Opinion Page: Network Neutrality on the Internet

Media policy analyst Christopher Stern talks about proposals for a new Internet fast-lane. His op-ed appears in Sunday's Washington Post.

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NEAL CONAN, host:

Imagine if your local video store only had VHS tapes of Warner Brothers Movies, but offered Limited Edition DVD's of all Sony pictures films. When you ask why, the cashier tells you, well, Sony paid a special premium to get their upgraded product on the shelf. For internet surfers, this scenario may just play out online if some telephone companies get their way.

That's because AT&T, Verizon, and others are lobbying to impose fees on content providers like Yahoo and Google, in order to have faster downloads, crisper video images, and more complex functions. Right now, the people who own the phone and cable lines that pipe in the internet to our homes have a neutral stance on how these websites are transmitted, but the times may be changing.

Christopher Stern wrote an Op/Ed on this issue in yesterday's Washington Post. Stern is a media policy analyst with Medley Global Advisors. He joins us now as part of our regular Monday Opinion Page feature. If you want to weigh in with your opinion, give us a call, 800-989-8255, or send us an email, talk@npr.org. And Christopher Stern, welcome.

Mr. CHRISTOPHER STERN (Media Policy Analyst, Medley Global Advisors): Thank you.

CONAN: This is about something called neutrality, network neutrality, which you admit in this piece, is a really obscure term that nobody understands.

Mr. STERN: But people will understand it over the next year or two. And, basically, what you're talking about is, the folks who own the pipes, the telephone companies, want to figure out a way to make some money to help them build these, this next generation of networks. And, I'm not sure if they want to impose these fees, but rather, they want to negotiate fees with Yahoo or Google or MSN, or anybody else for that matter, so to get, so these guys could make sure that their video downloads really fast. And that's where the internet is going. There's going to be a lot more video on the network over the next 10 years.

CONAN: And, obviously, it would matter a great deal if you can download King Kong in 2 1/2 minutes, as opposed to 15 minutes.

Mr. STERN: Absolutely.

CONAN: And, that's gonna give one website a real advantage over another. You may not know that Yahoo, just to pick one out of the air, has been turbocharged like this, and then the other one isn't, you just know Yahoo works better.

Mr. STERN: That's right.

CONAN: Okay now, there is also, you know, this is, network neutrality up to now was made for a world where we have what you call a meritocracy. Each website, well, if they were good they did well.

Mr. STERN: Right. It is a commercial meritocracy. If Yahoo does a great job, it attracts a lot of folks to come see, come to Yahoo's site. And, we've seen how Google has grown exponentially in the last five or six years. And so, there was never any worry that a carrier, whether it was a cable company or a telephone company, was helping one website, or one portal over the other. And the concern among some is that that may change.

CONAN: And, here's a quote you have from AT&T Chairman, Edward E. Whittaker, Jr., this was a statement he made recently, talking about internet content providers, saying they were getting a free ride, they don't have any fiber out there. They don't have any wires. They use my lines for free, and that's bull. For a Google or a Yahoo, or a Vonage or anybody to expect to use these pipes for free is nuts.

Mr. STERN: He's frustrated.

CONAN: You could hear it. And you say he's got a case.

Mr. STERN: I think it is important to acknowledge that these guys do own the networks. They are building this next generation that's gonna carry a lot of video, and they're looking for ways to help pay for it. I think they do own their parts of the network.

The question is, the people who are concerned about the future of the network, the future of the internet going a different direction. They're concerned that the owners of the network will assert some kind of authority about who gets what, that they've never asserted before, changing the character of the internet over the next decade.

CONAN: Now the phone company, a company like Vonage, is in direct competition with AT&T, and if they gave, you know, might they be accused of trying to block Vonage somehow, if they didn't give them this preferred service?

Mr. STERN: This is all very subtle, but one of the things that the telephone companies certainly can't do is block one website, or even degrade their ability to reach customers. Voice, oddly, is one of the, it uses such a small amount of the bandwidth on the internet, that if the Vonages of the world say they're not so concerned about this issue, because if they find themselves degraded or blocked, then there really is a problem. But, they're a little bit cautious about getting in the debate at this point.

CONAN: And, I guess it's really the companies that are going to be providing these big video downloads that absorb, all of a sudden this big gulp of bandwidth, all of a sudden. And you pointed out that, if Yahoo suddenly gets this huge demand on bandwidth, they're not paying any more at AT&T.

Mr. STERN: Well, they're paying some more but it's incremental, certainly not anything in relation to, in theory, how much money they're making. Look at Google, I mean, Google's now worth over 100 billion dollars. That's more than BellSouth is worth. And BellSouth, in effect's been around for a hundred years, Google's been around since what, 1998? And if you're a telephone executive, that's gotta be kind of frustrating.

