Posts Tagged ‘Network Neutrality’

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Network Neutrality is Dead. Long live Network Neutrality.

Tuesday, December 30th, 2008

In the past few weeks the Wall Street Journal has posted two opinion pieces online (here and here) basically claiming that Net Neutrality was dead. The blogs exploded, claiming that reports of Net Neutrality’s demise were greatly exaggerated: David Isenberg, Tim Karr, Harold Feld, Gigi Sohn, Google’s Rick Whitt, DSL Reports, and Rob Frieden to name a few. These really smart telecom policy wonks picked apart the numerous errors in the WSJ pieces errors. (I do have to correct one glaring error in the Gordon Crovitz piece. The specter of Net Neutrality regulation has not caused a low level investment in broadband access and the US’s low rankings in the international adoption statistics. I hope that would strike you as obvious.)

The basic thrust of their arguments was a content-cashing-versus-content-transmission distinction. What Google is doing is moving and distributing its content closer to the end recipients in an effort to improve delivery speed and quality. It was not seeking preferential treatment in terms of the transmission of its traffic. From a service perspective, I am not sure there is much of a difference.

What is truly at the core of the debate is common carriage versus private carriage. These are not new ideas. Common Carriage traces its origins to the Roman Empire. As such common and private carriage express competing notions of fairness and economic efficiency. We think it is unfair to give preferential treatment to certain (read wealthy) customers. At the same time, we also think it is economically inefficient to mandate a single (or limited set of) Internet access options for everyone, including those who are willing to pay more for premium services. So, how do I determine which means of achieving differentiated services is economically permissible and socially desirable?

Insight: To my mind this is not so much a question of network practices (i.e., routing versus caching), but of market power and market failure. Don’t get me wrong. I am a proponent of Net Neutrality. However, the most effective way to promote welfare-enhancing differentiation from anti-competitive discrimination is the presence of effective, sustainable competition. This is, by no means, a guarantee. As David Isenberg correctly points out, the US has four major wireless carriers, but no truly open mobile networks. (As I have argued in a previous Cool Stuff that wireless devices are not a perfect analogy to wireline Internet). Nonetheless, in the absence of competition to constrain the behavior network providers, some form of regulation will be required. Once the regulator is required to dictate allowable and unallowable network practices, all of the options are unattractive. In the light of the incoming administration, we should be considering how best to (re)introduce effective, sustainable competition.

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Posted in Broadband, Network Neutrality | 1 Comment »

It says “handsets”

Wednesday, June 4th, 2008

I finally just had a chance to read the FNPRM for the rules governing the C Block in FCC’s recently concluded 700 MHz Auction and it says “handsets”! Why is this significant?

For the C Block, comprising 22 MHz in the upper 700 MHz band, the FCC created special open access provisions. The FCC will require licensees to provide a platform that is open to third party devices and applications. Specifically, licensees must allow customers, device manufacturers, third-party application developers, and others to use any device or application of their choice on their networks in this band, subject to certain limited conditions. Licensees may not “lock” handsets to prevent their transfer from one system to another, or to other services that compete with wireless service providers’ own offerings. The FCC concluded that these rules were justified because it did not find “that competition in the [mobile] marketplace is ensuring that consumers drive handset and application choices, especially in the emerging wireless broadband market…. it is easy for consumers to differentiate among providers by price, most consumers are unaware when carriers block or degrade applications and of the implications of such actions, thus making it difficult for providers to differentiate themselves on this score.”

Insight: Beware the law of unintended consequences. Here it is not the proverbial monkey wrench, but a pair of bolts, literally, which could bring the FCC’s policy to a grinding halt. Implicit in the service rules is the assumption that the band will evolve to resemble the next generation of the current mobile market in the US. But assumptions like this never last. I wonder if it is possible for clever operator could escape the open handset requirement by providing fixed services. The 700 MHz spectrum is particularly well suited to a variety of applications, one of which might be fixed broadband. In rural and suburban areas fixed wireless broadband could be an effective competitor to wireline. Presumably these areas would be sufficiently competitive that the FCC’s finding would not hold (remember it is limited to handsets, and not even service plans). Thus, if the licensee is bolting “pizza boxes” to the side of homes, would this type of network not be subject to the open access provisions? It’s unclear, but something to think about.

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Posted in Broadband, Network Neutrality, Wireless Communications | 2 Comments »

Network Neutrality on Steroids: Enter the Hackintosh

Thursday, May 29th, 2008

Anyone who knows me for 2.5 seconds knows that I cannot leave well enough alone.  So, I am curious to see what happens when you run network neutrality full speed into 18th Century copyright law.

Network neutrality is a broad, sweeping concept intended to maintain the open and interconnected characteristics of the Internet.  One of the central principles of network neutrality is the freedom to attach any “legal” device which does not harm the network and run any application over it.  I am not quite sure what an illegal network device is, perhaps a digital Kalashnikov (though if the Supreme Court reinterprets the Second Amendment, even that might not apply).

Enter the Hackintosh. A Hackintosh is a PC which, with a few a modifications, can run the Mac OS X (called OSx86 for the IBM/Intel 8086, 386, 486, 586, etc., architecture). This is apparently not hard to do since Apple started using Intel chipsets. Moreover, the modifications are made to the bios and harddrive of the underlying computer, and not to the Mac OS. However, it is Apple’s contention that it is violation of its copyrights to run OS X on anything but one of their machines.

