14 March 2007

Net Neutrality and the View from the Cable Industry

David Weinberger entered the belly of the beast, so to speak, when he presented at the Cable Television Public Affairs Association meeting. The reaction he received was less than warm, to say the least.
But I really annoyed them when I complained about the panel's whining about competition. I said that the cable market isn't competitive. People yelled from the audience. I said that where I live, the town has franchised only one cable provider, although I think we're letting in a second. But, people in the audience said, I could get the Net by satellite or DSL. A more gracious and honest person would have accepted that, and clarified: Cable competes with other forms of delivery, but generally doesn't compete with other cable companies within a region...although they compete for franchises. I instead just got sarcastic. Yeah, real mature.
But what was particularly interesting was his exchange with a person from Time Warner on the topic of net neutrality.
During the panel beforehand, and in a conversation with a different Time-Warner guy afterwards, they kept coming back to their concern that if Net neutrality passes, the cable companies won't be able to raise capital. Oddly, the TW guy also argued that TW has absolutely no intention of violating Net neutrality. So, I said, TW ought to announce that and take the wind out of the NN sails. But announcing that, he said, would discourage investors. But, I said, it's either part of their business plan or it's not. We did not come to closure on that point. And I'm personally not convinced that that's the real reason they oppose Net neutrality. It sounds to me like a supporting reason, as is the argument that since no one has violated NN yet, we don't need a law forbidding people from violating it, as well as the "Google is getting a free ride" line of reasoning. I think — and I'm indulging my hunches here — that the real reason they oppose NN is that they want to ensure their subscribers have a "good experience," where the criteria of a good experience are those that govern expectations for how television works. They're thinking that users most of all want to be able to watch programs in high def and on demand, and so those packets need to get preference. They are frustrated by Web fanatics who want to hold back this rational load-balancing. The cable companies are in the business of selling us video content, and they see their ability to satisfy their customers being hampered by fanatics holding on to an out-dated architectural principle.

There are, of course, answers to this argument, but I think the primary response should be: No commercial entity should get to decide which experience needs to be optimized. Maybe I want to watch high def video, but you want to play video games, and someone else wants to download the high-resolution scan of the Bayreaux Tapestries. It's not obvious that video should win. The decision should not be made by the people who have a vested, commercial interest in the outcome. IMO.
I think this exchange offers some interesting insights. First, it highlights the disparate grounds of the carrier industry vs. the Save The Internet folk, and the fact that they are each talking past the other. Second, it highlights the attitude among the carriers that THEY know best what the "consumer" wants. The fact is that the people formerly known as consumers are no longer merely consumers, and the carriers are not delivering content - as McLuhan famously said, the user is the content. 'Net carriers are delivering people and their experiences to each other; hence a big difference vis-a-vis the neutrality/Quality-of-Service debate.

The corollary to this attitudinal conflict is what I'm hearing from the marketing/branding/advertising front-lines, that is, the brands must now "play by the consumer rules" (this is from the CEO of one of the household-name consumer and packaged goods companies). In the carrier industry, "playing by the consumer rules" at the very least means truly listening to the users' concerns about the loss of the end-to-end principle, which is what net neutrality threatens. This last point is not one that I'm hearing a lot of, especially from the companies that have built their fortune on that very principle's backbone.

[Technorati tags: | | ]


HandsOFF43 said...

Have you heard that one of Google's VP's has expressed doubts about net neutrality?

They know they want to be in the internet provider business but are afraid to admit it.

I consult for Hands Off the Internet. We oppose net neturality and I'd like to refer you to this WebProNews post about Google's internal conflicts.

Mark said...

Readers should check out Hands Off the Internet. According to SourceWatch, "This organization has been described as a classic astroturf group. Its website does disclose its industry membership, and its connection to Public Strategies, Inc.. But its homepage only describes itself as "a nationwide coalition of Internet users," giving a misleading impression of grassroots support.

HOTI's membership is dominated by telecommunications companies and conservative lobby groups.

Mark said...

And these comments from Common Cause: "If there were an award for Astroturf lobby campaigns, Hands Off the Internet (HOTI) would win hands down. With its pithy name, viral web cartoons, high profile spokesman (former White House press secretary Mike McCurry) and barrage of print and television advertising, HOTI has been effectively injecting the telephone industry's arguments on net neutrality into the public debate in recent months. And they manage to do it while hiding their relationship with their corporate backers. K Street Confidential columnist Jeffrey Birnbaum wrote in The Washington Post that "no one can determine who is supporting Hands Off the Internet by looking at its ads alone. To find out, one must dig into its Web site."

A little searching on the HOTI site reveals that AT&T, Cingular, BellSouth and other telephone companies are all "member organizations," but the level of financial support offered by those corporations is never disclosed. One can guess that it must run into the tens of thousands or hundreds of thousands of dollars, in order to support HOTI's extensive advertising campaign. In a single month, HOTI spent $693,658 on television advertising alone, according to independent researchers at the Campaign Media Analysis Group. That's more than $20,000 a day on TV commercials. The group has also been running full-page ads regularly in papers like The Washington Post and Roll Call. HOTI ads "are the epitome of doublespeak," according to Birnbaum. For example, one print ad attempts to frame the Hands Off the Internet message in pro-consumer terms. "Net neutrality means consumers will be stuck paying more for their Internet access to cover the big online companies' share," the ad claims. But every major consumer group supports net neutrality, and opposes HOTI's plan to give telephone and cable companies gatekeeper status over the Internet.

Anonymous said...

You expressed a concern about the loss of the 'end to end principle'-but if you read the final paragraph in Wikipedia it explicitly states that this principle has *not* worked well for real-time applications such as telephony.
Video is another example of a real-time application. The evolution of applications now requires that the 'net carry more than just TCP/IP applications. The entire environment is complex and difficult to understand and indeed, as you say, everyone is talking past each other.