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Networking The Internet Entertainment

First Detailed Data Analysis Shows Exactly How Comcast Jammed Netflix 243

An anonymous reader writes John Oliver calls it "cable company f*ckery" and we've all suspected it happens. Now on Steven Levy's new Backchannel publication on Medium, Susan Crawford delivers decisive proof, expertly dissecting the Comcast-Netflix network congestion controversy. Her source material is a detailed traffic measurement report (.pdf) released this week by Google-backed M-Lab — the first of its kind — showing severe degradation of service at interconnection points between Comcast, Verizon and other monopoly "eyeball networks" and "transit networks" such as Cogent, which was contracted by Netflix to deliver its bits. The report shows that interconnection points give monopoly ISPs all the leverage they need to discriminate against companies like Netflix, which compete with them in video services, simply by refusing to relieve network congestion caused by external traffic requested by their very own ISP customers. And the effects victimize not only companies targeted but ALL incoming traffic from the affected transit network. The report proves the problem is not technical, but rather a result of business decisions. This is not technically a Net neutrality problem, but it creates the very same headaches for consumers, and unfair business advantages for ISPs. In an accompanying article, Crawford makes a compelling case for FCC intervention.
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First Detailed Data Analysis Shows Exactly How Comcast Jammed Netflix

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  • by Anonymous Coward on Thursday October 30, 2014 @03:46PM (#48272517)

    Bennett Haselton is a frequent contributor, and I tend to hold-off judgement on these things until I read his fine points on the topic. I was recently particularly moved by his work on line queues at Burning Man. It changed my entire life. I now piss sitting down.

  • Sigh... (Score:5, Insightful)

    by MightyMartian ( 840721 ) on Thursday October 30, 2014 @03:47PM (#48272533) Journal

    "In an accompanying article, Crawford makes a compelling case for FCC intervention."

    That won't work unless it comes with a check with seven digits attached to it.

  • Common Carrier (Score:5, Insightful)

    by Anon-Admin ( 443764 ) on Thursday October 30, 2014 @03:49PM (#48272559) Homepage Journal

    Once again, a call for net neutrality will ensue. All we really need is for the FCC to call them Common Carriers and apply the age old law.

    It has already been applied to Telecoms and Utilities, just apply it to the ISP's and be done with this crap.

    http://en.wikipedia.org/wiki/C... [wikipedia.org]

    • Re:Common Carrier (Score:5, Informative)

      by Burdell ( 228580 ) on Thursday October 30, 2014 @03:59PM (#48272669)

      That would have zero impact. This is like the telephone company in city A have 96 channels to the telephone company in city B, but then 100 people try to make calls. Only some of them will go through, and that's a capacity issue, not regulated by Common Carrier status. They are not discriminating based on callers or anything, they are just "decliining" to upgrade capacity. In some cases, that could be regulated by state PUCs/PSCs, but AFAIK it is not normally. It is just up to the two carriers to reach an agreement.

      This type of thing happened a lot in the early dialup ISP days, when telecom deregulation spawed a lot of CLECs that had to connect to ILECs to carry calls. The ILECs structured the contracts with settlement money for to flow to the destination of a call (thinking most of the CLEC calls would be _to_ ILEC users), but then the CLECs went and got all the dialup ISPs to move modem banks to them. Suddenly all the calls went _to_ the CLECs, and the ILECs had to pay (some did not and went to court instead).

      • by Krojack ( 575051 )

        But with internet bandwidth, you have have overflow connections that are sitting dark and if needed just light them up and data will be flowing within seconds. This can even be automated. As traffic starts to fall off, turn those connections off.

      • Re:Common Carrier (Score:5, Insightful)

        by Jason Levine ( 196982 ) on Thursday October 30, 2014 @04:30PM (#48272977)

        It's more like Phone Company A has 100 channels to Phone Company B. They notice that there is a constant level of 99 calls between A and B. They also see that 25 calls are constantly being made to Joe's Pizzeria who uses Phone Company B for phone service. Phone Company A gets upset that Joe's isn't paying them (Phone Company A) for this traffic, so they refuse to add more channels. (Even though doing so would be inexpensive to do.) So calls to Joe's Pizzeria begin being dropped and Joe's customers get mad that they can't get through. Joe's finally signs an agreement with Phone Company A paying them money and suddenly the calls go through just fine.

