June 8th, 2006
Net neutrality extremism versus common sense economics
Net neutrality extremism and free markets don't mix
What the Net neutrality extremists don't want to do is debate the specific merits of the Markey amendment and I had a difficult time of getting any of the Markey proponents to address my specific question which is: Do we want to ban all forms of priority service. If the answer is yes, do we also ban services like:
- Priority mail
- Priority shipping (FedEx, UPS, USPS, etc …)
- Priority downloads (Gamespot.com, FileShack.com)
- Priority seating (First class seating on planes)
- Premium search result placement or "search neutrality" (Rep. Charles Gonzales amendment proposed to do precisely this! Companies like Google should be careful on what they wish for.)
One slippery answer I got was: Well we don't want to ban priority service or QoS (Quality of Service); we just don't want anyone to be able to charge for it. Take this specific portion of the Markey amendment:
SECTION 201. NETWORK NEUTRALITY.
(b) IN GENERAL.—Each broadband network provider has the duty—
(3) if the provider prioritizes or offers enhanced quality of service to data of a particular type, to prioritize or offer enhanced quality of service to all data of that type (regardless of the origin of such data) without imposing a surcharge or other consideration for such prioritization or enhanced quality of service;
Everyone will want priority service since the Government has declared it free but NO ONE will offer it because there is zero incentive to do so Well if no one can charge for it, why would anyone offer the service in the first place? What if we told FedEx or any other shipping company they can't charge for priority overnight shipping and that if they want to offer priority service, then they can't discriminate against the sender and all packages must be sent via priority shipping? What do you think would happen to priority overnight delivery service? The exact same thing that happens in any socialist system like the Soviet Union where lines were a mile long and service was lousy. Under such a system, everyone will want priority service since the Government has declared it free but NO ONE will offer it because there is zero incentive to do so. When you declare everyone gets priority service or no one gets it, the end result will always be no one gets it.
If we look the priority shipping example, I'll often go with the cheapest ground shipping method. Of course "ground" shipping doesn't necessarily mean something is literally shipped by ground, what it really means is something is shipped by "best effort". This means if there is room on an airplane to ship something overnight when all other priority overnight packages are already on board, then the standard priority packages will get shipped along with the priority packages. This means I'll sometimes get my "ground shipping" package in one day and sometimes it might take up to 5 days which is still perfectly workable if I'm not willing to pay extra to get guaranteed overnight delivery. The same thing applies to VoIP packets on the Internet. Businesses often buy enhanced quality of service with priority packet forwarding for a set amount of data throughput today. For those who pay for enhanced QoS, their VoIP packets may take 20 to 40 milliseconds to get to their destination. For those who don't pay for enhanced QoS who have settled for cheaper "best effort" service, their VoIP packets may take 20 to 100 milliseconds to get to their destination. In the typical "best effort" scenario, VoIP still works fine though the quality may range from excellent to tolerable. In the case of enhanced QoS customers, the sound quality is almost always excellent. This is how a free market society works; pay average prices and get average service, pay premium prices and get premium service. So long as no one deliberately stops the packets or deliberately slows them down, everything should be perfectly legal. (more…)
George Ou is Technical Director of ZDNet. See his full profile and disclosure of his industry affiliations.
