5 ms·

Net Neutrality II: Majority of economists are against Net neutrality

15 points by ZeljkoS 8y ago

fruzz 8y ago
I don't understand. Don't we already pay according to the bandwidth we use on the server side, and don't clients already pay according to the bandwidth they use, everyone paying more if we use more? And don't backbones already get paid according to usage? What am I missing here? It seems like paying twice for the same product?
- xenadu02 8y ago
  That's correct. ISPs are simply rent-extracting. The majority of the US (even in urban areas) has little or no broadband competition so there is no penalty on ISPs for double-dipping. They're hugely profitable and transit costs continue their slide toward zero. The big players are mostly refusing to expand fiber deployments. It has nothing to do with investments in their network, the cost of providing service, or anything else. They can increase profits by squeezing the likes of Google, Apple, Netflix, etc. So they will.
chimeracoder 8y ago
The phrasing of this question is absurd. The most reasonable interpretation is "should ISPs be allowed to charge more for higher speeds", which is already the case, and has nothing to do with net neutrality. Honestly, it's actually phrased in a way that applies to CDNs as well, which again aren't controversial or really related to net neutrality. Net neutrality doesn't mean ISPs can't change more for better service; it just means they can't differentiate their service based on the type or source of the data that they transmit.
- avisser 8y ago
  > The phrasing of this question is absurd. Agreed. The flip side question should also be asked - "Should ISPs be allowed to favor internet properties that subsidize user's traffic?" I'm not convinced the question they did ask gets at large internet properties using money to disadvantage smaller internet properties. The anti-competitive aspect w/rt web businesses is, to me, the prime concern. Innovation at ISPs is garbage and will continue to be garbage.
goombastic 8y ago
Which is why they didn't invent the internet.
api 8y ago
I ascribe this to a lack of understanding of how Internet protocols work and how the Internet works in general. Non-technical people tend to see the Internet as its services -- Facebook, Netflix, etc. -- and don't understand that protocol and traffic selectivity will have a massively chilling effect on the ability to innovate beyond those services.
- zwieback 8y ago
  You could turn that argument around and say "we had neutrality and got corporate giants like FB, Google and Netflix" so let's try something else now. If the internet providers could make more money by making Netflix pay that money could be invested to do other stuff. Not sure I believe that line of argumentation either, though.
  - api 8y ago
    Part of the problem in my mind is that most high speed Internet in the USA is provided by companies that have a vested interest in sabotaging the Internet and thus have a conflict of interest. They'd love to see something like the old TV cable model where customers have a small set of choices that must pay to play.
    - pitaj 8y ago
      And the answer to that, and a true solution to net neutrality, is competition. We need to get rid of the regulations and agreements that hurt small ISPs at the local level.
      - api 8y ago
        ISPs are a natural monopoly unless you want this in your neighborhood: https://news.lovepattayathailand.com/wp-content/uploads/2017/03/maxresdefault-8-1.jpg https://news.lovepattayathailand.com/wp-content/uploads/2017... I also must point out that fighting a patchwork of local regulations is more expensive than building out the actual infrastructure. It's a slog through political and bureaucratic molasses.
monocasa 8y ago
Majority of those surveyed who are connected to the Chicago School. Literally the classically liberal school of thought of Friedman. So, we'd probably have to check if they're OK if they said anything else. Also, I have issues with the whole premise of the question, as net neutrality isn't really about "for the right to send that traffic using faster or higher quality service". There's no magic go faster lane that they want to turn on, but can't because of regulations. It's about not allowing the ISPs to slow down other traffic.
- throwaway37585 8y ago
  > Majority of those surveyed who are connected to the Chicago School. How so? The majority of those surveyed are not from Chicago. According to the About section: > ...our panel was chosen to include distinguished experts with a keen interest in public policy from the main areas of economics, to be geographically diverse, and to include older and younger scholars. As with the IGM’s US panel, the experts are all outstanding researchers in their fields. The panel includes recipients of top national and international prizes in economics, fellows of the Econometric society and the European Economic Association, members of distinguished national and international policymaking bodies in Europe, recipients of significant grants for economic research, highly accomplished affiliates and program directors of the Centre for Economic Policy Research and the National Bureau of Economic Research, and past and current editors of leading academic journals in the profession. > It's about not allowing the ISPs to slow down other traffic. What you think a policy “is about” and its actual consequences are very different things.
