How many times do we have to pay for the same Internet service? (net neutrality)

It seems that the Federales have decided not to regulate Internet service providers with regard to “net neutrality” and carrying, e.g., Netflix streams to your house (nytimes). So now these unregulated monopolies will be able to charge us $50-100 per month for service and then charge us again for the same Internet service (by charging Netflix, et al., who will then turn back around and raise our subscription rates). Maybe they should save everyone a lot of trouble and just allow Comcast, Time-Warner, and Verizon to collect a 5% payroll tax on wages in exchange for … giving us whatever Internet speeds and cable channels they think would be appropriate.

Carlos Slim is presumably laughing at us right now…

Related: Thoughts on the Comcast/Time-Warner merger

 

7 Comments

  1. Jeffrey Friedl

    April 24, 2014 @ 1:16 am

    1

    If you call my cell phone, you pay for your connection to the telephone system, and I pay for my connection.

    It seems you’re comparing the Netflix situation to something like FedEx, where the content originator pays for for the entire delivery process, all the way to the end user. That’s not the case with the telephone or the Internet.

  2. Al

    April 24, 2014 @ 6:54 am

    2

    It was interesting to see how evil Comcast pulled this off. I’ve had Netflix for years and never had a problem until Comcast started to put pressure on Netflix to pay them a fee. All of a sudden, the streaming rate dropped way down and the service would cut out while in the middle of a movie. This went on for months. The day Netflix capitulated, everything went back to normal and has been fine since.

  3. philg

    April 24, 2014 @ 9:30 am

    3

    Jeffrey: I don’t know for a fact, but I believe that Netflix is already paying for its connection to the Internet. They are not themselves a backbone provider so presumably they pay something to be hooked up to the backbone (as has, I think, every Internet user since roughly the late 1980s when the ARPAnet was shut down) and/or they pay a content delivery network, such as Akamai, which pays for its backbone connections.

    So we have have for about 25 years a situation in which everyone connected to the Internet has paid for all of the bandwidth to which they are entitled (and American consumers have often paid at monopoly rates, e.g., when there is only one viable Internet provider in their town).

  4. Paul Houle

    April 24, 2014 @ 11:14 am

    4

    The underlying problem with broadband in the US is that we are drifting in the wind without plan or policy.

    Something like the TWC-Comcast merger comes along and everybody sees it’s not a good thing but it doesn’t look catastrophic, what can you do about it?

    The right thing to do is what they’ve done in the UK. Build out an optic fiber “last mile” network that is either state funded or tightly regulated, and then have competition for the “middle mile”. (End the boondoggle of government spending on “middle mile” networks that the private sector would build anyway.)

    Providers would compete to offer internet and TV service over this infrastructure, and if some carrier was offering worse service to Netflix than another carrier, users could vote with their feet.

    BTW, don’t buy the hype that FTTH is “expensive”; it does take a lot of labor to install, but once it is in it is good for at least 50 years and the OPEX costs are a tiny fraction of xDSL and HFC and other FTTx The reason AT&T got fiber religion in Austin isn’t that people are going to jump ship for superior service, but that Google can offer superior service a lower price than expensive AT&T U-Verse; AT&T doesn’t have the option of offering inferior service as a lower price unless they deploy low-cost fiber.

  5. un data

    April 24, 2014 @ 1:59 pm

    5

    Even AT&T has been saying video is special. There pipes
    can’t handle it.
    The fact that no regulator has even had a hearing on this
    tells you the fix is in.

    The fact that these companies sold unlimited data
    to their customer have no way to stop that
    instead don’t even give minimum broadband speed to the
    customer.
    They have been caping bittorrent and other services for years.

  6. Jeffrey Friedl

    April 24, 2014 @ 9:32 pm

    6

    I think I misunderstood the issue as cited in your original article, Phil. I thought you were complaining that Netflix’s ISP would charge Netflix more to handle Netflix’s traffic. But from the other comments, it seems that the end-user’s ISP is charging Netflix?

    That indeed sounds objectionable… I’d think that each company should charge only entities that they have a direct relation with… in the case of Comcast, its users and its backbone providers. Extra charges for large bandwidth seem reasonable, and they would eventually trickle down to the users of that bandwidth: Netflix and its users.

  7. un data

    May 5, 2014 @ 2:01 pm

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