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Comment by thr0waway1239 | Hacker News Reader

I once heard an interview with the Economist digital editor Tom Standage where he claims (at 5:45 into the interview) that net neutrality is the wrong thing to focus on, and the important thing is just making sure there is more competition between the telcos. Can someone more familiar with this issue tell me if this argument is correct?

https://www.podcat.com/podcasts/i63zqo-untether-tv-mobile-st...

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The argument doesn't makes sense. When a normal citizen is choosing her internet provider they are not going to expend a lot of time looking at the implications of their decision. If the services is cheap enough and has the thing that they usually use then they are done. Competition can easy bring cheaper services but hardly can bring improving in long term needs.

That's why we have laws that forbid companies to pollute the environment, restrict child labor and the like. Consumers will choose the short term benefits for themselves over the long term benefits for the society.

"The argument doesn't makes sense. When a normal citizen is choosing her internet provider they are not going to expend a lot of time looking at the implications of their decision."

I think you're missing the implication of the point.

If there is 'a lot of competition' - it makes cartel-like or colluding behaviour among carriers difficult, thereby facilitating de-facto net-neutrality.

Customers don't have to be aware of it.

And it's a reasonable argument: ensuring healthy and fair competition is almost always better than legislative controls, usually because regulations are often poorly conceived and effectuated, or at least, the market changes rapidly and the regulations fail to adapt.

I think that a reasonable net-neutrality law should probably be made both in Europe and in the US, that said, I'm weary of it being too onerous.

My position is also pragmatic: 'more competition' is unlikely in an industry with such massive barriers to entry etc..

> If there is 'a lot of competition' - it makes cartel-like or colluding behaviour among carriers difficult, thereby facilitating de-facto net-neutrality.

Can you explain this further? I struggle to see how you get from "a lot of competition" to "de-facto net neutrality", and how that would continue indefinitely.

It seems to me that we had de-facto net neutrality from the outset but that over time, as the industry matured, the large players started to talk about colluding. It has taken pro-neutrality lobbying and legislation to maintain neutrality in what was previously a free market.

Because it would be very difficult for carriers to co-opt entities like Netflix into nonstandard schemes if there were a lot of competition.

You hinted at it in your comment: "the large players started to talk about colluding"

Only a when there are a 'small number of large players' is this kind of collusion possible.

When there is a lot of competition, the entire layer of the value chain becomes weaker.

It's a problem because they control a scarce resource: the airwaves, and also a kind of scarce resource: access rights for fibre etc..

In my (limited) understanding of economics, all industries coalesce from numerous small players into a small number of big players.

> Can you explain this further? I struggle to see how you get from "a lot of competition" to "de-facto net neutrality", and how that would continue indefinitely.

Well to paint it as an extreme, if there was so much competition that you could change ISP's within minutes then considering the fact NN is so important to many people there will always be ISP's looking to offer that because people will leave the ISP's that don't.

> If there is 'a lot of competition' - it makes cartel-like or colluding behaviour among carriers difficult, thereby facilitating de-facto net-neutrality.

I don't see the point. If Google decides to pay to providers to speed up Google content. How having more carries solves the problem? Is not even worse as then Google will have more power to bring carriers to its side?

What will happen with little content providers? Can they compete once they are slow?

I see that is more difficult for carriers to agree on something, as the more they are the more difficult it gets. But I don't see hot it facilitates net-neutrality on, for example, the situation that I describe.

> If Google decides to pay to providers to speed up Google content.

The Internet doesn't work that way. If Google wants their services to work better at particular ISP they pay for bigger pipes to the ISP and/or install content caches at the ISP and everybody is better off.

http://www.extremetech.com/computing/186576-verizon-caught-t...

They're saying that the U.S. ISP companies have regional monopolies, and that net neutrality wouldn't be as much of an issue if there were substitute service providers per region.

This honestly isn't true, because if we had a marketplace for ISPs, most consumers would pick the cheapest option, which would probably be the one that subsidizes it's revenue from charging companies like Netflix. Some smaller companies that don't care about full market access wouldn't pay, and then you're at a tiered internet structure not unlike cable packages.