  - monocasa 8y ago
    > How so? From the About section: Chicago school is a broad term for an economics ideology, like "Austrian". Those surveyed are part of that ideology. > What you think a policy “is about” and its actual consequences are two very different things. So tell me then, how does this magical go faster lane work from a technical perspective, and how is net neutrality not letting them turn it on? Please be specific.
    - 8y ago
zwieback 8y ago
It's interesting to see the comments of the disagreeing economists, which can be summarized as "paying for a fast lane would be okay if the broadband market was competitive." So the problem isn't neutrality so much, it's the distribution layer itself.
Glyptodon 8y ago
The way the question is phrased seems likely to lead to misinterpretation to me.
glitcher 8y ago
This is a grossly oversimplified view of this issue. Next up: survey of economists show that our civil rights are hurting the economy!
- throwaway37585 8y ago
  What do you think is “grossly oversimplified”?
  - deleted 8y ago
    [deleted]
cabaalis 8y ago
It seems many of the responses with comments base their arguments off of serving high-bandwidth users. The question, IMO regarding NN is: "Is all bandwidth equal, and therefore pricing based purely upon metering usage, or is some bandwidth more/less valuable than others?" In principle, I think all bandwidth is equal. But if you've got 2 or 3 companies using 80% of bandwidth (made up a number for sake of argument) then it damages the other 20% to charge equal pricing bit-for-bit because ISPs have to increase capacity solely to serve the larger groups. So I think the answer is cloudy.
- monocasa 8y ago
  > But if you've got 2 or 3 companies using 80% of bandwidth (made up a number for sake of argument) then it damages the other 20% to charge equal pricing bit-for-bit because ISPs have to increase capacity solely to serve the larger groups. But none of these companies using up 80% of the bandwidth in your example are forcing their data down Comcast, et al.'s throat. Every packet coming from them was specifically requested by one of Comcast's paying customers, and metered within their customer's plan.
- throwaway37585 8y ago
  > In principle, I think all bandwidth is equal. Why?
  - cabaalis 8y ago
    Because I think of an ISP as a carrier, and don't believe it's their business to inspect traffic between me and their client for the purpose of facilitating transmission.
jccc 8y ago
The linked page does not anywhere say what the editorializing HN headline does, that a majority of economists are “against Net neutrality.” The question asked was: “Considering both distributional effects and changes in efficiency, it is a good idea to let companies that send video or other content to consumers pay more to Internet service providers for the right to send that traffic using faster or higher quality service.”
nabla9 8y ago
This question is framed in a way that if economist answers the exact question, it's likely agree or uncertain. Net neutrality as a whole is still a good idea. Consider this question: Q: Should the end users be able to buy better bandwidth or quality of service, so that they can get faster streaming or other services? Absolutely. If you order Netflix and are not satisfied with speed, you should be able to pay for faster network connection that works with every service. If you allow big corporations to pay bulk prices for delivery that is already paid by the customer, it's double pricing and restricts the ability of smaller companies to compete.
asperous 8y ago
The comments from the economists are much more insightful then the headline: Thoughts in favor: * Possible better efficiency (better allocation of resource by bringing externalities to market) * Net Neutrality already a myth due to CDNs, etc Thoughts against: * Price discrimination / vertical price squeeze * No competition / Market power of the cable and phone companies real issue
decebalus1 8y ago
