Net neutrality seems like a simple, easy-to-understand concept. But the deeper you dig into the concept, this appearance...
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of simplicity is actually just a light coat of surfacing on a complex set of problems. The best place to begin with net neutrality is its basic premise: Providers who are transporting data should treat every packet the same, regardless of the source, the destination or the service.
The primary foundation of net neutrality explained is this: Providers should not be able to give services they offer any advantage over a competing service running over their network.
The perfect example might seem to be voice services. Suppose you purchase access to the internet from a company that not only sells internet access, but also voice services. Now, suppose the provider decides to sell its voice service as superior in quality to any other available voice service -- and guarantee its service is better by degrading the handling of traffic to and from every other known over-the-top voice provider. For example, the access provider could choose to drop every 10th voice packet not sourced from, or destined to, one of its voice servers.
Unfair competition? Perhaps, but maybe not
Would this be unfair competition? It certainly seems to be. Net neutrality is specifically intended to prevent this sort of situation. The access provider, in this case, should not be able to privilege its voice traffic over that of its competitors. The rule goes beyond unfair competition, of course; it allows new services to develop without being hindered by existing providers, and it prevents existing providers from becoming a monopoly force, drawing every user into their services.
In a larger sense, this also tends to help prevent the splintering of the larger global (big I) Internet, as this kind of rule tends to prefer broad connectivity -- to harvest a lot of different versions of services -- over contained and local ecosystems.
Net neutrality explained in this surface analysis approach is easily complicated, however. First, there is the matter of fair use for facilities. Although the system is widely decried, there are many places where you can purchase a mobile phone at a discounted price -- as long as you sign a contract spelling out you will only use the selling provider's network. In essence, the provider is subsidizing the cost of the phone by charging more in network access fees. The consumer still pays, but the upfront cost appears to be lower -- hence, the barrier to entry to new service users is lower.
Is this an unfair business practice? Many would say it is -- and yet, many of us also buy cars that are heavily subsidized through taxation, and gladly support bond issues that spread the cost of buying a house in a community across many years. There are many automobile dealerships that offer free service for a set number of years if you use dealer financing, as well.
Bearing the full cost of maintaining the network
There seems to be little objection to such schemes in other areas, which appears to muddy the waters around the original clarity of the concept of net neutrality just a bit. The baseline problem is this: Will people actually buy internet access if they must bear the full cost of building and maintaining the network actually required?
Maybe the only solution here is to allow governments to run networks as utilities. Or maybe this would simply cause innovation to fail, or the push market for recovering the cost of running the network into other venues, such as paying steep fees for the use of managed equipment -- already a problem in some areas, and with some access mechanisms.
Moving past the problem of access fees, the waters are muddied a bit more when considering how networks are actually built. Suppose, for a moment, we assume all networks are built like the one shown in the illustration below.
CP1 and CP2 are two different content providers, AP1 and AP2 are access providers, and TP is a transit provider. Assume CP1 and CP2 are competitors, both offering the same type of service to the user, who is represented by the system on the far right side of the diagram. If every packet is treated the same by AP1, AP2 and TP, then the user will only see differences in performance based on the actual services offered.
Competition seems to be fair and equal at this point. AP2 might offer a competing service, as well, but AP2 cannot privilege its packets in any way, nor does it make financial sense for AP2 to subsidize network access based on the profits of offering this competing service -- in the perfect net-neutrality-explained world, of course. But what happens if CP2 builds a link bypassing AP1 and TP, as shown in the next illustration?
By creating this new link, CP2 has enhanced its service; it can not only draw the information required to run its service closer to the user, it has also eliminated several hops -- and many possible queues --between the service and the end user. Drawing a service closer to the user only seems to make sense from a content provider's perspective -- so much so that this is a growing phenomenon in the networking world.
What does this do to net neutrality? Should CP1 now be able to argue that the link between CP2 and AP2 is a transit link, and must be opened to traffic from CP1 to take advantage of this new, shorter path?
No easy analysis
There doesn't seem to be anyone arguing for this sort of enforcement. In fact, this situation puts access and transit providers at a severe disadvantage financially. They cannot subsidize the cost of their networks through services, and they cannot use their networks in any sort of way that reduces their competition. In fact, they cannot -- in many places -- gather the kinds of information about their users content providers regularly gather. In short, this doesn't seem to be very neutral at all -- rather, it appears, on the surface, to heavily tilt the playing field in favor of content providers.
So, net neutrality explained, which on the surface seems so easy to understand, doesn't seem to hold up to any sort of easy analysis -- or any solutions -- once you start digging into the particulars. There does not, in fact, seem to be any sort of simple solution that will not tilt the playing field in favor of someone, leaving public policy makers with the question of who to favor, rather than how to prevent anyone from being favored.
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