How the Google/Verizon Proposal Could Kill the Internet in 5 Years
Earlier this week Google and Verizon pledged to uphold a set of network principles that could transform the internet into a husk of its former self. Let's look down the barrel of the Googlezon* future.
Keep in mind that the two-page Googlezon proposal, which you can read here, isn't law, though both companies have requested that the Federal Communications Commission (FCC) turn it into a formal regulation. Even if it isn't law, though, Googlezon has stated it will follow the proposal's principles. And mostly those principles are harbingers of a dystopian media future.
Quick backgrounder on net neutrality
The Googlezon agreement was written partly in response to public interest groups and lawmakers lobbying for the US government to mandate "net neutrality." In a nutshell, net neutrality means that internet service providers like Verizon have to deliver everything – data, services, whatever – in a "neutral" way. For example, if we had net neutrality laws in the US, Verizon wouldn't be allowed to do things like make Gmail run faster than Facebook. Neither would Verizon be able to "prejudice" its consumers against certain services, for example by making any peer-to-peer traffic run really slowly.
Google has always been a staunch supporter of net neutrality, since its income depends on people being able to access the company's services quickly online. Imagine if Verizon demanded that Google pay extra to prevent YouTube from giving you the annoying twirly circle. Google's business model would be crippled, and you would probably have to start paying for YouTube access.
But nobody has successfully implemented net neutrality laws in the US. So if Google wants to protect its business, it has to make deals with companies like Verizon. And here's where things get ugly.
The internet becomes a pay-to-play medium
The the Googlezon agreement includes a section where both companies pledge to keep the "public internet" completely neutral. Verizon says it won't privilege some services over others (unless they are "special services" or "mobile services," but we'll get to that). And for its part, Google pledges that it will keep all of its services on the public internet.
But what the hell is this "public internet"? Isn't all of the internet public? Obviously there are internal business and government intranets that are private, and pay-to-play services, but the internet itself is by definition public. So why all this talk from Googlezon about how they'll keep the public internet neutral?
One simple answer, my friend: Googlezon is redefining the internet as a tiered service, like cable. And this new thing called the public internet is the lowest tier. Kind of like network television is the lowest tier in your television service options. From here on out, you will start to see the internet equivalent of cable service online: For an extra ten dollars, you can get the "movie lovers" package, where your ISP privileges Netflix and Hulu traffic, giving them to you super-fast. For another ten dollars, you can get the "concerned parent" package, which blocks peer-to-peer traffic as well as websites that they consider to be pornographic. And so on.
The "public internet" is for the poor
Pledging to keep the "public internet" neutral is great, but what happens when companies stop wanting to offer their services on it? Googlezon has the answer: In their proposal, they say that it's perfectly OK for companies and consumers to buy non-neutral, non-public "special services" online. If you're a media company that streams videogames, for example, your customers want a guarantee that the game won't stall out because of a crappy "public internet" connection. So you make your game available only to people with the special service "gamer package." Your customers pay you; you pay Googlezon; now there's a superfast connection for the privileged few with money to burn.
And what happens when news websites start delivering their pretty pictures and infographics in 3D? Verizon has already suggested 3D is a perfect "special service" to deliver in a non-neutral way. In five years, the public internet is going to look boring and obsolete. Where's the 3D? Where are all the cool games and streaming viddies? The public internet? Yeah, that's just for poor people.
But guess what's going to remain on the public net, the place where you go when you don't have money? Certainly there will be educational resources like Wikipedia. But mostly it's going to be advertisement-saturated free content from major entertainment companies. And of course there will be many opportunities to give your personal information to Facebook, or gamble away your non-existent savings on Zynga games. (Sorry - did I say gamble? I meant "pay for premium poker game content.") Put in brick-and-mortar terms: There won't be any produce markets on the public internet, but there will be plenty of liquor stores.
Big corporations truly rule the web
Though few businesses start without any seed money, it is still possible for a somebody with a good idea to launch their project online and attract investors once it becomes popular. When the internet is a tiered service, however, this will no longer be possible.
As Columbia law professor Tim Wu points out in the New York Times:
Just consider the power and public role of firms like Verizon or Google (especially if they work together). Sitting atop the web, they can influence what firms succeed or fail — by making sites load faster or slower, or end up on page 10 of search results. It goes further — in subtle ways, the information carriers have the power to influence elections and even censor speech they don't like.
What he's suggesting is that Googlezon will be a gatekeeper not just for new web services but also for content. The companies can choose to support services from any small business they like, and block others. Same goes for sites providing news or entertainment. Googlezon might make an agreement with the New York Times to load its pages faster than the Washington Post. And Googlezon might not load io9 at all, unless of course you're reading this blog via the Google Reader (as part of the "special service" package called "blogs and podcasts").
