Innovation

Sometimes the simplest solution can somehow elude people for a period of time.

• After long pushing hard for net neutrality legislation and wireless net neutrality regulation, TechCrunch's Michael Arrington, finally had an epiphany and figured out that he could become a fully satisfied consumer by simply choosing to take his business elsewhere -- from the AT&T Apple iPhone to the T-Mobile Google Android mytouch 3G phone. 

Competitive differentiated choice -- what a concept -- why didn't anyone think of this before?

• Consumers that value and want different things... can shop around and find what they want from different providers.
• Amazing. People don't have to lobby Congress, petition the FCC, or instigate an antitrust review -- they can simply vote with their feet and take their business to a provider that sells what they want.
• And even better with this competitive choice thingy going on, if a consumer decides they want something new or different in the future they can get it without having to wait for the government to figure out whether or not  they should force all providers to provide it.

Mr. Arrington's epiphany -- that robust wireless and broadband competition not only exists, but actually works very well -- is a powerful reminder that the first and best solution for consumers is not regulation, but to simply to choose to take their business elsewhere. 

A central policy question concerning the future of the Internet, cloud computing, and the National Broadband Plan is whether there should be Internet priorities or a priority-less Internet?

• The crux of the grand conflict over the direction of Internet policy is that proponents of a mandated a neutral/open Internet insist that only users can prioritize Internet traffic, not any other entity. 

To grasp the inherent problem and impracticality with a mandated neutral or priority-less Internet, it is helpful to ask if the Internet, which is comprised of hundreds of millions of individual users, has a mutual "hierarchy of needs" just like individuals have a "hierarchy of needs," per Maslow's famed, common sense "Hierarchy of Needs" theory.

"People are not approaching this from the perspective of helping us analyze what the trade-offs are" said FCC Broadband Coordinator Blair Levin about public comments to the National Broadband Plan -- per Multichannel News.  

• Industry's comments have attempted to be very focused on helping the FCC understand and appreciate the many explicit trade-offs involved in this very important proceeding.

A recap of the key trade-offs facing the FCC:

Choice, having the benefit of a selection of different alternatives to choose from, springs from the risk and opportunity of market competition  -- not from Government economic regulation.

Jonathan Zittrain's NYTimes Op-ed today, "Lost in the Clouds" ironically captured three of my big concerns/themes about the Internet and its natural outgrowth -- cloud computing.

• I recommend this op-ed because it pulls together a whole host of converging Internet issues that others generally treat separately.
• The problem with writing about these issues separately is that much of the richness of how these inter-related issues interact -- is lost.  

  Zittrain: "The cloud, however, comes with real dangers."

  • I agree. That has been much of the point of my 13 part series since the first of the year:
    • "The Open Internet's Growing Security Problem"

  Zittrain: "Worse, data stored online has less privacy protection both in practice and under the law."

Handset marketing exclusives are a pro-competitive wellspring of wireless growth and broadband adoption. Marketing exclusives are also a legitimate, proven and widespread marketing practice that marshals maximum marketing resources for selected, potentially-hot-new-products in order to drive maximum sales and adoption.

Comcast-Clearwire's 4G WiMax rollout starting in Portland today, as part of broader national launch this year, is powerful evidence of the vibrancy and dynamism of the facilities-based broadband competition trajectory in the U.S.

• This latest announcement provides an excellent opportunity to take stock of both the current state of broadband competition in the U.S. and the competitive trajectory of how the U.S. broadband market is getting increasingly more competitive.

Contrary to the parade of imperfection horribles claimed by anti-competition groups to try and justify a wide variety of new net neutrality-related regulations, the U.S. has more real and growing facilities-based broadband competition than any nation in the world.

The Comcast announcement provides powerful proof points of all the good aspects of vibrant facilities-based competition.

Kudos to Bret Swanson's excellent new research: "Bandwidth Boom: Measuring U.S. Communications Capacity from 2000-2008."

• For the first time, it measures and puts into perspective the incredibly explosive growth in American bandwidth capacity since the U.S. began strongly promoting facilities-based broadband competition and Internet infrastructure investment.
  • This research is new and interesting because it focuses on measuring supply-side bandwidth capacity, i.e. the fruit of tens of billions of dollars in infrastructure investment, rather than just the traditional demand-side measure of data traffic or usage.   

This research also helps refute the constant whining and pessimism by the tech elites' that the U.S. is in the "digital dark ages," is falling behind the world in broadband, and in need of massive U.S. Government intervention in the Internet infrastructure market in order to make any progress.  

• The one page report summary is here.
• The full report is here.

In summary, Bret Swanson's Entropy Economics report found:

"Over the eight-year period:

With all due respect to Mr. John Bogle, legendary founder of Vanguard and de facto leader of the American index fund movement that now manages ~$1.5 trillion, I must respectfully challenge, on the merits, Mr. Bogle's, and others, ongoing mischaracterization of indexing as "investing."

A scan of the major comments just delivered to the FCC on the National Broadband Plan (which is due to Congress February 2010), spotlighted the big broadband policy "fork-in-the-road" decision that the FCC now has before it.