CONAN: We're on the TALK OF THE NATION Opinion Page with Christopher Stern, talking about the next generation of internet, and who's gonna pay for it. You're listening to TALK OF THE NATION from NPR News. And, we've been talking about telephone companies thus far. Cable companies, obviously, have a big role in this. Right now, I guess its split roughly 50/50. Do they have the same concerns?

Mr. STERN: You know, over the next few years they have even more concern. Because the core of their business is video and what if all of a sudden, Yahoo or Google starts providing, or somebody else we've never heard of, starts providing I Dream of Jeannie over the web? And, instead of watching Nick at Night, or wherever I Dream of Jeannie appears now, you start watching it over the web. So there, this is a big issue for them. And while they care about it, they've been much less vocal, and I think they're probably a little annoyed that the Bell guys have been so loud about this. And they wish they'd sort of quiet down, and let it...

CONAN: This is up in Congress, and he's trying to write new regulation, and, new law, rather, and obviously, they're a long way from finished with that. But I guess both sides are lobbying pretty heavily.

Mr. STERN: Oh, absolutely. This is going to be something that plays out, as Congress begins re-writing the Telecommunications Act of 1996, which is one of the reasons why we're starting to hear about this now.

CONAN: Let's get a caller on the line, and this is Lee. Lee's calling us from Denver, in Colorado.

LEE (Caller): Yeah, I used to work for GTE, and then went to work for an equipment company, doing DSL. So, I got into this back in the 90's. And this is the same thing the phone companies tried to do back in the late 90's. It's called class of service. The idea is that, for the better levels of service, both bandwidth and reliability, you pay more. If you don't want that high grade of service, you pay less. It fell flat on its face in the late 90's.

I don't think the situation has changed dramatically enough that would make it a viable strategy for them today. Especially since their penchant is to price things according to what they think they need in revenue, as opposed to what the market will accept in revenue.

CONAN: Christopher Stern.

Mr. STERN: I think that's a really interesting point. That this debate in one form or another, keeps coming up every five years ago, when during the Time Warner/AOL merger, there was some concern about whether or not Time Warner, the merged Time Warner/AOL would be so big, that they would dominate the internet. And whether or not other internet service providers should be allowed to play a role on their network, and whether or not they should be allowed.

And sure enough, as conditions of that merger, they were required to allow other ISP's onto Time Warner's cable network. It is a different, this debate goes on, every five years, it seems to raise an issue about how much big companies that own the pipes should have control over what goes over those pipes.

CONAN: Lee, thanks for the call.

LEE: Thank you.

CONAN: And it's interesting that, of course, as consumers we also make this decision individually. We can have dial up, or we can get DSL, or we can get cable modem, whatever. If we want faster speed, we just pay a higher price.

Mr. STERN: And interestingly, consumer rights advocates say that's the right method. Don't charge more to Google and allow them to, don't put the telephone companies in charge of picking favorites by whoever pays them the most money. Let consumers decide, let them pay 40 bucks a month if they want a certain, they want to download video at a certain speed, or 60 bucks a month if they want to download even more. Or, let my mother-in-law download just her email at an even smaller price point. So, I think that's where the consumer rights advocates want things to go.

CONAN: And the concern, I guess, is in terms of what, you mentioned Google, build a better search engine they will come. But if there has to be a premium pay to get on the internet super, super highway, then the next Google may not make it.

Mr. STERN: That's right, there's a concern. By going this route, you're tamping down on potential for innovation. This is something that's happening throughout all our society. You're seeing those Lexus Lanes in California, where people can pay $5, and ride on the fast lane no matter how many people are on there.

You can see that folks who want to walk through the airport faster, and get through security, they can sign up and sign in early, and have some special arrangement.

CONAN: So, this is, is that a real concern, though? I mean, if the next Google comes along, again, that idea was so good, pretty soon, you know, all they need is a little capital, they're there.

Mr. STERN: Right, and over the course of years, Google could grow incrementally, incrementally, until it's the colossus it was. But what if, yeah, what if the next guy who has the smart idea, has to pay a toll to get on the internet? And that is, really, a concern. The internet's right now, pretty toll free.

CONAN: Christopher Stern, thanks very much for being with us. We appreciate your time.

Mr. STERN: Thank you.

CONAN: Christopher Stern is a media policy analyst with Medley Global Advisors, a policy research organization advising financial institutions. His piece on network neutrality, a term we're all going to come to know, he swears it, is in yesterday's edition of the Washington Post. You can read it and hear all of our previous Opinion Page features at the TALK OF THE NATION page at npr.org. I'm Neal Conan. This is TALK OF THE NATION from NPR News.

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