Googlezon could even strike a bargain with democratic political candidates to carry only their websites and block others. They could justify this by saying that people who want to get political information from conservatives can switch to another network that doesn't block them - or they can subscribe to the special "conservative service" package.
Your mobile is a battleground
Perhaps the most disturbing part of the Googlezon agreement is the companies' statement that there will be no net neutrality on mobile networks. Given that mobile networks are the future of how most people will go online, this section of the agreement is the most pertinent to any prediction about how this agreement will affect the internet.
Quite simply, the Googlezon agreement means that if you access the internet via your Android phone (or other mobile device), there will be no public internet at all. Your access to the web will be determined by your carrier, who may or may not offer special services - and who may decide to block any content it likes.
Googlezon proposes that every carrier or ISP will have to be transparent about what services it's privileging or blocking. But that doesn't mean these companies won't obfuscate their policies behind legalese. And even if your ISP honestly says, "We are blocking all websites run by Republicans," you may be locked into a three-year contract with them already.
Consumer choice when it comes to mobile networks is almost non-existent. Yes, you can sometimes switch networks, but in many areas of the world there is only one network that has coverage in your area. Besides, even if you research the local networks and choose the one whose policies fit your needs, there is no guarantee they won't change what they block once you're locked into a contract. And you could get locked into hardware platforms too - "get our movies and games package at half price when you buy a Droid!"
A burning vision of the internet in 2016
The public internet is basically overrun with 4Chan-like social networks that run very slowly and are drenched in advertising and spyware. You can watch some TV on the public internet, if you're willing to wait through long "buffering" times and bad commercials. You can play casual games, especially if you want to fork over a few bucks. There's webmail, though sometimes all your saved messages disappear - for "guaranteed backups" you need to subscribe to the special mail service via Googlezon. Plus, the only way to get to the public internet is with an unwieldy laptop, which sucks.
Most people go online with their mobiles. Anybody who wants to get access to games, movies, news, or other services online has to buy separate "special service" packages to make sure they run fast. Premium services guarantee you can watch movies on your Droid, or do your mail and calendaring on your Nexus SE234. An informal market in special service minutes springs up anywhere that people are too poor to get a mobile that does more than make phone calls.
Ironically, the public internet is the least public place online: It's an antisocial space, a crumbling, unsupported legacy network, full of ads and graffiti. Googlezon has succeeded in creating a caste system in the online world, and the public is the lowest caste of all.
GOVERNMENT PLANNING CONTROL OF INTERNET?
The problem with the liberal mindset is that it sees government solutions, even when there isn’t really a problem. Case in point: broadband internet.
Roughly 200 million Americans have broadband internet at home. Millions of others have access to it at work, school, the public library or on smart phones. Only about 5 percent of Americans lack broadband internet access according to The Wall Street Journal.
Yet in the eyes of bureaucrats at the Federal Communications Commission (FCC) this is an enormous problem to tackle with up to $350 billion taxpayer dollars – so far they have requested roughly $25 billion. On March 16, FCC released a national broadband plan “to bring broadband Internet connections to every home and businesses in the United States,” according to the Washington Post.
That night not one of the network evening shows mentioned the enormous government proposal – instead all three reported Tiger Woods’ return to golf at the Masters Tournament, ABC and CBS covered Michael Jackson’s posthumous record contract and NBC warned against kids going to Mexico for spring break.
“Good Morning America” called the plan “ambitious” and print outlets including Time magazine accepted the idea that there is in fact a broadband problem. A number of print outlets repeated cost figures billions too low without challenge and glossed over serious concerns about the possible seizure of bandwidth and loss of privacy.
One Reuters headline spun the plan positively, saying: “Some broadcasters like spectrum plan.” A New York Times headline provided only the perspective of the FCC on the “vital” plan.
USA Today led its front-page March 16 story with the FCC’s misleading assessment of the “problem.” The story said the FCC plans “to bring high-speed Internet service to millions of Americans who can’t get it today.”
It wasn’t until the sixth paragraph USA Today mentioned that 95 percent of American households already have access (only 65 percent have subscribed) “leaving 14 million largely rural Americans with no on-ramp.”
Many reports failed to remind readers about the prevalence of places that offer access (libraries, bookstores, Starbucks) and rarely admitted that some consumers may not want broadband access for whatever reason. Also, since broadband isn’t the only type of Internet access, it is reasonable to assume very few people are actually unable to get online if they want to.
FCC chairman Julius Genachowski claims broadband must become more available and “affordable” or it threatens “American’s global competitiveness.”
