In response to my essay last night about this new Free Press campaign to layer price controls on the Internet by banning metered prices via Rep. Massa's new bill (the "Broadband Internet Fairness Act"), George Ou and Richard Bennett reminded me of some of the contradictory statements that the (Un)Free Press crew have made on this issue. Indeed, if you look back at what Free Press and their chairman have said about the matter over just the past 18 months, they seem to be whistling two very different tunes.

For example, George Ou reminded me of what Free Press had to say in its November 2007 filing in the FCC's Comcast-Bit Torrent proceeding:

"More importantly, if Comcast is concerned that the collective set of users running P2P applications are affecting quality of service for other users on a cable loop... they could also charge by usage." (p. 29)

[...]

"Indeed, in many nations, network providers do meter, and bill their customers on the basis of amount used. So the transaction costs of doing so must not be prohibitively high. Indeed, a network provider can apparently meter cheaply because, in most networks, users' traffic to and from the Internet passes through a single gateway, the network access server." (p. 31)

And Richard Bennett reminded me of what Tim Wu, chairman of the Free Press, had to say about metering to the Washington Post just one year ago:

"I don't quite see [metering] as an outrage, and in fact is probably the fairest system going -- though of course the psychology of knowing that you're paying for bandwidth may change behavior."

So, what gives? Will the real Free Press please stand up? Does the Free Press believe in pricing freedom or price controls for the Internet?

You really have to hand it to the folks over at the (Un)Free Press with their endlessly shameful attempts to use doublespeak to remake the entire media, communications, and Internet landscape in their preferred Big Government image. Their latest bit of charlatanism is the so-called "Stop the Internet Rip-Off of 2009" campaign. It's another one of their computerized "stuff-the-FCC-and Congressional-complaint-box-with-electronic-form-letters" efforts that involves getting their merry band of radical reformistas to encourage lawmakers to sign on to Rep. Eric Massa's (D-NY) newly-introduced "Broadband Internet Fairness Act."

Ah yes, "Internet fairness." Who can possibly be against it? Well, before you rush to click send on that UnFree Press form letter, let's be clear what this effort is really all about. Free Press claims that the Massa bill is needed because "phone and cable giants [are] weighing schemes to hike prices, shut down the free-flowing Web and keep user innovation in check." How are those companies doing that? Tiered pricing! Rep. Massa says that, "Time Warner has announced an ill-conceived plan to charge residential and business broadband fees based on the amount of data they download." Oh my God, no... you mean some people might be charged for the costs they impose? What's next? Are we going to force people to pay for their own energy use by metering gasoline, electricity, or water? Think of the horror! (This is sarcasm, folks. All those things are metered currently. And yet, somehow, the Earth hasn't spun off its axis.)

Like all the other propaganda produced at the Free Press techno-spin factory, their latest crusade is based on a combination of outright lies and blatant economic ignorance. Metering broadband access is not an effort "to restrict Internet use," as Free Press claims. Rather, like every other metered system under the sun, it's an effort to price a scarce resource in such a way so as to maximize use. Broadband operators don't sit around all day scheming to find ways to decrease network usage. They wouldn't make any money that way!! They need to find business models that encourage increased uptake while also investing in and growing their networks to meet new demand and competitive challenges.

Moreover, there are other pro-consumer reasons for companies to consider metering options. Unless it is your goal to allow some particularly aggressive users to be subsidized by all other users, it is sometimes sensible to price usage based on demand. If you don't, you potentially create a perverse incentive for a small handful of over-grazers to to be feeding at the trough at everyone else's expense. As economist Russell Roberts aptly noted in the title of a famous 1995 Wall Street Journal editorial, "If You're Paying, I'll Have Top Sirloin." Thus, you would never want to make the "all-you-can-eat" pricing model the only option for the provision of a scarce resource. Even if you choose not to deploy it, it is useful to have the metered pricing model available in case you need to charge the over-grazers at some point.

