Monday, May 22, 2006

Net Neutrality: Mike McCurry V. Craig "Craigslist" Newmark

The "net neutrality" debate has reached a fever pitch as Congress mulls legislation that would allow Internet service providers to charge Web sites for preferred delivery of digital content.

Net neutrality advocates, including Internet giants like Google and, are lobbying Congress to preserve the status quo in which all Web content is treated the same. Phone and cable providers such as AT&T and Comcast say they should be able to sell premium tiers of service since they are investing billions to build broadband networks.

Congress is considering several competing pieces of legislation. One bill, sponsored by Rep. Joe Barton (R., Texas), embodies the phone company view, while another bill recently introduced by Rep. James Sensenbrenner (R., Wisc.) supports net neutrality. Both the House and Senate will hold hearings this week.

The Wall Street Journal Online invited Craig Newmark, founder of Craigslist and a net neutrality proponent, and former White House spokesman Mike McCurry, who heads a phone industry group, to debate the issue. Their exchange, carried out by email, is below.

[Mike McCurry]

Mr. McCurry begins: Our Hands Off the Internet coalition believes that the Internet of the future cannot carry the load we will put on it unless we substantially upgrade network facilities and capacity. Before too long, users are going to be streaming data-rich videos into the home, using the Web for online games, practicing telemedicine online, conducting voice conversations via [Internet telephony], you name it.

Craig Newmark is founder and chairman of Craigslist, a classified-listings Web site he started in 1995. Mr. Newmark is a Web-oriented software engineer with nearly 30 years of experience, including 17 years at International Business Machines Corp. He is a charter member of Save the Internet, a coalition that supports net neutrality legislation.
Michael McCurry is a partner at Public Strategies Washington Inc., a government relations and lobbying firm. Mr. McCurry has been a communications strategist for nearly three decades in Washington, serving as press secretary to President Clinton from 1995 to 1998. He is co-chairman of Hands Off the Internet, a group backed by AT&T and Verizon that opposes net neutrality regulations.

The current Internet is creaky and will suffer congestion if we don't invest in improvements. The network operators prepared to make those investments need to get a return and one way is to charge a premium for managing huge bandwidth content differently. Face it, most users trying to get video want packets of video data to assemble differently than regular email content.

So we say, let the current rules govern. Let's not impose a new and cumbersome set of regulations on the Internet that might thwart the necessary investments. We have no clear evidence that content is being discriminated against and we have no real problem with quality of service that cannot be addressed under current law. We think the advocates of regulated net neutrality have not pointed to a problem that needs a solution.

[Craig Newmark]

Mr. Newmark responds: Mike says "let the current rules govern" and that's what we're trying to do, trying to stop the big guys from changing the rules via the Federal Communications Commission. We're trying to preserve the level playing field. It's just fairness. Americans want to play fair, work hard and get ahead. That's what net neutrality is about.

Now, I've got to tell you where I'm coming from. My background is computer sciences and software engineering, and I still know a thing or two about network capacity, remembered from my lost youth. However, I do full time customer service, a very irregular 14x7 schedule, that's my gig. Over the years I've dealt with some thousands of people of all political persuasions, from the tens of millions of Americans who comprise our community.

Also, I've worked with a lot of people at mid and low levels at the big telecoms, handling matters of network capacity, and abuse, like scams or harassment. I also work with some of their engineers, talking about the way big telecoms operate and issues like network capacity. It turns out that they have lots of unused capacity for bandwidth, but the big telecoms have been very remiss in implementing the newer Internet protocols (IPv6) required for growth, due to bureaucratic inertia.

The telecom workers remind me that their companies are full of workers who really want to do the right thing. They're really good people who really want to serve, and they also want a level playing field. People at telecoms also remind me that they're aware that they're profiting from public property, like the airwaves and public rights of way... but that their bosses have forgotten that.

So, to preserve the level playing field, we need to prevent the powerful from paying people for special privileges. We're NOT talking about regulation, we're talking about preserving democracy.

Given my perspective, maybe the pivotal issue is trust? Given your own personal experience, say, with your phone company, what do you think? I can tell you what the telecom workers admit. You can also check out Walt Mossberg at The Wall Street Journal regarding this [and] cellphones.

[Mike McCurry]

Mr. McCurry: Look, the Internet is not a free public good. We all pay something to make it work right and that's the issue here. We pay federal taxes for interstate freeways but we charge 18-wheel semi-trailers higher taxes because they put a heavy burden on the road.

