Google, Verizon Deal Could Sidestep Net Neutrality [Updated]

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Google and Verizon are apparently working on a deal that could lead to companies paying for faster delivery of their Web content to end users, according to the New York Times. The deal would create a tiered data serving system that sounds very similar to the type of Internet content delivery structure the Federal Communications Commission is hoping to avoid.

Assuming the two companies reach an agreement, the deal would impact data transmitted over Verizon’s wireless network, but the tiered delivery system could eventually extend to other wireless data service providers, too.

Anonymous sources familiar with the negotiations said that as part of the deal Google wouldn’t take actions to challenge how Verizon manages content delivery on its wireless network. A deal between the two companies could be announced as early as next week.

If Google and Verizon strike a tiered content delivery deal, that could throw a wrench in the FCC’s efforts to ensure all Internet data is handled equally. The agency is currently conducting meetings with several communications-related companies such as AT&T, Skype, Google and Verizon, along with cable system operators and the Open Internet Coalition.

Gigi B. Sohn, president and a founder of the consumer advocacy group Public Knowledge, commented “The point of a network neutrality rule is to prevent big companies from dividing the Internet between them.”

For it’s part, Verizon claims it is still negotiating with the FCC. “We’ve been working with Google for 10 months to reach an agreement on broadband policy,” said Verizon spokesperson David M. Fish. “We are currently engaged in and committed to the negotiation process led by the FCC We are optimistic this process will reach a consensus that can maintain an open Internet, and the investment and innovation required to sustain it.”

While Verizon was backing up the report that it has been involved in the side negotiations, however, Google openly denied them. “@NYTimes is wrong. We’ve not had any convos with VZN about paying for carriage of our traffic. We remain committed to an open internet,” the company said through its Google Public Policy Twitter account.

With both sides offering different statements on the alleged negotiations, that could be an indicator that the talks aren’t going as planned — or that one side got cold feet. For now, it looks like whatever Google and Verizon were, or weren’t, discussing behind closed doors will stay there.

[Updated with Google’s response]

Comments

geoduck

IMO this is bad.
One of the fundamental tenents of the Internet was a level playing field. Everyone had the same chance of getting their message out. It lead to a rather chaotic environment but with Google search there was a degree of democracy about it.

If the deep pockets can buy faster access then all that goes out. Home Depot can pay to get it’s page to load in 1 second while Dave the Handyman takes 10. Who will get the business? Fox News can pay to get their site up in 1 second while DemocracyNow! takes 25? Who will get read? The internet as we know it would very likely be Balkanized with the less rich, less powerful, and politically out of favour getting segregated into the slow lane.

What ever happened to Google’s philosophy of “Don’t Be Evil”?

Bosco (Brad Hutchings)

If you want a physical world analogue to Net Neutrality, look no further than the 91 freeway that connects Orange and Riverside Counties in Southern California. It was already super congested in the 1980s, and in the early 1990s, a private firm was allowed to build toll lanes in the center median. Well, allowed by Orange County anyway. Riverside County wanted nothing to do with private roads, even though there wasn’t money or political will to expand the freeway outward by buying land, moving hills, etc.

So the funny part is where we are today. If you travel west on the 91 to Orange County in the morning, or east back to Riverside County in the evening, you are pretty much stuck in bumper to bumper traffic between the end of the toll road (where the 91 meets the 241) and the I15. Looking at the traffic flows, you’ll notice that this mostly affects commuters who live in cheaper Riverside County and commute to good paying jobs in Orange County. Others affected are weekend travelers to Vegas. Friday nightmares on the 91 east are common all summer long.

There is a lot to learn about net neutrality from the 91. The people who insist on it are like the Riverside County supervisors. They don’t want anyone being able to pay for an advantage because they think it will result in everyone else getting screwed. Those who oppose net neutrality are like the OC supervisors. They know that tiered pricing can actually lead to better traffic management because the drivers themselves will respond to price inputs. The little stretch of road between the 55 and the 241 ranges from $2 to about $10 depending on traffic conditions. For some people, an extra half hour with their families is worth $10. Just like, for some companies, speedier delivery of their bits might be worth a fee, especially on naturally congested routes or at naturally congested times.

One of my college buddies, Ted Balaker, coauthored a book about mixing private roads into freeway infrastructure. It is excellent grounding when considering public policy around communications networks.

skipaq

The question of Net Neutrality should come down on the side of access. That can be viewed from two perspectives. The supplier as in the retailer, news outlet and advertiser has their interests to get to the consumer.

The consumers interests don’t always align with those of the supplier. Often they conflict with them. The only role the FCC should have is to ensure that no unfair advantage be gained by anyone. If this deal’s purpose is to benefit a few at the expense of others then it isn’t good. It would be like pricing the private toll roadbeyond the reach of some to favor a few.