        This is extortion plain and simple. Add in the fact that the ISPs doing this have an Internet monopoly/duopoly in their areas and also tend to provide video services - that Netflix competes against - and you have extortion plus the use of a monopoly to crush competition in another market. This deserves swift and severe action to show the ISPs that this is NOT to be tolerated. Unfortunately, at best we'll get a strongly worded statement and perhaps a fine that Comcast will make back in the time it took me to write this comment.

        • True enough, but Joe's is big enough to actually pay the extortion, which most of the colaterally damaged companies using company B's phone line can't; so it's really an example of "When Elephant's fight, the mice get trampled".

      • by mysidia ( 191772 )

        That would have zero impact. This is like the telephone company in city A have 96 channels to the telephone company in city B, but then 100 people try to make calls. Only some of them will go through, and that's a capacity issue, not regulated by Common Carrier status.

        That's not the scenario. It's not capacity between cities, in this case, it is capacity between networks. The problem is they are discriminating against some networks and refusing to build capacity at the same time as they are building

    • by suutar ( 1860506 )

      And the cable companies get their shills in congress to tell the FCC "they are not common carriers, try again"

    • No help as they can work around that. What is needed is to allow local last mile competition. Right now the incumbents are paying off or suing cities that try to allow it. But look at the cities that got Google fiber. Suddenly, all of the incumbent carriers got so much better...
    • An easier solution would be to move speedtest [speedtest.net] to cogent, speedtest always rocks, no matter how slow the rest of the net is!

    • Once again, a call for net neutrality will ensue. All we really need is for the FCC to call them Common Carriers and apply the age old law.

      It has already been applied to Telecoms and Utilities, just apply it to the ISP's and be done with this crap.

      http://en.wikipedia.org/wiki/C... [wikipedia.org]

      Can't mod you up so ... Amen brother! Amen!

  • by lgw ( 121541 ) on Thursday October 30, 2014 @03:53PM (#48272601) Journal

    Stuff like this is why I think Net Neutrality discussions miss the mark - you're not going to fix the problem that way, you're only going to cause the cable companies to achieve the same throttling through other technical means. Trying to close technical loopholes via the lawmaking process requires a body of law the size of the tax code.

    The fundamental problem is that companies with a legally-granted monopoly for delivering high-speed internet are also allowed to sell content. In a free market, that wouldn't bother me - competition would sort it all out. But "last mile" is about as far from a free market as you can get in most of the country these days, and so we get this as a result.

    Last mile needs to become a public utility. Let vendors compete for my business, and I'll pick "just a pipe" or a content company or whatever mix fits my needs.

    • Stuff like this is why I think Net Neutrality discussions miss the mark - you're not going to fix the problem that way, you're only going to cause the cable companies to achieve the same throttling through other technical means.

      You can make crap like this illegal, in fact it arguably already is without net neutrality legislation.

      • by AK Marc ( 707885 )
        Nope. The anti-trust cases have ended up (successfully) arguing that a monopoly isn't a monopoly, if you have choice. You can choose to move states and get different choices, so you aren't "locked in".
        • by tepples ( 727027 )

          You can choose to move states and get different choices

          Which court in which case used this as an argument in its opinion to dismiss an antitrust action?

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      "Last mile needs to become a public utility. Let vendors compete for my business, and I'll pick "just a pipe" or a content company or whatever mix fits my needs."

      I think you have that backward.

      The backbone should be a public utility. The gov't should assume the responsibility for the massive infrastructure required to build the backbone. Then its easy for any small mom/pop ISP to connect to the public backbone for a nominal fee and provide last mile service to their area when they are unhappy with the cur

      • by sabri ( 584428 )

        The gov't should assume the responsibility for the massive infrastructure required to build the backbone.

