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Net neutrality

blog.samaltman.com

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Re: Net neutrality

#201

Post by aninhumer »

zanny wrote: post #196
aninhumer wrote: post #182

Earlier quoted context omitted.

Are you suggesting the only possible forms of anti-competitive coercion are government regulation or hit squads?

If it is voluntary it is not coercive. You can always not deal with your competition on unfair terms. In what circumstance could a 3rd party non-violent entity coerce you? The biggest one I can think of is "buying you out" but that is still either voluntary, in that the owners agree on the buyout, or it is a buyout of a publicly traded company, and I can't even get started on how non-free market the stock market is,…

>In what circumstance could a 3rd party non-violent entity coerce you?

Predatory pricing. Buying up necessary capital. Paying other companies to not deal with you (Suppliers, Retailers, Advertisers etc.)

All completely voluntary, and these are just off the top of my head.

Re: Net neutrality

#202

Post by aninhumer »

snitko wrote: post #200
aninhumer wrote: post #198

Earlier quoted context omitted.

>it has to drop prices on the whole line of products of its own. Why? >And who's to guarantee another company C isn't going to use the situation, knowing full well company A cannot afford another round of predatory pricing? The competitiveness of a market depends on the costs of entering it. If the amount of capital needed to enter the market is significant, new entrants willing to risk that much will be much less fr…

> Why? Suppose you produce socks and another company does the same and tries to compete. You produce 1 million socks a month and another company only 10 thousand. You obviously can't just drop prices on 10 thousands socks of yours, because that would still allow your competitor to stay in business - since there is demand for the rest of 990k of socks at your high price, your competitor would simply grab another 10k o…

>You obviously can't just drop prices on 10 thousands socks of yours, because that would still allow your competitor to stay in business

Ah sorry, I misunderstood. I thought you were suggesting they'd have to drop prices on a range of different products.

>What's there to prevent a rich investor from entering the market and competing?

The fact that there isn't an infinite supply of rich investors queueing up to disrupt markets. And that there are likely much better investment opportunities than entering an expensive price war just to gain a foothold in a newly competitive market (at which point company C can enter, and reap the same benefits without the inflated upfront costs).

Re: Net neutrality

#203

Post by AnthonyMouse »

snitko wrote: post #153
specialist wrote: post #151

Earlier quoted context omitted.

Regulation serves the public when it ensures a level playing field. Through the law, protection of property rights, a fair and impartial judicial system, the right to petition your government, etc. Regulation harms the public when it thwarts those democratic institutions. By protecting incumbents, limiting liability, forcing litigants into arbitration, hiding important information, etc. Some things only government ca…

Why is it that only government can provide some things well? Can you prove it both logically and empirically?

Some goods and services are dominated by up-front costs. That makes usage-based billing economically harmful by discouraging usage of a use-it-or-lose-it resource that has already been paid for. It also makes competition extremely inefficient because each competitor has to duplicate the high up-front cost of e.g. building a last mile network. The result when left to private enterprise is generally a monopoly that charges monopoly rents for access to the resource, and in cases where there is competition (e.g. because two existing monopoly markets merged through technological change, as with telephone and cable) the competition is highly inefficient because each competitor has to duplicate each other's costs. And if competition exists then the competitors are essentially required to engage in some form of explicit or implicit collusion to not lower prices, since in a market dominated by up-front costs each competitor can always gain revenue by lowering prices to gain customers, until the competitor responds in kind ultimately causing all providers to be unable to recover their up-front costs.

Having the government pay for such resources (as with roads) with tax dollars and then providing free access to the public is massively more efficient than private enterprise, because you eliminate the incentive for rent-seeking and economically harmful usage-based billing and for that matter eliminate all the overhead of billing, marketing, collections, denying access to non-subscribers, etc. But the only way to do this is if the resource can be funded in some other way, specifically through taxation.

Re: Net neutrality

#204

Post by ataggart »

aninhumer wrote: post #201
zanny wrote: post #196

Earlier quoted context omitted.

If it is voluntary it is not coercive. You can always not deal with your competition on unfair terms. In what circumstance could a 3rd party non-violent entity coerce you? The biggest one I can think of is "buying you out" but that is still either voluntary, in that the owners agree on the buyout, or it is a buyout of a publicly traded company, and I can't even get started on how non-free market the stock market is,…

>In what circumstance could a 3rd party non-violent entity coerce you? Predatory pricing. Buying up necessary capital. Paying other companies to not deal with you (Suppliers, Retailers, Advertisers etc.) All completely voluntary, and these are just off the top of my head.

>Predatory pricing.

Offering a lower price to consumers than your competition is not coercion against a competitor.

>Buying up necessary capital.

Offering a higher price to suppliers than your competition is not coercion against a competitor.

>Paying other companies to not deal with you

Entering into exclusive deals with other firms is not coercion against a competitor.

Re: Net neutrality

#205

Post by AnthonyMouse »

> Unpaid prioritization is sometimes necessary; if everyone in a neighborhood is trying to stream 4k video, something is going to get prioritized.

I don't understand where people get this impression. If there is not enough capacity in the network then yes, some packets have to be dropped, but there is no cause for the ISP to be looking at what kind of packets they are. Building a network where this is considered necessarily is inherently defective because the ISP cannot possibly even know what every kind of packet contains.

