[governance] RE: What is Network Neutrality - was; a very

[Milton L Mueller]

> -----Original Message-----
> From: Avri Doria [mailto:avri at acm.org]
>
> but as i have always understood it , the best effort Internet was
> indeed egalitarian with the exception or routing updates.  so why is
> it ok, for the best effort Internet to cease offering equal best
> effort for everyone and for all content?
>

I distinguish between economic equalitarianism and technical best-effort. technical best effort simply means that the routers perform in a predictable and standardized way. within those standards there is, and always has been, room for investments or services that improve performance, right? Buy more bandwidth. Buy faster servers. Use Akamai or edge caching.

Flat rate pricing is a free market phenomenon, consumers chose it over other kinds of rate structures in most cases because they preferred the certainty of what they would pay each month. likewise, mobile phone rates in the US grativated toward tiered flat rates, with large bundles of minutes for a simple rate, rather than a per call basis. But the rates are tiered, and you pay more for bigger bundles of minutes. We could go to somethig like this on Internet pricing.

Flat rate pricing insofar as it emerges from market forces is not an imposed egalitarianism but simply a rational bargain between consumer and end user. (there is a large economic literature on this, btw, going back to the telephone rates of the 1890s-early 1900s)  However, the greater diversity of internet traffic can cause that bargain to break down. I think ISPs will probably need to find a way to distinguish between the pricing charged someone who consumes 100Gb of bandwidth a month and someone who consumes 2 Gb. However, it is also possible that the transaction costs associated with such dfferentiation are high; if they are too high it may be more efficient to just build more b/w and offer it indiscriminately. That is why you need competitive markets, to sort out these kinmds of things. you don;t set prices based on a priori principles.

--MM

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