I hesitated in beginning this discussion of so-called "Net-Neutrality." In a time of poverty and erroneous war, is internet freedom important enough a topic, I asked, for serious discussion? In the end, I decided it was. The internet, as a tool of open communication, has revolutionized the fabric of our society, from communications to the economy, all in a brief decade, plus or minus a year or so. Its open framework, and the fundamental equality of every site on the 'net, served as a platform for innovation and experimentation unequalled in my lifetime. And, though you might not know it, since the issue is a bit complex and far less flashy than war or Congressional page scandals, that platform for innovation is in danger.
How the Internet Works
In order to understand the Net Neutrality issue, you need to know a little about how the 'net is organized. I'm not gonna lecture about servers and IPs and packets and the like. At the foundation of this issue are access and money, so we need to understand how access and money work on the 'net now.
For simplicity, I'll divide the players into a few general buckets:
(A seventh group, really a subgroup of the second, are webhosts -- companies whose business it is to host websites for other companies who are not large or tech-savvy enough to host their own servers.)
- Consumers - Consumers are regular folks who access the 'net to read websites, check email, IM and buy stuff. They don't make money off of the 'net, in general they just pay to access it.
- Small Publishers - These are bloggers and owners of small content or retail websites like Clark Schpiell Productions or Dumbrella. Most don't make any money, and a few make just enough for the owner/webmaster to offset the cost of his or her operation.
- Large Publishers - These are mid- to large-sized internet content or retail businesses like Salon.com or NewEgg, who make money and pay employees, but whose business model is entirely reliant on a free internet.
- Internet Giants - These are the sites, stores and portals every internet user knows, and nearly every one uses: Yahoo, Google, Amazon.com, ebay, etc. Their entire business models are based upon a simple principle: the more people who access the site, the more advertising or widgets they can sell. Their traffic is in the millions per day and on average they make a fraction of a cent per visitor, and almost all of them started out as small publishers and worked their way to this level.
- Huge Media Conglomerates - The fifth group are huge, wealthy "media conglomerates" whose primary business is not online, but who maintain a large online presence and would like to get a larger part of their revenue stream from the 'net. Here are record companies, movie companies and multi-media houses like Disney.
- Telecommunications Companies ("telcos") - These are the telephone and cable companies who control access to the 'net, and who own and upkeep most of the infrastructure.
The Net Neutrality debate centers around two truths about how the 'net works right now, whichever of the first five groups you belong to:
1) All internet traffic is treated equally. That is, if you send a piece of data over the internet (we'll call that bit of data a "packet" -- sorry, I lied to you earlier), whether you are a consumer or a huge media conglomerate, your packet has the same priority. When there are breaks in the network, or slowdowns, or stoppages, or huge open, fast flows, all packets are treated the same -- none has explicit or implicit priority over the other. This is shown in diagram 1, where each player is identified, and the numbered arrows represent packets, all with equal priority (priority "3" in diagram 1, for the sake of illustration -- the number is unimportant, since all have the same priority). Every email you send has the same priority, once it hits the 'net, as every song iTunes sells and every movie streamed from YouTube. All packets have the exact same priority so, in effect, no packets have priority.
2) In the United States, all of the groups, including the webhosts, pay the telcos for internet access. No one can access the internet without paying a telco. Whether you have a dial-up internet connection, DSL, a cable modem, an older ISDN line, or a huge, fast T1 or T3 connection, you have to pay a telco to set-up and maintain that connection. You cannot connect to the internet unless whoever leases that connection (you, your internet cafe, your place of business) pays a telco for access. Right now, there's basically two equations for access cost: the faster your connection, the more you pay, and (once you get to enterprise-level traffic -- the kind of traffic the Googles and Disneys and ebays get) the more data you send or receive, the more you pay. So, consumers, who send modest amounts of data, pay for either dial-up (at $10 - $20 per month) or high-speed (at $20 - $50) access. Small web publishers pay for a consumer connection and a little more for a modest amount of traffic through a webhost. Huge companies pay big dollars for super high-speed access (ISDN - T3), and pay for massive amounts of traffic (millions of connections). This is illustrated in diagram 2.