        Ah yes, with fibertaps everywhere.

        No thanks.

    • by alen ( 225700 )

      there is no legal monopoly, the cost is too high.

      FIOS only has on average 40% of potential customers in the markets they serve. it's impossible to borrow enough money to build out a last mile network and make a profit after you account for advertising and operational costs

    • You are totally correct here. ISPs should only be allowed to be content producers, or content distributors, IF they relinquish all their monopoly statuses with local municipalities. Comcast, Time Warner, etc should be taken to court under anti-monopoly laws in the US. As they are guaranteed monopolies and their behavior is definitely harming consumers and they are trying to leverage their monopoly in one sector to give them an unfair advantage in a different sector, this seems a rather simple case, but w

    • by nine-times ( 778537 ) <nine.times@gmail.com> on Thursday October 30, 2014 @04:35PM (#48273043) Homepage

      The fundamental problem is that companies with a legally-granted monopoly for delivering high-speed internet are also allowed to sell content.

      I agree with this part of your post, at least, and have been making the same argument for years. If the companies providing the infrastructure were not making money from selling content, and were only serving as "dumb pipes", then their business incentive would be in pushing customers toward higher-bandwidth (and therefore more expensive) connections. In that business model, companies that can provide content to saturate slow connections become very important, and so it seems likely that they would be falling all over themselves to provide a better connection to Netflix.

      Instead, the Infrastructure providers have no incentive to increase content availability, because any piece of available content becomes competition for the content that they are trying to sell. That's a bad system. Unless you have an effective regulatory system, the ISPs will find ways to push towards a walled garden AOL-style internet, charging for access outside of the walled garden.

      However, I don't think this is an example of "net neutrality" missing the mark. Net neutrality is a concept, and divorcing infrastructure providers from content providers is one way in which net neutrality could be promoted.

    • by nehumanuscrede ( 624750 ) on Thursday October 30, 2014 @04:55PM (#48273215)
      So the fix sounds easy, but gets complicated quickly. :|

      Break them up. Don't think about it, threaten or consider it. To borrow a phrase from Nike: JUST DO IT

      Force the companies who provide the bandwidth to split from the part of the company who sells content so there isn't any grey area issues. In order for the bandwidth side of the house to remain competitive, they'll need to upgrade their network to ensure they're delivering what their customers want. This also prevents the content folks from tweaking the network to ensure their own services get priority over competing ones. Taken to an extreme, and without some sort of oversight, the big players can absolutely destroy the competition in this manner.

      They've already proven they can't be trusted to do the right thing themselves. Time to step in with a big stick and start swinging.

      Of course, true competition needs to be in place to help fuel that fire otherwise we'll still end up with crappy throughput with no realistic choices of switching to another provider. We really need to end this whole regional mono / duopoly thing.

      On top of this, we'll need to purge the Congressional votes-for-contributions types to make sure the legislation has a fair chance of happening.
    • Last mile needs to become a public utility.

      "Reform this! Reform that!"

      Everybody keeps saying that like it's going to magically happen by some miracle.You think the politicians currently in office are going to let that happen? Especially when they have 95% chance of being reelected no matter what they do? When voting, know who/what your politician is representing, and then decide if you want the same thing. Their records are easy to find now, and you can stop believing the lies they tell you on the TV. When

      • by lgw ( 121541 )

        Well, this is rigged at the local level, so it's possible to fix it at the state or federal level. Local government is often more responsive, but when it's corrupt it generally can't be fixed at that level. I love to see a state step up and do this - force "last mile" into a utility wherever it locally has legally-granted monopoly status. State governments can also be fairly responsive, at least when issues don't touch car dealerships.

        • It doesn't matter what level you're at. The politician represents his financiers, or he receives no financing. Our obligation is to seek out those that aren't on the organ grinder's leash between elections so we have somebody to put on the ballot. That's how they do it, and it shows.