This is the third in a series of articles about Internet technologies. The first article was about web cookies. The second article explained the network neutrality debate. This article explains network management systems. The goal of this series is to provide a solid technical foundation for the policy debates that new technologies often trigger. No prior knowledge of the technologies involved is assumed.

There has been lots of talk on blogs recently about Cox Communications' network management trial. Some see this as another nail in Network Neutrality's coffin, while many users are just hoping for anything that will make their network connection faster.

As I explained previously, the Network Neutrality debate is best understood as a debate about how to best manage traffic on the Internet.

Those who advocate for network neutrality are actually advocating for legislation that would set strict rules for how ISPs manage traffic. They essentially want to re-classify ISPs as common carriers. Those on the other side of the debate believe that the government is unable to set rules for something that changes as rapidly as the Internet. They want ISPs to have complete freedom to experiment with different business models and believe that anything that approaches real discrimination will be swiftly dealt with by market forces.

But what both sides seem to ignore is that traffic must be managed. Even if every connection and router on the Internet is built to carry ten times the expected capacity, there will be occasional outages. It is foolish to believe that routers will never become overburdened-they already do. Current routers already have a system for prioritizing packets when they get overburdened; they just drop all packets received after their buffers are full. This system is fair, but it's not optimized.

Google has--as I noted it would last June--finally released (PCWorld, Google's policy blog) its eagerly-awaited suite of tools available for free (of course) at MeasurementLab.net that allow users to monitor how their ISP might be tweaking (degrading, deprioritizing, etc.) their traffic--among other handy features. Huzzah! So, now that we have visibility into traffic management practices on a large scale, remind me again why the FCC would need to mandate "net neutrality" requirements? Why not just leave the matter up to the FTC to enforce each ISP's terms of use under the agency's existing authority to punish unfair and deceptive trade practices? Won't the threat of users switching to another broadband provider discipline ISPs' traffic management? (As long as ISPs have traffic nationwide traffic management policies, even those users in areas lacking meaningful broadband competition will be protected from discriminatory network management practices by pressure in other markets.)

"If you believe that network neutrality government regulation is not needed, if you believe that the market will handle this ... then you should also welcome Measurement Labs," [Princeton Center for Information Technology Policy director Ed] Felten said. "What you are appealing to is a process of public discussion ... in which consumers move to the ISP [Internet service provider] that gives them the best performance. It's a market that's facilitated by better information."

Yes, it's true (as PCWorld article linked to above points out) that a consumer might not be able to discern whether apparent degradation of their traffic was actually caused by the ISP or whether it might be the result of, say, spyware or simple Internet congestion. But they don't need to figure that out for themselves. Although the relatively small percentage of users who install this tool are likely to be highly sophisticated (at least the early adopters), all they need to is "sound the alarm" about what they think might be a serious violation of "net neutrality" principles, and a small cadre of technical experts can do the rest: examining these allegations to determine what ISPs are actually doing. Sure, there will be false alarms and of course many advocates of "net neutrality" regulation will still insist that ISPs shouldn't be allowed to practice certain kinds of network management, no matter how transparently the ISPs might disclose their practices. But the truth will emerge, and in the ongoing tug-of-war between public pressure and ISPs' practical needs to manage their networks smartly, between the desire of some to have practices disclosed very specifically and the ISPs' desire to maintain operational flexibility, I suspect we'll find a relatively stable (if constantly-evolving) equilibrium. It won't be perfect, but do we really think government bureaucrats will do a better job of finding that happy medium?

The Entertainment Consumers Association (ECA) is a group that does some good things to mobilize gamers to fight misguided regulation of video games. I greatly appreciate their tireless efforts to fight stereotypes and myths about games and gamers, and to specifically counter the hysteria about video games that we sometimes see in the press, and definitely see in political circles on a regular basis. They're a great ally in the fight for freedom of speech and artistic expression in this field.

That's why I was so sorry to see the ECA launch a new campaign that encourages gamers to petition their congressional leaders and encourage them to regulate the high-tech economy more and waste more taxpayer dollars on inefficient universal service programs and subsidies:

Net Neutrality and Universal Broadband are not only great for America; they allow us to play the games we want at high speeds! ... ECA believes that Universal Broadband and Net Neutrality are vital for the development of the national infrastructure, and believes that this bill is an important opportunity to let Congress know that you agree.

