The panel consists of me, Brent Olson (ass’t vp, regulatory policy, AT&T) and Link Hoewing (ass’t vp, Internet and tech issues, Verizon). Paul Deninger of Jeffries Broadview and TechNet (yay) is the moderator. [I’m typing this while on the panel so my coverage will be worse than spotty. BTW, I’m the only one in the room with a laptop open.] [There was one exchange I found particular clarifying. Click here to jump to it.]

Brent from AT&T says that Net neutrality is an elusive concept but it generally means “how to respond to the changing nature of the Internet.” It started out as being about whether providers can block access to sites but now it means allowing providers to enhance their service. He says AT&T is the main DSL provider. “We are a price leader in this market and we’re committed to making more broadband available to more people at a lower rate.” They’re investing in fiber. “But our customers don’t just purchase broadband. They purchase broadband Internet access.” That means they expect to go where they want, send the emails they want, and use the services they want. “If we didn’t do this, our customers wouldn’t buy it. So it would be foolish” to block access or degrade experience.

He signs on to the FCC’s Four Principles (Martin’s revision). [But the principles don’t say that all services and sites will be equally accessible.]

He asks us to imagine there’s a company that wants to improve the performance of the Internet. E.g., Akamai. They help video unspool smoothly, etc. That’s ok, right? But that’s what AT&T is talking about offering. “We’re talking about entering into commercial arrangements—not unilaterally charging someone but entering into mutually beneficial arrangements.” [Distinction without a difference.] As consumers become more sophisticated in their use of the Net, providers ought to be able to offer more sophisticated pricing structures. It wouldn’t be good to build a high performance “Ferrari” network and charge everyone higher prices even if they don’t want it; nor do we want to build a “Yugo” network that goes slowly. One size does not fit all.

The key going forward, he says, isn’t neutrality but flexibility. YouTube and Google succeeded by doing something new. [But discriminatory pricing means that the garage shop won’t perform as well as the established companies that are paying for better delivery.] Net neutrality will deny users choice and will hurt innovation. [I missed how it hurts innovation. Sorry.] Net neutrality would “freeze the network architecture in place” just when it needs innovation. [I don’t trust the telcos to design the new network architecture. We have distributed processes in place.] “Let everyone in the ecosystem continue to innovate while keeping a watchful eye through FCC oversight.”

Brent of Verizon says technology is attractive to members of Congress. He says they understand it now because they have Blackberries and cell phones. [Yup, devices that conect them to the tubes of the Internets.] Net neutrality is within the framework of broadband policy. Brent is more optimistic about broadband deployment in the US than most of are. Wireless subscribers are going up rapidly. People are shifting to broadband rapidly. Wireline access for traditional telephone service is going down. Verizon has been losing several hundred thousand lines every month as people switch to other types of services.

Broadband is very competitive, he says. You can get real competition when there are only two competitors, especially in the early stages of the market. There are more competitors in more areas, “in some places up to four providers.”

Verizon is remaking its network by providing fiber to the home. They’ve now run fiber past 3M homes (i.e., 3M could sign up). By the end of the year, they plan on doubling that. Fiber deployment in the US is happening faster than in other countries, he says.

Verizon recognizes that upstream matters. That’s why fiber matters. E.g. the 15Mbps service has been selling well among gamers. (Verizon offers 50Mbps services in some areas.) Yes, he says, Japan has higher average speeds: 12Mbps.

The Senate bill supports the four principles and Verizon agrees with that. They think it will work because the FCC will enforce them and the market will make it work also.

He cites Dave Farber to support his view.

He concludes by saying that Verizon is losing lines into homes so it’s highly incented to provide great and open service.

I’m going to say that it boils down to the fact that the providers’ interests don’t align with the promise of the Internet. Thus, I don’t trust them to re-architect the Internet. We have a distributed, design process that does that. If discriminating among types of packets helps without degrading service then, frankly, I don’t care. But I don’t believe the providers will be able to resist the temptation to prefer their own services because that’s their business model: Sell content and services. We need to separate access from content/services.

Paul makes a few comments. Rather than thinking of the Internet as a Studebaker that needs updating (as one of the speakers said), why not think of it as a highway? Brent says that different people want different things. AT&T wants to be able to offer all those things and not do one size fits all because that means everyone pays the same price. Competition protects markets.

Randall of AOL says that the debate needs facts. He doesn’t believe the future of Internet innovation requires the carriers charging people tiered access. Those fees will be a spit in Verizon’s ocean. His guess is that it drives Verizon nuts that there are VOIP providers who are offering telephony that competes with Verizon’s. Paul says, “Isn’t it all about VOIP?”

Link says they have a competing VOIP service that runs on other people’s networks as well as theirs. Also, their SuperPages offering has to work on everyone’s network.

Me: I don’t want the highways to be designed by Halliburton, Yugo or Ferrari. We have a process in place—open and distributed—that works.

Link: But the backbone providers have always been in the design process.

Me: But they’re selling access to bits, not services and content. That’s the right model.

Paul: This debate came about because DSL is data via telephone lines…

Brent: The comms industry is getting complicated. The FCC said it’s no longer right to try to fit them into the old shoebox. [Missed some of this. Sorry.]

Q: There’s no such thing as Net neutrality in the wireless business. Whitelisting and blacklisting goes on already over cellphones and PDAs. And “on deck access” [I don’t know what that is.]
A: Brent: An EVDO card lets you go anywhere on the Internet, except for some capacity constraints.

Jonathan: People don’t use those devices the same way, so there isn’t the same consumer pressure.
Me: You shouldn’t be allowed to call it the “Internet” if you block access.

Randall: I had this discussion with the attorney general (?) of Texas who said because we (AOL) were blocking access to child porn sites, we can’t call it the Internet. I said, fine, we’ll explain to the market what we’re blocking.
Me: Then you weren’t offering the Internet. The Internet is a set of protocols that guarantee that all packets can move across all networks without prejudice or preference.

Q: Does David want to go back to ArpaNet days?
A: Me: No, I want all bits to be treated the same. That way the ends (not the middle) can provide services.

A: Randall: The providers shouldn’t filter bits. There should be competition among services for this.

Link: All of us recognize that we’re in the market to provide connectivity that works as it always had. If users don’t want to access services we want to market, they won’t. E.g., if we have fiber throughout a neighborhood and people would want to have a priority set for that. Net neutrality wouldn’t let people do that. A: (me) If I decide to set up the same service but I’m not Verizon, will you prioritize my bits the same? You can’t because you don’t even know that my bits are a medical service. So, you’re prioritizing your own bits (even if customers want it). That crushes competition.

Q: What business model?
A: Brent: No one really knows
Why can’t we harness what we have, responding to consumers.

A: Me: It should be a commodity business. Bits are the ultimate commodities. If the incumbents are ill-suited to do that, they should fail at it.
Link: Unbundling didn’t encourage a lot of investment. Now we’re getting networks built. The market will likely continue to be competitive.

Paul: Hope for both sides: No matter how the legislation comes out, the FCC in its one intervention maintained neutrality.

[Tags: massnetcomms net_neutrality digital_rights]

Categories: Uncategorized dw