5 ms·

The Cable Model and the Internet Model

44 points by ghshephard 12y ago

mwsherman 12y ago
Net neutrality is the cable model. It locks in local monopolies, aka, utilities. I find Fred uncharacteristically confused on this. We have local monopolies because cable (and phone) were built according to a utility model. Net neutrality is the legal reification of the utility model.
- ericd 12y ago
  AFAIK, it's monopoly power without the ability to leverage that monopoly to tax all the participants to the hilt.
- splitrocket 12y ago
  Providing last mile service, be it electrical, water, gas, sewage, or TCP/IP is a natural monopoly. No one is going to build more than one sewage pipe to a customer. It only makes sense that we don't allow these natural monopolies extract monopoly rents. Right now, we do allow the cable companies to do just that, and worse. If you find that your netflix or youtube is slow, just VPN into a server with a real internet connection and be amazed at how fast the video loads, even with the encryption overhead, all because the VPN bypasses the ISP's domain based throttling. (Unless you're a youtube or netflix employee who can spin up a VM for your own personal VPN or somesuch)
  - icebraining 12y ago
    Lots of us outside the US have multiple ISPs in competition, usually with their own cables. I'd really like to know what's so impossible about this, or what makes monopolization inevitable. Sure running cable is expensive, but it's hardly outside of the range of typical VC investment. It's not like you need to wire a whole country at once, you can start by serving small & cheaper areas.
    - ghshephard 12y ago
      The problem is that in many of these areas, the Cable Providers were provided a monopoly in order to get them to build out their services universally. In almost every city, there are tons of profitable opportunities to provide competition, but at the same time, a good portion of the city is not economical to provide services to - and the only reason they get Comcast (or whoever is providing them service) is that they were legally obliged to, in order to get access to the profitable areas. Is it fair to the people who provide universal service that they would have to compete with companies are aren't required to do so?
      - narrowrail 12y ago
        It seems the best option would be for each municipality to buy the coax cable infrastructure and lease it back to the cable company, while allowing for other companies to lease the same infrastructure.
    - ghshephard 12y ago
      The problem is that in many of these areas, the Cable Providers were provided a monopoly in order to get them to build out their services universally. In almost every city, there are tons of profitable opportunities to provide competition, but at the same time, a good portion of the city is not economical to provide services to - and the only reason they get Comcast (or whoever is providing them service) is that they were legally obliged to, in order to get access to the profitable areas. Is it fair to the people who provide universal service that they would have to compete with companies are aren't required to do so?
    - narrowrail 12y ago
      Just to clarify, something like 80% of the US has both DSL and DOCSIS available. If there is one option available, typically it is only DSL. I have friends that rely on WISPs and/or cellular in more rural areas.
    - mschuster91 12y ago
      > Sure running cable is expensive It's not just expensive, it's fucking hard. Speaking as a guy who occasionally does this for a living. The revenue you can make on a single phone wire these days just doesn't pay off in five years. Not in ten. Maybe in twenty years, but this break-even delay is too much for any investor who is not at government level! And this is why speedy stuff like FTTH is deployed in cities and not in rural areas: digging costs approximately the same in rural as in city areas... and if it costs me as provider 50 k€ to wire up 100m of city street with 500 customers, that's paying off in a year. Wiring up a rural area with (if you're lucky, and I'm already leaving out real rural areas!) 50 customers takes 10 years to break even... And this difference is why it is imperative that last-mile infrastructure building is done by a government entity charging the same amount of money for providing a bitstream Internet uplink to the customer - at a price point where the city customers subsidize the rural customers and the utility provider breaks even. The added value by telecom providers renting the wires from utility can be e.g. faster peering to Netflix, Facebook caching servers in the next major city, etc.
  - ghshephard 12y ago
