Raw Economics :

Google-Verizon CoOpoly Galvanize Net Neutrality

If the intention of the Google-Verizon CoOpoly proposal was to provide a compromising way forward on Internet broadband policy, they may have gotten more than they bargained for as the Net Neutrality forces achieve a laser like focus. and turn their bright focus upon them.

Verizon is no stranger to controversy, it strides confident across the American Internet landscape, bold in the knowledge that the United States is numero uno worldwide. Or at least that is the opinion of Verizon CEO Ivan Seidenberg. Interviewed in April at the Council on Foreign Relations, by the Wall Street Journal’s Alan S. Murray…

Murray: “So on the measures that matter most to you, where does the United States rank in terms of –[broadband]”

Seidenberg: “One. Not even close.”

Murray: “Number one?”

Seidenberg: “Yes. Verizon has put more fiber in from Boston to Washington than all the Western European countries combined. All. We have — if you look at smart phones — not us, Apple, Google — they have exploded this market in the U.S. Ask any European if they’re not somewhat envious of the advancements of smart-phone technology in the U.S.”

Its hard to be delusional and run a major company so this must be case of say it over and over until someone believes. Google, on the other hand, is harder to understand. Why they decided to put their face in this policy propellor is unclear. Once an arch enemy of the telecom set, they now appear to be in bed with and defending that position. More at the Google Public Policy blog.

Those who feel betrayed by the less than warm and fuzzy feeling of, “Do no evil,” are swarming like angry bees and those who were on the fence, now feel compelled to jump in one direction or the other. The combination of an election year and the K Street crowd make for a volatile mix.

Even the Tea Party feels the need to voice an opinion. 35 of their loosely put together groups sent a letter to the FCC presenting the idea that having an unfettered Internet is bad for liberty and free speech, very curious indeed, Their narrow logic being that anything government is bad, never mind the Internet was created by the government’s DARPA.

Meanwhile, in the U.S. Congress a group of representatives has sent a letter to the FCC. These congressmen are not just any elected officials, they all sit on the House Energy Subcommittee on Communications, Technology and the Internet. This is the committee that directly oversees Internet policy and would control any bills passed to the congress for a vote.

These congressmen are from some of the most technology dominant districts in the United States: Michael Doyle is from the district that has Pittsburgh and Carnegie-Mellon University, Edward Markey is from the district of suburbs surrounding Boston’s north -home of Harvard and MIT, Anna Eshoo’s district forms part of the Silicon Valley where many of their workers live, Jay Inslee’s district contains the city of Redmond, WA -corporate headquarters of Microsoft.

In the letter they refer to the traffic shaping lawsuit brought by Comcast to overturn the FCC censure which was successful and they cover the Google-Verizon policy proposal. They correctly state that public policy cannot be dictated by two private companies with their own interests in mind but must come from an agency that represents the long term goals of all U.S. citizens.

They cover the main points of the pro Net Neutrality debate: 1. Get going, the United States is falling behind and is increasingly missing the benefits of broadband that is persistent, pervasive and affordable. 2. No paid traffic priority, no multiple Internets. 3. The difference between wireline and wireless is meaningless, they both carry content, both should be regulated in the same manner. 4. The use of the term ‘managed services’ is just another way of saying prioritization.

Everybody is writing letters. The Senate Commerce Committee, Science, and Transportation, staffed by Senators Daniel Inouye, John Kerry, Byron Dorgan, Maria Cantwell, Frank Lautenberg, Mark Pryor, Claire McCaskill, Amy Klobuchar, Tom Udall, Mark Warner, Mark Begich and the chairman of the committee Senator John D. Rockefeller sent theirs about a month ago.

These senators asked the FCC some hard questions, like how long will take to reclassify to ‘common carrier’ status, implement the Broadband Plan and why are the broadband goals so modest in bandwidth and time to execute? They were also concerned by the lack of oversight due to the Comcast case.

The broadband battle lines are drawn and there is little room for compromise, someone has to lose in this confrontation. The telecoms have become monopolies once again with little competition and they smell huge profits in the future of wireless and the services developing on wireline broadband. They need to be forced back to their primary business, as carriers. As they control more access and desire to offer the services that incentivize them to limit other’s competition they will be become an increasing threat to very definition of the Internet.

If the FCC and congress gives in and lets the telecoms have their way the United States will be marooned in the economic backwaters of the worldwide Internet. There will be little chance to rectify the situation in the future once this mistake is realized, be sure, no country in the world is waiting for the United States. The developing world, in the shape of Brazil, China and India, are catching up. The industrialized nations that are far ahead of us are now contemplating increasing penetration and bandwidth.

Google and Verizon have been bold, can our agencies and politicians be as bold?

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