Net Neutrality: Just Like the Railroad Robber Barons or Disneyland’s Indiana Jones Ride
With so much confusion around such an important topic, Billboard explains the convoluted issue via the magic of analogy.
The issue of “net neutrality” has been steamy for some time, and now finally looks ready for a full boil. It received an oblique mention in this week’s State of the Union Address, is the subject of bills being disussed today in both chambers of Congress, and concern for the issue prompted millions of letters to the Federal Communications Commission ahead of a planned ruling on February 26th — the most letters received by the Commission since 2004 when Janet Jackson‘s Super Bowl nip slip caused a furor.
And yet the concept of net neutrality is, it seems, still not well understood by the general public, despite a barrage of explainer posts, op-eds and mainstream media coverage over the past year and change. This is, at least partially, the result of a pitched battle to control the message, a fight which features some of the nation’s largest lobbying groups on either side. But a large part of the confusion is due to the irreducible political and technical issues at stake. How many Americans understand how the internet works, or the esoteric powers of the FCC?
The commonly accepted alternative to a full exegesis of the finer points is to revert to analogy. So let’s try a couple.
Any time the U.S. Government attempts to regulate business to protect the public interest, the history of railroads in this country is a good place to start looking for analogues. In the case of net neutrality, there are plenty of similarities. By the late 1800s, the industrialists who controlled the rails had not only transformed commerce in America, opening entirely new markets and stimulating others, they had also consolidated themselves and exerted enormous political influence through their lobbying. The robber barons were at least as unpopular in their day as Comcast and AT&T are in ours.
The Interstate Commerce Commission was established in 1887 to regulate the railroads, in many of the same ways the FCC proposes to regulate internet service providers: enforcing transparency in pricing and services, and outlawing discriminatory practices over who was allowed to ship things over the rails.
In this metaphor, the ISP’s are the Robber Barons — “Time Warner Vanderbilt” — and content providers like Netflix and Google are the new industrialists, dependent on access to the transmission infrastructure in order to conduct their business. Ultimately, the Barons were forced to cede regulatory authority to the ICC, their monopolistic practices were (somewhat) curtailed, and America’s railroad-powered industrialisation marched on.
It deserves to be remembered that the passage of the Interstate Commerce Act in 1887 was the result of a decades-long movement, much of it consisting of grassroots lobbying efforts by coalitions of farmers and small business, over the course of which the Barons did their damnedest to stay the hand of the government, though their resistence was finally overcome. It’s also worth noting that though the the Act gave aggreived parties a legal basis on which to contest the practices of railroad operators, the courts subsequently ruled largely in the railroads’ favor.
Also worth mentioning is the fact that the designation eventually applied to the railroads is the same one at stake in the net neutrality fight: common carrier status. Recently, both President Obama and FCC Chairman Tom Wheeler have voiced support for regulating service providers like Comcast as operators of “common carrier” networks, and companies such as Netflix and Google have favored this option. The common carrier status currently applies to disparate concerns like airlines, theme parks, telephone networks, parcel services, department store elevators and, perhaps quite importantly, enterprise broadband internet provision.
It needs to be made clear that common carrier status is not the same as being a “public utility.” Local electricity, water and gas companies are utilities, not common carriers. This distinction is crucial. Many opponents to the internet being regulated as a common carrier have been arguing that doing so would turn the internet into a public utility, and thereby stifle innovation and investment. The industries noted above — airlines, parcel services, etc — are not stiflingly regulated — they are highly competitive, demonstrating that common carrier status is compatible with such business.
Whew. That was a good one. It’s helpful that the railroads existed before they were deemed a common carrier, providing a glimpse of what a non-neutral network looks like in the wild.
This one is complicated, since what is at stake in net neutrality is largely whether broadband internet should be regulated in the same way as wired telephone networks and cellular networks are. For many people this might seem obvious, especially since phone service often comes from the same corporations that provide internet service, and “voice” is just one of many types of data transmitted over the wires.
But the 1996 Telecommunications Act makes a key distinction between voice telephony service and “information service”, and applies a separate regulatory regime to each.
What would it be like if telephone networks weren’t common carriers?
Imagine it is the 1980’s and there’s a particular neighborhood with a huge population of teenagers, all talking on the phone constantly, and that hood was subjected to higher rates.
If the same regulatory vacuum that currently applies to the internet applied to television, then all channels could be premium channels, or a few companies could create virtual monopolies in providing bundles of channels at rates of their choosing and we wouldn’t have the robust local access television industry that … wait, nevermind. That actually happened.
If parcel services like UPS and FedEx were not considered common carriers, they could force big volume shippers like Amazon to “pay-to-play,” which would probably rapidly accelerate the phenomenon of Amazon developing its own delivery services.
This analogy almost seems to fit, since the net uptick in deliveries occassioned by the rise of ecommerce is similar to the uptick in bandwidth usage occassioned by the rise of streaming services like Netflix and Youtube (and porn), which together make up a huge proportion of traffic on the wires and are central to the arguments for the creation of “internet fast lanes.”
The effect for regular consumers would be that UPS shipped your packages much more slowly than those originating from Amazon, which would get priority.
It’s also clear in this example that the only feasible way for FedEx and UPS to cope with the increase in demand due to innovation in ecommerce was to put more (and perhaps bigger) trucks on the roads and continue to refine their logistics. They improved. Similarly, the way that Comcast, et al, can avoid slowdowns would be investment in improving the fiber networks that underpin the internet. The ISPs have argued that regulatory uncertainty and the spectre of common carrier designation make such investments more risky. Internet speeds in America languish behind those of other rich-world countries, and this intensifies the current regulatory battle.
Admittedly, there aren’t a lot of parallels here. But in 2005 the Civil Court decided that amusement park rides — specifically the Indiana Jones ride at Disneyland — should be considered common carriers: for a fee they “carry” anyone (as long as you are this tall, of course), are responsible for any damage that befalls a rider during transport, and must be made safe and fit to carry their precious, thrill-seeking cargo. Disneyland’s lawyers contested that the rides should be considered instead as entertainment. The court decided they were both.
This might apply somewhat in that the internet is many things — it is a way for citizens to communicate with one another and a platform for all sorts of services and entertainment. At times it may seem that attempts to regulate the internet within a framework developed for older technologies is a matter of a square peg and round hole. But, the principles applied in the late 19th century to regulate railroads might still be applied to this very different domain, rather than rewriting the laws and setting up unique regulatory paradigms every time a new technology rears its world-changing head.