Okay, how stuff works now was the hardest part to explain. The rest is easier. The problem, as Net Neutrality advocates see it, is that the telcos, who already charge everyone to access the internet, and who charge big players for large traffic volumes, want to find a new revenue stream. The telcos want to give a higher priority to the packets of those customers who can afford to pay a premium. The idea makes the telcos happy, since they figure rich companies will pay a premium to get higher priority access to consumers. That's more money for the telcos, their stock-holders and their executives. This new pay-for-priority model is illustrated in diagram 3. In diagram 3, you can see how wealthy players can pay to get higher priority for their content. All of that money flows to the telcos, and the losers are those of us who use the net for our art, business, communication and entertainment, but cannot afford to pay the priority premium.
The huge media conglomerates are excited about the idea, and they are the second group fighting against Net Neutrality. Because they move slowly, and are afraid to innovate, their services are often not so widely used as small, more agile, more innovative internet companies. For example, ABC/Disney has lots of free video feeds for their TV shows (with commercials), and lots of for-pay downloadable movies and stuff on their websites. But they can't compete with YouTube, because YouTube was an innovator, and created an open marketplace with a huge variety of content and the freedom for anyone to publish. YouTube innovated, because it had nothing to lose, and because the internet was and is an open marketplace with a low barrier to entry -- an environment which invites innovation and experimentation. YouTube doesn't have a significant revenue stream, but it has bajillions of visitors. Because there was not a high barrier to entry, YouTube tried something, and it paid-off big-time. Disney would like to have that many people watching its videos, but, since YouTube has more variety, doesn't have commercials, doesn't bombard the viewer with advertising, because of a myriad of other intangibles, and because its videos are just as fast as Disney's (because all packets sent over the 'net have the same priority), YouTube just has more traffic.
But while Disney does not have the same ability to innovate, Disney does have cash. A lot of it. If Disney could pay to have its videos sent to users faster that YouTube's videos, it would gladly do so (DIsney is a proponent of the telcos' idea of premium payments for premium priority). Disney knows that, since the internet has a finite amount of "bandwidth" (how much data can move through it at one time -- this "bandwidth" is always growing, but on any given day there is an upper limit), if their videos are faster (have a higher priority), YouTube's videos will be slower, since YouTube cannot afford to pay for that higher priority. Basically, right now the internet is a relatively even playing field -- since it's cheap to put your service or content online, and it is cheap to access that content, and the priority of everybody's content is equal, the best content (or, rather, the content people want most) gets the most play. But, if Disney could pay for higher priority, it's content, which may not be the best, would be easier to get. And other content, whose owners could not pay the premium, would be harder to get. Then the playing field would be tilted toward Disney -- since their content is the easiest to get, it doesn't have to be the best to compete. And no matter how good YouTube's content is, it is going to download slower than Disney's and, if a user has a slower connection or doesn't want to wait, suddenly Disney's content may be more attractive, even if it isn't exactly what the user wanted.
Looked at another way, on todays priority-neutral internet, Disney and YouTube are equals, as far as distribution is concerned. Disney (like the other huge media conglomerates) is not used to operating this way. In the physical world, Disney and an independent player (say, Fine Line Films) are wildly unequal in distribution. To illustrate this point: while no sane person would argue that Disney's 2004 film, the Princess Diaries 2, was nearly so good a film as Fine Line's Vera Drake (out at about the same time), Disney's distribution channel is so much more powerful than Fine Line's that most people did not even have the chance to see Vera Drake and decide for themselves (Vera Drake opened on fewer than 90 screens nationwide -- the Princess Diaries 2 opened on about 3,500). Because, in the physical world, Disney can buy access to consumers (distribution), smaller, less-wealthy film companies do not have equal footing for competition. Vera Drake may not have been as popular as the Princess Diaries 2 even if the number of screens had been equal. But, because the inequality was so wide, it never even had the chance to compete. If Disney were able to buy access to consumers (packet priority) online the way it does offline, it could use its most powerful asset (money) to compete, rather than having to rely on quality and innovation, where is behind the curve.
And the telcos and media conglomerates would like to pursue goes one step further than simply paying for priority: they want to pay for exclusivity. Say a telco is owned by or partnered with Disney. Disney might pay big not just for priority, but for exclusivity. If Disney is competing for internet eyeballs with YouTube, and Disney owns your connection to the internet, when you type "www.youtube.com" into your browser, Disney-telco might block that site, telling you it is inaccessible, or might re-direct you to its own online video site. This sounds like a hypothetical worst-case scenario, except that it is already happening. Executives at AT&T, Bell South and Verizon have made public (in interviews in such papers as the Washington Post and the New York Times) that they plan to charge companies to gain high priority or exclusivity for content on their networks. This spring, AOL blocked access to a website which opposed its plans to force AOL customers to pay to send emails. Last year a big Canadian telco, in the midst of a labor dispute, blocked its internet users' access to sites sympathetic to those striking workers.
