The FCC vs Us
To better understand the context you should first read ”FCC vs us” .
The Internet is a powerful demonstration of what we can do if given the opportunity.
The battle of Network Neutrality isn’t really about today’s Internet – it’s about the next “Internet”. We can’t imagine what it will be but one thing is certain beyond all doubt – the FCC and the carrier know they must not permit it to happen. The Internet has done enough damage to their industry. Their goal is to maintain the status quo, in which they set the rules of use, access, and even content.
At every step along the way the existing telecom industry has sought to maintain its privileged position. They were granted a “natural monopoly” during the depression in the 1930’s when the marketplace seemed to have failed and the technology wasn’t well understood.
We now understand the technology and we have repeated examples of how well the marketplace works. When we were allowed to connect our own devices we got answering machines not chaos.
Yet the FCC still acts as if the natural monopoly assumption still applied because of transference – its mission was to manage a monopoly. It has no reason to revisit the basic assumption. Its industry is codependent and its ROI comes from conforming to the Regulatorium’s measures the meeting the needs of its customers. It is a folie à deux. The FCC presumes scarcity and thus works hard to manage the available capacity resulting in high prices and thus scarcity.
The Internet is a demonstration of what happens when the FCC is unable to do us favors. But as with any cult, it’s hard to escape when ones entire reality is defined by the cult. After all, we’re talking about an agency that considered the telephony as nothing more than a way for its carriers to deliver services – there was no notion that we would actually own the telephone. It’s madness, I say, pure madness!
From Theirs to Ours!
We own the wires in our homes – how come we don’t own the wires in our communities?
Infrastructure such as roads and power lines exists for the benefit of our communities.
Our communications infrastructure is very different—more like train tracks than streets. We buy services from the carriers just like we buy rides from the railroads.
Today we can choose to drive our own cars over our roads rather than choose to take the train. But we don’t have the option of doing our own communicating over our own “wires” (be they copper, (fiber) glass or even radios).
When the railroads were able to act as gatekeepers we got robber barons. The “natural monopolists” were slicker – the phone companies, in particular ATT (once known simply as The Phone Company) promised benevolence in return for their privileged role in providing communications services.
They delivered on the promise or, at least, seemed to. Given they were guaranteed a return on their “investment” there was no reason to question their business judgment. I put investment in quotes because unlike a real business they were judged by regulators not customers.
The ability to talk to someone else over a telephone is wonderful and without any basis for comparison. Few people can imagine anything better. In fact, American’s had reason for complacency as they had what many considered to be the best phone system in the world.
Absolute benevolence corrupts and in 1956 the US Supreme Court ruled that the carriers had overstepped in banning the Hush-A-Phone, a device which simply clamped on a phone to keep the call private. The phone company argued that it reduced the quality of their service by muting the sound.
It’s easy to ignore the idea that it’s their service. If telephone calls are telephone calls then does it matter?
The FCC has coevolved with the industry and together they have crafted a world that is self-contained. To the FCC a call is defined as complete when the other phone rings. A psychologist would see this is a symptom of a personality disorder. Most people consider a call as complete when someone answers or, at least, if you can leave a message.
But until the 1970’s we didn’t have answering machines in our homes – the phone companies argued that it would hurt their network if we were allowed to attach our own equipment. Again the courts (not the FCC!) found the phone companies were fibbing.
Each time we, the customers, have had a chance to create our own solutions we made the phone network more valuable and increased the usage because we were able to make it meet our own needs. A real marketplace rewards innovation. The phone companies fear the marketplace because it may favor others’ innovation.
Perhaps part of the problem is in the word “customers”. A customer chooses among available products – a user creates solutions. No wonder the phone companies are worried. How could a handful of phone companies compete with millions of empowered users? We aren’t just customers – we are the competition.
In 1984, in an attempt to introduce competition into the marketplace ATT was broken up. ATT cooperated because it wanted to focus on what it considered the more profitable parts of its business. It ceded the users to the regional operating customers and then watched as these users made these “Baby Bells” more valuable than the parent.
