrality, tho.


regulation is inevitable, tho. what normally happens is that they take a hands-off approach during the developmental phase of a technology, and then when it matures, the new technology becomes a utility. FCC seems to be nearing the conclusion that terrestrial broadband is a utility now. wireless broadband obviously is not.

 

[WhoWee]

No. The "scare" is that ISPs like Comcast would charge more or block access to things like video streaming services or P2P networks simply because they compete with their cable TV offerings.

Net neutrality is not about preventing charging more for increased bandwidth (either instantaneous bandwidth or total data uploads/downloads) but about preventing them for charging different amounts for different content using the same bandwidth. If they want to charge $400/GB, that's their prerogative. (Or maybe not, is the pricing of bandwidth regulated in the US? Either way, that's not what net neutrality is about.) What net neutrality seeks to prevent is them being able to charge $400/GB for video streaming and $40/GB for Physics Forums.

Net neutrality says that if you want to be an ISP, you sell bandwidth, you don't get to dictate what your users can use that bandwidth for.

ALSO POST number 83 NeoDevin:
"No. The parts allowing companies to charge more for more bandwidth (if such things are actually mentioned in the rules, and not just commentary added by the news organizations) are redundant and unnecessary. Companies will still be able to offer unlimited bandwidth contracts if they choose, or offer finite bandwidth packages. This part hasn't changed.

The parts preventing them from charging more for some types of data than others were necessary. This prevents ISPs run by cable companies from using a (near) monopoly to shelter their cable services (or any other such conflict of interest). I only wish they could have covered all mobile bandwidth with the same rules (that you pay for bandwidth, irrespective of what you choose to use that bandwidth for). "

If we can focus on the NetFlix and Comcast scenario for a fairness check. I'm not an expert in this area. I'm going to post my understanding and will defer to the experts to clarify anything I mis-communicate.

Comcast has invested significantly to run cables and develop their networks. Comcast has sold their cable services to millions of subscribers. Comcast pays for cable content and re-sells to clients. Comcast also provides internet access in a bundled package (as well as phone).

NetFlix purchases content and re-sells (actually rents) to either subscribers or renters. NetFlix is available via US Mail or as a download. NetFlix (or client) pays the US Mail to deliver content. NetFlix does not pay Comcast to deliver content - but clients do pay Comcast for internet access.

Comcast and NetFlix are in competition for movie rentals. They may or may not offer the same content.

The new regulations will require Comcast to provide NetFlix equal delivery capabilities - at no cost to NetFlix.

If my understanding is correct, I don't believe this is fair to Comcast. NetFlix has a delivery option via US Mail (that isn't required to offer a discount to them). If the same Comcast clients (on the cable side) want a TV channel that Comcast doesn't offer - they do without.

Ultimately, the movie studios (manufacturer) might be the winners in the future. It sounds as though all they need to do is sell movie subscriptions directly to (retail) internet subscribers - cut the cable (wholesaler) provider out completely?

 

[nismaratwork]

ALSO POST number 83 NeoDevin:
"No. The parts allowing companies to charge more for more bandwidth (if such things are actually mentioned in the rules, and not just commentary added by the news organizations) are redundant and unnecessary. Companies will still be able to offer unlimited bandwidth contracts if they choose, or offer finite bandwidth packages. This part hasn't changed.

The parts preventing them from charging more for some types of data than others were necessary. This prevents ISPs run by cable companies from using a (near) monopoly to shelter their cable services (or any other such conflict of interest). I only wish they could have covered all mobile bandwidth with the same rules (that you pay for bandwidth, irrespective of what you choose to use that bandwidth for). "

If we can focus on the NetFlix and Comcast scenario for a fairness check. I'm not an expert in this area. I'm going to post my understanding and will defer to the experts to clarify anything I mis-communicate.

Comcast has invested significantly to run cables and develop their networks. Comcast has sold their cable services to millions of subscribers. Comcast pays for cable content and re-sells to clients. Comcast also provides internet access in a bundled package (as well as phone).

NetFlix purchases content and re-sells (actually rents) to either subscribers or renters. NetFlix is available via US Mail or as a download. NetFlix (or client) pays the US Mail to deliver content. NetFlix does not pay Comcast to deliver content - but clients do pay Comcast for internet access.

Comcast and NetFlix are in competition for movie rentals. They may or may not offer the same content.

The new regulations will require Comcast to provide NetFlix equal delivery capabilities - at no cost to NetFlix.