Ok, let's see how insightful some of the 'agree' comments are: David Autor, MIT: > Net neutrality is a fiction. Hire Akamai (et al.) to mirror your servers worldwide to speed content to your users. What the fuck are you talking about? And Akamai will pump that content onto some magic rainbows to get to your users. I wouldn't put my name/univeristy next to that comment. _ Joseph Altonji, Yale > High bandwidth traffic imposes externalities on other users. Fair, but I'd say this is an incentive for ISPs to step up their game. This is a very old argument. _ Darrell Duffie, Stanford (Strongly agree) > If all qualities sell at the same price, markets cannot allocate quality efficiently. Works for soap, wine, and haircuts; why not Internet? First of all, soap, wine and haircuts are not a medium of sharing information. And all qualities are not sold at the same price. I pay differently for different speeds and bandwidth. Clearly this guy has no idea what he's talking about. _ Richard Schmalensee, MIT > It is not generally good policy to restrict firms' product offerings, but there seem to be other considerations. I like pizza and it's not necessarily a good idea to eat it every day, but there seem to be other considerations. _ Richard Thaler, Chicago > Seems like those who cause congestion should pay more. I know some worry that ISPs will play favorites, but that should be preventable. Yeah, it should be preventable. Through net neutrality rules. Honestly, what the fuck is this? Also, who cares about their opinion? Not a fan of Taleb but I tend to side with him on his opinion about economists. Next up, let's ask accountants what they think about Net neutrality.
- throwaway37585 8y ago
  > What the fuck are you talking about? The point is that net neutrality doesn’t even exist presently. > Fair, but I'd say this is an incentive for ISPs to step up their game. What do you mean? > This is a very old argument. Yours or his? > First of all, soap, wine and haircuts are not a medium of sharing information. How is this relevant? > And all qualities are not sold at the same price. I think that’s the point.
  - monocasa 8y ago
    > The point is that net neutrality doesn’t even exist presently. Despite the right wing talking points, we've had net neutrality for the whole existence of the public, consumer level internet. First due to the fact the physical infrastructure of the 90s were owned by the telephone companies who were common carriers. Then by the FCC's attempt at light touch on broadband until Verizon sued them to get a court order that the FCC could only enforce it by declaring them to be full common carriers.
jellicle 8y ago
a) the headline is bullshit. This is a small panel of economists selected from a right-wing economics association. b) It's clear from the responses that none of the individuals surveyed (in 2014) had any understanding of the issues involved. Most of them clearly think that net neutrality is about dealing with congestion/excessive use, and obviously think that ISPs should have some way of dealing with that. The question is worded in the most deceptive way possible to encourage that misunderstanding. For example, look at the response of Thaler. He says he agrees (meaning he is "against" net neutrality for this question) and then explains his answer: "Seems like those who cause congestion should pay more. I know some worry that ISPs will play favorites, but that should be preventable." He's clearly for net neutrality but is an "against" vote for this question because he doesn't understand what the issues are (or didn't in 2014). Another way of looking at it is that the question as stated, despite being titled "Net Neutrality", has nothing to do with net neutrality.
- throwaway37585 8y ago
  > This is a small panel of economists selected from a right-wing economics association. Why do you claim the interviewed economists are “right-wing”? > The question is worded in the most deceptive way possible to encourage that misunderstanding. What is deceptive about the question? > He's clearly for net neutrality Where did you get this from? > the question as stated... has nothing to do with net neutrality. Letting companies pay more to send content faster to their users has nothing to do with net neutrality, in your view?
AmIFirstToThink 8y ago
The responders seem to forget that the video content providers paid their ISP bills as well for their internet connectivity. They paid akamai and level3 for CDN. They paid amazon aws or google gcp for the bandwidth costs. In case of Netflix OpenConnect gave ISP's an option to reduce traffic at exchanges. The person that watched Netflix paid her ISP bill. Netflix paid its ISP bill. Now, the ISP of that lady wants to charge Netflix also. For what?
stillbourne 8y ago
Economists aren't engineers, I don't give two fucks what they think or want. I care about the dominate opinion among those who are involved in keeping the internet running and afloat.
zzleeper 8y ago
At least the one I respect more (Samuelson) has a decent quote: Disagree. Reason: 'This would be a great idea if the market for service provision was competitive, but is less obvious with our current market.' On the other hand, it's sad that smart people that should know better (Chetty, Altonji) answered like that. One interesting observation is the IO/Finance divide. IO experts (Liran Einav) are in favor of NN, while Finance folks (Darrell Duffie) are against. Probably because the latter almost always think about efficiency, while if you work in IO you have to be aware of the market structure (and natural monopolies, etc)

