Google Says It’s Time To Turn Japanese

"We hope policymakers take a careful look at exactly what is now happening overseas, why, and then draw the right conclusions about the steps necessary to bring the benefits of real broadband competition and innovation to all Americans," he concludes at the Google Public Policy Blog, referring to a report appearing in the Washington Post.

The WaPo article detailed that Japanese broadband was up to 30 times faster than the broadband in the United States.

30 times. Now, I’m not going to make a value judgment on this, but, in the America you grew up in, can you remember anything we could stand being second place in?

Okay, hockey and soccer. We didn’t care.

But a decade ago, Japan was struggling to keep up with the US in terms of Internet speed, and now they can watch broadcast quality television over it?

It’s interesting this article came from the Washington Post, too. A year ago, the paper wasn’t so hot on the idea of Net Neutrality. I called them on it, but I don’t think anyone noticed.

Whitt also notes SaveTheInternet.com’s explanation of why Japanese broadband speeds exploded so rapidly:

Less than a decade ago, DSL service in Japan was slower and pricier than in the United States. So the Japanese government mandated open access policies that forced the telephone monopoly to share its wires at wholesale rates with new competitors. The result: a broadband explosion.

Not only did DSL get faster and cheaper in Japan, but the new competition actually forced the creaky old phone monopoly to innovate.

That’s interesting, because the telco and cable company arguments have been exactly the opposite. They argue that any government involvement would stifle innovation and investment, even though a decade of non-involvement and $200 billion of tax-payer handouts have resulted in a duopoly that’s given us, well, about 15th place.

But my favorite part of the WaPo article was this section:

 [Japanese broadband] allows pathologists — using high-definition video and remote-controlled microscopes — to examine tissue samples from patients living in areas without access to major hospitals. Those patients need only find a clinic with the right microscope and an NTT fiber connection.

"Before, we did not have the richness of image detail," Matsuya said, noting that Japan has a severe shortage of pathologists. "With this equipment, I think it is possible to make a definitive remote diagnosis of cancer."

That’s funny to me because I seem to remember representatives of Verizon talking about the "cock-and-bull" and "Chicken Little stories" going around about Net Neutrality and how such government interference would stall or derail access to valuable Internet-based medical services.

It’s been a year and a half since this debate really started to get going, and I’ve seen no argument from the phone and cable side of it that’s held up to scrutiny.

"I believe it is important for companies like Google to establish a place of meaningful dialogue with the general public," he writes, "and to open our policy advocacy role to outside analysis — and yes, criticism."

Following is a quick summary of Whitt’s main points.

What Type of Network control is okay for access providers?

1.    Manage their network with content-neutral practices to neutralize "objective network harms," like denial of service (DOS) attacks, viruses, and worms.

2.    To prioritize packets of a certain application type, like video, because there are tangible end-user benefits such as video quality.

3.    Prioritization based upon objective criteria such as latency or jitter, applied in an even-handed manner.

Not okay.

Prioritization used for discriminatory purposes, such as degrading or prioritizing certain applications based on an intention to impair the offerings of competitors. "[S]uch practices should be prohibited as unreasonable," said Whitt.

AT&T’s Full of It

Former AT&T CEO Ed Whitacre complained that Google and others would have to pay to use his "pipes." However, Whitt confirms what everybody knew. They already do pay for it:

Web companies must arrange with network operators to: carry the data traffic from company facilities to their Web servers over local telecom lines (the “last mile”); carry the data traffic from the Web servers into the Internet over high-speed, high-capacity data lines (“special access”); and carry the data traffic over the numerous interconnected networks that make up the Internet (the “Internet backbone”).

To accomplish these important connectivity and transport functions in a fast and effective manner, Internet companies collectively pay many billions of dollars per year to network operators, which fully compensates them for their network investment.

There Is No Competition In the Broadband Market

1.    Phone and Cable companies control 99.6% of the broadband market
2.    Alternative broadband does not compete in terms of speed, price, or availability.
3.    Entry costs are enormous.
4.    Switching costs for consumers are too punitive.

"Together, these salient factors — excessive market concentration, no viable competitors, considerable consumer switching costs, and substantial barriers to entry — should lead policymakers to conclude that there is a major competition problem in the broadband market."

Check out Whitt’s full, detailed posts on the broadband market, type-based differentiation, and paying for bandwidth.