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Excellent Wall Street Journal Editorial: "FCC.Politics.gov"

The Wall Street Journal's editorial writers totally get the net neutrality issue.

  • Be sure to read their excellent editorialFCC.politics.gov.

They understand net neutrality is all about:

  • Regulating the Internet;
  • An industrial policy pushed by high-tech rivals Google and pro-regulation groups like Moveon.org and FreePress; and
  • A slippery slope towards government intervention and political mischief.

They were also dead on in understanding that no good deed goes unpunished in Washington -- i.e. the FCC majority is concluding that it is not reasonable for Comcast to deliver quality of service for most all its customers by minorly affecting the available speeds of bandwidth hogs when they congest the network. Unbelievable.

Kudos to the Wall Street Journal's strong defense of free markets and the free-market Internet.

 

Must read Op Ed by FCC Commissioner McDowell:-- "Who Should Solve this Internet Crisis?"

Peta-kudos to FCC Commisioner Robert McDowell for his spot-on Op Ed in the Washington Post warning against potential Internet micromanagement by the FCC in: "Who should solve this Internet crisis?"

Commissioner McDowell's sage analysis gets right to the crux of the net neutrality debate: the Internet's genius is that free people in a free market process of voluntary collaboration are best positioned to solve the Internet's ever-changing operational and engineering problems and challenges -- NOT the FCC  with bureaucratic engineering, "Mother-may-I" regulation, and over-reaching governmental coercion.  

Commissioner McDowell understands the policy choice: support a path of Internet collaboration or net regulation.

  • Departing from the extremely successful, bipartisan, free-market Internet approach enshrined in law since 1996, threatens to encourage a new regulatory activist approach around the world that could "balkanize" the Internet and ultimately undermine its free, open and universal essence.   

Commissioner McDowell is right to warn that the Internet "would certainly die of clogged arteries if network owners had to seek government permission before serving their customers by managing surges of information flow."

More evidence no broadband industrial policy is needed

A recent study by the Leichtman Group found 70% of American broadband subscribers are very satisfied with their service, and relatively few are actually seeking faster Internet access.

  • This suggests the drumbeat for a national broadband industrial policy, because America's Internet is too slow and falling behind the rest of the world, is just empty rhetoric and wishful assertions by Big Government types.
  • As I have blogged before, the facts are not the friends of those screaming for de facto nationalizing the Internet.  

Bottom line:  The more one learns about the facts about what benefits American broadband consumers actually enjoy, and what they demand in the future, it is not what the Big Government folks claim.  

FCC: Network Managers Guilty Until Proven Innocent?

The FCC is reportedly considering putting "the burden on the network operator to prove that its network practices are reasonable" in its net neutrality proceeding on Comcast's network management, according to today's top story in Washington Internet Daily.

  • Assuming that this report is accurate, and assuming that an FCC majority would approve such a shift of the burden of proof, let me explain why such an FCC ruling would be a profound assault on the freedoms that Americans hold most dear.   

It would be supreme irony, if in the supposed name of "Internet Freedom," the FCC somehow ruled that network operators had no freedom to manage their private property, enter into contracts or pursue business without prior permission from the FCC.

  • Freedom from Government is central to the U.S. Declaration of Independence which declares "certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness." 
  • The Fifth Amendment of the U.S. Constitution guarantees the presumption of innocence: No person shall "be deprived of life, liberty, or property, without due process of law."   

Why would it be bad to put "the burden on the network operator to prove that its network practices are reasonable"?

Markets work! Vonage & Comcast collaborating on reasonable network management

Today's announcement by Vonage, the independent VOIP leader, who is collaborating with Comcast to address reasonable network management of Internet services, is more tangible and compelling evidence that market forces continue to work well in meeting consumers needs -- and that there is no market failure for the FCC to address with stifling net neutrality regulation.

The Internet has thrived because of Congress' wise bipartisan Internet policy set into law in 1996: "It is the policy of the United States to preserve the vibrant and competitive free market that presently exists for the Internet..., unfettered by Federal or State regulation."  

The FCC needs to continue to:

  • Excercise regulatory humility, patience, restraint, and common sense in letting free market forces continue to best meet consumers diverse and dynamic needs; and 
  • Encourage industry to collaborate and innovate to produce technological and practical solutions that best serve everyone involved in the Internet.

The Internet has proven to be the greatest de-regulation success story of all time. 

