by jonl on January 10, 2011
This is something I posted in the “state of the world” conversation with Bruce Sterling on the WELL…
I give talks on the history and future of media, and on the history, evolution, and history of the Internet. I gave the talk this week to a small group gathered for lunch in a coworking space here in Austin, and after hearing the talk a technologist I know, Gray Abbott, suggested that I say more about the coming balkanization of the network as the most likely scenario. The Internet is a network of networks that depends on cooperative peering agreements – I carry your traffic and you carry mine. The high speed Internet is increasingly dependent on the networks of big providers, the telcos or cable companies like AT&T, Sprint, Verizon, Time Warner, and Comcast. They all see the substantial value supported by their networks and want to extract more of it for themselves. They talk about the high cost of bandwidth as a rationale for charging more for services – or metering services – but I think the real issue is value. When you see Google and Facebook and Netflix making bundles of money using your pipes, you want a cut. And if you’ve also tried to get into the business of providing content, it’s bothersome to see your network carrying other competing content services, including guerilla media distribution via BitTorrent.
However higher costs could become a barrier. The value of the Internet is a network effect – it’s more valuable as more people use it to do more things; cost as a barrier to entry could reduce participation and diminish the Internet’s value. Killing the golden goose, so to speak. Low cost barriers also stimulate innovation. If I want to create a television series, aside from production costs, I also have to find a broadcast or cable network that will carry it – I have to get permission, in effect, because broadcast and cable channels are relatively scarce and relatively expensive to get into. Larry Lessig pointed out, in his review of The Social Network, the real story of Mark Zuckerberg – that he could build Facebook from nothing without asking anybody’s permission.
“Network neutrality” is about limiting restrictions on use and access,not necessarily about controlling cost, though it might mitigate against “toll roads” on the information superhighway. According to the Wikipedia article on net neutrality, “if a given user pays for a certain level of Internet access, and another user pays for the same level of access, then the two users should be able to connect to each other at the subscribed level of access.” That doesn’t really suggest a low cost of entry, and even with “neutral” networks (or, as we prefer to say these days, an Open Internet), the overall cost of access could increase, or there could be metering that would contain some sorts of activities, like video transmissions. Right now I have unmetered or flat rate access, so I could watch all the Netflix and Hulu I want without additional cost.
Time Warner or AT&T U-verse customers are dropping the cable television services because they can download all the programs they want via the Internet service from the same company. I can imagine companies looking at stats – more and more customers dropping the service, more and more bandwidth dedicated to streaming and BitTorrent. It’s no wonder these companies are feeling cranky, and it’s no wonder they’re talking about finding ways to charge more money. But this is what their customers want.
This isn’t really about the Internet as an information service or a platform for sharing and collaboration. This is about the Internet as a channel for media, an alternative to cable television. One fear many of us have had is that big network companies will push that interpretation. “It’s time for the Internet to grow up, we want to make a real network with real quality of service, we want to make it more like our cable networks.” Which are more tightly controlled, of course, and carry only the content the providers agree to carry.
Phi Beta Iota: OpenBTS is here and spreading. Net Neutrality is not favored by any of the Industrial Era powers (e.g. AT&T, Verizon, Oracle, Microsoft) because they do not understand distributed value–they are still in a concentration of wealth and control mind-set. They literally do not get that 1% of 5 trillion a year is a lot better than 5% of 1 trillion a year for the simple reason that the first creates more wealth faster–the residuals is where the growth is to be found. We are right back in 1994 where Steve Case understood the fundamentals and went after the market not served.