Broadband Engineers Say Net Neutrality Rules Could Hurt Customer Experience

Rep. G.K. Butterfield, D-N.C., also warned about possible “unintended consequences” of neutrality rules as he accepted an award from the Center. Butterfield said he’s not against ensuring an open Internet, but worries rules could delay broadband deployment in unserved and underserved communities like those in his district.

Neutrality rules could be “fertile ground for additional lack of clarity” about what management practices are acceptable, said Mark Wegleitner, Verizon technology senior vice president. Providers can’t fight congestion simply by adding more capacity because network slowdowns are “unpredictable in time, place and severity,” he said. Regulation could delay companies’ response time to problems, especially when they occur at inconvenient times, he said. “At 2:00 in the morning, I don’t know if I can afford to call a lawyer to find out whether the action I'm about to take in the network is going to be OK, because … there’s a crisis at hand and it has to be dealt with immediately.”

Regulations can frustrate efforts to stop cyberthreats like worms and bot nets, too, said AT&T Chief Security Officer Edward Amaroso. Bot nets are “amazingly easy to program” and let loose, but network providers face red tape playing defense, he said. “I have a group of lawyers … sort of glaring at us, saying ‘How dare you?'” he said. “I want to sit back and say, ‘How dare we what?’ We're desperately trying to protect infrastructure” and the customer experience.” Policy makers must consider network security when making rules, he said. “Sadly I think most of the [net neutrality] debate … has completely missed the point.”

Network management tools are needed to prevent customer dissatisfaction, but some approaches are better than others, said Jason Livingwood, Comcast executive director of Internet systems engineering. He said the old management practice Comcast used when it blocked BitTorrent was “a technically inelegant solution.” Management tools shouldn’t block specific protocols, he said. “We've certainly learned that the hard way.” Comcast’s new management approach is protocol and application agnostic, and runs only at targeted times, he said. The company has received no complaints about the system, and other providers around the world have expressed interest in adopting it, he said.

FCC broadband team deployment director Rob Curtis agreed that network congestion factors into the debate, but said it’s not clear precisely how much it matters. Curtis wants to know how much fixing congestion problems costs, and how much it’s worth to consumers: “I have yet to see a really robust conversation around those two pieces.” Some have told the commission that congestion can be solved with more capacity, he said, but no one has said how much that approach would cost. Congestion problems may be ameliorated in part without network management, Curtis said. More content is being pushed to the edge of networks and cached locally, and compression techniques are constantly being developed and improved, he said.

Economists doubted the economic case for tight broadband regulation. Robert Willig, an economics professor at Princeton University, urged the FCC to continue to employ its existing framework as the wireless market is “wildly competitive.” Access regulation should only be considered if there’s clear evidence of serious competitive failure and reasonable prospects that regulation will improve matters, said Marius Schwartz, professor of economics at Georgetown University. A regulated monopoly paradigm doesn’t fit today’s broadband market because risk of anti-competitive access discrimination is lower, he said. Telecom access regulation has done best when the technology was relatively stable and simple, but today’s broadband technology is complex and rapidly changing, he said.

The commission analyzes competition the same way that the Federal Trade Commission and Department of Justice do, said Chief Economist Jonathan Baker. Factors affecting potential competition include steps potential rivals must take to enter the market, incumbent responses, a new firm’s conduct after rivalry and the extent of actual competition. Key issues considered are whether exclusion would raise rivals’ cost or reduce their access to markets, whether incumbents obtain market power and if efficiency benefits are offset, he said. The FCC usually conducts broader public interest reviews in various legal contexts, including spectrum management and media ownership rules, he said.

It’s critical to see the wireless industry as a multi- product industry, said George Ford, chief economist at the Phoenix Center. In a multi-product setting, the measure of competitive outcomes is the price and profit of the entire range of services, he said. Mandated openness can sharply reduce the profitability of the network service provider, potentially to where such a mandate could reduce the equilibrium number of firms in the industry, he warned. As a result, there would be less competition, he said, and such a mandate could harm small- or medium-sized wireless companies which often serve unserved and underserved areas.