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The issue of net neutrality from the other side

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Assigned keywords: Computer

The issue of net neutrality arose from the fact, that the business models of the telecommunication enterprises were shown to be defective. Theirs resembled that of the printer industry: sell cheap printers and expensive ink; give them cheap internet connections and make money with IPTV, Triple-Play, Music-on-Demand and such.

The customers, however, mainly ignore these services, instead excessively use their bandwith, sometimes agains the interest of the companies.

Most broad band connections have flat rate pricing. The customer does not pay for any usage, but the enterprise still has to pay their superior backbone provider for every gigabyte transferred. So the customer has no incentive to put a limit on his usage, moreover he has an incentive to make the most use of it, as he then can maximize the value of his connection. Different from an all-you-can-eat offer which is limited by physical constraint of the human digestive tract, the customer can fully use his connection day and night.
Now companies drafted mixed calculations to estimate the impact of power-users and how they are financed by standard-users, which make only moderate use of the lines.
Unfortunately the companies were unable to foresee that the standard user by now may as well produce huge amounts of traffic, as it became common to use bandwidth demanding services such as YouTube, MMORPGs or iTunes.
To make matters worse, the rise of VoIP does not only consume bandwith, but makes competition to many telcos themselves, if they own a telefone network too.

Another unforeseen development is the fact, that more and more content providers begin to actively use the bandwidth of their customers to relieve theirs. Programs like Bitorrent make use of swarmloading, that is, assembling a file from many connected peers and uploading to them. If, for example, an update is delivered using this method, the provider effectively saves on bandwidth cost. The end customer does not care as long as he's got a flat rate, leaving the cost to his internet provider.

Now the providers have two possible solutions to free themselves from the corner they've painted themselves into: either, they salt the access to the outside by regulating bandwith (or let those on the other side pay), meaning an end to net neutrality. Or they abandon the flat rate model altogether, charging for transfer costs.

Now it is somewhat obvious why the providers fear the second possibility: whoever goes that way first will be punished by his customers as "greedy shark". Abandoning net neutrality, however, is less obvious, as it can be hidden by using the fine print typical for the whole branch (at least in Germany).

Nevertheless I regard governmental intervention as a mistake. The market for internet access is diversive enough to allow different providers different solutions. The customer then has the choice which bitter pill he wants to swallow. Having somewhat limited traffic, I'd rather opt for a volume rate instead of manipulated access, which could be the better solution for someone else.


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