We Want Internet Providers to Respond to Internet Demand, Not Shape It

The debate over network neutrality is misguided, Robert McMillan argues in Wired, because amid dismay over the FCC’s proposal to allow ISPs to sell “fast lanes” to companies, people don’t understand that giant internet companies like Google, Facebook, and Netflix already enjoy preferential delivery of their bits to end-users. This takes place, he points out, through “peering connections,” in which giant web companies pipe data directly to ISPs on their own private connections rather than through the internet backbone, and through “content delivery networks,” or CDNs, which are servers run by web companies deep inside the bowels of the ISPs.

“We shouldn’t waste so much breath on the idea of keeping the network completely neutral. It isn’t neutral now,” McMillan writes. He approvingly quotes network developer Dave Taht as saying, “most of the points of the debate are artificial, distracting, and based on an incorrect mental model on how the internet works.”

McMillan is narrowly correct that many people don’t talk about or are not aware of these complexities, but he is wrong in his broader implication that the concerns behind network neutrality—including those around internet “fast lanes” —are thereby misplaced. His explanation of peering and content delivery servers is helpful, and a Wired graphic comparing “What you think the Internet looks like” and “What the Internet really looks like,” is a useful visual summary of McMillan’s point.

What McMillan’s argument does not make clear, however, is the difference between following internet users and leading or manipulating them. He explains that

Because these [big internet] companies are moving so much traffic on their own, they’ve been forced to make special arrangements with the country’s internet service providers that can facilitate the delivery of their sites and applications. Basically, they’re bypassing the internet backbone, plugging straight into the ISPs….

Although Google does have an edge over others, not every company needs that edge. Most companies don’t generate enough traffic to warrant a dedicated peering connection or CDN. And if the next internet startup does get big enough, it too can arrange for a Google-like setup….

Traditionally, ISPs have not charged for interconnection points. They’re happy to have Google or Netflix or Akamai or Level 3 servers or routers in their data centers because they speed up service for their customers and reduce the amount of traffic that has to flow out of their network.

McMillan is right that these arrangements do constitute a “fast lane” of a kind. But what he is describing are peering arrangements that reflect the flow of internet traffic. If vast numbers of people are voting with their clicks and seeking content from Google, Facebook, and Netflix, then we want the ISPs to give their customers what they want, and take whatever technological measures are necessary to ensure that the huge amount of traffic coming from these sources is delivered smoothly.

What we don’t want to see are ISPs that deploy these technological measures to shape instead of reflect the flow of traffic online. The fear around the specter of ISPs selling “fast lanes” is that it would open up the gates for just such manipulation— allowing them to extort tolls, giving them an incentive not to ensure sufficient capacity for “normal” (non-tariff-paying) traffic, and enabling them to compete unfairly with content companies in such areas as the provision of streaming movies.

Despite the name, advocates are not concerned with some abstract and pure notion of “neutrality;” the goal is always to defend the principle that the company that connects us to the internet does not get to manipulate or control what we do on the internet.

So how do we ensure that they don’t? McMillan puts all his hopes in the basket of competition. “What we should really be doing is looking for ways we can increase competition among ISPs—ways we can prevent the Comcasts and the AT&Ts from gaining so much power that they can completely control the market for internet bandwidth,” he writes.

I’m certainly for robust competition and end-user choice. And I agree that ultimately the issue comes down to limiting telecom power. That said, I’m skeptical that competition in this area will ever be sufficient to remove the need for other measures to prevent the telecoms from accumulating too much power—such as strong regulations. Competition is an excellent way of distributing Chinese restaurants across a city—and keeping customer service good within them. But there are many problems with trying to impose a market-competition paradigm on something like the gigantic, capital-intensive, publicly vital, utility-like service that ISPs provide. Currently the best most Americans can probably hope for is an oligopoly of two or three ISPs to choose from, and that is not the kind of rich competition that reliably prevents power from being abused. (And remember, even where there were multiple railroad lines competing with each other—and today, airlines—the government has always required each of those companies to honor the rules of common carriers.)

The other alternative is to resurrect the “open access” regulatory regime created by the Telecommunications Act of 1996, which required cable companies and other telecoms to open their networks to competing ISPs in the hopes of curbing telecom power by creating rich competition for their services. One problem with that regime is that it required telecoms to open their wires to, and internally host servers owned by, companies that they were competitive with and naturally hostile to. Unsurprisingly there were many reports of telecoms not treating their competitors fairly. If that could be made to work the resulting competition would be great—but making it truly work would have required much messy and invasive oversight and regulation of its own. (In any case this approach was ended by the FCC, which declared broadband an “information service” not subject to the regulations, a determination that the Supreme Court declined to overturn.)

Competition is great where it works to restrain the power of big companies and protect the freedom of the individual. But I’m skeptical that we can refrain from directly regulating companies that are at the end of the day utilities by trying to induce them into the same dynamics that govern Chinese restaurants. Not only is the capital-intensive, high-barriers-to-entry nature of the telecom sector far different, but society relies upon its services far more—not only to sustain the many other marketplaces that depend on our telecom infrastructure, but also to sustain our free speech.