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These ISP companies use legal shenanigans, coupled with the unavoidably large startup costs of creating a new/competing ISP, to effectively run regional monopol

These ISP companies use legal shenanigans, coupled with the unavoidably large startup costs of creating a new/competing ISP, to effectively run regional monopolies. Google kind of gave up their master plan for Fiber after they were litigated in multiple jurisdictions essentially over bullshit that they were legally within their right to do, such as use shared lines - and that was Google, which had a ton of cash to throw at the problem. These monopolies aren't so bad by themselves; we have similar monopolies with power and water. But those are regulated so that their monopolies can't be blatantly abused. ISPs are trying to roll back regulations that, in the minds of pro-NN people, will allow them to abuse consumers using their monopolies. The problem with what these network providers are doing is that they own both the lines and the content. For example, if your ISP is a shareholder in Hulu, they're going to charge way more for Netflix to stream than Hulu, so they can essentially use this new ruling in an anti-competitive manner. I'm not sure what most of the anti-net neutrality side's supporting arguments are aside from the fact that the regulations are unfairly limiting ISP's abilities to make money. They will mention that these regulations are affecting the free market, but in my opinion other existing regulations are much worse about limiting the effects of the free market, except those would make it easier for ISPs to be competed against, not harder.

mediocrejoker 9y ago
Thanks for the detailed reply. It seems like a lot of the disagreement hinges on the fact that ISPs have a monopoly and many people cannot easily "vote with their wallet" if the ISP does something they don't like. I wonder if focusing on making it easier for competitive ISPs to start up would do more towards bridging the gap between the two sides. I think a lot of the anti-NN crowd is based on a more philosophical argument, that if the ISP built the infrastructure then they own it and they should be able to charge $1 million per day for access if they want (they would obviously not do that because nobody would pay it) I wonder what is the biggest impediment to setting up a legitimately competitive ISP? Presumably the (ostensibly wasteful) cost of duplicating the last-mile infrastructure? As an aside, do you have more info on the legal challenges to google fiber?
- dragonwriter 9y ago
  > I wonder if focusing on making it easier for competitive ISPs to start up would do more towards bridging the gap between the two sides. Fighting against properties of a service that make it a natural monopoly is usually not going to work as well as limiting the ability of the resulting monopoly to be leveraged. Either, of course, takes active regulation, and tends to be unpopular with both laissez-faire ideologues and the people holding the monopoly.
  - mediocrejoker 9y ago
    I would think either strategy would be unpopular with the monopoly-holders. Why do you say it's more difficult? It seems like it would be more sustainable in the long run even if it's more difficult up front.
    - zAy0LfpBZLC8mAC 9y ago
      Because it is a natural monopoly, essentially due to the massive cost of building and maintaining a second last-mile network which would necessarily be underutilised. The costs of maintaining a last-mile network are essentially independent of the number of users (unless you let unused parts of the network go out of date/fall into disrepair, in which case you effectively don't have a second network anymore). As such, it is always better to try and win over one more customer to increase revenue, even if that customer pays less than the cost of keeping their line in working order, both because the costs are mostly there anyway, and because it reduces the revenue of the competition, thus increasing the likelyhood that they will fail and thus make you have a monopoly again. That's actually exactly the behaviour you see over and over when some smaller business (or larger business, for that matter, see Google Fiber) tries to build a network