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Net Neutrality an 'American Problem', Australians Suggest Alternatives

Head of leading ISP's in Australia believe Net Neutrality is a U.S. problem and the country should take a look at the Australian market for better ideas on how to address bandwidth issues. Brett Winterford and Julian Hill of ZDNet Australia reporting from London:

The debate was sparked after several American and British service providers offered to charge a premium to prioritize traffic connecting with some sites over others. "The U.S. have got a problem," weighed in Justin Milne, group managing director for Telstra Media and former chief of Australia's largest ISP, BigPond. "Their problem is that unlike Australia, they (offer) truly unlimited plans." The problem with an unlimited-access plan, explains Hackett, is that it "devalues what a megabyte is worth." American customers have never been able to put much of a dollar value on traffic, as historically, U.S. ISPs have "had it very easy" in terms of bandwidth costs.

Read full story: CNET News

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Yup, listen to the aussies By Suresh Ramasubramanian  –  Sep 28, 2008 9:26 pm PDT

They're actually talking sense and their pricing models are grounded on some solid realities.

NNSquad etc be damned, its about time some saner ISP pricing models were introduced .. capping traffic is fine. Prioritizing to different places .. well, bandwidth hogs sucking down way too much p2p will limit themselves immediately the next time they get their bill. Other users neednt even notice.

Good point By Richard Bennett  –  Sep 29, 2008 2:51 am PDT

NNSquad is a group of hysterics and alarmists, best ignored.

Well... By Dan Campbell  –  Sep 29, 2008 7:54 am PDT

First of all, the statement "optical fiber basically doesn't run out of capacity" is not relevant because we are talking about a last (or first!) mile problem.  The Internet backbone is not the issue.  It is technologies like DOCSIS cable and DSL that constrain users.  They are great technologies, let's be honest, as they've managed to use the existing physical infrastructure to deliver pretty good broadband service that satsifies most subscribers for now and has for the last decade.  But to a degree they are "short" term solutions given what else could be done if not for the expense of laying fiber.  Until the day comes when we have fiber to everyone's home, which I'm not sure I'll live to see, we'll have to deal with this.  But trenching to lay fiber to neighborhoods is not exactly cheap, easy or fast.  (Where in the world is WiMAX?)

Second, no one denies that "volumetric" pricing models is where we may end up.  It's pretty much where we started with by-the-minute metered dial-up service.  It's still kind of where mobile phone service is at the moment.  It's just that it is unfortunate for those that have enjoyed flat-rate unlimited Internet access for $40/month for the last decade to have to prematurely switch to a consumption-based model because of a handful of subscribers who abuse the service by using P2P applications, something that appliances like Sandvine and Cisco have to date handled, however inelegantly.  Sure, we may have gotten to a consumption model sooner rather than later with where video is headed, but that's not what started this whole thing.  Now, we have to deal with Comcast's two-fold approach of a (admittedly high) monthly cap along with real-time monitoring and throttling.  It's a step towards consumption-based pricing.  When that occurs, maybe some subscribers will find a less expensive plan that works for them (is $40/month considered "expensive"), but others, even those that are not file sharers or heavy video users, will have to deal with a broadband bill that may float monthly and be more than what they currently pay.

Third, the Aussies should step a little lightly in criticizing how it works in the US.  In my experience in deploying a broadband platform in Perth, I found Internet transit to be severely limited to a few providers, which results in extortionate pricing, less redundancy and lower availability when an undersea cable gets cut, which I've unfortunately had to experience.  Also, because alot of Internet content is indeed still hosted in the US or Europe, there is a natural throttling of Australian Internet subscriber traffic by virtue of the 200-300ms round-trip delay, which via TCP ratchets back the subscriber's session throughput.  Obviously there's not much anyone can do about the geography, the speed of light or how TCP works (well, outside of those at Riverbed, BlueCoat, Expand, etc.), but those factors do work to tame the user expectations a bit.  Living outside of DC, much of my browsing lands at data centers in northern Virgina some 20ms away, so it can be very fast and it sets a higher performance expectation.

The Value of a Megabyte By Robert Cannon  –  Sep 29, 2008 10:57 am PDT

Yeah, that's what happens when you commoditize a resource - the price drops to real cost.  If you create an artificial scarcity, you can reduce supply and create an artificial increase in price.  — Normally the US is criticized for having excessively expensive broadband; here AUS is criticizing the US for having excessively affordable broadband? Ironic — Finally, David Clark MIT gave an excellent paper this weekend at TPRC discussing the true cost of broadband in the US.  Basically Clark concludes that the cost of broadband is less than 10c per Gigabyte (not Megabyte) transit, maybe ~5c for direct connections (like connecting directly to youtube instead of getting those packets over the transit line), and ~2c per gigabyte for local in-network content (read cached).  Yip, that makes one question the value of broadband - it also makes you question the costs that are imposed on the network through high use of the network....

But.. By Ian Peter  –  Sep 30, 2008 2:16 pm PDT

I think this debate and analysis is missing something. Certainly in the beginning, the network neutrality debate was not about efficient charging, but about carriers having the capacity to discriminate against, or in favour of, certain types of content or certain content providers. Better charging regimes doesn't solve that potential problem. Not does the capacity of fibre suggest there are no bottlenecks in transmission networks.

Carriers banning VOIP altogether would be one example of a distortion (who would gain from that, I wonder?) Carriers charging popular content sites (eg Google)a premium for directing traffic would be another,. Those sorts of distortions are a potential threat to the Internet and are at the centre of the NN debate. More efficient charging regimes don't remove the commercial benefits and accompanying Internet distortions that could arise if there was no means to enforce neutral access to all sites and all traffic types..

The debate of course has got distorted into extremist views like banning traffic shaping. But there are some potential issues there still and my Australian friends have not solved that problem with their higher (and probably more realistic) charges than their US counterparts.

Appropriate market regulation By The Famous Brett Watson  –  Sep 30, 2008 6:14 pm PDT

Ian Peter said:

But there are some potential issues there still and my Australian friends have not solved that problem with their higher (and probably more realistic) charges than their US counterparts.

Quite so. In my opinion, we've solved the other issues by encouraging a somewhat competitive market for Internet access, and by an industry watchdog that's prepared to bite anticompetitive behaviour as necessary. Your FCC seems to have done its job reasonably well in the Comcast case so far, but I hear many complaints about lack of choice in the USA broadband marketplace. It's going to take some serious political will to fix that problem, and the incumbents will (of course) fight it tooth and nail.

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