  • This is no time for the FCC to snatch defeat from the jaws of victory with new net regulation.   

Opposing views on Net Neutrality for American Bankruptcy Institute Newsletter

I wrote the anti-net neutrality argument and Professor Lowell Feldman wrote the pro-net neutrality argument for the ABI Telecom Technology Committee newsletter this month for the American Bankruptcy Institute:

Both articles are copied below, mine followed by Professor Feldman's:

Why Net Neutrality is Unnecessary and Bad Policy

Written by:

Scott Cleland

Chairman, NetCompetition.org -- a net neutrality forum funded by broadband companies Washington D.C.

Free market Internet pricing and diversity of choice

The reality of market pricing for Internet usage is naturally gaining more attention.  

  • The New York Time's had an informative Sunday page one story: "Charging by the Byte to curb Internet traffic." 
  • Today the Wall Street Journal highlighted why market pricing for Internet usage is evolving with dramatic changes in the Internet marketplace in its story today: "Cisco projects growth to swell for online video."  

The big economic takeaway here is that in a free market Internet, where users have very different demand: i.e. needs, wants and means for speed, usage, mobility, latency, immediacy, reliablity, flexibility and other attributes -- suppliers (ISPs, application providers and content providers) must have the freedom to innovate, experiment and provide a diversity of choices, at a diversity of prices in order to meet the diversity of demand from users.

The big political takeaway here is that Internet "fairness" is not legislated/regulated net neutrality or a one-tier Internet where all bits must be treated the same and where light Internet bandwidth users must subsidize heavy Internet users -- but real and practical Internet fairness comes from users paying their way, paying for what they use above a certain amount and not expecting others to subsidize one's extreme bandwidth usage.

"All-you-can-eat" bandwidth expectation shenanigans

I wanted to follow up and build upon my post of last week: "The logic of Internet Pricing Diversity and the Fantasy of free limitless bandwidth."

  •  I keep hearing this backward-looking refrain from net neutrality proponents that because some people characterize dial-up and early broadband bandwidth as unlimited or as an all-you-can-eat usage model -- that that model should never evolve or change.
    • Balderdash! This is some people's wishes being presented as analysis.

I believe U.S. Internet access consumers have come to understand at least two truths: 

The logic of Internet pricing diversity vs the fantasy of free limitless bandwidth

The free market Internet works. Both Time Warner Cable and Comcast are logically and naturally experimenting with free market solutions to address increasing network congestion problems that threaten quality of service, because of extremely high and disproportionate bandwidth usage by a small slice of the broadband population. 

  • As widely reported, Time Warner Cable is experimenting in Beaumont Texas with a commercial offering that provides consumers with a range of choices based on their bandwidth consumption and desired speed, and includes a new $1 per gigabyte charge for usage above a plan's monthly limit. 
  • Also widely reported, Comcast is testing in Chambersburg PA and Warrenton VA, a protocol-agnostic network management approach which would potentially delay all of the traffic of extremely heavy users during periods of serious network congestion -- in order to maintain quality of service for everyone.

Free market experimentation is the best, fastest and most efficient finder of solutions to complex difficult problems.

Free market competition produces a diversity of choices for consumers, which is essential because consumers have a diversity of wants, needs and means. A free market naturally provides a diversity of supply offerings to meet the diversity of consumer demands.

U.S. remains #1 in 2008 World Competitiveness Yearbook -- The U.S. isn't falling behind

The 2008 World Competitiveness Yearbook just came out and the U.S. is ranked #1 in world competitiveness again -- for the fourteenth year in a row.

  • This ranking by the Swiss IMD is the third major, world-respected, independent ranking that concluded the U.S. is not falling behind the rest of the world in competitiveness.
  • These three different independent assessments are in stark contrast to broadband critics' call for abandonment of free-market competition policies in favor of a more regulatory broadband industrial policy. 
    • In November 2007, the U.S. ranked #1 in the World Economic Forum's Global competitiveness Report for 2007-2008.
    • Last year, the Economist Intelligence Unit's latest Global Digital Rankings had the U.S. tied for second in the world.

Bottom line: Pro net neutrality and pro-regulation proponents love to jump on isolated data or studies like the OECD broadband rankings to justify a reversal of free-market competition policies in favor of more command and control government industrial policies.

However, facts are pesky things.

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Q&A One Pager Debunking Net Neutrality Myths