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Net Neutrality – If It Isn’t broken, don’t fix it!   no comments

Nov 19, 2014 @ 8:13am Ask the Expert

netneutralityPart I: Definition of net neutrality; definition of parties involved; examination of parties’ roles; detrimental to new business development

Net neutrality, as defined by the Federal Communications Commission is: “The ‘Open Internet’ is the Internet as we know it. It’s open because it uses free, publicly available standards that anyone can access and build to, and it treats all traffic that flows across the network in roughly the same way. The principle of the Open Internet is sometimes referred to as “net neutrality.” Under this principle, consumers can make their own choices about what applications and services to use and are free to decide what lawful content they want to access, create, or share with others. This openness promotes competition and enables investment and innovation.”


There are basically only three parties to the whole internet/net neutrality equation:

  1. Retail Traffic carriers: such as cable companies, phone companies, satellite companies, etc.
  2. Content providers: such as Netflix, YouTube, Hulu, Spotify, etc.
  3. End users: you and me


The whole net neutrality issue has come about because the traffic carriers, want to charge content providers a fee for “fast lane” service to deliver their content to the end users.


So what’s wrong with this picture?  Here’s what’s wrong with it…. You and I pay a monthly fee to a traffic carrier for X amount of bandwidth.  You and I want to watch a movie or listen to a song from a content provider.  Hey, we have paid a fee for our bandwidth so we rightfully expect to be able to utilize that bandwidth whenever we want to.  The problem is, the traffic carriers have oversubscribed their networks.  Let’s say a traffic carrier serves a neighborhood of 1000 homes and they give each home 5Mbps of bandwidth and, the total bandwidth that the traffic carrier can carry on their main circuit to that neighborhood is 500Mbps.  This means that if 100 homes are utilizing the full 5Mbps of bandwidth they have paid for, the other 900 homes will have no bandwidth and won’t be able to use the internet.  Now, bear in mind that this is the theoretical limit.  Since data is moved in bits and pieces, all 1000 homes in the neighborhood would have at least some access to the net but if everyone maxed their connection at the same time, everyone’s connection would slow to a crawl since the maximum available bandwidth in this example is only 500Mbps.  The traffic carriers are gambling that only a certain percentage of the end users will be online at any given point in time and that only a certain percentage of end users will be using the maximum bandwidth that they have paid for at any given point in time.  Quite frankly, that’s a workable model and one that has prevailed over time.  The problem is – what if all the end users want to use their fully allotted bandwidth all at the same time? If that happens, then the traffic carriers cannot provide what the end users have paid for because they don’t have that much bandwidth.  This is known as oversubscribing your network.

So, what the traffic carriers want to do is to charge the content providers in order to give the content providers’ data, priority over other types of traffic.  This is completely wrong because the content providers host their servers at a data center (or multiple data centers) and they are already paying the data centers for all the bandwidth they need.  It is the traffic carriers who have oversubscribed their networks and yet it’s the traffic carriers who want to charge the content providers.

The content providers are not the problem.  The content providers have paid their hosting company(ies) for ample bandwidth to move their data to the end users.  It is the traffic carriers who have oversubscribed their networks that are causing the issue.  So, the traffic carriers want to charge the content providers to prioritize their traffic.  Which raises another question… if the content providers’ traffic is prioritized over other traffic, then what does that do to your VoIP phone service, or the content you’re trying to get from a company that doesn’t pay to have their traffic prioritized, or your email?  What needs to happen here is there should be no charge to the content provider.  The traffic carriers need to increase their overall capacity so that the end users can download whatever they want whenever they want it at the maximum speed that they have paid the traffic carrier for.

Think about this… if your next-door-neighbor downloads content from a content provider who has paid the traffic carrier a fee to prioritize their traffic and you are downloading something from a content provider who has *not* paid an additional fee to the traffic carrier, you could see your download slow to a crawl while the traffic carrier prioritizes the traffic of the paying content provider over that of the traffic from a nonpaying content provider.  Under this scenario, you, and the content provider you are using, are both being penalized so the traffic carrier can prioritize the data of the paying content provider.

If traffic carriers are allowed to charge content providers to prioritize their traffic, that may become an insurmountable barrier to countless new businesses that could potentially exist.  Think of it this way… suppose content providers have to pay traffic carriers to carry their traffic – in this scenario, what happens when someone comes up with a new idea, like youtube?  Can you imagine a couple kids in a garage that come up with a great idea but next to no one can download the content because the kids are running a startup and they don’t have the type of cash needed to pay traffic carriers to prioritize their content??  Think about how that will stifle competition and not allow for the latest and greatest ideas to get out to the public.


This will be a multiple part series since there is so much ground to cover on this topic.  Stay tuned for more.

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Written by Dave on November 19th, 2014

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