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Alright but (1) why should I publicly subsidize a private company who can't manage to fit a project like that on its balance sheets?

(1a) Isn't that a sign they need to be a public utility?

Furthermore, (2) the last time we did this (1996 Telecommunications act), wasn't it no strings-attached? (3) Wasn't it widely seen as the private companies not coming through with the intention of the legislation?

(4) What do you mean "flood the small guys off the net"? Are you saying they would maliciously do denial of service attacks on smaller companies, as in a "Trespass to chattels"? If not, then what do you mean, in concrete terms, without platitudes?

(5) "no way for the ISPs to recover those dollars in the future" - Isn't it true that other companies in other countries can do it without government subsidies and are yet, still profitable?

(6) [background] It seems like you are outlining an industry-wide endemic attitude which belies service. Although I agree that there are institutions structured this way, there are others, such as Level3, or my ISP, Sonic.net, which appear to be committed to tendering networking services.

[question] Wouldn't it be better if companies who do not value providing high quality service actually do exit to a NetFlix model ... as service-providing doesn't seem to be the right industry for their culture (they are entertainment companies such as Paramount, not utilities such as PG&E). Thoughts?

Thanks.

(1) It's more that they would have no incentive to do so themselves. Businesses do not exist to serve the public good; they exist to make money. I agree that consumers may be better served by a public utility structure; but it's hard to get the will in government to spend the money when a commercial alternative already exists.

(2) No; there were plenty of strings attached.

(3) This can be attributed to the line-sharing rules on DSL. It became less profitable to invest in landline infrastructure, so the telcos started buying up wireless companies instead because it was a better investment.

(4) No, I mean that there will be congestion in any large networked system. In any congestion scenario, low bandwidth applications get squeezed, while video just sends crap along without worrying about congestion / latency. It may have to downscale, but by and large big bandwidth generators will continue to dominate traffic scales and cause latency and throughput issues. Without the ability to perform QoS at the link level (a legitimate conern given that layer 7 QoS may not be viable much longer if everything gets wrapped in SSL) these problems become worse.

(5) I'm guessing you speak of Europe. The structure of their bandwidth markets are much different and can't be compared. Telecom in Europe is largely a public/private partnership, where in the US it is privately owned.

(6) They could provide better customer service, but it would cost more (in fact, many of the large ISPs do offer a "premium support" option for a fee). But customers are not willing to pay more for better customer service, because generally you call customer service once or twice a year at most. Additionally, most utilities I've had to deal with also have terrible customer service.

Furthermore, it's disingenuous to compare B2B companies like Level3 with consumer ISPs. B2B is a totally different market: business customers expect a certain level of support and are willing to pay more for it. Support is a feature of the product in the B2B space; in the B2C space it's just a necessary cost center. Furthermore, if you're a consumer who does value business-class support, you're free to purchase access from a B2B provider: you just may not like the price.

ok, I think we are quite different but let me address just two things.

For (4), are you suggesting that a company first pays for the bandwidth, and then pays again, for essentially the privilege to use the bandwidth paid for? (Given the Verizon/Level3 debacle, it was clearly shown that the networks are at about 40% capacity - so the narrative of scarcity or oversubscription is false - can't be used, sorry.)

And for (6), I'm suggesting that conglomerate companies have industries they are good at, and those they aren't. I wouldn't expect to buy an automobile manufactured by starbucks - and furthermore if starbucks went out to manufacture automobiles, everything from the board of directors down would be poorly suited for the task - they are in the food services business - it's fundamentally different.

So the idea here is that perhaps some of these modern cable service providers should be entertainment companies and not distributing in-house hardware or laying out the internet infrastructure - they may be terribly structured for that job.

No, I'm suggesting that a company like Netflix pays to deliver traffic directly to a company like Comcast. Netflix only pays once (they're paying Comcast instead of paying Level3/Cogent, at least for delivering to Comcast customers).

I think our big difference of opinion comes in the understanding of the industry. Content and distribution have always been intimately linked. In fact, that's the whole disagreement: Netflix is performing content distribution but is not paying for the full cost of that distribution. Inexplicably, a lot of people feel those costs should be pushed to the consumer (i.e. "I already pay once for Internet! Netflix shouldn't have to pay because I already do!") rather than to the company making the profit off the specific act of a user watching a video (who will inevitably push those costs to the consumer, but only to THEIR consumers).

Netflix's business model is nearly identical to HBO's. The only difference is that HBO bills through the cable companies and Netflix does not. But the cable companies take a cut of HBO's earnings for distribution. Netflix wasn't paying that until recently.

>Netflix's business model is nearly identical to HBO's. The only difference is that HBO bills through the cable companies and Netflix does not. But the cable companies take a cut of HBO's earnings for distribution. Netflix wasn't paying that until recently.

You're probably right about that. However, I don't agree with the FCC being lobbied in order to protect an aged revenue model and further increasing lock-in. That shouldn't be the FCC's purpose.

The whole thing smacks of the laws some states are enacting trying to prevent Tesla from selling cars online, etc.

I think the ISP should be a common-carrier and unbiased vehicle for the open exchange of information that makes the Internet so intellectually critical. It sounds like you prefer them to be a privately held entity with zero civic obligations.

I really wish that there was a metaphorical wall between entities that facilitate the civic function of a press and these more or less chicanery-based private corps.

I'm terribly worried about the fact that the fate of modern discourse, society planning, press, arts, and culture essentially lies in the hands of the people whose primary goal is to bring commercially sponsored leisure distractions to the living room - their interests are too narrow and their vision of the task is too thin - as if we asked the Orville Redenbacher corporation to single-handidly draw up agricultural subsidization, land use, and disbursement policy (I bet their suggestions would favor more popcorn and leave 80% of the problem unsolved.)

" It would lead to a mass exodus of investment dollars from wired broadband because there would be no way for the ISPs to recover those dollars in the future."

There is a way, I pay a bit over a hundred dollars a month to the cable company for an internet connection. Some of that money should surely be ear marked for taking care of infrastructure? Why does it matter if i'm using it to watch Netflix?

Funny how only internet in the US is broken. The rest of the world can combine net neutrality with superior performance to that of the US monopolies. Why on earth should you try to put a bandage on the symptoms by throwing away net neutrality instead of focusing on the cause.

Not all businesses are suitable to deliver content over CDNs (and not all wants to anyway), thanks for forcing that part of a business in to a third party.

What am I paying my isp for then? If subscription fees don't cover bandwidth costs how have they been doing business up to this point?