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Friday 7 March 2014

Net Neutrality : Premature Obituaries

"Rumours of my death have been greatly exaggerated " - Mark Twain 

The internet has been awash over the last few weeks with misinformation around the death of net neutrality. Journos with no idea of how the internet works have been making allegations of backroom deals done between Netflix and Comcast . Thankfully, most of that is now coming to rest and the voices of reason have started speaking louder. Finally, Peering coordinators at ISPs are feeling better about what they do for a living. 

The one misinformation that refuses to go away is the idea around ISPs and mobile operators throttling traffic from websites they do not like. In my opinion, this "Throttle to Extort" revenue model  is pure hogwash. All telcos have had this capability for years and they have mainly been managing P2P traffic with it , so that the seeders don't clog up the network with their illegal downloads. It is not net neutrality that stopped them from throttling the likes of Google and Netflix- It is customer loyalty that set the parameters of what they can 
and cannot do . Verizon or any other operator for that matter are not going to rock the boat so hard that customers look for better internet experience elsewhere .They may be evil- they are not dumb!


Now, P2P may have been the traditional bad boy of internet traffic. His popularity has, however waned over the last few years with the rise of other legal forms of media consumption. Video, now  forms almost 70% of all network traffic these days. There's definitely a case for managing traffic on the mobile side, where capacity is limited and performance depends  on many external factors.




You can do 2 things in a mobile network. First option is to treat everyone equally, so when the shit hits the fan and the network does gets congested, because everyone's streaming the 'House of Cards' on to their mobiles in glorious HD- everyone gets the same shitty quality and you can't even update your Twitter feed. Everyone is equally pissed and they vent their anger against the mobile operator on social media. Clearly a Lose-Lose proposition for everyone.

The second option /opportunity, is that you treat traffic equally for everyone,  however when network capacity reaches its peak and the cell gets congested, you prioritize services for those who are paying higher, or those services which are so critical that their owners will pay to have them available across all network conditions. This is the model which the EU Commission are proposing to table later this year for operators within the European Union.( BTW this is exactly the model that many busy roads follow during rush hour traffic ). 

There is a debate on whether this model would even work. Would ESPN or any other provider pay to have a higher priority on a network across all network conditions ? Probably not. Would they pay to have it available during high congestion, say during a world cup final or super bowl event?  Maybe, if they can see a clear business justification for that. In my opinion, this should be a win-win for everyone involved. 

Under the earlier FCC regulations, Verizon would always have to offer the first option, under all network conditions. There is a provision in the FCC regulations for 'reasonable' traffic management during congestion. However there is no clear definition of what is 'reasonable' and what is 'unreasonable' . We could all agree that it is 'unreasonable' for Verizon to throttle your Netflix, because they don't get along with Netflix's CEO. The bigger issue is would it be considered 'reasonable' for them to offer a prioritized lane for paying service providers during these cases of extreme congestion. The court decided that FCC does not have a case and handed victory to Verizon. They're pretty clear that if the FCC need this regulated, they need to take it up with Congress and have Congress pass a bill that expressly tells operators what they can and cannot do. This is exactly what is being done in Europe.


There is of course the 3rd evil option that everyone is talking about. This is where Verizon and other operators will treat ALL traffic as low priority, except for those services that pay to have them available at the highest speed. ( Check out this proposition ..) Technically, this is possible, however it is a complete bitch to implement and manage. There are too many complexities involved with even implementing this in a fool proof way. Not to mention all the bad press this would bring along with it. I highly doubt that any operator would follow this 3rd option and risk a massive churn of subscribers to the competition. American operators, with the exception of a few MVNOs are already seen as DeathStars staffed by evil Vaders.The situation in Europe and other parts of the world may be marginally better for operators, however they are still seen as the bad guys. Option 3 is again a lose-lose proposition and is not even worth considering..

Unfortunately , option 3 is the one that has captured the imagination of most of the popular media and the blogosphere ..



Enough for the first blog post. I hope to go into more detail on these business models in my later posts. 
Laters..

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