So, if a computer is attached to the Internet, would Apple’s prohibition violate the principle of network neutrality?  Well, it turns on whether the Hackintosh is a legal device. I am not an expert in intellectual property law anymore, but to my mind it would be illegal tying and bundling to require that OS X could only be run on Apple machines. Can you imagine if Sony sold me a record (vinyl or shellac) and in the liner notes stated that I do not have permission to play it on a Victrola, only a Sony turntable?

Next, let’s consider the DMCA.  The Digital Millennium Copyright Act makes it a crime to circumvent technical prevention measures (TPM) in order to illegally copy copyrighted electronic materials. Running OS X on a machine other than a Mac does not necessitate an illegal duplication.  Under the first sale doctrine, one can buy a valid copy of OS X Tiger on eBay for about $75.FN Apple cannot say that it is an illegal copy to put the OS on a computer – that’s purpose the software was sold for.  Further, they cannot restrict the device with which you read the OS, back to the Victorla… could GE prevent you from reading a book published by NBC Universal under a Sylvania light bulb?

So, let assume that Apple does not sell their operating system (but they do), rather they license a complete device, called a Macintosh. Presumably, then the operating system is part of a useful article, and not a writing. It would therefore not be copyrightable. So, Apple would not have any valid copyrights to be violated by duplication and modification of the OS.  Further, since duplicating it is not illegal, the DMCA does not apply. Loading OS X on a machine other than an Apple might be breach of contract, but not a copyright violation.

Insight: I am not sure that Hackintosh is a legal device, but it probably is not an illegal device. I am curious to hear the opinions of the network neutrality and copyright experts. So, in this high speed collision between the broad, sweeping principles of network neutrality or arcane copyright law which survives?

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Posted in Cool Stuff, Network Neutrality | 2 Comments »

Next Generation Spectrum Policy

Wednesday, March 5th, 2008

I am very pleased to announce that the FCC has just published a suite of papers which I worked on while I was there. This work sought to tackle some of the intractable problems facing spectrum policy. For nearly a century, spectrum policy has focused on “scarcity” and resolving “harmful interference”. This was largely due to limits of the technology of the day. Now radios fueled by semi-conductor processing power, are enabling spectrum policy to evolve. We can now focus on a much more efficient principle of “use coordination”. The first paper in the series, OSP Working Paper #41, examines the Tragedy of the Commons and how economic protocols might be employed to alleviate this problem, while preserving the openness and innovation associated with unlicensed operation. It achieves this by coordinating competing demands on the spectrum. There are several different means for assigning priority to allocate use. However, allowing would-be users to express their willingness to pay seems to be the most economically efficient. Through an economic coordination protocol, usage at any given time is awarded to those with the highest value. OSP Working Paper #43, looks at how the set of rights which underlie this regime can be assigned through auctions.

Insight: Of all the work I have done in my professional career, this is the product of which I am most proud. The future of spectrum policy will be one of “use coordination”, where the “exclusiveness” of a license will be determined at an auction along with which entities are assigned the license. We are back to First Principles. This work holds the promise to wrestle the spectrum from the hands of a few powerful entities and put it back in our hands. In addition, it is likely to increase efficiency and hence the benefit we all receive from its use. The beauty of the system is that if the current spectrum arrangement is the most efficient, then it will emerge as such. At the very least, we will have exposed society to a huge upside with very little downside risk. It also would allow us to grant priorities to those whose ability to pay is diminished, such as public safety and financially disadvantaged users.

As a body of work, it has far reaching implications. At the recent FCC field hearing on network management (viz. Net Neutrality), there was much reasonable debate on what constitutes reasonable network management. There were many views as to how to handle competing demands on limited network resources. To my mind, the most efficient way will be some variation on willingness to pay, perhaps through an economic coordination protocol.

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Posted in Broadband, Network Neutrality, TV White Spaces, Wireless Communications | No Comments »

A flawed analogy for wireless Carterfone rule for Network Neutrality.

Tuesday, January 22nd, 2008

Walt Mossberg, Tim Wu, and others have recently been calling for a Carterfone decision for wireless networks. In 1959, Thomas Carter (no relation) introduced a device which allowed mobile radio systems to be interconnected with the Bell System landline telephone network. The device was in fact a mere acoustic coupler and not hardwired to the network. AT&T attempted to stop Mr. Carter from connecting his radio-wireline equipment. In the ensuing litigation, the FCC opened the telephone network to the interconnection of non-Bell System equipment.Drawing this logic to the fixed and mobile Internet, Mossberg asserts, “You don’t have to get the permission of your Internet service provider to do so, or even tell the provider about it. You can just pack up the old machine and set up the new one.” Therefore, he argues, you should be able to use any wireless device on any mobile network. Well, Verizon and AT&T are making steps in that direction. However, what Mr. Mossberg does not mention that his cell phone contains two parts: 1) the radio and 2) all the other cool stuff in there. The radio handles all of the modulation/demodulation necessary to connect the phone to the network. The parallel in the wired world is your cable or DSL modem. It is to this box that one connects his router, PC, or other Internet appliance. In most cases, you get the modem from your ISP and there is less consumer choice for broadband modems than there is for cell phones. So, in order for this argument to stand, it must not lose sight of the fact that in the wireless world these devices are in the same box, while in the wireline the same box.
Insight: I am not arguing against wireless Network Neutrality; however, the analogy comparing cell phones to PCs is only half correct. So, a proper analogy might be comparing the flexibility of the PC and wireline Internet to the ability to connect any IP device or other cool stuff to your data-enabled cell phone.

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Posted in Network Neutrality, Wireless Communications | 1 Comment »

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