15 points by ZeljkoS 8y ago

I don't understand. Don't we already pay according to the bandwidth we use on the server side, and don't clients already pay according to the bandwidth they use, everyone paying more if we use more? And don't backbones already get paid according to usage? What am I missing here? It seems like paying twice for the same product?

xenadu02 8y ago
That's correct. ISPs are simply rent-extracting. The majority of the US (even in urban areas) has little or no broadband competition so there is no penalty on ISPs for double-dipping. They're hugely profitable and transit costs continue their slide toward zero. The big players are mostly refusing to expand fiber deployments. It has nothing to do with investments in their network, the cost of providing service, or anything else. They can increase profits by squeezing the likes of Google, Apple, Netflix, etc. So they will.

chimeracoder 8y ago

The phrasing of this question is absurd. The most reasonable interpretation is "should ISPs be allowed to charge more for higher speeds", which is already the case, and has nothing to do with net neutrality. Honestly, it's actually phrased in a way that applies to CDNs as well, which again aren't controversial or really related to net neutrality. Net neutrality doesn't mean ISPs can't change more for better service; it just means they can't differentiate their service based on the type or source of the data that they transmit.

avisser 8y ago
> The phrasing of this question is absurd. Agreed. The flip side question should also be asked - "Should ISPs be allowed to favor internet properties that subsidize user's traffic?" I'm not convinced the question they did ask gets at large internet properties using money to disadvantage smaller internet properties. The anti-competitive aspect w/rt web businesses is, to me, the prime concern. Innovation at ISPs is garbage and will continue to be garbage.

goombastic 8y ago

Which is why they didn't invent the internet.

api 8y ago

I ascribe this to a lack of understanding of how Internet protocols work and how the Internet works in general. Non-technical people tend to see the Internet as its services -- Facebook, Netflix, etc. -- and don't understand that protocol and traffic selectivity will have a massively chilling effect on the ability to innovate beyond those services.

zwieback 8y ago
You could turn that argument around and say "we had neutrality and got corporate giants like FB, Google and Netflix" so let's try something else now. If the internet providers could make more money by making Netflix pay that money could be invested to do other stuff. Not sure I believe that line of argumentation either, though.
- api 8y ago
  Part of the problem in my mind is that most high speed Internet in the USA is provided by companies that have a vested interest in sabotaging the Internet and thus have a conflict of interest. They'd love to see something like the old TV cable model where customers have a small set of choices that must pay to play.
  - pitaj 8y ago
    And the answer to that, and a true solution to net neutrality, is competition. We need to get rid of the regulations and agreements that hurt small ISPs at the local level.
    - api 8y ago
      ISPs are a natural monopoly unless you want this in your neighborhood: https://news.lovepattayathailand.com/wp-content/uploads/2017/03/maxresdefault-8-1.jpg https://news.lovepattayathailand.com/wp-content/uploads/2017... I also must point out that fighting a patchwork of local regulations is more expensive than building out the actual infrastructure. It's a slog through political and bureaucratic molasses.

monocasa 8y ago

Majority of those surveyed who are connected to the Chicago School. Literally the classically liberal school of thought of Friedman. So, we'd probably have to check if they're OK if they said anything else. Also, I have issues with the whole premise of the question, as net neutrality isn't really about "for the right to send that traffic using faster or higher quality service". There's no magic go faster lane that they want to turn on, but can't because of regulations. It's about not allowing the ISPs to slow down other traffic.

