• Our Stance on “Internet Deregulation” vs. “Net Neutrality”

    • (Last modified on: Mar. 26 at: 11:11 pm. EST)
      Alizarian.com is in the business of web design, not politics. However, we must address a legal issue that affects our business practices: the regulations defining how Internet content gets sent and received.
    • We support “Net Neutrality” - the idea that all Internet content is entitled to indiscriminate treatment from internet service providers (ISP's). Since these ISP's function as content deliverers, they are regulated by the “common carriage” principle. In other words, being a messenger does not give one the right to interfere with the message. “Internet Deregulation” is a misnomer because the ones seeking more control are ISP's, not the Internet itself.

  • Table of Contents

  • Timeline of Events

    • June 16, 1860: the Pacific Telegraph Act of 1860(1) states that telegraph lines must treat information transfers with neutrality: “messages received from any individual, company, or corporation...shall be impartially transmitted in the order of their reception...”
    • 1959: Thomas Carter invents the “Carterfone,”(2) a device that allowed workers on off-shore oil rigs to send and receive radio transmissions by patching through AT&T phone lines. AT&T sues.
    • June 1968: The Federal Communications Commission (FCC), during the Computer Inquiries, rules that the AT&T telecommunications network functions as a “common carrier”(3) (4) of information, which means that any paying customer can use the services of AT&T without discrimination or preference. (5)
    • January 1996: The Telecommunications Act of 1996 is signed into law. Intended to promote competition, it removed some barriers for market entry, and allowed telecommunications companies in different segments to compete against each other. (6)
    • March 1996: SBC Communications buys Pacific Telesis for $45 billion. Other companies announce mergers as well.
    • February 1999: Supported by the Internet2 group, the Abilene Network is established for 200+ universities. Abilene is a faster network, separate from home broadband.(7)
    • 2002: AT&T prohibits their customers from using Wi-Fi connections,(8) while Cox Cable attempts to charge premiums for those using virtual private network (VPN) services.
    • June, 2003: Rep. John Conyers, Jr. (D-MI) labels net neutrality as “a solution in search of a problem.”(9)
    • February 2005: the FCC launches an inquiry against Madison River Communications for blocking their DSL customers from using the web phone services offed by rival, Vonage VoIP. (10)
    • July 2005: Canadian ISP Telus blocks their subscribers from viewing a TWU website.(11) TWU is the union for Telus employees, who were on strike at the time.
    • April 2006: ISP Comcast Cable blocks the transfer of all emails containing the text, “DearAOL.com,” a website petitioning against AOL's pay-per-email proposals.(12) Both Comcast and AOL are owned by TimeWarner.
    • COPE
    • Current bills in congress
    • Since this topic is complicated, most people neither realize its importance nor the outcomes of either position. Therefore, let us begin by presenting the basic arguments of both sides.

  • A) The Case for “Net Neutrality” - Preserve the Status Quo

    • The current nature of Internet traffic is that, with all things equal, no website can get preferential treatment to reach consumers. That is, consumers can send and receive any information on the Internet with equal treatment. Hence, the massive servers of Google cannot transfer their content any faster than the relatively small servers that host Alizarian.com
    • The playing field is truly equal. Nobody gets preferential treatment.
    • The playing field is cheap. The only thing needed to start a successful online business is a good idea.
    • Consumers get to decide which online businesses should be successful.

  • B) The Case for “Internet Deregulation” - Create Free Markets

    • It seems unfair that successful Internet companies cannot take advantage of their success, because they must operate on the same lowest common denominator as failing companies. If a business can afford deliver their information to consumers with a better “quality of service" (QoS), they should have the opportunity to do so. By analogy, if small package delivery companies can only afford bicycles, then the largest companies are not allowed to use planes.
    • Regulation prevents growth. If the government places barriers that prevent the best companies from rising above the pack, then there is no innovation.
    • Regulation forces consumers to pay more. ISP's are forced to give equal treatment to the best and worst of online businesses - the expenses will get passed down to the rest of us.

