Big Telecom wants you to believe net neutrality is an impediment to fairness and innovation on the internet. Of course, the truth is just the opposite; the internet has been a force for innovation because of net neutrality. And nothing would be less fair than giving one company's data preference over another's.
Robert Litan of the Brookings Institute shills for Big Telecom. My rebuttal on the flip.
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Yet perhaps without realizing it, those who are now advocating "net neutrality"-- the notion that those who shell out the big bucks to build new much higher speed networks can't ask the websites that will use the networks intensively to help pay for them-- could keep this new world from becoming a reality. Further, they could deprive the websites themselves of the benefits of being able to use the networks to deliver their data-heavy content.
Really? So Google, for example, doesn't pay for their use of the network? This is a fallacy the Telcos have been furiously perpetuating for some time. The fact is all businesses that use the networks pay for their proportionate usage. I'm a web developer and manage a few servers for my clients. Each server I lease gets 2000 GB of bandwidth a month. If I go over that bandwidth, I pay for it. Google uses exponentially more bandwidth than I, and I'm sure they get a 'rate', but they do pay for what they use.
Economists are fond of saying that there are no "free lunches," which is to say that new products and services don't magically appear. Those who benefit from them pay for them. A corollary of this simple principle is that markets will not work efficiently-- that is, they will not generate the maximum output at the least cost-- unless prices fully reflect all of the costs of products sold or services delivered. "All" of the costs include not only those that the producers bear, but also the "externalities" that they or users may impose on others. Pollution, for example, is a well known externality. We have a whole raft of environmental laws to "make polluters pay" because otherwise the prices of producing steel, cars and other pollution-generating industrial processes and products would be too low: society would purchase more of these items than is socially desirable.
No, there are no free lunches. Which is why we pay for the our usage based on bandwidth. We pay for each byte of data we send out over the internet. That's fair. Now, if the price is currently too low, that's another issue. But the way it's currently structured is immanently and undeniably fair.
Until recently, traffic congestion on the Net was not a problem. There was so much excess capacity in the fiber optic cables and other parts of the complex telecommunications network that additional data heavy traffic delivered from one site did not threaten the reliability of traffic delivered from other sites and routed through the Net. But that blissful world is gone now. The existing networks are rapidly running out of excess capacity. We need new cyber-highways if the brave new world of movies, fast Google searches, and telemedicine-- to take a few examples-- is to become at all viable.
This is the crux of the Telco's argument. Because of bandwidth hogs like Google, Vonage and MSN, the networks are now congested. So Telcos need an incentive to build more networks. Faster, better networks. Well, the incentive is already there: more users are using more bandwidth which, in turn, generates more revenue for the operators of the networks.
The question, then is: who should pay for these much higher speed networks? Asking all users to pay the same amount, regardless of how much they data they download, hardly seems fair. It would be like asking double wide trailer trucks to pay the same taxes for using our real world highways as you and I who drive our much smaller cars. In fact, state governments tend not to do this: they require trucks to pay taxes based on weight per axle that you and I with our cars (or SUVs) don't pay.
There he goes again. That's not the way it works. Companies pay for the bandwidth they use. Google pays a hell of a lot more for bandwidth than I do.
Big Telecom already has an incentive to build these new networks. The problem is, they aren't satisfied just providing the network. They also want to -- and do -- provide content and services over the net. AT&T wants to go head to head with Vonage for the VOIP market. They want to deliver video on demand and compete with with the Cable and Satellite providers. There's nothing wrong with that, but they need to compete fairly with the other companies providing those services. It's fundamentally unfair for them to leverage their control of the networks for an advantage over their competitors. The internet, after all, belongs to all of us. It is in the public interest that it remains that way.
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