Why net-neutrality rules should be applied equally

By Rob Pegoraro
Sunday, August 22, 2010; G03

Have Google and Verizon got a deal for you!

The nation's leading Web firm and one of its biggest telecom firms teamed up two weeks ago to offer a joint proposal to end a prolonged debate over "network neutrality."

In that document, the firms suggested that the government impose net-neutrality regulations on wired Internet connections but exempt separate, add-on services from those rules. The rules would also be waived for wireless services, although carriers would have to disclose what sites or services they hinder or prioritize.

Many Web sites and telecom firms would probably support the policies, but it's odd that they are coming from these two in particular.

Google has a long history of pushing for net-neutrality rules -- the company and others persuaded the Federal Communications Commission to attach openness obligations to wireless spectrum freed up by the digital-television transition.

Verizon, in turn, didn't have a problem buying up new spectrum under those obligations.

As a result, politicians, techies and other observers have reacted with a mix of confusion and anger.

Not all the anger is justified. Google and Verizon's proposal features some reasonable ideas. Chief among them is requiring transparency about network-management practices. The insistence of telecom firms that they don't -- or no longer -- discriminate against legitimate sites and services suggests that publicity alone might deter some abuses.

On wired services, Google and Verizon would prohibit charging any one site or service for faster access -- favorable treatment allowed in some definitions of network neutrality.

The Google-Verizon proposal's allowance for "additional online services" exempt from neutrality rules deserves a look, too, though it would help if the companies better explained what they have in mind. Some examples Verizon has thrown out, such as "smart grid" monitoring of electrical use, involve minimal amounts of data that shouldn't need prioritized service, while vague references to "entertainment and gaming options" require more details.

Does Verizon want to sell a separate, super-responsive connection for online gamers (most users don't obsess over "ping times" the way they do), or would it charge extra for a guarantee of uninterrupted high-definition video streaming (when those video sites might compete with its Fios TV service)?

In one way, the joint proposal earns its skeptical reception. Google and Verizon make a fundamental mistake in not treating wired and wireless connections alike.

Wireless services do have special capacity issues, as anybody who tried to use a cellphone on the Mall on the day of President Obama's inauguration can testify. But wired services aren't immune from congestion; note the bandwidth quotas imposed by cable-modem providers Comcast and Time Warner Cable.

What about the competitive nature of wireless access, compared with the monopoly or duopoly of wired broadband in most areas? Verizon, Google and other advocates of keeping wireless unregulated neglect two factors that constrain competition.

First, 3G coverage maps of carriers illustrate how many areas have just two or one choices for mobile broadband. Second, long-term contracts mean most users can vote with their wallets only every two years.

The biggest reason to apply net-neutrality regulations to wired and wireless alike is basic economics. Anytime the government applies one set of rules to some competitors in a market but not others, it distorts that market.

And although wireless broadband hasn't always been a real alternative to land-based cable, DSL or fiber connections, faster 4G services make it a more viable option. That's why the FCC's broadband plans rely so heavily on providing more spectrum for over-the-air services.

So why would we now want to subject companies that use a cable or wire to provide broadband to stringent regulations and leave out competitors that use public airwaves? Just because the government plays favorites this way all the time doesn't mean it should repeat that error.

And remember, imposing net-neutrality rules does not require surrendering to anarchy on our Internet connections. They just mean that Internet providers could manage their networks only in ways that wouldn't hinder or favor a particular legitimate site or service.

So if your Internet provider's connection gets clogged because some users are hitting one site, it couldn't cut off access to that site. But it could, after providing fair warning, throttle back those users' download speeds, cap their bandwidth or charge them extra.

Straightforward usage limits would have the added benefit of being understandable to customers and companies alike -- unlike a lot of federal regulations and corporate terms-of-service documents.

And they would encourage Internet providers to build enough capacity to avoid subjecting too many customers to these limits.

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