Podcast: Internet service providers charging for premium access hold us all to ransom


Stupid question, I’m sure, but can’t someone start an ISP that doesn’t do that and compete with the ones that do? Or is that not feasible?

It would take very deep pockets. The current oligopoly has its infrastructure in place; had a great deal of it in place even before becoming ISPs, such as cable and trunk lines. In a large market, setting up the infrastructure would be a, um… non-negligible cost.


Mmmm… Pizza.

Welcome back to the Compuserve era, except shinier.

Has anywhere else in the world tried the British experiment of forcing the monopoly phone supplier to offer LLU access to the lines and wholesale internet access? And secondly why isn’t this applied to Virgin cable as well as BT?

This is an example of an infrastructure market with a natural monopoly in that there’s no point in laying more than one cable to the home. Just like electricity, water, sewage, gas. That monopoly is highly regulated by the government and in many cases was financially supported with public money both during build out and normal running. What we have with the US net neutrality debate is both a failure to regulate and a failure to create a viable competitive market by the government that was responsible for funding and controlling the market. It’s not a free market and it cannot be one. But it could be a viable competitive market.

It seems reasonable to suggest that the US should at least look at the British model of LLU and wholesale. But of course it will suffer from “not invented here”, “It’s different in the USA”, assorted (non-existent) ideological problems, but most of all, lobbying and corruption. It will end up as an oligopoly because that’s what the US system tends towards in every infrastructure market.


I’m wondering whether it isn’t possible for customers to file a class action suit- After all, we signed on with our ISPs under the understanding that we would be able to access what we wanted at the advertized speeds.

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I really like the analogy. I sometimes wonder if the issue is caused by simply not conveying a better option for the ISP’s for dealing with Netflix, which should probably just upgrade their infrastructure. How do you deal with all of those charges of the information moving between distant servers? The IANA governs IP addresses that the ISP’s then assign to block regions. With that information, it’s extremely simple to calculate an abstract “distance”, which could then be used to calculate a standard overage charge if X amount of data passes through a long distance. I think what Comcast is openly doing with Netflix breaks the core concepts of non-bias that govern the operation of the Internet, and their IP blocks should be suspended. Hypothetically speaking.

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This is hyperbole with little basis in reality. The proposed regulation isn’t even going to be published for another two weeks, and no one except the people who wrote it know exactly what it’s going to do. But, according to those people one thing it will definitely not do is

. . . allow ISPs to demand bribes from publishers in exchange for letting you see the webpages you ask for.

If you want to know what is actually known about the proposal, this article in PCWorld does a pretty good job of actually explaining it.

I’ve gone back and forth on net neutrality. I’ve thought about it as they are (at least) semi-monopolistic and operate with government supplied right-of-way… to the other end that they own the infrastructure and can manage it as they see fit. I am more on that later argument now as we do have (some) competition in (many) areas. Should they operate like public utilities? Id rather they didn’t. I can get internet at least 3 different ways at my house… not to mention on my phone almost anywhere I can go… good luck getting someone else to pipe water to you…

Having said that they must owe something to the public for the right-of-way (or airwaves) they need to survive… but I don’t think net neutrality is it. I can understand how “in theory” it would be good for all bits to be treated equal. But given that there is an upper bound on channel capacity (Shannon’s theorem) and more practical limitations on the operators ability to upgrade (more channel bandwidth, more power, better coding) I don’t see how its possible. I’ll reduce to absurdity with one person tries to use 100% of the capacity argument. Can operators do nothing about that? what about the rest of the customers?

Backing away form the absurd, you have Netflix on one end and Netflix subscribers on the other capable of using some noticeable percentage of the capacity. Let say they use enough that the video I’m watching of a cat playing piano starts to get choppy (I guess I’m watching it on Dailymotion instead of Youtube…) and so is the guy’s video of Braveheart on Netflix. I’m unhappy, Netflix user is unhappy. My ISP cuts a deal with netflix. Netflix subscriber is happy. My cat is still choppy (or not, I’m not sure… but lets assume it is.) maybe I even drop my ISP. But you know what? that might be fine with them because they have the other source of income from netflix to keep the netflix guy happy. Its a business decision. Maybe they have more money to upgrade their network sooner… or maybe they just pay themselves more.

If they see a pair using a lot of capacity, they are going to want to charge one or the other for the privilege of slowing down the internet for the rest of their users. They’ll either go the source, or the receiver. And the ISP’s have already learned that capping/throttling/charging per byte is not popular… as you can see by going through boingboings own archives.

lastly… how is the pizza place buying another phone line NOT akin to buying premium access? It sound to me like you would rather the phone company give them more lines for free without regard to if the network can support unlimited phone lines.

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