Monday, March 6, 2006 - The Progress & Freedom Foundation Blog

A Short History of Equality for Networks

Considering Ron Wyden's net neutrality legislation, I am reminded of what now seems like ancient history--from the dawn of the Internet, and what was perhaps the sunset of telco's ambitions to enter video delivery service... Who now remembers video dialtone?

One puzzle in this net neutrality debate has been the willingness of should-know-better tech companies to embrace this form of regulation. They seem reluctant to recognize that as democratic as "neutral" sounds, that in fact such a regime is likely to quickly devolve into a tangle of regulation navigable only by an elite. To someone starting on the telco side, this naive outlook is unthinkable.

Perhaps to Net old-timers, though, it is not so surprising. The Net has been something of an anomoly from the start, a government-funded venture that actually in the end did more good than harm, albeit by accident. Way back in the first days of the Net, networks operated under a gentle interconnection mandate (I believe from DARPA, don't make me go hunt it down). This general rule, unlike every other example of its kind, stayed in the background. As the Net evolved and private and commercial networks piled on, Internet interconnection proceeded peacefully, with the larger networks agreeing to interconnect for free ("peering") and smaller networks paying for "transit." Although there have been some problems with peering and transit, there have been remarkably few, and when the FCC made vague noises about regulation some years back, they were resisted.

Now to today. Perhaps the tech firms that support net neutrality remember the interconnection mandate of the past, and that it did little harm. But they have forgotten the later evolution of peering and transit, where free carriage for some and pay-as-you go for others did just fine. Would "net neutrality" even have allowed those arrangments?

And they perhaps never were fully aware of ... video dialtone. Back when the phone companies still had a keen interest in getting into the cable television business. The early 1990s. The FCC, always anxious to encourage competition, were ready to let the telcos in, provided of course, that they operate their video networks so as to allow equal access and reasonable charges and no exclusivity and/or discrimination... on and on. With the 1996 Act video dialtone was swept away and replaced with a regime of open video services.

Never heard of it? It never really went anywhere. There are a few networks here and there. But basically nothing. It wasn't just that the Internet came along, and interest in getting into the one-way video delivery business waned. The whole regulatory apparatus and process was just way too cumbersome and slow. If there hadn't been so much delay and complication on the regulatory front, telcos and others could have moved into the video business with some alacrity, before the Net. It was no mere accident of timing that investment moved into then much-less-regulated networks. Investment will always go there.

Right there are huge opportunities for growth of wireless networks, hopefully including wireless broadband. But wireless still has some capacity issues. Maybe these issues all have technical solutions, but deploying those solutions is going to take some capital. Do we really want to narrow the business models that can be used to raise and recover that capital down to... video dialtone for the Net?


posted by Solveig Singleton @ 3:06 PM | Net Neutrality