We asked for competition but what we got were a lot of phone companies offering us services. We didn’t get the ability to define our own services though we did acquire ownership of the wires within our homes and ownership of our own phones. We could now pay $10 for a phone rather than being forced to rent a $100 phone.
Connectivity in the Raw
Since the 1960’s those of us working with computers were accustomed to creating our own networks using raw wires and some hardware to connect our computers. We didn’t think about the network as a service – we had computers so could program them to solve our own problems. It didn’t matter if a few bits were lost because we could program around it. Even if we had a reliable connection we needed to handle failures like broken wire. Often we just wanted the most recent data and didn’t want the overhead of waiting for guaranteed delivery.
These pragmatic efforts gave us the digital phone network and the Internet. The difference was subtle – the phone companies controlled their entire network. Thus they build a network designed to offer customers choices rather than giving users opportunity.
The original Internet designers couldn’t exercise much control – all they could do was internet-work local area networks across any transport that was available. The LANs used a wide variety of protocols – all they had in common was that they used packets. All the Internet Protocol can do is to make its best effort to deliver the packets to the destination. It cannot understand the meaning of the packets. It can’t even promise the packets will reach the destination!
This lack of control of the network gave rise to the End-to-End principle wherein the network just is a generic transport and all the meaning, including the users definition of reliability, is done at the edge outside the transport itself.
This is the secret of the Internet – if it can handle failure it is not dependent upon the transport. Therefore control shifts from the network operator who just provides generic transport to the users. As we’ll see, the network operator cannot make the network more valuable – both because you can’t have some golden packets and because you don’t know the users requirements—is it better to have timely delivery or guaranteed delivery. The network operator cannot know. This is the real meaning of network neutrality.
The Opportunity Dynamic
This is the dilemma faced by the roulette player. If you place a bet on a single number you’ll almost always lose. But if you wait till the wheel stops you can then take the number and find a use for it. Rather than trying to solve a particular problem, you find a problem that matches the solution! Every number is a winner but only if you don’t care which problem you are solving!
This is the way evolution works and this is the way marketplaces work. The best mousetrap is less valuable than a mediocre one that becomes a very popular cat feeder.
This is what I call the Opportunity Dynamic or, if I can, Frankston’s Law – marketplaces that provide opportunity rather than narrow solutions allow demand to create supply. It’s similar to Moore’s law but focus is on the mechanism rather than physics.
We create our own solutions using whatever is available. It as if we found a bag-a-bits and had to find out what we can do with them. Not much – we could send email and exchange files. Some things worked well on our high speed local networks. They worked less well if some of the connections were slow. A telephone company has to assure that the entire network cannot be better than these slow links – users can choose to take advantage of the opportunities afforded by the high speed links.
In the early 1990’s Tim Berners-Lee defined modest protocols that made it easier for researchers to share their efforts. Because the protocols were simple and open others were able to contribute and experiment with their own variations giving us the World Wide Web.
Few people are programmers or web designers but we must give everyone the opportunity to create solutions and share them – we didn’t know which brilliant idea will fizzle and which will be exciting. Everyone was able to extend the web without having to seek permission – but only a few became widely accepted by the users, AKA, the marketplace.
The Web made the Internet useful for ordinary people. This created a demand for more and more “Internet”. People couldn’t articulate exactly what they wanted but were excited when they got it. The more demand the more supply we got – we got ways to use the packets and just about any packets added to the supply. All the bits were the same so you can’t raise the price except where a carrier controls the supply and can just charge a premium for simply connecting to the rest of the Internet.
We could contrast this with the telephone companies’ futile attempt to sell their digital services – ISDN. They tried to charge a premium for their digital services but found that few customers were willing to pay a premium for digital services. It didn’t make voice calls sound any better so why pay and we were already using modems. The services the carriers tried to provide weren’t worth paying extra for and were typically worse than what we could do for ourselves.