    • I'd be basically OK with it if they were allowed to charge the peer for the (actual and reasonable) cost of the upgrade and no additional fees were charged, even though they would be willing to meet half way were it not in competitive relationship. We'd almost need to force them to split their businesses into separate walled off cable TV and Internet businesses to end the large incentive to squelch competition for eyeballs on the screen. If they offer better peering deals to some transit providers and worse

  • OK, so people had to implement this blocking, right?

    And it had to have been more than one person, right?

    How many individuals would have to have been active and knowingly involved in order to implement such blocking?

    From that number, how long until someone straight-up comes out and says they did it and exactly how they did it? You know, instead of having to rely on this external third-party reverse engineering.
    • by MozeeToby ( 1163751 ) on Thursday October 30, 2014 @04:06PM (#48272731)

      Engineer - "Hey Boss, we need some cash to upgrade the connection to these networks."
      Boss - "What?! We just upgraded those connections a couple years ago"
      Engineer - *rolls eyes* "Well the link is saturated, looks like lots of people watching online video... Netflix comes in over this connection so it makes sense"
      Boss - "First they take our subscribers now they're forcing us to upgrade our equipment... well fuck em!"
      Engineer - "Waaah?"
      Boss - "You heard me, fuck em!"
      Engineer - "But... our customers will get terrible service when they try to watch Netflix, or do anything else on that network for that matter"
      Boss - "Exactly!"

      • Replace the Boss' last line with:

        Boss: "Oh, boo hoo! What're they gonna do? Leave us and go to another ISP? We've got a monopoly in the area! They want Internet? They need to come to us. Besides, if we make Netflix look bad, maybe people will dump them and pay us $200 a month for cable again!"

      • by torkus ( 1133985 ) on Thursday October 30, 2014 @05:03PM (#48273307)

        Actually netflix offered to foot the bill for upgrading the bandwidth - it's literally a couple cross-connects in a datacenter, maybe a fiber card or two.

        Oh, and netflix ALSO offers to drop a server in your datacenter *free* which caches all the common netflix streams. This reduces the internet bandwidth demands by something like 90+% since it lives within the ISP's datacenter and just needs to download each stream once.

        But the last line is exactly the point. The ISPs are also TV providers and they don't want you to have a good netflix experience. If they can passively let that happen...well of course they will. No one can accuse them of taking any action to damage your netflix streaming...it's their complete inaction that's resulting in it.

        • The ISPs are also TV providers and they don't want you to have a good netflix experience.

          Then ask about a specific work to which Netflix has the rights and the TV provider division of the ISP does not. "I'm having trouble watching House of Cards at home. It works fine on $different_isp_next_town_over. Might this be a problem with Comcast?"

      • There's too much revisionist history in the Boss's statement for my tolerance. Boss- "First they take our subscribers now they're forcing to upgrade our equipment... well fuck em!" First they had subscribers, then Netflix introduced the online version of their service (circa 2008) bringing in more subscribers, then Xfinity got added (circa 2010) offering the speeds demonstrated by Netflix carried by Comcast but with a selection of Comcast's cable offerings. fast forward a few years and Netflix is still the
      • /Oblg.

        South Park - Cable Company
        https://www.youtube.com/watch?... [youtube.com]

  • by jschultz410 ( 583092 ) on Thursday October 30, 2014 @03:56PM (#48272641)
    and not a net neutrality issue thankfully.

    Settlement free peering between tier 1 carriers only happens when the flow of traffic is roughly balanced between the contracting peers.

    When one peer is pushing a lot more traffic onto the other network, then that usually goes out the window and the pusher is required to pay the receiving network. Otherwise, networks would be monetarily incentivized to unload traffic they should carry on their own networks onto their peers' instead.
    • Re: (Score:2, Funny)

      by 0123456 ( 636235 )

      I'm sorry, but your post is too sensible and informative for today's Slashdot, where technological knowledge takes a back seat to 'stick it to the man!' outrage.

