About Professor Tim Wu’s recent New York Times oped, a few comments:

His essay begins, “If we aren’t careful, [the U.S. is] going to repeat the history of the oil industry by creating a bandwidth cartel.” Really? If the past decade shows anything, it’s the stunning progress America has made in improving the availability of new and better broadband options. In short, precisely the opposite of a bandwidth cartel.

A decade ago (not adjusting for inflation), basic DSL cost $70/month in Pennsylvania, $60/month in the Rocky Mountain states, and $90/month in California. Since then, prices have plunged while online speeds and access choices have surged. Meanwhile, Wi-Fi spots are in every coffee shop and more than 15 million users have signed up for wireless broadband, which is also getting faster.

Seems like a pretty odd “cartel.”

Wu’s major focus is on what he calls the “pressing need to explore all alternative supplies of bandwidth before it is too late.” But the idea of adding bandwidth alone is a discredited (and monumentally expensive!) model for handling consumers’ Internet needs. Even the Japanese, with their sophisticated networks, have accepted the need to manage traffic data to keep up with P2P filesharing.

The real problem with Wu’s argument is that it almost completely ignores the need for across-the-board investment incentives – for unproven and proven technologies. To take one example, PBS technologist Bob Cringely recently observed that Cisco’s new Nexus 7000 router, when fully tricked-out, could support around one million concurrent users. He continued that this will “undoubtedly set a new low cost point for per-subscriber hardware” and that Cisco “is going to sell a lot of these puppies” to IPTV providers.

That’s the kind of technology coming to market and consumers will wind up the beneficiaries as quality improves and prices continue to drop.

But the key is that will only happen if the regulatory climate remains conducive to investment, network management and new deployment. Judging by Prof. Wu’s previous embrace of Net neutrality and his selective silence on network management and new investment, this is a reality he should consider.

Hands Off The Internet has a letter in today’s New York Times.

To the Editor:

Your May 19 editorial “Democracy and the Web” argues for broad new federal regulation of the Internet — a first in Internet history.

You say that “if Internet service providers started discriminating among content to make more money or to suppress ideas they do not like,” users will suffer. What you overlook is that there already are laws and regulators poised to deal with any such hypothetical problems.

Moreover, the first-time ever federal control of the Internet “pipes” inevitably will hinder the network management (and build-out) needed to handle the torrent of new video and other data-rich traffic flooding the Internet. Users (and democracy) then will really suffer when they face higher costs or limited service, or both.

Federal control and dumb pipes are not the answer to our broadband needs, especially when the alleged basis of the new laws is speculation.

Mike McCurry
Christopher Wolf
Co-chairmen
Hands Off the Internet
Washington, May 19, 2008

BusinessWeek highlights the latest Andrew Odlyzko paper (PDF) on Net Neutrality, which makes a pretty odd argument…

The general conclusion is that some form of government intervention, to set the rules, is inevitable. (And at some point it may be welcomed by the players, just as government intervention was welcomed in the end by the railroads.)

Well, yes, government intervention was welcomed in the end by the railroads. That’s because, as Timothy B. Lee pointed out in the New York Times, whatever the good intentions of those who sought to regulate the market, the result was, as a Ralph Nader group described it, “primarily a forum at which transportation interests divide up the national transportation market.” Lee explained further at Ars Technica…

The railroads were the high-tech industry of their day, and there was a lot of concern in the 1870s and 1880s that the railroads had become too monopolistic. Congress responded by creating the Interstate Commerce Commission in 1887, giving it the power to regulate the railroads. … [Yet] the story of the ICC does not have a happy ending. After President Grover Cleveland appointed Thomas M. Cooley, a railroad ally, as its first chairman, the Commission quickly fell under the control of the railroads, gradually transforming the American transportation industry into a cartel. By 1935, when it was given oversight of the trucking industry, the commission was restricting competition and enabling price increases throughout virtually the entire surface transportation industry.

Indeed, more than 100 years later, taxpayers are still subsidizing railroads. You might begin to imagine now why the regulation was “welcomed in the end by the railroads.” If you’re still having trouble, close your eyes and count to $2,000,000,000. That’s how much taxpayer money Amtrak now receives every year. Out of your pocket.