    > all because the VPN bypasses the ISP's domain based throttling. Small but important detail - ISPs don't do "domain based throttling" - but it's entirely possible (and was well detailed fact in the case of Netflix/Cogent/Comcast) that your content provider (Netflix) has purchased transit from a provider (Cogent) that is unable to deliver the service they contracted to because they don't have large enough circuits open to the last mile (Comcast) The real question is whether the last-mile providers such as comcast should be obliged to provide settlement free peering at unlimited data rates with all transit providers is the real question. "Strong" network neutrality would say that they do, and, if Strong network neutrality turns out to be the law of the land, the implication will be that all ISP will transition to volume based pricing for their customers in order to make up for the loss in income that they got from selling transit rights. A somewhat weaker version of network neutrality, but still useful, would suggest that comcast can charge for transit peering onto its network, but must do so on a non-discriminatory rate as established by regulators. I.E. Perhaps Comcast can charge 1$ /mbit/second charged @95th percentile, if they are determined to be a common carrier / title II applicable. Then providers like Netflix (or anyone, for that matter) that fulfilled the minimum operational requires (NOC, peering points, etc...) could purchase transit directly from Comcast. Alternatively, if they don't fulfill those technical requirements, or just don't want to bother, they can purchase transit from providers like Cogent/Level 3, who would resell at a bit of a markup. That's the future I envision being the happy medium for consumers, last mile providers, transit providers, and content providers.
    - nitrogen 12y ago
      The problem with your proposal is that consumers already pay far more than $1/mbit/s to Comcast unless they are still in the introductory pricing period, or are lucky enough to live where Comcast has competition. What's worse, if the consumer actually uses all of that bandwidth (or even their proportional share of a shared last mile link), they will reach their download cap before the end of the month. The exact thing I pay an ISP to do is to provide unlimited (up to my bandwidth plan) transit to the peering points of the services I want to use. They have no ethical or moral right to turn around and charge Netflix, Google, Crunchyroll, Vimeo, or anybody else for the thing I'm already paying for.
guiomie 12y ago
I recommend also reading the comment/discussion from Mark Cuban at the bottom of the article. Here is the initial comment: "Come on fred. Cable companies started as analog. They were held back from going digital more quickly because people still watch TV and they had to support old stb. It wasn't a binary go all in for digital or not And as far as 1k channels are you saying more linear is better than the thousands of hours of HD on demand content they offer to tv viewers ? Or for the remote dvrs coming online ? Consumption of on demand and dvr viewing is growing faster than internet viewing of long firm content. Or did you not notice that side of the equation. People do watch far more digital tv than they do internet video. By a long shot And you seem to forget that the internet was designed for everything but video. But that's a topic for another time. If you want to discuss the openness of the net you have to take out netflix. That's one company the discussion of the open internet can't be built around one company (disclosure I own a lot oc nflx stock and do quite a bit of business with )"
- jacquesm 12y ago
  > And you seem to forget that the internet was designed for everything but video. I've had that one leveled at me on more than one occasion (including a very irate backbone operator that was pissed off that my webcam software was about to saturate the transatlantic link) but I really do not agree with that. The internet was designed to transport bits, to do so connectionless (UDP/IP, Multicast/IP) or using virtual circuits. What the content of those bits was was no doubt important but it is not exactly as if the internet was designed to the exclusion of one particular medium because it happens to produce a lot of bits. Talk about videoconferencing started in the 1930's, and in via the internet in the 1970's (roughly around the time the internet was built). I highly doubt that you could make a credible claim that streaming video across the world digitally was the one application that the internet was not designed for. The whole idea is that it transports bits, and that it does so with maximum speed and reliability routing around problems where those are encountered. What those bits represent is an affair of the sender and the receiver.
  - angersock 12y ago
    Yep. That was the line that annoyed me the most, other than the continued dismissal of concerns about ISP behavior--it's pretty obvious at this point to anybody in tech that they can't be assumed to be competent and unbiased actors.
zackmorris 12y ago
A better analogy (to me) is that the internet infrastructure is part of the commons (like roads, bridges, canals etc) and the internet data is the free exchange of ideas (like phone calls and ham radio broadcasts). Internet technology may be so ubiquitous now that I don't think we can trust control of it to private interests. Arguing in terms of corporations frames it in the wrong light and reminds me of Ma Bell.