The only sensible algorithm for ISPs to use is to drop the packets of the users currently transferring the most data. This actually does the right thing in the large majority of cases. If you're using VoIP, your packets don't get dropped because VoIP is not very bandwidth intensive. If you're doing some bulk transfer at full bore then your transfer slows down because you're transferring more data than anybody else. If you're streaming video then you're fine as long as the bitrate is less than what the ISP can currently provide to each active user, and if it isn't then you're screwed in any event.

The alternative is begging for gamesmanship. You can easily make a bulk transfer look like a hundred VoIP streams. Especially with P2P. Building a network where cheaters get ahead and innocent but unrecognized protocols get downgraded is completely unreasonable. You can't cheat an algorithm which is completely fair to all protocols.

Re: Net neutrality

#206

Post by jbooth »

rayiner wrote: post #172
jbooth wrote: post #161

Earlier quoted context omitted.

I must be doing a really bad job of writing, because you're not addressing the point I was trying to make at all. I'm ok with paying $100 for internet access (well, not really, but still). If $100 cannot get me internet access at the advertised speeds, I'm ok with paying 120, or whatever additional cost per GB. What I'm not ok with, is if $100 doesn't do it, Verizon goes out and shakes down the companies I do busines…

This is shared infrastructure. If it costs you $16,000 to build out to a neighborhood of 10 people, then you have to set the price at a point where you can amortize that cost over the maximum number of subscribers. The Netflix junkie may be willing to pay $130/month, but if he's the only one that signs up, your cost per subscriber explodes. Thus, if you're a provider, the amount of money you are willing to spend on t…

Why not just price it as $/month for X transfer, with $/GB above that rate? That'd be simple, transparent, no damage to the market structure of internet businesses, no future anti-trust cases, and we're straight-up paying for the infrastructure that we, as consumers, are using.

Is your case that more money would go to network improvements with the backroom deal routine? Have you considered that the backroom deal routine allows a lot more room for pocketing money and not really investing in the network?

Re: Net neutrality

#208

Post by aninhumer »

ataggart wrote: post #204
aninhumer wrote: post #201

Earlier quoted context omitted.

>In what circumstance could a 3rd party non-violent entity coerce you? Predatory pricing. Buying up necessary capital. Paying other companies to not deal with you (Suppliers, Retailers, Advertisers etc.) All completely voluntary, and these are just off the top of my head.

>Predatory pricing. Offering a lower price to consumers than your competition is not coercion against a competitor. >Buying up necessary capital. Offering a higher price to suppliers than your competition is not coercion against a competitor. >Paying other companies to not deal with you Entering into exclusive deals with other firms is not coercion against a competitor.

And when you go bankrupt because you're unable to run your business, you'd consider that completely voluntary?

Re: Net neutrality

#209

Post by rayiner »

mbreese wrote: post #176
rayiner wrote: post #150

Earlier quoted context omitted.

Universal access is usually implemented as build-out requirements in an ISP or cable provider's franchise agreement. The exact terms vary by municipality, but build-out requirements are the general rule.

It's unclear how this plays out in the era of state-wide franchising agreements.

Statewide franchise agreements are usually layered. For example, there is a Delaware cable franchise agreement, but the City of Wilmington has its own provisions. Also, e.g., many places in Maryland have granted Verizon FIOS franchises, but in Baltimore there is no FIOS because the parties got stuck on a build out provision.

Re: Net neutrality

#210

Post by snitko »

AnthonyMouse wrote: post #203
snitko wrote: post #153

Earlier quoted context omitted.

Why is it that only government can provide some things well? Can you prove it both logically and empirically?

Some goods and services are dominated by up-front costs. That makes usage-based billing economically harmful by discouraging usage of a use-it-or-lose-it resource that has already been paid for. It also makes competition extremely inefficient because each competitor has to duplicate the high up-front cost of e.g. building a last mile network. The result when left to private enterprise is generally a monopoly that cha…

> economically harmful usage-based billing and for that matter eliminate all the overhead of billing, marketing, collections, denying access to non-subscribers

So are you saying that feeding the whole IRS is LESS expensive than having an automated billing system that could track who is subscribed and who can enter a certain road? Because if it's not more effective, then, by the same token, why don't we also fund air travel with taxation? Too expensive to check tickets and deny access to free riders. It's better to just let everyone fly for free. Hell, you can say anything is more effective when funded by taxation. But that doesn't make it true. I don't understand why do I have to subsidize someone who uses roads everyday, while I use it once a week, for example. It's like as if I had to pay the same price for 1 airline ticket as the other person paid for 10. And while it may be a burden for a company to deploy a billing system, with government the burden is on the consumer: I have to fill all those tax forms and make sure everything is correct (or pay an accountant) - talking about some economically harmful activity, I don't like it when someone conscripts me to be a part-time accountant.

Your claims that government provided services are better because their production is more effective is not proven. Show me the exact mechanism. Show me how is it cheaper for everyone and not just for some? Can you demonstrate that the money spend on running the IRS is actually less than private enterprises would spend on the billing system? If you can't do it, then your words shall be called a speculation, not proof.

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