Andrew Odlyzko is right that government intervention was eventually welcomed by the railroads. However, we don’t think “the players will like it because they can create a cartel like the railroad industry did” is a very compelling argument for net neutrality. It’s certainly not an argument we expect consumers and taxpayers to find persuasive.

Anyone buying into the net neutrality notion that “a bit is a bit is a bit” should check out this New York Times article on the dangers of international cyberattacks:

Attacks on the Internet itself, say, through what are known as root-name servers, which play a role in connecting Internet users with Web sites, could cause widespread problems, said Paul Kurtz, the chief operating officer of Safe Harbor, a security consultancy. And having so many nations with a finger on the digital button, of course, raises the prospect of a cyberconflict caused by a misidentified attacker or a simple glitch.

Still not convinced? Read on:

Still, many in the security community and the news media initially treated the digital attacks against Estonia’s computer networks as the coming of a long-anticipated new chapter in the history of conflict — when, in fact, the technologies and techniques used in the attacks were hardly new, nor were they the kind of thing that only a powerful government would have in its digital armamentarium.

This much is clear: Global security risks are rising in tandem with the broadband web. That in turn points to the necessity of deploying networks capable to recognizing threatening data in the form of viruses, Trojan Horses or whatever malware tomorrow’s hackers invent.

Someone once said that a libertarian is a conservative who’s just been arrested. Probably true. But in that same spirit, it will be interesting to hear how the net neutrality crowd describes one of its favorite bogeyman, deep-packet inspection, the next time it helps stop a major denial-of-service attack.

This month’s zombie attack on Estonia’s economy was only the latest example of the growing dangers on the Net. It will assuredly not be the last.

The New York Times’ Steve Labaton had an interesting article recently on the neutrality issue, which included this line:

“… there remains considerable Democratic opposition [to neutrality regulation]. Last June, a vote on an amendment by Mr. Markey similar to what he plans to introduce failed by 269 to 152, with 58 Democrats voting against the measure. Many of those Democrats have been allied with unions, which have sided with the phone companies because they believe that the lack of restrictions will encourage the companies to invest and expand their networks.”

True enough. And for a completely unvarnished sense of how seriously the unions object to neutrality regulation, check out this from the 700,000-member Communications Workers of America.

With all of the recent activity – midterm elections, new majorities, telecom mergers, etc. – now behind us, we had a hard time picking one thing to start back with, but today we settled on The New York Times’ editorial page. It’s been more than half a year since they’ve picked up the subject of “net neutrality,” and based on the mistakes in the editorial, they seem to be in a bit of a rush to catch up. For instance, early on the editors make a casual assumption that might seem sensible to most:

Internet users now get access to any Web site on an equal basis. Foreign and domestic sites, big corporate home pages and little-guy blogs all show up on a user’s screen in the same way when their addresses are typed into a browser. Anyone who puts up a Web page can broadcast it to the world.

But is it correct that any website will “show up on a user’s screen in the same way” as any other? Not quite. It’s true that a “best effort” delivery is the standard across worldwide networks, but the way things actually work is a lot more complicated. As Wired explained last year, the Internet has never been “as egalitarian as people would like to think it is.” So the New York Times wants to restore an idealized past that never actually existed.

But that’s small potatoes. The biggest mistake comes soon after, where the Times tries to get into what “net neutrality” laws would actually do:

Cable and telephone companies are talking, however, about creating a two-tiered Internet with a fast lane and a slow lane. Companies that pay hefty fees would have their Web pages delivered to Internet users in the current speedy fashion. Companies and individuals that do not would be relegated to the slow lane.

There’s another reason why it’s a good thing our blog is back – the Times could really use another source of information.

Simply put, nobody will be “relegated to the slow lane.” There will never be a slow lane. The “fast” and “slow” lane analogy puts the wrong image in people’s heads. The Times would be accurate if they described the lanes as “faster” and “fast.” With new broadband services coming on line now and in the years ahead, everyone will receive access faster than we already do now.

The Times continues:

Creating these sorts of tiers would destroy the democratic quality of the Internet. Big, wealthy voices would start to overpower the smaller, poorer ones. Innovation would be threatened if start-ups and small companies could not afford the new fees. The next eBay or Google might never be born.

It’s ironic that the Times chose these particular companies – because both are among the “big, wealthy voices” who want the government to get them out of helping to pay for investment on new high-speed fiber. Mind you, that’s the same broadband infrastructure that will them make billions in coming years.