Award Winning Blog

Monday, December 10, 2007

What to Do With Heavy Internet Users?

Comcast’s heavy handed treatment of its peer-to-peer networking customers made me wonder if these customers deserve to expulsion or a fruit basket. In other words do heavy users present an opportunity or a threat to network managers?

ISPs, like airlines, only make money when customers use their services. Airlines and many other businesses typically reward heavy users with rewards. Other ventures can use data mining to determine the profitability of any particular heavy user. So I readily agree that that not all heavy users are desirable.

The problem with Comcast’s approach appears to be that the company assumed any peer-to-peer user is a problem customer deserving degraded service, rather than a candidate for upselling. Comcast should offer more expensive service to the power user who needs better than best efforts traffic routing. I do not consider this a violation of network neutrality. My beef with Comcast or any ISP lies in instances where the carrier without disclosure or reasonable explanation drops packets and otherwise degrades service, or vice versa.

For me network neutrality is primarily about transparency in a transaction that increasingly presents opportunities for mischief. At the WIK conference I recently attended on the European approach to Network Neutrality, there was much discussion on how parties frame the issue. The most common U.S. frame involves a referendum on the virtues of marketplace competition, assumed to exist, versus marketplace failure assumed to exist.

Other alternative frame considers technical standardization of the Internet and whether TCP/IP promotes or retards innovation, i.e., a variation on the dumb versus smart pipe argument. Others in Europe involve consumer protection, contract law and ex ante versus ex post facto regulation.

8 comments:

Harold Feld said...

I agree that the framing is usually about market power. While I'm willing to play in that wading pool (in part because I think that in the right economic conditions, the problems do go away), I have also tried to move the frame well beyond that. Glad to see others do the same.

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