      • Re: (Score:2, Informative)

        by Anonymous Coward

        Sensible?? More like nonsensical and completely misses the point of the article. As a great many people have pointed out, this is not unsolicited traffic, but traffic requested by Comcast's customer. So where on earth do you get the idea that

        "When one peer is pushing a lot more traffic onto the other network, then that usually goes out the window and the pusher is required to pay the receiving network."

        has ANY relevance to this story? Given what has been reported as the "trivial" costs of upgrading the inte

    • by Burdell ( 228580 ) on Thursday October 30, 2014 @04:04PM (#48272721)

      Traffic balance is not the primary measure these days (from what I understand), it is just an economic decision. However, the Netflix case is interesting, because they were essentially used as a leverage tool by Cogent against the other carriers. Cogent has a long history of trying to get settlement-free peering, not meeting contract terms (whatever they are), getting dropped, and then blaming the other side. They have long wanted to be a settlement-free "tier 1" provider (which is a nebulous term, but go with it), but have generally not been. They sell bandwidth often at below-market rates in order to attract customers to leverage against the other "tier 1" providers. They saw Netflix on the rise and grabbed them, apparently selling bandwidth much cheaper than any other backbone (possibly at a loss even) in order to leverage settlement-free peering contracts out of other providers.

      Any network engineering with a clue knows that you never buy bandwidth only from Cogent (or even Cogent and one other provider), because you _will_ get disconnected from somebody when Cogent gets in another peering dispute.

    • Re: (Score:3, Insightful)

      by PPH ( 736903 )

      When one peer is pushing a lot more traffic onto the other network,

      Simple fix: A Netflix client that echos the content back to the source server.

      Problem fixed.

    • by Anonymous Coward on Thursday October 30, 2014 @04:10PM (#48272771)

      When one peer is pushing a lot more traffic onto the other network, then that usually goes out the window and the pusher is required to pay the receiving network.

      They're not pushing the traffic - the other network is pulling it. Netflix's traffic is not unsolicited - every goddamned packet is being sent in response to a specific request from the other network's customers, and it's not fucking transit - the Netflix packets will terminate within the receiving network. Are you seriously arguing that Comcast should be paid by Netflix because they're carrying gigabytes of Netflix traffic their own fucking customers requested?

    • Re: (Score:3, Insightful)

      by waldozer ( 1204634 )
      I think you have it backwards. Netflix does not "push data" to Comcast. Comcast customers "pull data from Netflix".
      • Netflix does not "push data" to Comcast. Comcast customers "pull data from Netflix".

        It doesn't matter. There is an imbalance of the data flow through the peering connection.

        Comcast doesn't guarantee data rates to off-network content providers. It can't, or you'd be paying even more outrageous rates for service from them.

        Here's why. Imagine Comcast has 2 million subs. I don't know the numbers, but let's use that for argument. They each have 50Mbps service. That means that EVERY PEER CONNECTION that Comcast has would have to be at least 100,000,000 Mbps to guarantee full rate to every sub

    • Settlement free peering between tier 1 carriers only happens when the flow of traffic is roughly balanced between the contracting peers.

      When one peer is pushing a lot more traffic onto the other network, then that usually goes out the window and the pusher is required to pay the receiving network.

      So you're saying if Netflix downloaded more data from Comcast than they sent, that Comcast should pay them?

      I have no problem uploading an amount equal to what I download from Netflix, or even more, if you really think that will solve the problem. I don't really control the software on my Roku box, but I don't mind if Netflix puts some P2P software on it for help carrying their own traffic.

      • So you're saying if Netflix downloaded more data from Comcast than they sent, that Comcast should pay them?

        If Comcast was the source of the data that was creating congestion on a Netflix-to-peer link, I'd say yes, I think Comcast should have a part in paying for the increased bandwidth required to carry their data.

        I have no problem uploading an amount equal to what I download from Netflix, or even more, if you really think that will solve the problem.

        Who said that would solve the problem? All it would do is make Netflix less responsible for paying for the upgrade, not that the upgrade would happen.