If my understanding is correct, I don't believe this is fair to Comcast. NetFlix has a delivery option via US Mail (that isn't required to offer a discount to them). If the same Comcast clients (on the cable side) want a TV channel that Comcast doesn't offer - they do without.

Ultimately, the movie studios (manufacturer) might be the winners in the future. It sounds as though all they need to do is sell movie subscriptions directly to (retail) internet subscribers - cut the cable (wholesaler) provider out completely?

Comcast doesn't own the fiber, they just live there.

 

[WhoWee]

Comcast doesn't own the fiber, they just live there.

If Comcast doesn't own the cable - do they lease it?

 

[nismaratwork]

If Comcast doesn't own the cable - do they lease it?

Yes indeed, that's what I meant by "live there"... sorry, I wasn't really clear. The government flat-out owns major trunk lines, but I shouldn't make it sound as though Comcast hasn't invested in infrastructure. They do maintain switching station and subnets, and non-municipal cable/fiber, but that can be done by other companies leasing the lines.

Really, what Comcast and others lease is bandwidth that can manage a given throughput (how much data can move... aka speed), and then they have to make the effort to keep all of that straight.

 

[WhoWee]

Yes indeed, that's what I meant by "live there"... sorry, I wasn't really clear. The government flat-out owns major trunk lines, but I shouldn't make it sound as though Comcast hasn't invested in infrastructure. They do maintain switching station and subnets, and non-municipal cable/fiber, but that can be done by other companies leasing the lines.

Really, what Comcast and others lease is bandwidth that can manage a given throughput (how much data can move... aka speed), and then they have to make the effort to keep all of that straight.

If they lease bandwidth from the Government - that lease should be the starting point of all discussions. Next, it sounds as though Comcast does own everything from the trunk line to their customer's (tv, computer, or phone) equipment.

I don't see how the FCC can force them to provide equal access to a competitor without compensation (from the competitor) - or a lower rate on their lease payment on the trunk line - to accommodate mandates.

 

[NobodySpecial]

I don't see how the FCC can force them to provide equal access to a competitor without compensation (from the competitor) - or a lower rate on their lease payment on the trunk line - to accommodate mandates.

They are being compensated - you are buying bandwidth from them.

Suppose there was only one oil refinery producing gasoline for your area (which there probably is for most of the US) and they sign a promotion deal with GM so that the gas costs twice as much for a Ford driver.
Well it's a free country - a competitor can always build their own refinery and gas stations and supply Ford and GM drivers equally

 

[nismaratwork]

If they lease bandwidth from the Government - that lease should be the starting point of all discussions. Next, it sounds as though Comcast does own everything from the trunk line to their customer's (tv, computer, or phone) equipment.

I don't see how the FCC can force them to provide equal access to a competitor without compensation (from the competitor) - or a lower rate on their lease payment on the trunk line - to accommodate mandates.

It's very tricky, but you're picking up the essentials rapidly. A few corrections:

Comcast owns a very small amount of cable leading from the point where they establish a local network, but even then because of older rulings others can carry on the some portions of the same lines. Think of it this way, if I switch from Comcast to Time Warner, nothing physical changes from the point where coaxial cable leaves my wall, out of my home or building... etc. The government has been very careful from the beginning to make sure that they'd have similar controls over cabled (and now fiber) communications that they did over broadcast and radio. They already had the phone system as a template, and that's probably the best analogy.

Now, the thing is Comcast DOES limit how much you can download per month: 250 Gigabytes, which they claim covers over 99% of their customers. I would argue that 250GB is going to be less than enough with Netflix and similar services through gaming consoles and other devices, and the rapid growth of digital distribution of legal goods such as games.

Anyway, my point is that Comcast can protect their profits by not allowing me to (as they see it) overuse their service and force them to narrow their profit margin. They can't however, tell me how to allocate that 250GB beyond the obvious: it must be legal use. The issue here is that Comcast (again, just an example) shouldn't be allowed to tell you who you can spend your time with.

MY point is that technically, it's absurd trying to block traffic on the scale Comcast proposes without expecting the rapid use and evolution of countermeasures. They can throttle you down to 1 GB per year, and you can opt out, but they can't tell you not to download 1GB of Swiss Mountain Porn.

NobodySpecial has the point down: a competitor can come in and simply offer the same service on the SAME LINES, but in the 'old' model, just the way that AOL was crushed.

 

[WhoWee]

They are being compensated - you are buying bandwidth from them.