  • The Reality: The Internet Deregulation Argument is a Logical Fallacy

    • Don't get us wrong - we're capitalists. Even though we are getting to do what we love, Alizarian.com is out to make money, pure and simple.
    • However, some traditional expectations of free market capitalism cannot be applied to the Internet. In fact, the argument for deregulation is a red herring.
    • The real motive behind deregulation is to provide a way for ISP's to force website owners to bid against each other for preferential treatment. Only the owners, who can pay, will get to send their content to consumers on faster, uncongested “pipes" (lines of communication). Undoubtly, Internet services owned by the ISP's will get to use the better pipes.
    • They argue that the amount of data being transferred on the Internet (bandwidth), is growing faster than their pipes can handle. Someone's got to pay - either the consumers who can afford faster pipes, or the online businesses that want to reach their customers with better QOS.
    • In fact, both sides have lots of extra arguments, which do not address the only argument worth consideration: the rule of “common carriage.” The understanding is that a deliverer of information does not get to pick and choose what information gets to be delivered.
    • The counter-argument to common carriage uses a postal service analogy. If the post office can allow their customers to choose from low-cost delivery, to first class or express service, then why can't the ISP's do the same? However, this argument is yet another red herring.
    • The people who use the postal service to send mail already know who their receivers are.
    • Therefore, those that send postal mail are able to act in a time-sensitive manner. A clothing company can ship its winter catalogues weeks in advance using cheap bulk rates, whereas websites can only send information at the very moment it's needed.
    • The postal service has built enough infrastructure to support the volume of mail sent. On the other hand, ISP's are trying to turn their pipes into a scarce commodity.
    • At any rate, the right to charge different rates for different delivery speeds is irrelevant because the Internet does not work that way. Receivers of winter catalogues don't care when they get them - as long they arrive before spring.

  • Net Neutrality Serves the Public Interest

    • If online businesses must first compete against each other just to send their information, the direct beneficiaries are the ISP's. We, the receivers of the information, become (quite literally) a third party.
    • If ISP's get to decide the which websites can reach consumers, then they become the gatekeepers of the Internet. ISP's aren't actually supporting Internet deregulation, or any deregulation - they are supporting legislation that allow them to abuse their positions. However, nearly 150 years of legal precedent says that they bound by the principles of common carriage.(13)
    • ISP's also claim that market factors will prevent abuse. However, consumer choice is a weak regulating factor in the broadband industry because it is a duopoly. Most American households get only two choices for broadband Internet - their local cable or DSL provider.
    • The final market factor should always be the consumer. Allowing ISP's to have total discretion over networks and pipes removes consumer choice over the Internet.
    • ISP's argue that they should have the right to use their infrastructure as they please. However, they own less than 2% of the property where they have laid their pipes. The other 98% is public land, funded by public subsidies.(14) Telecommunications companies are permitted to public rights-of-way because they are 1) delivering a public service, and 2) act as a common carrier. In order for ISP's to have total autonomy, they would have to buy all the public property that they use.
    • Website owners don't actually get a free ride. We pay our bandwidth usage. It would be unreasonable, and unlawful, to pay for tiered treatment, while the web services of of ISP's receive de facto preference.

  • Increasing Infrastructure: a Practical Solution

    • Over 200 universities in the United States use a seperate network, called Abilene, which is supported by the Internet2 group. Students and faculties at these schools enjoy Internet speeds 10,000 faster than average home broadband. (15) How is this possible?
    • Durin the dot-com boom, telecom companies laid down fiber optic cables everywhere, and at over-capacity to meet future demands. However, most of this fiber is not in use, because these companies have decided to turn bandwidth into a scarce commodity.
    • Researchers at Internet2 looked for all possibilities to meet the bandwidth needs at universities. The most practical, most cost-effective, and most simple answer was to make use of this “dark fiber” infrastructure, instead of giving some Internet content better quality of service at the expense of others. (16)
    • If we really made use of the available infrastructure in this country, net neutrality would become a non-issue. (17) Every Internet connection would have more than enough capacity to guarentee the fast delivery of any website.

  • Citation & References are on the next page.

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      last updated on 2007-04-24 EST 23:04:28-0500
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