        There are two problems here. The first is a limited bandwidth connection is being congested (and all connections are limited in some way.) The second

    • Got it, but where does the fact that the traffic has been requested by the users the target network play into it? The more appropriate term here is "puller" as opposed to "pusher". The traffic would not be there except for the end network requesting it in the first place.
    • by suutar ( 1860506 )

      Except that the recipient (me) is already paying Comcast to deliver the bits. If they want to go to sender pays, then I get to start charging them for traffic that they send to my house.

    • I agree, why should Cogent need to supply all this throughput that Comcast's paying customers are asking for!? Waaaaaiit a minute....

    • by Xipher ( 868293 )

      Eyeball networks didn't usually get settlement free peering to begin with. Until you had these huge eyeballs form like Comcast that kind of peering was between the transit ISPs themselves. Comcast used to be a customer of these ISPs, and didn't get the peering agreements until they started congesting links by dropping transit services. I found information on this discussed on the NANOG mailing list from 2010, so this has been going on for a number of years already.

    • by AK Marc ( 707885 )

      When one peer is pushing a lot more traffic onto the other network, then that usually goes out the window and the pusher is required to pay the receiving network.

      When did this change? In the Early Days, the puller paid, not the pusher. Hosting servers in datacenters was almost free, as upload bandwidth was "free" to the ISP. I pay my ISP to get the Internet. If their connection to the content I want isn't good enough, my ISP, not the other side, should pay to fix it. Puller pays. Otherwise, my ISP should be paying me to be their customer for generating demand that they make money from.

  • by Anonymous Coward on Thursday October 30, 2014 @03:59PM (#48272675)

    I should be able to use my bandwidth any way I please! It's freedom of speech! They can't throttle netflix! George Bush would be rolling in his grave!

    This is a ploy from Obama to help spread misinformation about ebola (Obola) on his path to further to destroy the country!!1!

  • The report proves the problem is not technical, but rather a result of business decisions.

    Is anybody actually surprised by this?

    This has always been about maximizing profits, and preventing a competitor from gaining access to your customers.

    Because cable companies are ran by assholes.

  • I assume there's a reason why Netflix hasn't perused the idea of load balancing across CDNs? Yes, it'd be a pain in the ass, but I know both Akamai and Limelight will read from your source to deliver bits to an end user.

    It'd be a hell of a lot better than buckling to ISPs. At least you're in control of your costs at that point.

    • by bill_mcgonigle ( 4333 ) * on Thursday October 30, 2014 @04:34PM (#48273021) Homepage Journal

      Netflix is its own CDN - they will give, for free, one or more caches to any ISP, causing any one movie to transit the ISP's nonfree network connections only once.

      But this is about competition for video services, not caching.

      • by killfixx ( 148785 ) * on Thursday October 30, 2014 @04:51PM (#48273181) Journal

        This is a very salient point. Netflix already has these arrangements with other ISPs. Only Comcast, AT&T, and Verizon (surprise surprise) refused to host local caching servers. Of course, this precedes their demands for more money because, "Waaaahhhh...they're stealing our customers, they need to pay!".

        Netflix tried to be the better entity (within reason) and were told, in no uncertain terms, "Go fuck yourself."

        Yay, free market!

        *sigh*

      • by alen ( 225700 )

        except CDN's have paid ISP's for years for hosting costs. netflix refuses to pay and wants their CDN hosted for free

        • Re: (Score:2, Interesting)

          by Anonymous Coward

          This is complete nonsense. Google and Akamai both place hardware just inside ISP borders at no cost. They don't pay the ISPs to do this, the ISPs are saving a shit-ton on transit and are happy to set aside a little space and electricity for the hardware. This includes Comcast. Try doing a traceroute to 23.79.61.240 for example, this is one of at least a dozen Akamai servers sitting in a Comcast cage in Atlanta. Akamai is paying zero dollars for that.

          Netflix offered the same arrangement and Comcast said no,

          • by jcam2 ( 248062 )

            1 - What evidence do you have for how much Comcast charges Google or Akamai for placing hardware at their facilities?

