Net Discrimination (AT&T Caves On Net Neutrality)

...Net neutrality travels under the euphemism of "nondiscrimination," which sounds very nice. But what it really means in practice is that the government dictates what AT&T and other Internet access companies can charge users of their pipelines. So there's "discrimination," all right -- against the companies that have invested billions to lay that pipe.

The beneficiaries of this discrimination are Google, Microsoft, Yahoo and other very rich Web businesses, which have loaded up on Beltway lobbyists to have these mandates imposed. Democrats are taking the PAC money and running interference. The Democratic Commissioners -- Jonathan Adelstein and Michael Copps -- were able to extort this concession from AT&T because one of the three GOP Commissioners recused himself from voting on the merger under pressure from Democrats on Capitol Hill. It was a nasty game of bad cop-worse cop, and it is probably a portent of things to come.

The one thing no one should be deceived about is that this ambush has anything to do with "consumers." Internet users will benefit most from the rapid rollout of broadband, which requires letting companies get a return on their investment. Net neutrality is all about imposing price controls that shake down one corporate player for the benefit of another.

It's the same thing.

No, it isn't. Not even close.

First, net neutrality is about disallowing infrastructure owners from giving preferential treatment to traffic in which they have a financial interest. It has nothing to do with blocking or filtering traffic someone finds objectionable, for whatever reason. If we're going to use Target as an analogy, the comparison would be that the government is preventing Target from giving its store brands or a brand in which it has a financial interest more prominence on its shelves. Target isn't trying to keep you from buying Planter's nuts, but it is putting Target brand nuts in the premium store locations. The net neutrality equivalent is that Planter's bought some government regulators off with PAC money and got them to force Target to put Planter's nuts in the premium store locations. That's nothing but corporate welfare and socialism, so is net neutrality.

Second, you are using a government shakedown in comparison to operational and marketing procedures used by a private corporation. The government owns the roads and you aren't allowed to build other roads. While AT&T owns some of the infrastructure, Google and Microsoft are perfectly free to build their own Internet infrastructure. One of these things is not like the other.

The correct analogy to broadband providers which have locally granted monopolies (ie, the cable companies and hardwire telcos) would be something like an electric utility. Yes, it's traded on the NYSE and pays a dividend, but the odds of anyone being able to start up a competitor are effectively ZERO.

Now suppose your electric company owned all the local Burger King franchises too, and decided one morning that Wendy's and McDonald's needed to pay 3x the current rate per kilowatt hour?

Would your response be, "Hey, Wendy's is free to go build their own hydro stationa and nuc plants if they choose?"

The correct analogy to broadband providers which have locally granted monopolies (ie, the cable companies and hardwire telcos) would be something like an electric utility.

AT&T provides DSL and/or cable broadband in various markets, but they have competition from other cable providers and private DSL providers. There is no monopoly. As a matter of fact, broadband Internet is an extremely competetive market. This part of your argument is incorrect, so the rest of it falls apart and need not be addressed.

There's an FCC report at

http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-264744A1.pdf

which indicates that something like 98% of American broadband is either over cable (throttleable at will by the cable owner to discourage competition) or telco (throttleable at will by the telco to discourage competition).

I'm PAYING for my bandwidth, it's not a gift from the pipeline owner to me, to Google, to Vonage or anyone else. I'm entitled to use that bandwidth for any legal purpose, particularly if I'm using it for a service (VOIP) which competes with other business lines of the pipeline owner.

Wonderful, but none of that supports your original assertion that the providers have a monopoly. You even admit that there is no monopoly. I am assuming monopoly was the (poor) excuse you were using to justify government interference in the market.

Your new argument falls apart logically. You pay for cable television as well, but you are limited to the programming offered. You have no ability (or right) to specify what or how the provider delivers programming. The networks practice discrimination in their programming. Are you proposing a "broadcast neutrality" law that forces television networks to provide equal access for every fool with an idea?

The fact is that you have bought the socialist argument for "fairness," something that doesn't actually exist. You seem to believe you have some "right" to internet access. You favor socialism if it suits your desires.

Well, in my neighborhood there is a broadband monopoly. I have a choice of Charter cable or nothing. And as a matter of fact, other cable companies are prohibited by community ordinance from offering their services to me.

You may call that a free market but I don't.

Well, in my neighborhood there is a broadband monopoly.

I see, and your neighborhood is the macrocosm of internet service. It is ever the excuse of the closet socialist that government intervention is acceptable when one's own ox is being gored.

You may call that a free market but I don't.

I never said it was a free market. Telecom is one of the most heavily regulated industries in this country. I was simply refuting your argument that there was a monopoly. Try as hard as you will, there is not a simple dichotomy of monopoly or free market. In any case, net neutrality will certainly do nothing to move the internet broadband providers toward a free market. It is a move in exactly the opposite direction.

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