Obviously, telcos would be happy to provide premium priority to the huge media conglomerates for a premium payment, which is why they oppose the idea of Net Neutrality. More revenue and more profit benefits the company and shareholders in a way that being a responsible arbiter of a shared public service does not. Which brings us to:
The Net Neutrality Coalition
We know then who is against Net Neutrality (big media conglomerates and the telcos), but who is for it? And, maybe more importantly, why should we all be for it?
The proponents of Net Neutrality are an interesting mix. Bloggers, content sites (like CSP) and consumers obviously benefit from Net Neutrality -- without the idea of Net Neutrality, we small-time users would be last in line to have our essays, videos and emails delivered. What's more, since we all connect to the internet through a telco, without neutrality we may find our online access limited by exclusive deals cut by those telcos -- we might not have access to the whole internet, but rather just to the parts of it with which our telco has struck a deal. The internet giants like ebay and Yahoo and Google thrive on Net Neutrality -- their business models are built on the idea that, if they provide quality, innovative services, hordes of people will flock to them. But if one telco is charging them a premium fee for each user, and another is blocking users from their site in favor of another who paid for exclusivity, their businesses crumble. Same goes for online retailers like Amazon.com and Apple's iTunes. Also onboard are a host of traditional businesses, progressive political groups, large computer companies like Apple and Microsoft, and internet and technology pioneers like Vint Cerf and Steve Wozniak. All of these people recognize that a free, open and democratic internet fosters innovation and creativity, and that if we allow access to be further commoditized, as the telcos would like to have happen, individual innovation will diminish.
All of the people and groups who believe in Net Neutrality see the internet as a shared public resource. We all pay the telcos for access to the internet, but once we are online, we all feel we should be free to choose where we go and what content we wish to receive, regardless of how we got there. As a shared public resource, the internet should be kept open and neutral.
The underlying problem is this: while the internet is open and neutral right now, it is so by design, not by law. While there are numerous written and unwritten rules in varous places suggestng that the 'net should remain free and open, there is nothing truly substantial standing between the telcos and their proposed pay-for-priority/pay-for-exclusivity models except for our outrage and a handful of forward thinking congressional lawmakers like Representatives John Dingell from Michigan, Ed Markey from Massachusetts, and North Dakota senator Byron Dorgan, who (along with Maine senator Olympia Snowe) has authored a Net Neutrality bill called the "Internet Freedom Preservation Act of 2006." This bill, and a similar one authored by Dingell and Markey in the House of Representatives, would take large steps toward solidifying the idea on Net Neutrality into law.
Of course, the opponents of Net Neutrality are wily. They oppose regulation which would protect internet users, and cut off a potentially large new revenue stream for a select few. For the past year or so, the battle for Net Neutrality has been an uphill one -- pro-business forces in control of the House of Representatives, the Senate, and the FCC (famously represented by savvy technocrat Alaska Senator Ted Stevens -- his famous speech against Net Neutrality shows how uneducated these lawmakers, in the pocket of the wealthy telcos, really are) have blocked every attempt to codify neutrality. They've formed coalitions like "Hands Off the Internet," which masquerades as a grassroots group who wants to keep the internet "as it is." What they really mean, of course, is not keeping the internet neutral (which they plan to change), but rather keeping the internet deregulated, so that telcos can do whatever they choose.
But, come January, control of the House and Senate will shift to the Democrats. The FCC will continue to be led by Bush appointees who oppose Neutrality, but if we can convince our lawmakers to pass a Neutrality-friendly bill, the FCC will have to enforce it.
The battle for Net Neutrality is an important one for everyone who relies on the internet for communication, for business, and for entertainment. Over the last decade, the 'net and its citizens have thrived because everyone was free to create content, try new ideas, and consume whatever content they chose, regardless of who or how they paid to access the 'net. Because that freedom is now threatened, we should do everything we can to make Net Neutrality, the common sense, democratic way the internet works today, the law, so that greedy telcos and giant media conglomerates cannot twist the 'net to their monopolistic purposes. Savetheinternet.com is a good place to start.