            2 - Google is just as much a competitor to Comcast via Youtube and the Google Play movies store. Why is only Netflix being targeted?

    • They have but they didn't want to pay anything close to the costs of what Akamai charges or anything close to the costs Akamai has to host their CDN.

      Admittedly, they may have some weird stipulations going on with copyright and all that jazz.

      • by PRMan ( 959735 )
        All kinds of wrong. They will provide a server box to be housed in the ISP containing their most popular content FOR FREE.
  • On the summary, not the article. Comcast wasn't "jamming' Netflix. Jamming is an active response. What Comcast did was nothing. Now whether they should have done something about the overflowing links is the argument, but that's a far cry from "jamming."
  • by carrier lost ( 222597 ) on Thursday October 30, 2014 @05:05PM (#48273341) Homepage

    "Similarly, M-Lab's data shows that the problem wasn't a lack of bandwidth on the part of the ISPs (i.e., no actual technical congestion), because those same ISPs had no problem connecting to a different transit provider, Internap. So the only logical culprit was the interconnection points. There was more than enough bandwidth to go around. There's just the single bottleneck of the interconnection border router (which, again, is trivially simple to get rid of by opening up more ports)."

    link [techdirt.com]

    • by Svartalf ( 2997 )

      Basically, it was a pissing match like people claim it was. Something that USED to be called out on the carpet over- because it's violating common carrier status that the jokers in question all have and alternately want and don't want. (They don't want the regulation, but they want the shield from vicarious liability from their customers' actions...)

  • by Jodka ( 520060 ) on Thursday October 30, 2014 @05:51PM (#48273731)

    from wikipedia [wikipedia.org]

    Franchise fees are governed under Section 622 of the Cable Communications Act of 1984.[2] Section 622, states that municipalities are entitled to a maximum of 5% of gross revenues derived from the operation of the cable system for the provision of cable services such as Public, educational, and government access (PEG) TV channels.

    Franchise fees are fixed at a maximum of 5% of gross revenues. So how do municipalities maximize revenues from franchise fees? By maximizing cable company gross revenues. And how do municipalities maximize cable company gross revenues? By creating monopolies! By awarding exclusive license to one provider to extract monopolist profits from the public.

    Note that there is nothing inherently wrong with permitting local governments to charge cable companies fees. That is justifiable to the extent that local governments incur costs of infrastructure repair with damage from cable installation. All that is needed is a single addendum to the law, one prohibiting local governments from creating monopolies. The law could simply mandate that municipalities must offer franchise licenses to all ISPs if they offer licenses to one and that all licencees must be be charged at the same rate.

    The only reason we have cable monopolies in the U.S. is because the Cable Communications Act of 1984 created that perverse incentive. Other countries without such laws have much faster service at much lower prices.

    If federal law permitted local governments to do this sort of thing with groceries, computers and cars we would have regional monopolies for those products as well. Be grateful that your town council is not permitted to sell grocery, computer and car franchises.

    • by Svartalf ( 2997 )

      The biggest problem without them is you'd end up having a tragedy of the commons. How would any of them intercommunicate to allow the Internet to be.

      One of the things you can do is harshly punish the ISPs in question when they play games like this. One of the things they have right now is "common carrier" status. That's a liability shield against all sorts of things that your customers might do that's illegal. You could be held vicariously liable if you don't have that status and they commit acts of sed

  • Going with the notion that excessive regulation has it's own cost, maybe the solution here is to split up the cable giants? Comcast could easily be three separate companies- one that manages infrastructure and charges for it, one that sells TV channels to customers, and one that sells internet. The two later companies would just lease bandwidth from the former.
  • Listen, we will get what we want right now by turning big monopoly ISPs into utilities.

    However, we have to think strategically. If we only think tactically we will get out maneuvered.

    Play chess for a moment. What happens when the big ISPs are utilities? Yes, they will be regulated more heavily but they will also have their protection from competition enshrined more deeply in law.

    What is more, the federal government will gain increasing control over the internet. Consider the NSA for example. Do you for an i

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