Internet Non-neutrality

With the start of CRTC's so-called network neutrality hearings this week, there will be much pontificating about right vs. wrong, advantages vs. disadvantages, and so on. You might think from this that this will be an academic and law-based exercise where the evidence is impartially weighed and a just outcome will be the eventual result.

I do not believe this. I have myself written on the topic of throttling, caps, metering and other controls used by Bell Canada and other ISPs in Canada and elsewhere, but not recently. I stopped because this is less and less about the evidence and technological capability, or even about sound public policy: it is about politics and influence. This is what happens when there is a lack of diverse competition in a market - politics comes to the fore in an attempt by interested parties to skew the market to desired outcomes. What we have here is a market failure. In a broader sense this is no different from the situation with GM or Nortel, and government's choice to become involved, or not, in each respective instance.

This CBC article nicely summarizes the grouping of the contending parties in front of the CRTC. Notice that while they are grouped by commonality of position, perhaps it is more important that these are also barometers of each group's political influence. I don't want to come across as too cynical, but I think it is most probable that the largest businesses, the ones with the biggest numbers for employment, network assets, business investment and ties to government will skew the results in their direction.

This is not necessarily a dreadful outcome, even though it is not entirely fair. Regardless of how one may feel about broadband, these are the companies that have made it possible. The main contenders, for all their attention to customer service and responsiveness, ride on the infrastructure built by others; the passengers will always have less influence than the carriers when it comes to transport policies. This is as true for broadband as it is for railroads and airlines.

Therefore, if you are on the side of the independent ISPs, don't look to government to help you out. The only effective solution is facilities-based competition. We need more than the telephone and cable companies providing broadband infrastructure. However it is not easy to break this effective duopoly. Wi-Fi and Wi-Max have yet to come to the rescue since, like any facilities-based ventures, they require massive up-front investment to become viable alternatives. All they've scored so far is limited penetration, and a lot of unfulfilled promises. Mobile wireless competition, which is on the way, will also help a little bit, but again, not much.

I am going to largely ignore the CRTC proceedings since I do not see that they will be very influential on CRTC's ultimate policy determination.