throwaway37585 8y ago
> Majority of those surveyed who are connected to the Chicago School. How so? The majority of those surveyed are not from Chicago. According to the About section: > ...our panel was chosen to include distinguished experts with a keen interest in public policy from the main areas of economics, to be geographically diverse, and to include older and younger scholars. As with the IGM’s US panel, the experts are all outstanding researchers in their fields. The panel includes recipients of top national and international prizes in economics, fellows of the Econometric society and the European Economic Association, members of distinguished national and international policymaking bodies in Europe, recipients of significant grants for economic research, highly accomplished affiliates and program directors of the Centre for Economic Policy Research and the National Bureau of Economic Research, and past and current editors of leading academic journals in the profession. > It's about not allowing the ISPs to slow down other traffic. What you think a policy “is about” and its actual consequences are very different things.
- monocasa 8y ago
  > How so? From the About section: Chicago school is a broad term for an economics ideology, like "Austrian". Those surveyed are part of that ideology. > What you think a policy “is about” and its actual consequences are two very different things. So tell me then, how does this magical go faster lane work from a technical perspective, and how is net neutrality not letting them turn it on? Please be specific.
  - 8y ago

zwieback 8y ago

It's interesting to see the comments of the disagreeing economists, which can be summarized as "paying for a fast lane would be okay if the broadband market was competitive." So the problem isn't neutrality so much, it's the distribution layer itself.

Glyptodon 8y ago

The way the question is phrased seems likely to lead to misinterpretation to me.

glitcher 8y ago

This is a grossly oversimplified view of this issue. Next up: survey of economists show that our civil rights are hurting the economy!

throwaway37585 8y ago
What do you think is “grossly oversimplified”?
- deleted 8y ago
  [deleted]

cabaalis 8y ago

It seems many of the responses with comments base their arguments off of serving high-bandwidth users. The question, IMO regarding NN is: "Is all bandwidth equal, and therefore pricing based purely upon metering usage, or is some bandwidth more/less valuable than others?" In principle, I think all bandwidth is equal. But if you've got 2 or 3 companies using 80% of bandwidth (made up a number for sake of argument) then it damages the other 20% to charge equal pricing bit-for-bit because ISPs have to increase capacity solely to serve the larger groups. So I think the answer is cloudy.

monocasa 8y ago
> But if you've got 2 or 3 companies using 80% of bandwidth (made up a number for sake of argument) then it damages the other 20% to charge equal pricing bit-for-bit because ISPs have to increase capacity solely to serve the larger groups. But none of these companies using up 80% of the bandwidth in your example are forcing their data down Comcast, et al.'s throat. Every packet coming from them was specifically requested by one of Comcast's paying customers, and metered within their customer's plan.
throwaway37585 8y ago
> In principle, I think all bandwidth is equal. Why?
- cabaalis 8y ago
  Because I think of an ISP as a carrier, and don't believe it's their business to inspect traffic between me and their client for the purpose of facilitating transmission.

jccc 8y ago

The linked page does not anywhere say what the editorializing HN headline does, that a majority of economists are “against Net neutrality.” The question asked was: “Considering both distributional effects and changes in efficiency, it is a good idea to let companies that send video or other content to consumers pay more to Internet service providers for the right to send that traffic using faster or higher quality service.”

nabla9 8y ago

This question is framed in a way that if economist answers the exact question, it's likely agree or uncertain. Net neutrality as a whole is still a good idea. Consider this question: Q: Should the end users be able to buy better bandwidth or quality of service, so that they can get faster streaming or other services? Absolutely. If you order Netflix and are not satisfied with speed, you should be able to pay for faster network connection that works with every service. If you allow big corporations to pay bulk prices for delivery that is already paid by the customer, it's double pricing and restricts the ability of smaller companies to compete.

asperous 8y ago

The comments from the economists are much more insightful then the headline: Thoughts in favor: * Possible better efficiency (better allocation of resource by bringing externalities to market) * Net Neutrality already a myth due to CDNs, etc Thoughts against: * Price discrimination / vertical price squeeze * No competition / Market power of the cable and phone companies real issue