Sorry, but someone at the ECA will have to tell me how Net neutrality regulation will make my online Madden and Tiger Woods Golf experience move faster. If anything, such regulations would slow things down by making it more difficult for carriers and gaming networks to create more effective bandwidth management schemes and pricing plans such that my video game bits can get through faster. Is that called "discrimination"? You better believe it, and it's a great thing. Go ask Microsoft why they signed up Limelight Networks a couple of years ago to help them make the Xbox Live experience more tolerable. Empowering regulators to micromanage this process, by contrast, is just going to quash innovative approaches to the problem and invite more regulation of high-tech markets in general. That won't help gamers in the long run.

Regarding the call for universal service subsidies... I suppose I could see the ECA's logic if those schemes actually worked. But we have 70 years of experience with these pork subsidy programs and they have proven to be an abysmal failure. They are prone to extreme waste, fraud, and abuse and, worse yet, those inefficient subsidies have discouraged competition in rural areas. You're not going to get more entry in the broadband business by subsidizing favored local operators all day long. And subsidizing risky new ventures isn't much better since it just lets bureaucrats roll the dice with our tax dollars. Bad idea.

Finally, there's a more important principle matter at stake here: If you want to hold the line on future government attempts to regulate video games, it's generally not a good idea to come to Congress asking for favors in the form of new regulation or spending. With one hand government giveth; with the other they (eventually) take away.

I was happy to see the discussion over The Wall Street Journal's Google/net neutrality story. Always good to see holes poked and the truth set free.

But let's not allow the eruptions, backlashes, recriminations, and "debunkings" -- This topic has been debunked. End of story. Over. Sit down! -- obscure the still-fundamental issues. This is a terrific starting point for debate, not an end.

Content delivery networks (CDNs) and caching have always been a part of my analysis of the net neutrality debate. Here was testimony that George Gilder and I prepared for a Senate Commerce Committee hearing almost five years ago, in April 2004, where we predicted that a somewhat obscure new MCI "network layers" proposal, as it was then called, would be the next big communications policy issue. (At about the same time, my now-colleague Adam Thierer was also identifying this as an emerging issue/threat.)

Gilder and I tried to make the point that this "layers" -- or network neutrality -- proposal would, even if attractive in theory, be very difficult to define or implement. Networks are a dynamic realm of ever-shifting bottlenecks, where bandwidth, storage, caching, and peering, in the core, edge, and access, in the data center, on end-user devices, from the heavens and under the seas, constantly require new architectures, upgrades, and investments, thus triggering further cascades of hardware, software, and protocol changes elsewhere in this growing global web. It seemed to us at the time, ill-defined as it was, that this new policy proposal was probably a weapon for one group of Internet companies, with one type of business model, to bludgeon another set of Internet companies with a different business model.

This is the second in a series of articles about Internet technologies. The first article was about web cookies. This article explains the network neutrality debate. The goal of this series is to provide a solid technical foundation for the policy debates that new technologies often trigger. No prior knowledge of the technologies involved is assumed.

Over just the past 24 hours, there's been quite a hullabaloo surrounding the Wall Street Journal's controversial front-page story on Google's edge caching plan and whether it violates Net neutrality. (See Cord's post and Bret's). Lessig calls it a "made-up drama", David Isenberg says it's "bogus" and "bullshit," and Google's Rick Whitt has said it's much ado about nothing.

Regardless, here's the important thing not to overlook about this episode: It is a prime example of the what Tim Lee has referred to as "the fundamental problem of backlash" that ensues whenever there is even a hint of a potential violation of network neutrality (however one defines it). As Tim argued in his excellent Cato paper on Net neutrality, "No widespread manipulation would go unnoticed for very long," and a "firestorm of controversy would... be unleashed if a major network owner embarked on a systematic campaign of censorship on its network." (p. 23). Indeed, this (non-)story about Google's edge-caching plans have spawned an intense "firestorm of controversy" over the past 24 hours and it doesn't even involve serious network meddling or censorship! I've been trying to keep up with all the traffic about this on TechMeme and Google News during that time, but I have given up trying to digest it all. (Take a look at those snapshots I pasted down below to get a feel for the volume we are talking about here).