It wasn’t feasible to dial into online services if you had a meter running so we used the analog connections, even if they were slower. But eventually they become nearly as fast as the carriers’ ISDN but without a premium charge! Worse, as David Isenberg notes, the carriers built a network to offer choices thus limiting our ability to make it more valuable. The value is migrating away with the carriers themselves finding it far better to use the Internet than their expensive “phone network”. This is also true for video.
We see the Opportunity Dynamic repeating itself. Each time users get a chance to create their own solutions not only doesn’t the world fall apart, it becomes much better. We tend to want more of the same because that is all we can describe. We might get what we ask for but without essential dynamic that gives us the ability to create what we really want.
We saw this when the carriers tried to give us the so-called “wireless Internet” – it was really more like television. Mobile access is only useful when we have real browsers and open access.
The growth in Internet usage spurred by the web gave us lower prices and more capacity. And people discovered they could use the Internet for phone conversation without making any changes to the network itself. Even more surprising is that the quality can be far better than the traditional network because we aren’t constrained by the presumption of scarcity.
The reason the telephone companies have spent vast amounts of money assuring “Quality of Service” is that they had to find out how little quality they could get away with. Once again our language betrays us – rather seeing quality as a goal, we find that in the Regulatorium quality is a concession.
Gizmo Cults
Videophones failed when the carriers offered them but webcams have no cost so why not make them available – another example of how much more when can do when we aren’t just generating revenue for the carriers.
Today we are dazzled by the features of so-called 3G technology but if you look inside you see rigor mortis in the ossifying complexity. But this serves the carriers’ need to generate billable events. If you used a simple packet protocol people could extend the network themselves and generate their own solutions.
But then how can we pay for the network!
In the FCC world the only option is to pay as you go by buying services. It is unable to take into account the kind of externalities that permit us to fund roads without putting a tollbooth at every corner.
This is the crux of the problem. The FCC’s entire Regulatorium is an intricate system built around the assumption that we are buying services from service provider – telephony and TV. Even the Internet is treated as a service detached from the transport itself.
We pay money to buy services from the carriers and they design a network to maximize their revenue. If we create services ourselves the network becomes more valuable but the carriers get less income.
This entire dysfunctional system was defined during the depression when capitalism seemed to be a failure. Yet by trying to prevent failure we’ve achieved just the opposite, we’ve locked naïve and false assumptions into regulation.
We’ve created a system with large amounts of money invested in maintaining the status quo. It’s all-to-easy to identify the risks but we can’t predict the future. So we placed the bet on the number #7 and fear the alternatives.
Yet the carriers understand that their system is not at all viable – they must prevent effective competition and even say so publicly! They rightly fear neutrality – if they don’t have an advantage they can’t compete with their users – us! They don’t want to repeat the mistake of ISDN. The users can’t be allowed to create their own solutions. But the real lesson of ISDN is that such efforts are futile.
The Tragedy of Dependence
The Regulatorium isn’t really concerned with technology itself. The FCC’s predecessor, the Federal Radio Commission had the responsibility for maintain an orderly market for radio broadcasting. The FCC’s goal was and is to assure that we have communications services. It did so by assuring a viable telecommunications industry even if that means protecting it against us – the users.
In the 1930’s it was necessary to define strict technical standards so that all the elements of our communications system would work together. Without the ability to store the millions of bits needed for a fraction of a second of television the cameras and television receivers had to adhere to strict standards.
The FCC had to do more than define the technical standards. Frequency allocation created the idea of a radio band and the FRC had to allocate a limited supply of bands. It was charged with determining how to best serve the public good.
Even in the absence of scarcity the FCC continues this mission – even to the point of charging $300,000 per dirty word or picture! Wouldn’t it be more appropriate wash the offender’s mouth out with soap?
As we see, each element of the Regulatorium builds on itself reinforcing its assumptions even as the assumptions are proven false at every opportunity.
