[iDC] Net Neutrality
Joel Slayton
joel at well.com
Wed Jun 21 17:43:16 EDT 2006
Hello everyone,
Lawrence Lessig is a scheduled Keynote at ISEA2006 this year and will
speaking on the subject Network Neutrality, August 9th 10-12. There
will be ample opportunity in the session for questions and discussion.
Hope to see many of you there.
Best
Joel
On Jun 21, 2006, at 4:29 AM, Danny Butt wrote:
> Kia ora all,
>
> I thought that with all the recent coverage on Net Neutrality that
> this list may find the following comment piece/summary of issues
> might be of interest, would be interested in feedback from this group.
>
> Best regards,
>
> Danny
>
> ----------------------------
>
> Net Neutrality: No Easy Answers
> <http://www.dannybutt.net/digital/2006/06/21/net-neutrality-no-easy-
> answers/>
>
> Comment piece for Media International Australia, June 2006. http://
> www.emsah.uq.edu.au/mia/
> Pre-print, please do not cite or quote without permission.
>
> Danny Butt, Suma Media Consulting
>
> The concept of "Network Neutrality" has received a great deal of
> attention in the press recently, mostly due to so-far unsuccessful
> US telecommunications legislation proposals that required Internet
> Service Providers (ISPs) to carry any and all Internet traffic
> equally, rather than being able to prioritise certain traffic or
> charge differential rates for different kinds of content.
>
> For the proponents of Net Neutrality, there has been and should be
> a clear separation between the provision of physical network
> infrastructure and the provision of content. Much as in the
> telephone system, the ISPs should be treated as "common carriers"
> which are in the business of providing access to all content on the
> Internet. In the U.S., for example, legislation until recently
> required cable television providers to carry all content packages
> and provide the latest technologies in all areas they served, even
> if it would be more economically efficient to provide only those
> content packages with which they had direct relationships. The
> policy justification for legislating for this openness springs from
> the limited competition in the telco/ISP/broadband area, meaning
> that users don't have true competition due to high switching costs
> and limited choice.
>
> Net Neutrality proponents wish to see something similar for the
> Internet: a requirement that all ISPs provide access to all content
> on the Internet without different charges or reduced performance
> for content not approved or owned by the ISP itself. They want to
> see ISPs continue to charge purely on speed and volume rather than
> providing some services for free/cheap and making others more
> expensive.
>
> At first glance, the issue seems like a straightforward benefit for
> consumers, worthy of public policy interventions. But for the ISPs
> and the providers of network services, different issues are at play
> that make it less simple. The Internet has transformed from a
> research network focussed on text and file transfer, to a highly
> flexible media and communications platform capable of emulating
> both the phone system and cable television. There are business
> pressures for ISPs to implement differential provision policies for
> Internet traffic for two reasons.
>
> Firstly, Quality of Service (QoS) policies are required to
> prioritise important, time-sensitive traffic over less important
> traffic, when there are more requests than there is bandwidth
> available. For example, if you are video-conferencing, where
> maintenance of a certain data rate is necessary for uninterrupted
> viewing, under busy traffic conditions ISPs would like to be able
> to ensure you can see your conference uninterrupted, even if it
> slows down the person downloading a copy of a software programme
> next door. Similarly, if you are using Skype or a similar Voice-
> over-IP application to have an audio conversation, you would like
> to think that this could work even if you next door neighbour is
> downloading movies via a peer-to-peer file sharing application,
> where a few seconds delay is not going to make a difference to
> their experience. In Australia and New Zealand, a number of ISPs
> have already undertaken "bandwidth shaping" trials, or limiting the
> availability of bandwidth to traffic on common "ports" used by peer-
> to-peer applications.
>
> In these examples, "non-neutral policies" that prioritise some
> types of traffic over others are an essential part of giving the
> customer what they want. The problem is that what constitutes
> benefit for the customer and benefit for the ISP's bottom line
> becomes blurred. This is the case when, for example, the ISP is
> also a telecommunications provider, and the extensive use of VoIP
> may be cannibalising their phone revenues, and the suppression of
> this traffic for "QoS purposes" just happens to reduce take up of
> VoIP. Or the ISP has a relationship with a content producer (e.g.
> major record labels), in which case preventing peer-to-peer traffic
> may play a role in encouraging users to download the music content
> on the ISP's website.
>
> Differentiating between QoS discrimination for valid or anti-
> competitive reasons becomes even more difficult when next
> generation networks offer a "triple play" of voice, Internet, and
> movies from one provider. In this case, the ability to deliver
> specialised content services becomes part of the value proposition
> for the network, and motivates the consumer to purchase these
> services. Some ISPs argue that without the ability to guarantee
> certain use patterns they will not be able to fund the new networks
> and innovative services. For example, they would say, if you were
> considering signing up with ISP X for voice/Internet/movies, but
> read a review that their reliability on voice was not 100%, this
> would inhibit takeup of these new services.
>
> While many small producers and consumer rights advocates (and large
> web companies who are not reliant on deals with highly branded
> content industries) have promoted Net Neutrality as equivalent to
> the deals between cable television networks and content providers,
> there are more complex interactions between content and
> infrastructure as intensive interactive traffic becomes the norm.
> In particular some of the new functionality such as that found in
> interactive television and gaming relies on a sophisticated
> relationship between content and hardware.