44 points by ghshephard 12y ago

Net neutrality is the cable model. It locks in local monopolies, aka, utilities. I find Fred uncharacteristically confused on this. We have local monopolies because cable (and phone) were built according to a utility model. Net neutrality is the legal reification of the utility model.

ericd 12y ago
AFAIK, it's monopoly power without the ability to leverage that monopoly to tax all the participants to the hilt.
splitrocket 12y ago
Providing last mile service, be it electrical, water, gas, sewage, or TCP/IP is a natural monopoly. No one is going to build more than one sewage pipe to a customer. It only makes sense that we don't allow these natural monopolies extract monopoly rents. Right now, we do allow the cable companies to do just that, and worse. If you find that your netflix or youtube is slow, just VPN into a server with a real internet connection and be amazed at how fast the video loads, even with the encryption overhead, all because the VPN bypasses the ISP's domain based throttling. (Unless you're a youtube or netflix employee who can spin up a VM for your own personal VPN or somesuch)
- icebraining 12y ago
  Lots of us outside the US have multiple ISPs in competition, usually with their own cables. I'd really like to know what's so impossible about this, or what makes monopolization inevitable. Sure running cable is expensive, but it's hardly outside of the range of typical VC investment. It's not like you need to wire a whole country at once, you can start by serving small & cheaper areas.
  - ghshephard 12y ago
    The problem is that in many of these areas, the Cable Providers were provided a monopoly in order to get them to build out their services universally. In almost every city, there are tons of profitable opportunities to provide competition, but at the same time, a good portion of the city is not economical to provide services to - and the only reason they get Comcast (or whoever is providing them service) is that they were legally obliged to, in order to get access to the profitable areas. Is it fair to the people who provide universal service that they would have to compete with companies are aren't required to do so?
    - narrowrail 12y ago
      It seems the best option would be for each municipality to buy the coax cable infrastructure and lease it back to the cable company, while allowing for other companies to lease the same infrastructure.
  - ghshephard 12y ago
    The problem is that in many of these areas, the Cable Providers were provided a monopoly in order to get them to build out their services universally. In almost every city, there are tons of profitable opportunities to provide competition, but at the same time, a good portion of the city is not economical to provide services to - and the only reason they get Comcast (or whoever is providing them service) is that they were legally obliged to, in order to get access to the profitable areas. Is it fair to the people who provide universal service that they would have to compete with companies are aren't required to do so?
  - narrowrail 12y ago
    Just to clarify, something like 80% of the US has both DSL and DOCSIS available. If there is one option available, typically it is only DSL. I have friends that rely on WISPs and/or cellular in more rural areas.
  - mschuster91 12y ago
    > Sure running cable is expensive It's not just expensive, it's fucking hard. Speaking as a guy who occasionally does this for a living. The revenue you can make on a single phone wire these days just doesn't pay off in five years. Not in ten. Maybe in twenty years, but this break-even delay is too much for any investor who is not at government level! And this is why speedy stuff like FTTH is deployed in cities and not in rural areas: digging costs approximately the same in rural as in city areas... and if it costs me as provider 50 k€ to wire up 100m of city street with 500 customers, that's paying off in a year. Wiring up a rural area with (if you're lucky, and I'm already leaving out real rural areas!) 50 customers takes 10 years to break even... And this difference is why it is imperative that last-mile infrastructure building is done by a government entity charging the same amount of money for providing a bitstream Internet uplink to the customer - at a price point where the city customers subsidize the rural customers and the utility provider breaks even. The added value by telecom providers renting the wires from utility can be e.g. faster peering to Netflix, Facebook caching servers in the next major city, etc.
- ghshephard 12y ago
  > all because the VPN bypasses the ISP's domain based throttling. Small but important detail - ISPs don't do "domain based throttling" - but it's entirely possible (and was well detailed fact in the case of Netflix/Cogent/Comcast) that your content provider (Netflix) has purchased transit from a provider (Cogent) that is unable to deliver the service they contracted to because they don't have large enough circuits open to the last mile (Comcast) The real question is whether the last-mile providers such as comcast should be obliged to provide settlement free peering at unlimited data rates with all transit providers is the real question. "Strong" network neutrality would say that they do, and, if Strong network neutrality turns out to be the law of the land, the implication will be that all ISP will transition to volume based pricing for their customers in order to make up for the loss in income that they got from selling transit rights. A somewhat weaker version of network neutrality, but still useful, would suggest that comcast can charge for transit peering onto its network, but must do so on a non-discriminatory rate as established by regulators. I.E. Perhaps Comcast can charge 1$ /mbit/second charged @95th percentile, if they are determined to be a common carrier / title II applicable. Then providers like Netflix (or anyone, for that matter) that fulfilled the minimum operational requires (NOC, peering points, etc...) could purchase transit directly from Comcast. Alternatively, if they don't fulfill those technical requirements, or just don't want to bother, they can purchase transit from providers like Cogent/Level 3, who would resell at a bit of a markup. That's the future I envision being the happy medium for consumers, last mile providers, transit providers, and content providers.
  - nitrogen 12y ago
    The problem with your proposal is that consumers already pay far more than $1/mbit/s to Comcast unless they are still in the introductory pricing period, or are lucky enough to live where Comcast has competition. What's worse, if the consumer actually uses all of that bandwidth (or even their proportional share of a shared last mile link), they will reach their download cap before the end of the month. The exact thing I pay an ISP to do is to provide unlimited (up to my bandwidth plan) transit to the peering points of the services I want to use. They have no ethical or moral right to turn around and charge Netflix, Google, Crunchyroll, Vimeo, or anybody else for the thing I'm already paying for.