where the monopolistic incumbent so far didn't care to provide useful service. The moment that project is announced, you get really good and cheap connectivity from the incumbent. Given that they before didn't consider it to be a good investment, you can guess that they are doing it only to destroy the competition. Also, the network operator that has the less-utilized network necessarily has to charge higher prices per user to cover their costs, which leads to a positive feedback of even less customers, leading to even higher prices, ... Having two parallel last mile networks is effectively unstable. There is a reason why there aren't multiple water pipes and multiple electricity cables and multiple natural gas pipes in your house.
jedberg 9y ago
> I'm not sure what most of the anti-net neutrality side's supporting arguments are My friend was a lawyer for an ISP and now works for the FCC (I promise she's a good person otherwise). The main argument is that small ISPs can't compete if Net Neutrality exists, because they can't build a network big enough for every customer to stream Netflix and YouTube. If they could have most of their customers blocked from those services, they could afford to offer it to the few that want to pay extra for it. The other main argument against it is that it's not fair that Grandma, who only wants to read email once a day and look at the kids on Facebook, pays the same as the kid next door who is watching Netflix while playing an RTS while torrenting three movies. They're both decent arguments, and would totally make sense in a world where multiple ISPs could reach everyone's home.
- jimktrains2 9y ago
  > The main argument is that small ISPs can't compete if Net Neutrality exists, because they can't build a network big enough for every customer to stream Netflix and YouTube. If they could have most of their customers blocked from those services, they could afford to offer it to the few that want to pay extra for it. I find it hard to believe that the electrical grid, water, sewer, and natural gas systems all are able to make due but the poor ISPs rolling in cash can't. Meanwhile, these same ISPs are working to make competition illegal or impossible. This isn't an issue of providing better service. This is an issue of making more money by squeezing the customer every way they can while making recourse impossible.
- ryall 9y ago
  I wouldn't call either of these "decent arguments" for forsaking net neutrality. They can both be solved by offering tiered pricing and data caps. For instance, grandma pays $10 a month for a Gb of data, Netflix Youtube kid pays $100 for unlimited. Same goes for small startup ISP.
- jacques_chester 9y ago
  > The main argument is that small ISPs can't compete if Net Neutrality exists, because they can't build a network big enough for every customer to stream Netflix and YouTube. If they could have most of their customers blocked from those services, they could afford to offer it to the few that want to pay extra for it. Hypotheticals can be checked by referring to other countries with different market structures. Australia has a broader mix of ISPs and Telcos than the US, despite until the 90s being under the control of a single public system (Telecom), with a plurality of the current infrastructure owned by its privatised successor (Telstra). They seem to do fine with net neutrality. Regular competition. > The other main argument against it is that it's not fair that Grandma, who only wants to read email once a day and look at the kids on Facebook, pays the same as the kid next door who is watching Netflix while playing an RTS while torrenting three movies. Charging by bandwidth and usage is well settled. The point is that the ISPs don't want to segment the consumer market. Too hard: there's competition, which as we know is unamerican because it makes business haaaard. Instead they want to segment the provider market. Far fewer of them to negotiate and there's zero competition. You, the ISP, have at any point in time monopoly control over the consumer who is using your infrastructure. Providers have no other way to route traffic over the last mile. Nobody mounts this kind of lobbying effort from the goodness of their hearts. They see a gigabuck in it.