>
> A useful analogy can be seen in the gaming console market, where
> the console manufacturers need to innovate at a hardware level as
> well as negotiate deals with content providers to create a
> portfolio of available titles [1]. By maintaining licensing control
> over who can develop titles, console manufacturers are able to
> capture up to a third of the retail value of each game sold, and
> this is integral to their profits. This is crucial because price
> pressure on consoles means that the profit margin on the hardware
> console is low. For console manufacturers, a suggestion that they
> should all be able to play each others' games is infeasible.
>
> The Internet, and the World Wide Web in particular was developed
> around a separation of traffic protocols, user environment, and
> content formats. Part of what made the web so ubiquitous was that
> you could view content on any operating system (Windows, Unix,
> Mac), via any browser (Netscape, Internet Explorer), over any kind
> of Internet connection (modem, LAN, wireless). This is what allowed
> the network to have a sense of neutrality.
>
> However, the shift in the web from a predominantly text-based
> asynchronous information exchange platform, to sophisticated real-
> time applications (audio-visual media in particular), have resulted
> in more diverse, often proprietary platforms that link content,
> transport, and interface in new ways. Examples include Windows
> Media Center, or Apples FairPlay DRM format/iPod hardware/iTunes
> software. This shift is driven by a combination of user-experience
> requirements (users expect integration) and an attempt to gain
> control of the hardware-software environment for areas of growth
> content to allow multiple revenue streams and brand control, along
> the lines of the console model. The degree to which this is a
> prerequisite for network innovation or constitutes anti-competitive
> behaviour is an policy question whose dimensions are complex and
> with remedies which are unclear.
>
> A further complicating factor is that the highly branded content
> (music, movies) that is driving uptake of high-speed data services
> predominantly comes from offline sources where distributors not
> only controlled, but usually financed production. This is a very
> different model from the early Internet, where content was
> sometimes funded by ecommerce or advertising, but more commonly
> produced on a non-commercial basis. Or to put it another way, you
> can't charge people a premium for much of the text-only internet,
> but you can for episodes of Desperate Housewives. And if you're an
> ISP charging for access to those episodes, you're probably paying a
> lot of money for the rights to show them, so you are going to want
> to prioritise access to those over other video content.
>
> The question of what viable economic models will look like under
> next-generation networks is central to the Net Neutrality debate.
> On one hand, it seems unrealistic to expect that the vertically
> integrated content & distribution model has no place on the
> Internet - to exclude it by legal means will probably delay the
> introduction of new, efficient distribution models that users want
> (see, for example, the role of iTunes in kick-starting the digital
> music downloads business). But it is also true that the public
> policy implications of Internet and telephone connectivity are much
> more substantial than those of a console operator or movie theatre:
> when people discuss the importance of information-literacy they are
> not usually talking about access to playing games on an X-Box or
> being able to watch a Disney film. There is a genuine public need
> for effective access to email and Internet communications.
>
> Yet in the new Internet networks all these kinds of information are
> delivered through the same mechanism. A large part of the problem
> is that people in the US (in particular) assumed that the Internet
> was public because the protocol for transferring information is
> public. But the actual physical networks are owned primarily by
> private entities who interconnect via market transactions and they
> have many incentives to recoup their investment/seek profit by
> tying their access offering to what people actually want, i.e.
> content. Especially when, as Richard Bennett has noted, there is no
> money to be made in being an ISP without those services, and the
> Internet backbone providers are almost always telcos who are
> offsetting their costs with voice services [2].
>
> The business models were different back in the early 1990s when it
> was primarily research institutions who owned the pipes, but that's
> not "neutral" or "public" in the way a government service is
> public. At least part of the blame for the current predicament can
> be laid at the feet of the "traditional Internet folks" who avoided
> government involvement in the Internet like the plague, and
> believed that a free market was the only way of preserving freedom
> of expression. A review of the history of other public utilities
> shows that in a market environment, governments might be the only
> mechanism that can realistically be subject to effective political
> influence in the public interest.
>
> In summary, the Net Neutrality issue is not as simple as it might
> first appear. There could be genuine suppression of innovation from
> simplistic anti-discrimination legislation, yet imperfect
> competition is a feature of these networks which requires public
> policy remedies. The most important activity over the next few
> years will be clarifying what the most important public benefits of
> network access are, and developing mechanisms for supporting those
> benefits. In a rapidly changing network environment, these will
> need to be more sophisticated than simply arguing for a status quo,
> or worse, implementing poor legislation that is unresponsive to the
> business models that will shape the Internet's future.
>
> Danny Butt <http://www.dannybutt.net> is a consultant in new
> media, culture, and development, and partner at Suma Media
> Consulting <http://www.sumamedia.com>.
>
> [1] For an excellent overview of the value chains in this sector,
> see Johns J. (2006)"Video games production networks: value capture,
> power relations and embeddedness." Journal of Economic Geography 6
> (2):151-180; doi:10.1093/jeg/lbi001
>
> [2] See comment on Tim Berners-Lee's weblog: Berners-Lee, T. (2006)
> "Neutrality of the Net" , Accessed 27th May 2006.
>
> --
> Danny Butt
> db at dannybutt.net | http://www.dannybutt.net
> Suma Media Consulting | http://www.sumamedia.com
> Private Bag MBE P145, Auckland, Aotearoa New Zealand
> Ph: +64 21 456 379 | Fx: +64 21 291 0200
>
>
>
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Joel Slayton
Chair, ISEA2006 Symposium +
ZeroOne San Jose: A Global Festival of Art on the Edge

August 7-13, 2006 | 8 WEEKS TO GO
Early bird discount tickets through June 30 only:
http://www.acteva.com/booking.cfm?bevaid=110251
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