Now Internet giants want some federal bailout money. Hell, why not? Everyone else has their begging bowl in hand.
As we read in today’s WashPo, it’s just the latest twist in the Internet Access Wars. For those paying attention, you’ll know that there’s been a running fight over the past several years concerning broadband access and the notion of ‘net neutrality.’
Although it sounds simon-pure, the reality is somewhat different. Internet giants have been asking legislators to choose sides in a purely private negotiation between the telecoms that provide bandwidth and large internet companies like Google and Amazon that carry on business free of charge over an infrastructure paid for by consumers.
As bandwidth has increased exponentially over the last few years, content providers have kept pace. Think of high-volume traffic generated by music download sites, Google, Amazon and streaming radio sites. And now movie downloads at a gig or so a pop. Although broadband is rapidly becoming the standard, even these bigger pipes are stretched by the massive files now moving through the system. The question is who pays for the infrastructure improvements necessary to accommodate the desires of internet companies, not to mention those of their customers.
Until now, there’s been a principal of “net neutrality”, which considers everyone’s data to be the same, whether a few bytes or a few gigs. As the evolving infrastructure gets disproportionately stuffed by a relatively few businesses and their customers, telecoms are proposing a virtual “car pool lane” for larger enterprises that need rapid data movement even at times of congestion. This guaranteed service would attract an additional fee. And hence the outcry.
Google naturally wants all the capacity it can get. In its “Guide to Net Neutrality” Google opined:
Network neutrality is the principle that Internet users should be in control of what content they view and what applications they use on the Internet. The Internet has operated according to this neutrality principle since its earliest days. . . . Fundamentally, net neutrality is about equal access to the Internet. In our view, the broadband carriers should not be permitted to use their market power to discriminate against competing applications or content. Just as telephone companies are not permitted to tell consumers who they can call or what they can say, broadband carriers should not be allowed to use their market power to control activity online.
This is a noble-sounding way of saying that a “neutral” Internet must forward packets on a first-come, first served basis – even if Google is sending enough packets through the network to choke a virtual horse. This isn’t about ‘discrimination.’ Good grief.
But when we stop to think about it, there’s nothing particularly odd about different pricing models within a specific service. Think of first class travel versus cattle class in the airlines, cruise lines and railroads, for instance. As a starting point, therefore, the idea of different levels of service is not unreasonable. But who would pay for the higher service?
Well, up till now Amazon and Google have argued that it should be the consumers themselves. A couple of years back an Amazon representative stated the position without apology. According to Amazonians, it “makes perfect sense” for carrier customers to pay for bits they use and it’s up to them how many bits they do use: “Bits don’t flow unless the consumers want them” and it’s one thing for network operators to charge more to end users for specialized services, “just don’t charge [content] providers.”
Well, the titans have announced that they’re willing to bury their differences in return for some federal bailout money. They’ve formed a ‘coalition’ to beg for some of the federal money to build broadband improvements. Back to the WashPo:
Achieving that goal at prices acceptable to consumers, however, would be expensive for telecom and cable network operators. Some in the coalition could push for laws that would achieve lower prices and higher speeds through more wireless and telecom competitors, but that could cause further disagreement among members, Scott said.
Some have already suggested requesting funds from the federal economic stimulus plan for broadband deployment. Yesterday, an aide to House Speaker Nancy Pelosi (D-Calif.) said Pelosi was in favor of that idea.
Oh, dear God. They agree to be friends if the taxpayers fork it over? And the Congress can then decide what infrastructure gets build and which technologies are implemented?
Here’s the reality: broadband providers and Internet companies need each other. That essential fact will force the players to sort out their differences. After all, there’s too much of their own damned money at stake. Leave them alone and don’t give them anything. Consumers will express their preferences and the spirit will move in good time.
If the broadband providers accept bailout money, they’re going to have Congress picking sides – and technologies. If the Internet has taught us anything, it’s this: consumers, innovators and entrepreneurs are the ones who most efficiently determine both the technologies to use and the business models that work.
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