guiomie 12y ago

I recommend also reading the comment/discussion from Mark Cuban at the bottom of the article. Here is the initial comment: "Come on fred. Cable companies started as analog. They were held back from going digital more quickly because people still watch TV and they had to support old stb. It wasn't a binary go all in for digital or not And as far as 1k channels are you saying more linear is better than the thousands of hours of HD on demand content they offer to tv viewers ? Or for the remote dvrs coming online ? Consumption of on demand and dvr viewing is growing faster than internet viewing of long firm content. Or did you not notice that side of the equation. People do watch far more digital tv than they do internet video. By a long shot And you seem to forget that the internet was designed for everything but video. But that's a topic for another time. If you want to discuss the openness of the net you have to take out netflix. That's one company the discussion of the open internet can't be built around one company (disclosure I own a lot oc nflx stock and do quite a bit of business with )"

jacquesm 12y ago
> And you seem to forget that the internet was designed for everything but video. I've had that one leveled at me on more than one occasion (including a very irate backbone operator that was pissed off that my webcam software was about to saturate the transatlantic link) but I really do not agree with that. The internet was designed to transport bits, to do so connectionless (UDP/IP, Multicast/IP) or using virtual circuits. What the content of those bits was was no doubt important but it is not exactly as if the internet was designed to the exclusion of one particular medium because it happens to produce a lot of bits. Talk about videoconferencing started in the 1930's, and in via the internet in the 1970's (roughly around the time the internet was built). I highly doubt that you could make a credible claim that streaming video across the world digitally was the one application that the internet was not designed for. The whole idea is that it transports bits, and that it does so with maximum speed and reliability routing around problems where those are encountered. What those bits represent is an affair of the sender and the receiver.
- angersock 12y ago
  Yep. That was the line that annoyed me the most, other than the continued dismissal of concerns about ISP behavior--it's pretty obvious at this point to anybody in tech that they can't be assumed to be competent and unbiased actors.

zackmorris 12y ago

A better analogy (to me) is that the internet infrastructure is part of the commons (like roads, bridges, canals etc) and the internet data is the free exchange of ideas (like phone calls and ham radio broadcasts). Internet technology may be so ubiquitous now that I don't think we can trust control of it to private interests. Arguing in terms of corporations frames it in the wrong light and reminds me of Ma Bell.