The Other Side of the Sprint Vs. Cogent Depeering 174
Swoolley writes "A month back this community discussed the Sprint vs. Cogent depeering. Now a story I wrote for Forbes.com tells the inside story of the fight, based on the lawsuits the two companies filed against each other in Virginia state court. For once, thanks to those suits, the public gets to see the details of a confidential peering agreement between two of the Internet's largest autonomous systems, as well as the circumstances leading up to the depeering. (Which company is in the right? Read the facts and decide for yourself.) While some people have argued that the depeering is reason for more government regulation, the Forbes story makes the case that details of the recent Cogent vs. Sprint fight argue for exactly the opposite: keeping the Internet backbones free of government meddling."
government regulation: the devil is in the details (Score:5, Insightful)
Is anyone else here tired of knee-jerk partisanship framing discussion in terms of false dichotomies? Government involvement can do a whole lot of good or a whole lot of bad. The devil is always in the details.
Good: regulate to prevent monopolization of last-mile utilities and reduce barriers to competition.
Bad: let lobbyists who supported your campaign write bills that hand out huge billion dollar tax breaks to carriers to build out the next generation "information superhighway" and sit idle while all of that money goes straight into the pockets of shareholders instead while countries like South Korea [nytimes.com] and Japani [iht.com] take the lead in broadband while America slowly turns into a broadband backwater [blogspot.com].
Hopefully things will work out a little differently in the new administration.
Some Regulation (Score:5, Insightful)
There seems to be a tags issue (Score:4, Insightful)
Looking at the tags for this story (and many others), it seems tags are being used more for comments on the story than as a useful means to group stories by tag. For instance here we have the tags 'corporatewhining' and 'fuckemboth', both of which are most definitely a comment on the story, not a useful tag as such, well, not very useful as comment either, truth be told.
For that matter, the more useless a tag, the more likely it is to be of a derogatory nature.
That's pretty broken really, not even slightly useful as a feature.
Perhaps there should be a list from which people select, such as there is when submitting stories
Mod parent up (Score:3, Insightful)
You can't spend your way out of a bad economic cycle; that's like drinking more beer as a solution to a hangover.
That's a great analogy! You might be able to drink away a hangover, but it's just going to result in a worse hangover later.
Re:government regulation: the devil is in the deta (Score:2, Insightful)
You started off that post great, but it all went downhill in the "Bad:" section.
Using tiny, *tiny*, whole countries as an example is flawed. Over 90% of Japanese live in less than 20% of the total area Japan occupies. To illustrate further, the US could easily bring New York City into the 'fiber to your door' reality for about the same cost of the entire country of Japan. Unfortunately for your argument, 90% of Americans don't live in New York City, or rather, in 2% of the area of the entire USA.
If that were true, it would be very cost effective and easy to roll-out new technologies. This is the same reason that the Japanese didn't get charged when ISDN was rolled out to the entire country, and the same for DSL.
Next time try comparing apples to apples.
Re:government regulation: the devil is in the deta (Score:4, Insightful)
Pretty much.
...the Forbes story makes the case that details of the recent Cogent vs. Sprint fight argue for exactly the opposite: keeping the Internet backbones free of government meddling.
It is, in fact, inconceivable that Forbes would make any other case. Ideology predetermines their arguments, and in this case, the ideology at work is a sort of economic anarchism that, quite frankly, has been completely discredited by the current state of affairs in the US economy. Not all regulation is "government meddling"; some of it is necessary to protect consumers -- and often even vendors -- from dishonesty and short-sighted greed that is often harmful in the long run to the miscreants themselves.
It is at least mildly ironic that the proponents of economic anarchism are often simultaneously proponents of a hardline law-and-order position in other areas of law.
Re:Actually, it was (Score:4, Insightful)
Or they could have done nothing at all. One of the most helpful things for the business environment is stability. Knowing exactly what the government is going to do, because that's what it has always done, relieves a business from expending capital on adjusting to changing conditions.
Of course, no government would ever have done nothing, as the citizens wouldn't have stood for it. But, so long as we're spinning moonbeams...
While we're on analogies: (Score:5, Insightful)
You can't spend your way out of a bad economic cycle; that's like drinking more beer as a solution to a hangover.
While we're on analogies: Government stimulus packages don't - because the money they hand out has to come from somewhere. That somewhere is either additional money they tax away (typically from the most productive - the ones they were trying to "stimulate") or by "printing" (or equivalent) new money which gets its value by pulling value out of the money already out there. And the government handling of this money has costs. The stimulus is always less than the stifling.
So government "economic stimulus" is like trying to lengthen a blanked by cutting a strip off one end and sewing it onto the other. The blanket not only ends up no longer, but even a bit shorter.