Suppose there was only one oil refinery producing gasoline for your area (which there probably is for most of the US) and they sign a promotion deal with GM so that the gas costs twice as much for a Ford driver.
Well it's a free country - a competitor can always build their own refinery and gas stations and supply Ford and GM drivers equally

Please clarify your (they and you) designations. It's my understanding Comcast leases bandwidth on the trunk line - does NetFlix also lease space on the trunk line?

 

[nismaratwork]

Please clarify your (they and you) designations. It's my understanding Comcast leases bandwidth on the trunk line - does NetFlix also lease space on the trunk line?

HERE you come to the crux of the issue:

Netflix buys bandwidth too, like an ISP, but it only needs to extend for a short 'distance' before it becomes traffic on some ISP somewhere. So, for Netflix the primary challenge for streaming video is actually keeping their servers smoothly humming and their network clean and clear, all while refining the art of when to allocate the most bandwidth (it's pricey).

An ISP carries, as it's essential service, all content from OUT THERE, through their network TO YOU. They don't have to constantly run or hold Netflix's catalogue, but anytime A makes a call for that resource at B, the ISP's JOB is to carry it at their advertised speed to you. To keep their service fast they can:

1.) Buy more bandwidth
-increase monthly prices
or
-lower profit margins (by no means losing profitability)
2.) Throttle how much throughput you're allowed per month
-Comcast does 250GB/month, but not parsing what makes that 250.
3.) Throttle specific traffic (packet shaping is an example) from sites that are using a disproportionate amount of your bandwidth.
-Problem A: Netflix, MS Live, iTunes and TV... etc... are all LEGAL.
-It's easy to get around this if your target is illegal activity.
-Illegal activity is being eclipsed by the massive amount of money being found in digital distribution
PROBLEM: Netflix wants there to be as little additional cost to you as possible to get their service. For them, and others in digital distribution the calculation is simple:

Users Reached = Profit.

For the ISP it's: User's Paying + (250GB - X) = Profit (where X = how much the enduser consumes of that 250GB).

See the conflict? The ISP doesn't get any more money because you spend your pre-paid month of their service looking at HD video on Hulu, but Hulu is thrilled at this development.

So, if the ISPs want to go to war over this, they'll be fighting the people who use their service on the supply side as well.

 

[nismaratwork]

WhoWee: You're asking all of the right question btw.

 

[WhoWee]

Now, the thing is Comcast DOES limit how much you can download per month: 250 Gigabytes, which they claim covers over 99% of their customers. I would argue that 250GB is going to be less than enough with Netflix and similar services through gaming consoles and other devices, and the rapid growth of digital distribution of legal goods such as games.

Anyway, my point is that Comcast can protect their profits by not allowing me to (as they see it) overuse their service and force them to narrow their profit margin. They can't however, tell me how to allocate that 250GB beyond the obvious: it must be legal use. The issue here is that Comcast (again, just an example) shouldn't be allowed to tell you who you can spend your time with.

QUOTE]
It seems the best thing Comcast and others can do is modify their current agreements with cost schedules above the 250GB level. Next, they could inform clients of their on-going/cumulative level of use - much the way a cell phone provider discloses minutes used or available (until the cost increases). Perhaps each time a client attempts to download a movie, the ISP can inform them of the impact of their decision on the specific account? This would prevent customers from incurring additional costs - unless that is their intention.

 

[NeoDevin]

ALSO POST number 83 NeoDevin:
"No. The parts allowing companies to charge more for more bandwidth (if such things are actually mentioned in the rules, and not just commentary added by the news organizations) are redundant and unnecessary. Companies will still be able to offer unlimited bandwidth contracts if they choose, or offer finite bandwidth packages. This part hasn't changed.

The parts preventing them from charging more for some types of data than others were necessary. This prevents ISPs run by cable companies from using a (near) monopoly to shelter their cable services (or any other such conflict of interest). I only wish they could have covered all mobile bandwidth with the same rules (that you pay for bandwidth, irrespective of what you choose to use that bandwidth for). "

If we can focus on the NetFlix and Comcast scenario for a fairness check. I'm not an expert in this area. I'm going to post my understanding and will defer to the experts to clarify anything I mis-communicate.

Comcast has invested significantly to run cables and develop their networks. Comcast has sold their cable services to millions of subscribers. Comcast pays for cable content and re-sells to clients. Comcast also provides internet access in a bundled package (as well as phone).