The regulated industries don’t chafe at these controls – they revel in them. The regulators and regulated co-evolve as part of a single system. Strict regulation protects them from facing a real marketplace. The Regulatorium also meets the political needs of those who want promise to protect us from whatever may go wrong.
The carriers more than willing to pray upon our fears even if their warnings don’t make any sense as when they tell us that only they can provide secure transactions – even if their naïve notions can do real harm.
The tragic irony is that they achieve just the opposite – in each example we’ve seen, whenever we’re given the ability to create our own solutions we do far better than the Regulatorium could possibly do.
The Regulatorium presumes it must make our choices for us. This is a direct violation of the basic principles in the US Constitution.
Those who don’t understand how systems work presume that every system is fragile and would fail unless carefully managed. This was the origin of the Y2K fears. This is a dangerous notion akin to presuming you can cure illness using leeches. It sucks the vitality out of the economy and leaves us weak and vulnerable.
The Internet has proven that we have abundant capacity for transporting bits and the capacity increases as we use it. We gain the benefits of our experiments because failures are contained and success can be shared.
If we are not forced with prescriptive regulations we are free to choose which problems to solve. Why should we put people’s lives at risk by having them dial 911 when we have far better ways to send messages?
Preserving moribund and confining businesses just because they are big shows a deep loathing for Capitalism. It’s socialism and statism at its worst.
The FCC gives voice to those who fear change and don’t understand how systems change and evolve. It is our state church imposing a narrow agenda on the country despite clear evidence of the harm it does and the price we pay.
The FCC is a vehicle of social policy. This is one reason why it is difficult to accept the implications of abundance. If anything, Congress seeks to preserve today’s accidental business model by assuring scarcity as when it imposing the “Broadcast Flag” on us.
Technology does have social implications – if we understand how systems work then we can be far more tolerant of others’ and reap the rewards of disruptive change.
The FCC is embodiment Karl Marx’s dream – it was created at a time when Capitalism was failing with the intention of having the state impose the one correct solution for the good of all. It is erecting barriers to keep us apart rather than giving us the opportunity to communicate.
There is no Real Neutrality.
We have to make a choice between pandering to our fears versus preserving an infrastructure whose primary goal is assuring the welfare of the gatekeepers.
Unfortunately too many identify with the gatekeepers both as business to be preserved and as guardians of our society. Yet we pay a terrible price for this safety.
There is no status quo – stasis is not an option in a dynamic and evolving world.
The ability to innovate and create our own solution is absolutely necessary if we are to survive the unexpected and to excel in a vibrant world economy.
The FCC’s Regulatorium has become a dangerous fantasy mired in the early 1900’s. There is no middle ground – the Opportunity Dynamic is too strong. The only question is whether we continue half-assed measures to maintain the Regulatorium’s fictions or stop working so hard to prevent opportunity.
We must own the infrastructure in our community. This is not a repeat of the natural monopoly. We are all stake holders and can contribute.
Because few people understand the technology we are still mired in the notion that only a telephone (or cable) company can give us a service like telephony. The might be aware of Skype but don’t see that it demonstrates that we not only create the services ourselves -- we invent the services.
The Procrustean Regulatorium has forced us to deny ourselves this ability. The Internet is treated as just another service rather than the raw material for creating our own solutions.
The Internet is not a service – it’s just the way we use existing transports. We must choose between the fantasy world of the FCC and the Internet. There is no middle ground.
We can each create our own networks at home, in our communities and across larger regions till the world is connected with copper, glass and radios. It’s basic infrastructure we use to create value and create our future.
The idea of “network neutrality” gives credence to the idea that we must be allowed to create our own solutions. We shouldn’t be “allowed”, it’s our infrastructure and our future. We cannot tolerate the FCC taking what is ours and handing it over to carriers whose goal is to maximize their profit while denying us opportunity.
The FCC and their children see us as a threat to their future. Let’s prove them right by creating opportunity so we can discover our own future
