Why NN is so limiting in the real world -- Thierer's great XBox personal story

I always enjoy reading, listening, and learning from Adam Thierer of the Progress and Freedom Foundation because of his clarity of thought and practical insights. His latest blog is noteworthy
http://blog.pff.org/archives/2006/07/microsoft_xbox.html  because he explains how limiting the one-size-fits-all approach of NN regulation would be in limiting the user experience of all that Microsoft's XBox has to offer its users.

He makes a pretty persuasive case of why special Microsoft-Verizon commercial cooperation could best serve each of their customers.

Please enjoy our new flash video: A Royal Fable

We thought the time was ripe to produce another flash video on net neutrality, because they are such a fun and effective way to communicate what is really going on in this net neutrality debate. 

When the dominant online giants: Google, Microsoft, eBay, Yahoo, Amazon, and IAC, first funded and named "Itsournet.org," their pro-net neutrality lobbying coalition, we needled them here for their "Freudian Slip"  in claiming they "owned" the Internet. We suggested to them that it might be more forthright and neutral to "share" ownership of the Internet with the rest of America and rename their coalition: itseveryonesnet.org. Alas they did not take our advice.

Thus, we thought their elitist sense of Internet ownership and entitlement was worthy of a new flash video.

We can see what has happened. The online realms of Google, Microsoft, eBay and Yahoo, with their 80-90% gross margins and their dominant market shares have naturally grown to believe the Internet is "theirs." Like royalty, they believe they are "entitled" to dynastic ownership of their online realms for perpetuity, and shouldn't have to stoop so low as to have to compete to keep it. 

How dare anyone ask the royal Internet companies, who use and benefit from the Internet the most, to help pay for some of its upgrade! Their response is "let the consumer pay!"  Their "royal" edict is clear: "Royalty" doesn't have to pay, royalty gets paid.   

We hope you enjoy our little royal fable.

Netcompetition's first flash video has been seen over 2500 times on youtube.com, and our "welfare for billionaires" idea, was headlined in this interesting June 14th Wall Street Journal story on the net neutrality debate.      

Translating the "Washington-ese" of Itsournet.org's letter to the Senate on Stevens Bill

I thought it would be useful to “translate” the “Washington-ese” of the online giants’ recent letter to the Senate on NN. My translation is in italics.
Dear Senator,

We write to express our deep concern with the Advanced Telecommunications and Opportunity Reform Act, S. 2686. 

            Translated: It appears we have painted ourselves into a corner and need your rescue. After screaming from the rooftops that we must have new net neutrality legislation pass now, in order to “Save the Internet,” we got stuffed in the House, the Senate Commerce Committee, and the FCC. We now find ourselves in the embarrassing position of blocking passage of most of the new Net Neutrality protections which we were asking for and which the American people could greatly benefit from.
·          Here’s our dilemma Senator. S.2686, would only protect Americans’ First Amendment rights to free speech on the Internet and only protect consumers rights to access any content, applications, and device of their choosing. Everyone else gets what they want but us. The House and Senate won’t give us the special regulated prices, terms and conditions we need to maintain our 80-90% gross margins. It isn’t fair. Didn’t you get the memo? It’s OUR net.     
We ask you to insist that this legislation include meaningful and enforceable network neutrality provisions before it is considered by the full Senate.

Googleman: Congress needs a comic book!

Kid you not, Google's Vint Cerf in his debate today actually ruminated on the need to create a comic book to educate Congress on the Internet and net neutrality. He also played to the elites in the audience, by giving veiled instructions to a questioner to google "Stevens" and "tubes." Mr. Cerf apparently is not shy about telling a room full of press that he and his colleagues do not have a very high opinion of the mental aptitude of our national legislators.

It is common tactic for elitists to question the inteligence of those who disagree with them, that way they don't have to consider that the other side may have made a better case.   

