Comment by ryanworl | Hacker News Reader

Comment by ryanworl | Hacker News Reader

Parent Full thread

If Facebook makes deals with cell phone carriers to have their traffic be free to the end user, it may incentivize SnapChat users to switch to Instagram for a comparable experience minus the data charges.

Luckily, most of the largest technology companies are incentivized in one way or another to keep net-neutrality as it is. Google, Microsoft, and Amazon literally sell cloud computing services to tons of companies large and small who could be negatively impacted. Apple wants new apps made in the App Store and would prefer these new apps hurt Facebook, Google, and Amazon in some way if possible. Facebook relies on third-party mobile applications and websites for collecting tons of data to feed back into their ad system. Google prefers an open web to index and serve search ads against.

I don't think the lines are as clear as Fred has drawn here. There are plausible reasons for major technology companies to come out in support of net neutrality that are in their own self-interest, not just good-will.

The opponents of net neutrality aren't those guys - it's AT&T, Verizon, Altice, Comcast, CenturyLink, Charter, TimeWarner, etc.

With net neutrality, they are essentially forced into a very low margin business of selling data pipes, where it's all very comoditized, and it's difficult to 'add value'.

Without net neutrality, they can pick and bundle services over the top and give them prioritised traffic on their network, so watching Comcast Video is prioritized, but watching Netflix buffers every 4 seconds. Offer subscribers a short term discount to try Comcast Video, and then watch as the money rolls in when everyone dumps Netflix and moves over to Comcast Video.

I can attest to this experience on Centurylink gigabit trying to stream Comcast's Xfinity Go, or streaming Netflix while on Comcast before they made the backroom peering deal. In the evenings, they would either run at the lowest quality, or buffer very often while running in potato vision.

To clarify, given the net is not neutral, Facebook will be able to provide better services because they pay internet providers some fee for extra bandwidth and reduced latency. While Snapchat would decide to provide worse services at a more reasonable cost to them.

This helps Facebook in the battle against Snapchat, but hurts Facebook in that they have to pay an extra fee. A similar argument could be made with other tech companies and their rivals.

Is this a correct interpretation?

The correct version of the argument is that Facebook can afford to pay for extra bandwidth and reduced latency, but new market entrants cannot. Snapchat has plenty of funding.

It also has knock-on effects in the allocation of financial gains of successful startups. The more money required to launch/scale a company, the more likely it is that investors (capital) get a larger share of the profits than founders or employees (labor). That's not necessarily a direct reason to oppose/favor net neutrality, but is worth considering alongside all the other data points.

> There are plausible reasons for major technology companies to come out against net neutrality that are in their own self-interest, not just good-will.

Sorry, just to clarify, are you saying that there are plausible reasons for major technology companies to support net neutrality because of their self interest?

(I found your statement a bit hard to parse.)

It was hard to parse because I didn't actually write what I meant! Sorry.

I meant these tech companies have reasons to support net neutrality besides good will.

Tech companies aren't the same as network providers, though. And Google didn't make it as an ISP. It pits tech against telecoms.

Reply on news.ycombinator.com