In that regard, I love this quote from the always-bloodthirsty Tim Karr of the (inappropriately-named) regulatory activist group Free Press:

If Google or any other tech company were secretly violating Net Neutrality, there would be an absolute and cataclysmic backlash from the grassroots and netroots who have made Net Neutrality a signature issue in 21st Century politics. The Internet community would come crashing down on their heads like Minutemen on Benedict Arnold.

Indeed, that's exactly what we saw today. But it wasn't just pro-regulatory fanatics like Free Press. The entire tech and business blogoshere and even some of the mainstream media were on top of this. That's the "fundamental problem of backlash" at work, and with a vengeance.

Over the past year or so, many market-oriented critics of Google, like Scott Cleland and Richard Bennett, have criticized the company for aligning itself with Left-leaning causes and intellectuals. Lately, however, what I find interesting is how many leading leftist intellectuals and organizations have begun turning on the company and becoming far more critical of the America's greatest capitalist success story of the past decade. The reason this concerns me is that I see a unholy Right-Left alliance slowly forming that could lead to more calls for regulation not just of Google, but the entire search marketplace. In other words, "Googlephobia" could bubble over into something truly ugly.

Consider the comments of Tim Wu and Lawrence Lessig in Jeff Rosen's huge New York Times Magazine article this weekend, "Google's Gatekeepers." Along with Yochai Benkler, Lessig and Wu form the Holy Trinity of the Digital Left; they set the intellectual agenda for the Left on information technology policy issues. Rosen quotes both Wu and Lessig in his piece going negative on Google. Wu tells Rosen that "To love Google, you have to be a little bit of a monarchist, you have to have faith in the way people traditionally felt about the king." Moreover:

Last week I discussed Barbara Esbin's new PFF paper about the FCC's absurd investigation into how the cable industry is transitioning analog customers over to digital. This is an essential transition is the cable industry is going to free up bandwidth to compete against telco-provided fiber offerings in the future. The faster the cable industry can migrate its old analog TV customers over to the digital platform, the more bandwidth they can re-deploy for high-speed Net access and services. Mark Cuban helps put things in perspective:

1. the only thing that cable companies, and satellite for that matter have to sell is bandwidth and the applications they can run on that bandwith. More bandwidth means more digital everything.

2. For Basic Cable subscribers that get say, 40 analog channels, they are consuming 40 x 38.6mbs or 1.54 Gbs. Let that sink in. 1.54 Gbs of bandwidth. Compare that to how fast your internet access is. That more bandwidth than your entire neighborhood consumes online, by a lot.

Thats also the equivalent of 500 standard def digital channels. If you convert that to revenue per bit for cable companies, or cost per bit for basic cable consumers, the basic cable customers are getting the best deal in town. By a long shot.

Digital cable customers, not so much. Digital customers are paying multiples of analog customers for bandwidth. In reality, analog customers are getting an amazing deal, and the cable companies have been hesitant to convert them only because of the potential FCC backlash.

I'm as cynical as the next guy when it comes to cable rates and motivations, but the reality is that the longer analog remains, the fewer opportunities to leverage the freed up bandwidth to create next generation bandwidth hog applications. Will the cable companies charge us an a lot for that bandwidth, probably. But when we start to see applications built on top of 250mbs per second and more, it will have far more value to society than watching USA Network on your old analog TV. And Net Neutrality? Well if everyone had that 1.54gbs available to them, net neutrality would be a non issue. We wouldn't be arguing about access or pre-emption, we would be arguing about quality of service.

Once again we are reminded that all regulations have opportunity costs and in this case the FCC's actions could cost consumers the loss (or at least delay) of higher-speed broadband offerings in the near-term.