decebalus1 8y ago

Ok, let's see how insightful some of the 'agree' comments are: David Autor, MIT: > Net neutrality is a fiction. Hire Akamai (et al.) to mirror your servers worldwide to speed content to your users. What the fuck are you talking about? And Akamai will pump that content onto some magic rainbows to get to your users. I wouldn't put my name/univeristy next to that comment. _ Joseph Altonji, Yale > High bandwidth traffic imposes externalities on other users. Fair, but I'd say this is an incentive for ISPs to step up their game. This is a very old argument. _ Darrell Duffie, Stanford (Strongly agree) > If all qualities sell at the same price, markets cannot allocate quality efficiently. Works for soap, wine, and haircuts; why not Internet? First of all, soap, wine and haircuts are not a medium of sharing information. And all qualities are not sold at the same price. I pay differently for different speeds and bandwidth. Clearly this guy has no idea what he's talking about. _ Richard Schmalensee, MIT > It is not generally good policy to restrict firms' product offerings, but there seem to be other considerations. I like pizza and it's not necessarily a good idea to eat it every day, but there seem to be other considerations. _ Richard Thaler, Chicago > Seems like those who cause congestion should pay more. I know some worry that ISPs will play favorites, but that should be preventable. Yeah, it should be preventable. Through net neutrality rules. Honestly, what the fuck is this? Also, who cares about their opinion? Not a fan of Taleb but I tend to side with him on his opinion about economists. Next up, let's ask accountants what they think about Net neutrality.

throwaway37585 8y ago
> What the fuck are you talking about? The point is that net neutrality doesn’t even exist presently. > Fair, but I'd say this is an incentive for ISPs to step up their game. What do you mean? > This is a very old argument. Yours or his? > First of all, soap, wine and haircuts are not a medium of sharing information. How is this relevant? > And all qualities are not sold at the same price. I think that’s the point.
- monocasa 8y ago
  > The point is that net neutrality doesn’t even exist presently. Despite the right wing talking points, we've had net neutrality for the whole existence of the public, consumer level internet. First due to the fact the physical infrastructure of the 90s were owned by the telephone companies who were common carriers. Then by the FCC's attempt at light touch on broadband until Verizon sued them to get a court order that the FCC could only enforce it by declaring them to be full common carriers.

jellicle 8y ago

a) the headline is bullshit. This is a small panel of economists selected from a right-wing economics association. b) It's clear from the responses that none of the individuals surveyed (in 2014) had any understanding of the issues involved. Most of them clearly think that net neutrality is about dealing with congestion/excessive use, and obviously think that ISPs should have some way of dealing with that. The question is worded in the most deceptive way possible to encourage that misunderstanding. For example, look at the response of Thaler. He says he agrees (meaning he is "against" net neutrality for this question) and then explains his answer: "Seems like those who cause congestion should pay more. I know some worry that ISPs will play favorites, but that should be preventable." He's clearly for net neutrality but is an "against" vote for this question because he doesn't understand what the issues are (or didn't in 2014). Another way of looking at it is that the question as stated, despite being titled "Net Neutrality", has nothing to do with net neutrality.

throwaway37585 8y ago
> This is a small panel of economists selected from a right-wing economics association. Why do you claim the interviewed economists are “right-wing”? > The question is worded in the most deceptive way possible to encourage that misunderstanding. What is deceptive about the question? > He's clearly for net neutrality Where did you get this from? > the question as stated... has nothing to do with net neutrality. Letting companies pay more to send content faster to their users has nothing to do with net neutrality, in your view?

AmIFirstToThink 8y ago

The responders seem to forget that the video content providers paid their ISP bills as well for their internet connectivity. They paid akamai and level3 for CDN. They paid amazon aws or google gcp for the bandwidth costs. In case of Netflix OpenConnect gave ISP's an option to reduce traffic at exchanges. The person that watched Netflix paid her ISP bill. Netflix paid its ISP bill. Now, the ISP of that lady wants to charge Netflix also. For what?

stillbourne 8y ago

Economists aren't engineers, I don't give two fucks what they think or want. I care about the dominate opinion among those who are involved in keeping the internet running and afloat.

zzleeper 8y ago

At least the one I respect more (Samuelson) has a decent quote: Disagree. Reason: 'This would be a great idea if the market for service provision was competitive, but is less obvious with our current market.' On the other hand, it's sad that smart people that should know better (Chetty, Altonji) answered like that. One interesting observation is the IO/Finance divide. IO experts (Liran Einav) are in favor of NN, while Finance folks (Darrell Duffie) are against. Probably because the latter almost always think about efficiency, while if you work in IO you have to be aware of the market structure (and natural monopolies, etc)