He's only saying it's a "red herring" because ISP monopolies and net neutrality are different issues.

> This honestly isn't true, because if we had a marketplace for ISPs, most consumers would pick the cheapest option, which would probably be the one that subsidizes it's revenue from charging companies like Netflix.

The marketplace doesn't work that way. Neither Netflix or any other content provider has any interest in paying any ISP for the pleasure of serving their customers. Netflix would just refuse to pay the low cost ISP and tell it's customers to change ISPs if they complain.

The only reason Netflix is paying Comcast is because Comcast has enough market power and captive users to blackmail Netflix into paying them, lest Netflix be denied access. If there was any alternative to Comcast, Netflix would just say screw that.

The key point about net neutrality is that it prevents the telco monopoly from becoming a key gatekeeper in deciding who gets to do what and how fast on the Internet. If they become that gatekeeper, all the consumer and producer surplus in mutually beneficial transactions between websites and consumers can be siphoned off by the telcos without adding any value. Just adding more telcos to the mix spreads the siphoning around, but still sucks the profits out of the websites who would otherwise be more likely to reinvest to produce better services.

I'm not too familiar with the issue, but the idea would be that a free and competitive market for telcos would allow consumers to use the internet service that best hits their needs. If net neutrality is important enough, someone would make a telco company that is "net neutral" and customers would pay for that service over others.

The general idea is that a free market is more flexible and quicker to react than the government. It would be quicker to shape itself to the demands of the consumers. This could cover issues like net neutrality, antiquated infrastructure not being upgraded, etc. Prices would also probably go down.

I think this is an important issue alongside net neutrality. I also believe that some extra government regulation is necessary for utilities and essential services, so I'm not against government interference.

In general, the consumer benefits most when an industry has a lot of competition in it.

The market has to be protected. The equilibrium has to be taken care of and sought after, otherwise there is an inherent risk that it'll arise only after hostile actions and a great deal of collateral damage. The regulation inhere is for limiting the collateral damage that competing players could inflict upon consumers.

This is true. In the US you have a small number of telcos with a strong grip on the industry whereas in many (but not all) EU countries excessive choice reduces the problems.

The thing to understand about net neutrality is it's a transfer of power from business to government. The devil is in the detail. If you look closely at the laws involved there are vague clauses that allow for extra government censorship and control in the future.

In basic terms, net neutrality sort-of makes sense in the US and makes less sense in the EU. It's a poisoned chalice created and pushed by do-gooders.

Can you clarify who you are referring to as the do-gooders here? Everyone who is asking for net neutrality?

And is the common people the group who is the victim of the poisoned chalice?

I didn't write that comment, but in my opinion net neutrality is mostly a solution in search of a problem. Hypothetically, ISPs could try extorting and controlling the entire internet, but realistically it's not going to work.

I'm more concerned about app neutrality. Apple is extorting 30% from app makers and enforces rules to ensure their dominance over my phone.

> I didn't write that comment, but in my opinion net neutrality is mostly a solution in search of a problem.

Net neutrality is (partial) remedy for lack of competition. Cure that and a lot of the reasons for net neutrality disappear. However, it is not realistic to expect true competition in the US telecoms market anytime soon.

One reason a lot of people see net neutrality as a solution in search of a problem is that net neutrality was the default before and it hasn't been egregiously abused to date. I'm sure a lot of people will agree it's a problem once they get some first hand experience of it.

> Hypothetically, ISPs could try extorting and controlling the entire internet, but realistically it's not going to work.

I don't know. Comcast seems to be doing a pretty good job at it in the US.

> I'm more concerned about app neutrality. Apple is extorting 30% from app makers and enforces rules to ensure their dominance over my phone.

You do know you can sideload apps on your phone?

Can you sideload on Apple without jail breaking?

Yes, either via an enterprise certificate or via a free developer account. Especially in China they are big on sideloading via enterprise certificates :)

Yes, I know it's not ideal, but at least it's possible.

Those seem like two worthy goals that are not mutually exclusive.

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