(If not for that loss it would be like daylight savings time. B-) )
For more on this see the broken window falacy [wikipedia.org].
Re:government regulation: the devil is in the deta (Score:3, Insightful)
The real question on regulation is if it does more good than harm. The easiest way for me to think about it is as a controls system.
It can be underdamped (no regulation), meaning that the industry will go to extreme highs and lows as companies go for short term profits and take advantage of monopolistic opportunities only to be bitten in the ass by those same policies later. Any slight impact on the industry will send companies fortunes flying high or crashing low. There is also little need to innovate since once you have secured your position you can simply remain there until a competitor begins to make inroads on your market.
It can also be overdamped (too much regulation), meaning that the government is so involved that it is slowing innovation and holding companies to the same playing field even if one has a much better product than the others. Industries will be slow to recover from negative effects and slow to take advantage of new opportunities as they wait for the regulation to catch up with changing technologies.
Of course, it is technically possible for a system to be perfectly damped, where regulation would protect the industry from wild swings while still allowing innovation to flourish. Of course, this is the knife edge that is nearly impossible to walk, especially tech industries that are constantly changing.
In the US, it would seem to me that we are underdamped, telcos are taking short term profits rather than improving infrustructure. If the government could reduce the cost of entry into the market or legislate a maximum cost / bandwidth it would improve the infrustructure immensely.
Re:Actually, it was (Score:0, Insightful)
History says your wrong.
Right wing economists have been pushing this meme for 30 years, but history just doesn't support it. Just take a look at American history prior to 1929. Economic busts and panics every thirty years almost like clockwork. Economic busts where a regular feature of capitalism right up until the FDR began regulating the hell out of the financial industry. And sure enough, Bush removed the regulations and the historical pattern returned.
Begging the question (Score:3, Insightful)
You do realize, I hope, that you are citing the conclusion of your hypothesis as proof of it?
As long as we're on speculative economics in an alternate history, would you care to address the events of 1937-1938?
Network neutrality (Score:4, Insightful)
This is Forbes, after all. According to Forbes, the Great Depression was proof of the need for less government regulation.
How would government regulation help in this case? Peering has to make economic sense for both parties or they wouldn't do it. All that happens after peering is broken is that the routers are reconfigured to send traffic over their transit links instead of the peer links. Ultimately, customers are not hurt (except for downtime because of an unplanned link outage).
The government has no business inserting itself into this agreement. The government is not in the business of understanding the economic conditions that provoke peering agreements.
I recall reading an article a few years ago about how Yahoo gets approximately half of it's total bandwidth for free. It makes economic sense for content providers to peer with content consumers. This is where the net neutrality thing breaks down. Large content providers make sure they create links that make sure their content gets to eye balls quickly. The smaller content providers don't get this privilege unless they use content caching services or they find a co-lo that has a network with plenty of peering agreements already in place. Is it unfair? Yeah, so? That's how the chips fall.
If Verizon finds out that enough of their customer traffic is destined to Cogent, it only makes sense for them to peer. Both Cogent and Verizon have a huge number of peering agreements and I wouldn't be surprised if not having this agreement in place really makes that much of a difference to either one of them.
Mod Parent Insightful or Informative (Score:2, Insightful)
Regulation is required to get some transparency and a better sense of confidence into markets. CDO's are the perfect example.
How big is the market for CDO's? What's the liability to investors? Were counterparties *required* to put up capital? What are the terms of the CDO agreements? What kind of leverage is there in CDO's?
None of those questions can be answered at this time and yet once-mighty investment banks literally vanished overnight with unknown leverage conditions.
Re:While we're on analogies: (Score:3, Insightful)
So government "economic stimulus" is like trying to lengthen a blanked by cutting a strip off one end and sewing it onto the other. The blanket not only ends up no longer, but even a bit shorter.
Incorrect. Because the government can borrow during busts and pay it back during booms, a government stimulus during a recession is like borrowing one of your blankets from summer to keep you warmer in winter.
For more on this see the broken window fallacy.
The broken window fallacy only applies when you are spending on something with no value. That would indeed be retarded. But if the government is spending on useful infrastructure or something else that provides value or creates more room for economic growth, then the broken window fallacy would be irrelevant.
Re:There seems to be a tags issue (Score:3, Insightful)
I agree that tags aren't especially useful, but they're occasionally handy for things like 'badsummary' or 'flamebait.' Hasn't that been one of the requests around here forever--"Can we moderate stories 'flamebait'?"
They're also a great source of funny one-liners: a story the other day about a guy in the military who asked "what can I do about this crappy laptop?" had "chargeback" and "airstrike" as the first two tags.