NetFlix purchases content and re-sells (actually rents) to either subscribers or renters. NetFlix is available via US Mail or as a download. NetFlix (or client) pays the US Mail to deliver content. NetFlix does not pay Comcast to deliver content - but clients do pay Comcast for internet access.

Comcast and NetFlix are in competition for movie rentals. They may or may not offer the same content.

The new regulations will require Comcast to provide NetFlix equal delivery capabilities - at no cost to NetFlix.

If my understanding is correct, I don't believe this is fair to Comcast. NetFlix has a delivery option via US Mail (that isn't required to offer a discount to them). If the same Comcast clients (on the cable side) want a TV channel that Comcast doesn't offer - they do without.

Ultimately, the movie studios (manufacturer) might be the winners in the future. It sounds as though all they need to do is sell movie subscriptions directly to (retail) internet subscribers - cut the cable (wholesaler) provider out completely?

The US mail and Comcast have different delivery models. The US mail charges delivery to the sender (who tacks it onto the price that the receiver pays). Comcast has already charged the receiver for the bandwidth. They are trying to charge the sender for the same bandwidth, in order to protect their other business interests.

Imagine what the outcry would be if the US mail decided to start charging both the sender and the receiver. Take it even further, and suggest that the US mail does this, but only for mail sent by political parties in opposition to the one currently in power (US mail is government run, right? Canada Post is, at any rate).

Comcast essentially wants to be able to charge the consumer twice for the same bandwidth. Once directly, on their monthly bill, and once indirectly, as a charge to Netflix, which must then pass it on to the consumer. Comcast is able to do this because they have a near monopoly in place in many regions. In the long run this monopoly would (might) be broken by other ISPs moving in offering more reasonable service, but not before Comcast is able to put most other streaming video services out of business with their monopoly. This happens on a much faster scale than the increased competition (due to the time needed to build infrastructure). Once most of the streaming video services are out of business, Comcast can drop the differential pricing, and remain competitive with other ISPs.

 

[NobodySpecial]

Ultimately, the movie studios (manufacturer) might be the winners in the future. It sounds as though all they need to do is sell movie subscriptions directly to (retail) internet subscribers

They are afraid this will not make them as much money (actually as individual executives they are afraid of any change)
At the moment they can sell packages - if a cinema chain wants the new Harry Potter it also has to take a couple of Rob Schneider movies that nobody wants. Similarly with cable packages - to get the movie/sports package you want you have to buy a bunch of base packages you don't want.

The companies have done their sums and realized that if they want to swap your $100-120 month cable package for direct rentals, you are either going to have to watch a lot of 99c/episode downloads on iTunes or they are going to have to charge you cinema-level prices for pay-per-view movies.

cut the cable (wholesaler) provider out completely?

The trouble is when the cable company is also an ISP and a studio - like Fox.

 

[nismaratwork]

Now, the thing is Comcast DOES limit how much you can download per month: 250 Gigabytes, which they claim covers over 99% of their customers. I would argue that 250GB is going to be less than enough with Netflix and similar services through gaming consoles and other devices, and the rapid growth of digital distribution of legal goods such as games.

Anyway, my point is that Comcast can protect their profits by not allowing me to (as they see it) overuse their service and force them to narrow their profit margin. They can't however, tell me how to allocate that 250GB beyond the obvious: it must be legal use. The issue here is that Comcast (again, just an example) shouldn't be allowed to tell you who you can spend your time with.

QUOTE]
It seems the best thing Comcast and others can do is modify their current agreements with cost schedules above the 250GB level. Next, they could inform clients of their on-going/cumulative level of use - much the way a cell phone provider discloses minutes used or available (until the cost increases). Perhaps each time a client attempts to download a movie, the ISP can inform them of the impact of their decision on the specific account? This would prevent customers from incurring additional costs - unless that is their intention.

The way it stands now Comcast has a monitor that customers can use, and the first time you go over the limit you're given a warning. Now, I'm not sure if a warning means an e-mail, or a call... you get the idea. Anyway, the second offense = suspension of your account for a YEAR.

...

A little ham-handed. There are plans above this at the home-owner level, and business solutions are extremely expensive. There is no intent to keep a high-use customer however... as you can see from their plan, it's effective for them to cut that growing minority loose.

 

[WhoWee]

The way it stands now Comcast has a monitor that customers can use, and the first time you go over the limit you're given a warning. Now, I'm not sure if a warning means an e-mail, or a call... you get the idea. Anyway, the second offense = suspension of your account for a YEAR.

They suspend your account? Why wouldn't they just charge you more?