The FCC was ordered in the 2009 stimulus package to come up with a plan to increase broadband access and affordability. According to the NY Times, the plan is 376 pages long. It would mandate the expansion of broadband infrastructure and cellular towers.
The stimulus package “earmarked” $7.2 billion for broadband deployment, but an FCC task force found that costs would “range between $20 billion and $350 billion,” according to Information Week.
A Costly Solution
The FCC broadband plan wants to not only extend service and somehow lower its cost; it is calling for 100-megabits-per-second speed broadband to 100 million homes by 2020. The current average for access speed is 3 to 4 megabits per second. AT&T Inc. and Qwest Communications were “irked” by that goal, according to Reuters.
Qwest called it “a dream.”
Increasing the speed of all broadband access by 24 to 33 times what it is now will carry enormous costs. The FCC’s $350 billion estimate was specifically for 100 megabits-per-second speed broadband.
But surrounding the FCC announcement of its plan the news media downplayed that possibility by repeating low estimates and mostly ignoring the $350 billion high-end estimate. All three networks ignored the FCC announcement on their evening shows March 16. While ABC’s George Stephanopoulos cited an even lower estimate of “at least $15.5 billion” that morning.
The only mention of cost in Brian Stelter’s New York Times story was the FCC’s desire to change the Universal Service Fund, which already spends $8 billion a year to help rural and poor households get phone lines.” The Washington Post mentioned tapping that $8 billion fund and seeking up to $16 billion from lawmakers – but did not add those together to come up with $24 billion.
CNN’s chief business correspondent and Newsroom anchor Ali Velshi agreed that the Internet needs a “big boost” and discussed the broadband plan with former FCC chairman Michael Powell on March 16, but did not mention ANY price tag in that segment.
Meanwhile liberal blogs and think tanks including Huffington Post and Brookings Institution have mentioned the $350 billion estimate.
Genachowski says those much higher speeds are necessary for national competitiveness, but ABC accidentally undermined that claim on March 16. After mentioning the broadband plan, Becky Worley went on to discuss how people can spend less money on the internet.
Stephanopoulos suggested to Worley that “not everyone needs the real premium [broadband Internet] service.” Worley agreed and suggested that people ask for only the basic tier service in order to cut costs.
David Burstein, editor of industry newsletter DSL Prime, told The New York Times, “They [FCC] talk, talk, talk about affordability, but when you look at the plan, most peoples’ prices are going to go up.”
Broadcaster and Other Concerns
One obstacle currently in the FCC’s way are broadcasting companies that hold more bandwidth (or spectrum) than they currently use. Time magazine described the financial value of this bandwidth accurately calling it “the new black gold.”
The FCC wants broadcasters to surrender this extra bandwidth, but have not provided all the details. Reuters reported that TV broadcasters “will be asked to give up spectrum to wireless carriers” and that the FCC plans to “let them share” in the profits from auctioning off the bandwidth. Those profits typically go the U.S. Treasury so there is no way of knowing if broadcasters would receive reasonable compensation.
Although “Good Morning America” and CNN Newsroom didn’t mention it, there is both opposition and concern about FCC proposal. Associated Press reported on March 15 that broadcasters oppose returning some of their bandwidth.
On March 15 BusinessWeek quoted Dennis Wharton, National Association of Broadcasters spokesman, who said “We’re hopeful that doesn’t suddenly become ‘voluntary’ with a gun to our heads.”
One day later Wharton told the Wall Street Journal, “We are concerned by reports today that suggest many aspects of the plan may in fact not be as voluntary as originally promised.”
An editorial in the Journal called the plan a “Trojan Horse,” and said that the FCC wants to reclassify broadband services so it can impose more regulation. Other intrusions into the free market were mentioned in that editorial, including the potential for “forcing major broadband providers like Time Warner Cable and Qwest to share their high-speed networks with smaller competitors at federally set rates.”
PCMag.com also found downsides to the plan that were ignored by TV broadcasts and many print stories. David Murphy asked “Who Hates the National Broadband Plan?” In answering that question, he mentioned government agencies like Department of Defense, TV broadcasters, mobile carriers, lawmakers and individuals.
Free market think tank The Competitive Enterprise Institute released a statement expressing concern the national broadband plan’s call to create many new federal programs. “[T]he Universal Service Fund has illustrated, government-centric efforts to expand telecommunications networks suffer from inefficiencies, waste, and fraud.”
Taxpayers should also be concerned about the plan because it calls for a “digital goods tax” and expansion of the Universal Service Fund so that the tax is expanded to all types of telecom service in order to subsidize some users, according to American’s for Tax Reform.