mediocrejoker 9y ago

Thanks for the detailed reply. It seems like a lot of the disagreement hinges on the fact that ISPs have a monopoly and many people cannot easily "vote with their wallet" if the ISP does something they don't like. I wonder if focusing on making it easier for competitive ISPs to start up would do more towards bridging the gap between the two sides. I think a lot of the anti-NN crowd is based on a more philosophical argument, that if the ISP built the infrastructure then they own it and they should be able to charge $1 million per day for access if they want (they would obviously not do that because nobody would pay it) I wonder what is the biggest impediment to setting up a legitimately competitive ISP? Presumably the (ostensibly wasteful) cost of duplicating the last-mile infrastructure? As an aside, do you have more info on the legal challenges to google fiber?

dragonwriter 9y ago
> I wonder if focusing on making it easier for competitive ISPs to start up would do more towards bridging the gap between the two sides. Fighting against properties of a service that make it a natural monopoly is usually not going to work as well as limiting the ability of the resulting monopoly to be leveraged. Either, of course, takes active regulation, and tends to be unpopular with both laissez-faire ideologues and the people holding the monopoly.
- mediocrejoker 9y ago
  I would think either strategy would be unpopular with the monopoly-holders. Why do you say it's more difficult? It seems like it would be more sustainable in the long run even if it's more difficult up front.
  - zAy0LfpBZLC8mAC 9y ago
    Because it is a natural monopoly, essentially due to the massive cost of building and maintaining a second last-mile network which would necessarily be underutilised. The costs of maintaining a last-mile network are essentially independent of the number of users (unless you let unused parts of the network go out of date/fall into disrepair, in which case you effectively don't have a second network anymore). As such, it is always better to try and win over one more customer to increase revenue, even if that customer pays less than the cost of keeping their line in working order, both because the costs are mostly there anyway, and because it reduces the revenue of the competition, thus increasing the likelyhood that they will fail and thus make you have a monopoly again. That's actually exactly the behaviour you see over and over when some smaller business (or larger business, for that matter, see Google Fiber) tries to build a network where the monopolistic incumbent so far didn't care to provide useful service. The moment that project is announced, you get really good and cheap connectivity from the incumbent. Given that they before didn't consider it to be a good investment, you can guess that they are doing it only to destroy the competition. Also, the network operator that has the less-utilized network necessarily has to charge higher prices per user to cover their costs, which leads to a positive feedback of even less customers, leading to even higher prices, ... Having two parallel last mile networks is effectively unstable. There is a reason why there aren't multiple water pipes and multiple electricity cables and multiple natural gas pipes in your house.

jedberg 9y ago

> I'm not sure what most of the anti-net neutrality side's supporting arguments are My friend was a lawyer for an ISP and now works for the FCC (I promise she's a good person otherwise). The main argument is that small ISPs can't compete if Net Neutrality exists, because they can't build a network big enough for every customer to stream Netflix and YouTube. If they could have most of their customers blocked from those services, they could afford to offer it to the few that want to pay extra for it. The other main argument against it is that it's not fair that Grandma, who only wants to read email once a day and look at the kids on Facebook, pays the same as the kid next door who is watching Netflix while playing an RTS while torrenting three movies. They're both decent arguments, and would totally make sense in a world where multiple ISPs could reach everyone's home.

jimktrains2 9y ago
> The main argument is that small ISPs can't compete if Net Neutrality exists, because they can't build a network big enough for every customer to stream Netflix and YouTube. If they could have most of their customers blocked from those services, they could afford to offer it to the few that want to pay extra for it. I find it hard to believe that the electrical grid, water, sewer, and natural gas systems all are able to make due but the poor ISPs rolling in cash can't. Meanwhile, these same ISPs are working to make competition illegal or impossible. This isn't an issue of providing better service. This is an issue of making more money by squeezing the customer every way they can while making recourse impossible.
ryall 9y ago
I wouldn't call either of these "decent arguments" for forsaking net neutrality. They can both be solved by offering tiered pricing and data caps. For instance, grandma pays $10 a month for a Gb of data, Netflix Youtube kid pays $100 for unlimited. Same goes for small startup ISP.
jacques_chester 9y ago
> The main argument is that small ISPs can't compete if Net Neutrality exists, because they can't build a network big enough for every customer to stream Netflix and YouTube. If they could have most of their customers blocked from those services, they could afford to offer it to the few that want to pay extra for it. Hypotheticals can be checked by referring to other countries with different market structures. Australia has a broader mix of ISPs and Telcos than the US, despite until the 90s being under the control of a single public system (Telecom), with a plurality of the current infrastructure owned by its privatised successor (Telstra). They seem to do fine with net neutrality. Regular competition. > The other main argument against it is that it's not fair that Grandma, who only wants to read email once a day and look at the kids on Facebook, pays the same as the kid next door who is watching Netflix while playing an RTS while torrenting three movies. Charging by bandwidth and usage is well settled. The point is that the ISPs don't want to segment the consumer market. Too hard: there's competition, which as we know is unamerican because it makes business haaaard. Instead they want to segment the provider market. Far fewer of them to negotiate and there's zero competition. You, the ISP, have at any point in time monopoly control over the consumer who is using your infrastructure. Providers have no other way to route traffic over the last mile. Nobody mounts this kind of lobbying effort from the goodness of their hearts. They see a gigabuck in it.