Bosco (Brad Hutchings)

If this deal?s purpose is to benefit a few at the expense of others then it isn?t good. It would be like pricing the private toll roadbeyond the reach of some to favor a few.

You’re right on the first sentence, not right on the second. You can provide premium level service to “the few” that’s not at the expense of others. It’s growing the pie, so to speak. Like every other economic concept, it’s not a zero sum game. Mistaking it for one is what leads to Riverside County thinking, where everyone suffers equally.

b0wz3r

There is a lot to learn about net neutrality from the 91.

This is completely mistaken metaphor.

While on the surface it seems to be valid, bandwidth for lanes, etc. it is not.

It does not take into account the realities of diverting signal via other routers and pathways to reach its destination, and the last time I checked signal travels through wire or fiber optics a hell of a lot faster than cars on a freeway.  Additionally, unlike on a freeway, more routes can easily be requested on an ad-hoc basis by routers to get their message to their destination, and then released once they are no longer needed.

On the contrary, if this plan were allowed, those extra ad-hoc access routes would no longer be available to those who could not or would not be willing to pay for them, thus creating this sort of “traffic jam” situation, not alleviating it.

As usual, more a$$ backwards logic from Bosco.

geoduck

Bosco
I’m going to break my rule and respond to you.

Your freeway analogy is faulty. What road I choose to go on is my choice.  If I have 10Mb or Gb Internet into my house it is my choice. That is absolutely NOT what is being talked about here.

<From the Article, the First Line in Fact>

that could lead to companies paying for faster delivery of their Web content to end users

This is, to continue the defective highway analogy, about Wallmart building a freeway ONLY for Wallmart customers. This is about BP buying a commuter lane ONLY for BP customers. This will help to further concentrate power and influence. The Web was supposed to be a level playing field where everyone had an equal chance to be hard. This would gut that.

Once the precedent of faster access for deeper pockets is established:
What’s to keep Acme Superstores from paying to slow down the messages of their competitors?
What’s to keep Acme Internet Service from only selling higher speed access to their favourite political parties and denying it to the rest?
Remember, in many areas you do not have a choice of this or that internet provider. When we lived in Minnesota the choice was Comcast or rabbit ear antenna. There was no other option for either cable or internet. If <InsertYourISPHere> wants to sell higher speed access only to the Revolutionary Communist Youth Brigade (because, ironically they have a wealthy benefactor) then that’s the message you’ll get and Republican, and Democrats, and Catholics, and Libertarians will be disadvantaged. There is a finite amount of bandwidth. Sharing it equally is one way of sharing. Giving the most to those that can pay and letting the rest starve is another. I know which one I think is right. Breaking down NetNeutrality is as anti Democratic, anti Libertarian as it gets.

The Internet is the 21st centuries Town Square where ideas and positions are shared freely for all to judge. I’m all for people having the power to chose what message they get. However, if one group can buy the ability to get their message out first and loudest and than all the rest it harms everyone.

skipaq

Bosco,
There is no problem with companies making deals that will be a benefit to them as long as it isn’t at the expense of others. The internet is and has been a special place. It should not be turned into a system like broadcast TV where networks try to control what is available and at what price. If a company wants to make money on the net then let them take the net as a neutral place to play in.

It isn’t that I disagree with what you are saying. It is just that I don’t trust Verizon and Google anymore than I would trust Apple and AT&T to cut a deal on content delivery.

Bosco (Brad Hutchings)

Google denies the story.

@geoduck… You’ve obviously never paid for commercial web hosting, or if you have, you’re not familiar with bandwidth caps, premium bandwidth, uptime guarantees, and stuff like that. From a hosting perspective, it is an extremely unlevel playing field out there, and if you make your living serving up pages, you have to stay on top of continually changing value in that space. So it has always been for 15 years that I’ve been serving stuff up on the net. Transport itself doesn’t scare me, because it’s effectively what Akamai and the like offer by positioning a private network of servers close to consumers. Net Neutrality policy that keeps a lid on Verizon is effectively a pay-off to Akamai and other players like them. To your particular example, Home Depot can afford Akamai, and to wager they do actually use them would be a better bet than “black” at the roulette table. Tom the Handyman can’t dream of affording Akamai.

@b0wz3r… If you ever understand the metaphor, you should get into a graduate comp. sci program. You’d do well. The biggest lesson I drew from grad school is that networks are everywhere, and they can model just about anything. It is nice to see a resurgence, for example, of Hayekian thinking in Economics. F.A. Hayek won a Nobel Prize basically for thinking about economics less as calculus and aggregates and more as networks of actors and actions.

