[governance] "Net Neutrality as Global Principle for Internet Governance"

[Milton L Mueller]

Danny:
If I understand it, your argument is that if we rely on Net Neutrality
we will not get any investment in broadband networks because broadband
financing will come from content providers, who will build networks that
will impose favorable treatment for their own content. This is a
vertical integration argument. It is an argument worth considering
seriously, although I usually hear it from cable companies not from
civil society people. See below for more.

-----Original Message-----
From: Danny Butt [mailto:db at dannybutt.net] 

>while the dominant business model for financing 
>next generation internet networks (e.g. not 
>those funded by telcos with historically 
>government supported investment)is that of 
>audiovisual media, which is a different 
>thing altogether.

I think the argument that networks need vertical integration into
content has been demonstrated to be untrue in the last decade. The
strong trend is for disintegrating network from content and
applications, even in the historically integrated markets such as
subscription TV and mobile. The Internet is emerging as the common
platform for video distribution and anyone who attempts to impose some
kind of exclusivity is learning that they are cutting themselves off
from the bulk of the market. On the other hand I would have no objection
if a separate, specialized network set itself up to distribute a
specific kind of content and sold subscriptions separately. It just that
I don't want major ISPs with market power doing that. 

Let's dispense with the label "next generation internet networks"
because no one knows what "generation" you are talking about and stick
with the more generic and accurate "broadband internet networks." 

There are four main sources of investment in broadband Internet:
1. Telephone companies (who have acquired many ISPs)
2. Cable and satellite subscription TV companies
3. Mobile telephone companies
4. Independent ISPs, who could be either wired, relying on telco
infrastructure, or new networks using wireless

There are also some additional, minor sources of investment:
5. Content providers such as google
6. Newly-digitized terrestrial broadcasters

First point here is that infrastructure development by content providers
is a tiny drop in the bucket in the relative scheme of things. Second,
in each of these areas, you see a trend away from integrating network
and content. Telcos tried to develop "interactive TV" in the early 1990s
and were put to shame by the Internet -- all those experiments were
failures. Cable operators are discovering that a great deal of their
product mix is migrating to the internet. In the US, they stole market
share from telcos by offering broadband internet faster and cheaper,
apart from their TV offerings. Mobile operators used to be all walled
gardens and special exclulsive deals but that is clearly breaking down.
Google's entry is specifically as an open network. 

People initially claimed that voice over IP -- which is now routine --
would crash the internet's bandiwdth unless discriminatory measures were
taken. That hasn't proved true. 

>It's easy to clamour for Net Neutrality, but harder to 
>think about what a sustainable ISP industry might look 
>like in this environment. We already see ISPs (e.g. bigpond 
>in Australia) setting data caps while hosting video from 
>"content partners" which doesn't count against a cap. This 
>is a form of discrimination, 

Yes, indeed, it is. Bad.

>variations on which  
>will only increase as carriers attempt to deal with a radically  
>increased traffic load from audiovisual media for which a telco  
>business model is not well aligned.

There are many other ways of handling that increased traffic load. 

>In the media world, distributors fight for exclusive territorial  
>rights for high-value content. 

That can easily be done via a neutral-Internet subscription model. For
example, in the US I subscribe to MLB.TV, which allows me to see
baseball games (a peculiar American sport in case you don't know) from
any city. EXCEPT where there are local blackouts. If the MSG broadcast
network is carrying a Yankees game, I cannot get it from MLB.TV, I have
to watch the broadcast (which may or may not be available where I live).
But still, I can access MLB.TV from anywhere. The point is, content
owners can enforce exclusivity without vertically integrating with
bandwidth owners and hard-wiring the discrimination into the network. My
network operator should not block me from Yankees games because they are
part owners of the Red Sox. 

>the paper says "Given the ease with which the Internet's 
>architecture facilitates global connectivity, there is 
>no reason why a right to access Internet resources should 
>end at a country's borders" it is saying to the media 
>and entertainment industries "Your business model has 
>no reason to exist."

No, you are confusing access to copyrighted content with the universal
connectivity of the network. This argument is completely off-base (to
return to the baseball theme) 

>"aligning the WTO regime with the global Internet 
>governance regime" pretty unrealistic given that a 
>key feature of the WTO has been mostly about developed 
>nations ability to enforce Intellectual Property Regimes 
>that support the ability of content owners to price  
>and content discriminate among nation-state markets. 

Well, I confess I _am_ interested in undermining some of the more
abusive manifestations of TRIPS. And it's interesting that you try to
attack the USG's policy with one side of your mouth and defend the basis
of that policy with the other. 

>the basic business model of screen production which 
>is based on territorial excludability.

That basic business model may be obsolete. But anyway, NN does not mean
that copyright owners can't decide who to sell their content to. It has
nothing to do with that. 

>I also tire of the distinctly U.S. anti-governmental 
>rhetoric in the paper (governments are routinely 

I suggest you speak with RSF (based in Paris), the dissidents in Burma
and China, or European HR activists. Anyone who doesn't see governments
as an important and (in many parts of the world) main threat to Net
neutrality is ideologically blinkered. I'm sorry we have ideological
disagreement on the proper role of government, but try to deal with it
honestly and not rely on cheap appeals to anti-US sentiment,
particularly since the US is currently the pusher of some of the most
intrusive and abusive forms of state internvetion in this sector. 

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