Google's Cerf vs Dave Farber Debate -- scary memories of CLEC unbundling fiasco

There wasn't much new ground broken in the hyped debate between Google's Vint Cerf, "co-father of the Internet" and Dave Farber, Cerf's former Professor and thus a "grandfather of the Internet."
What I found most interesting was Mr. Cerf's focus in the debate on the the CLEC experience after the 1996 Telecom Act and his emphasis that there is still not enough last mile competition.  

I should have made the connection before, but his experience at MCI, one of the largest failed CLECs, must have been highly formative for him before he moved to Google. It sounded to me that Mr. Cerf sees NN as partly re-fighting the whole CLEC-unbundling issue -- or righting what he believes as a past wrong. It also sounded to me that his head is still in an intra-modal re-seller competition mindset and that he is not a believer in emerging inter-modal competition -- despite the evidence.

Rebutting Ebay which says NN is not about price regulation...sure CNET debate thread #9

My friend Chris Libertelli goaded me into explaining why NN cold lead to price regulation which I do with six points below.

UNE-P and NN both overreached!

Posted by Scott Cleland (See profile) - July 14, 2006 1:22 PM PDT


Both UNE-P and NN were/are huge regulatory over-reaching attempts.

From the beginning, your side has irresponsibly argued for an all encompassing concept of NN and drafted legislation that is hugely over-reaching. What do I mean?

CNET's Molly trying to argue the online giants aren't that profitable... CNET #8

The latest back and forth is CNET Molly Wood trying to make the case that the online giants aren't so profitable. Why oh why did she want to take the debate in the direction that undermines her case the most.

My source is Mary Meeker Queen of the Internet
Posted by Scott Cleland (See profile) - July 14, 2006 12:22 PM PDT

No need to back down here.

My source for 80-90% gross profit margins for Google, Yahoo, eBay, and Microsoft -- is Mary Meeker,of Morgan Stanley, who is a leading analyst and authority on Internet and Internet related stocks, and (also dubbed "Queen of the Internet" by the media). She presented these figures as part of a financial presentation to the Warburg Pincus annual conference on May 18th, 2006.

Broadband duopoly BALDERDASH!

Neutrality-ites parade out the charge that the market a "broadband duopoly" in order to justify NN regulation. Balderdash!  Thus, I particularly relished the Business Week's article on Clearwire, which is an emerging nationwide alternative to DSL and cable modems. This great article is just more in a mountain of evidence to anyone that is fair-minded in examing the merits of the broadband duopoly assertion.  

Significance of FCC refusing to impose NN conditions on Adelphis deal -- Senate implications

Its very significant that the FCC refused to impose NN conditions on the Adelphia deal. 

First, after all the huffing and puffing of the liberal blogging community, Moveon.org's 1 million person petition, and the 700 group coalition -- the neutrality-ites continue to fail. Add FCC (4-1) rejection of NN conditions on the Adelphia transaction to the House defeat of NN (269-152) and the Senate Commerce Committee defeat of NN (11-11) The phrase "more bark than bite" comes to mind when thinking about NN.

Second, it is good to have new Republican Commissioners McDowell and Tate on the offical record against NN. That's important because there now should be a solid Republican FCC majority against NN for the rest of the Bush Adminstration

Agree with CNET's Molly on something... sort of...#7

Found that Molly and I agree that technology is the answer we just continue to disagree on what that means for policy...

This would be much easier if CNET would just agree to do a podcast.

Excellent train of thought to explore!

Posted by Scott Cleland (See profile) - July 13, 2006 11:35 AM PDT

You may not be aware of it but you are making my point for me. If all the Internet needs is bandwidth, why don't the online giants just invest in the last mile? Intel is doing it with $600m in Clearwire. Google, Microsoft Yahoo and the others could easily afford to bid on the current FCC wireless broadband auction. Or they could co-invest with existing telcos of cable companies to build faster pipes? Oh I forgot. Co-investing, sharing the investment cost burden of upgrading the Internet -- among those that benefit the most -- oh, that wouldn't be neutral -- can't have that.