Guys, the Internet pie is still growing at a phenomenal pace. It’s continually reshaping too. Now is not the time for Riverside County thinking, which assumes that if someone gets ahead, someone else must fall behind. The dirty little secret about Net Neutrality is that it’s mostly pointless in practice. See the Akamai example.

doogie

I imagine that every one of you is already paying for a tiered service plan with regards to bandwidth to your house.  My personal experience includes AT&T, Comcast and Time Warner, all of whom offer a variety of up/down speed packages at various prices.

We need some free market pricing to determine the value of things.  This needs to be balanced with the fact that the competition for providers is extremely limited.

doogie

The Web was supposed to be a level playing field where everyone had an equal chance to be heard.

That implies that there was a plan for the internet beyond robust communications.

Jeff Gamet

Hey Bosco -

Thanks for finding the Twitter comment from Google. I added that to my article.

geoduck

Interesting response from the FCC Chair
Net Neutyrality Would Trump Google/Verizon Deal

From the Article

“Any outcome, any deal that doesn’t preserve the freedom and openness of the Internet for consumers and entrepreneurs will be unacceptable,”

skinnybear

I would like to point out (and I am probably much older than almost everyone posting, since I remember life w/o TV…) that people, including me, said that they would never pay for something that was free. I now have Direct TV and an iPhone.

Net Neutrality, while I like in principle, will die because the monied interests that control this country will kill it, if a larger profit will be made. Money is always the trump card. This whole issue reeks of future profit for the big guys. Bosco recognizes that we little people will suffer without Net Neutrality with his reference to “cheaper” Riverside and their congestion.  Let the pipeline get clogged for the masses as long as the “better off” can pay. While I do not like his analogy, I agree with his premise. Net Neutrality will be something we will be writing about in the past tense.

geoduck

Net Neutrality, while I like in principle, will die because the monied interests that control this country will kill it, if a larger profit will be made.

Sadly, I think you are correct.

b0wz3r

@b0wz3r? If you ever understand the metaphor, you should get into a graduate comp. sci program. You?d do well. The biggest lesson I drew from grad school is that networks are everywhere, and they can model just about anything. It is nice to see a resurgence, for example, of Hayekian thinking in Economics. F.A. Hayek won a Nobel Prize basically for thinking about economics less as calculus and aggregates and more as networks of actors and actions.

I hold a PhD in Experimental Cognitive Psychology from the University of California, Santa Cruz, with a specialization in psychophysics, sensory perception and cognitive neuroscience.

Neural network theory and parallel distributed processing have been around for decades in my field.  I’m glad to see that economics is hopefully turning away from the dead end of Keynesian theory and learning from us in the biological behavioral sciences and taking evolution and ideas such as the tit-for-tat cooperative program seriously.

The freeway metaphor still backfires on you though.  You haven’t disputed my claims that what’s being proposed here will actually concentrate power, not distribute it, as you are claiming.

Bosco (Brad Hutchings)

The freeway metaphor still backfires on you though.? You haven?t disputed my claims that what?s being proposed here will actually concentrate power, not distribute it, as you are claiming.

Well, I didn’t actually claim that any of this either distributed or concentrated power. The gist of my argument, which I think skinnybear misunderstood, is that (a) net neutrality is basically a meaningless concept which is there for the self-anointed cool people to rally around, and (b) the people who are all hung up on equality have a view of a fixed pie where for someone to get ahead, another must fall further behind. geoduck claimed above that bandwidth was a finite (he meant non-growing) resource. Absolutely wrong. That is Riverside County thinking (more precisely, the thinking of their leaders), and the people who end up suffering the most from that kind of thinking are the commuters from Riverside County! Had Riverside County accepted the toll lanes in the center median on the 91, thousands of people per day would now be paying $10 - $15 to have an extra hour or so with their families. And perhaps saving half of that in gas. There would have been investment to expand total capacity of the 91 clear past the 15. The premium capacity usage would free up the “free” capacity to accommodate more cars or ease congestion.

But you know, the thought of some millionaire gynecologist driving his BMW 7-series with USC Alumni plate frames at 75 mph past all the poor middle class hourly workers somewhere through Corona just gets everyone’s liberal panties in a bunch. How unfair that that be allowed to occur, even if it draws investment into the whole system and makes it run better! Whatever. The funny thing about net neutrality, since it doesn’t mean anything anyway, is that Google and Verizon are or aren’t talking behind everyone’s back to determine what it is or isn’t going to be tomorrow.

P.S. If you think it actually means anything, what are your thoughts on port 25 blocking, basically an industry standard practice that you definitely would not want to end because of net neutrality rules?

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