The Internet needs investment. That investment will be spread across the market and the big companies that provide content will help pay the cost and work that cost into their business models. Or the consumer will get stuck with the entire bill. And my mom who uses the Internet to email and read news will have to subsidize the guy down the street who wants to stream HDTV movies 10 times a day.

Having the FCC regulate net neutrality (and what exactly is the definition of "net neutrality" anyhow?) will dampen investor interest in building bigger, faster, smarter pipes -- Wall Street has already made that clear. The best protection for the "little guy" is a robust market with lots of competition that will force those with "power" to make the best deal available to the consumer.

[Craig Newmark]

Mr. Newmark: I agree, the Net ain't free. However, Google and YouTube and iTunes are already paying their fair share, a lot of cash. Their owners and consumers use the Internet, based on an underlying telecom structure based on public resources that we all own.

Do you believe Yahoo should be allowed to outbid Google to slow down Google on people's computers? That's the kind of thing that the big guys are proposing.

For that matter, the hard part of the infrastructure is already done: "The backbone was terribly overbuilt," says Fiber Optic Association President Jim Hayes [according to a September 2004 article published on] "Ninety-three percent of all the fiber that's been installed is still unused."

Mike, can I suggest some straight talk from your clients?

[Mike McCurry]

Mr. McCurry: Everything I have seen points to a bandwidth crunch coming in the years ahead. I am not a techie but one of BellSouth's chief architects [Henry Kafka] said recently that the average residential broadband user today consumes about two gigabytes of data per month. Watching TV over the Internet would consume 224 gigabytes per month. Regularly downloading movies would average nine gigs. We do believe that video over the Internet is in the near future, right?

Our point is that the entire Internet will slow down if we don't start making the needed enhancements. But if we try and let government lawyers and regulators engineer the future of the Internet, they will either get it wrong or write rules that lead to unintended consequences. Our coalition and the companies in it have pledged to abide by the principles the FCC articulated last year -- no discrimination against content and no degradation of service. So if they tried to "slow down" anyone's traffic, they could risk FCC action -- the Commission has been pretty clear about that.

Why not see how fierce competition in the broadband market works to produce the improved Internet we need before we decide to introduce a very heavy dose of regulation?

[Craig Newmark]

Mr. Newmark: With all that empty fiber, bandwidth is not an issue. A bigger issue is that we're running out of [Internet protocol] addresses. The new net protocols, IPv6, address that, but the big telecoms are already very late implementing that. (Hey, I'm an engineer, and their engineers talk to me.)

FYI, Bellsouth guys have admitted that they don't intend to play fair [according to a December 2005 Washington Post article]: "William L. Smith, chief technology officer for Atlanta-based BellSouth Corp., told reporters and analysts that an Internet service provider such as his firm should be able, for example, to charge Yahoo Inc. for the opportunity to have its search site load faster than that of Google Inc."

No one's talking about "government lawyers and regulators engineer[ing] the future of the Internet," except, well, you, Mike. We're trying to prevent that, and trying to get Congress to maintain the level playing field we have right now, that the FCC just tried to ruin. We're just asking everyone to play fair.

Mike, if you support "living by the current rules" then you support continuing net neutrality and the level playing field, thanks!

Finally, sorry, but the members of [your] coalition routinely break their commitments. Consider the last no show for your home phone repair. Consider the wireless coverage maps in their ads... and then check the maps they really use, if they'll show you. What's the deal with the wiretapping thing?

[Mike McCurry]

Mr. McCurry: I'll stick to net neutrality for this discussion.

I don't think you are being straight about what advocates of regulated neutrality want. You are asking that the federal government mandate certain performance criteria of the Internet based on how it works today in order to protect against some hypothetical problem that might occur down the road, isn't that right? Is there a real problem now with discrimination on the Net? It looks to me that companies are rushing to provide faster connections for Internet users, not looking how they can slow someone down (which would be a nutty thing to do from a business perspective.) Where is the problem that needs to be solved?

And doesn't the FCC have authority already (under Title I) to step in and act if necessary? Or how about the Federal Trade Commission or the Justice Department. I'll be the first to admit that the current administration does not seem to think much of antitrust law, but if you recall I tried to do something about that in 2004. [Mr. McCurry was a senior adviser to Sen. John Kerry in the final weeks of the 2004 presidential campaign.]

[Craig Newmark]

Mr. Newmark: I'm being completely straight: no one's interested in regulation in the sense you're thinking, we just want the existing level playing field to continue… Beyond that, we're not interested in mandating performance criteria, none of that stuff.

I'd like to think that the telecoms are "rushing to provide faster connections for Internet users," but that's not what I hear from their guys. Compare the rate of broadband adoption, say, in South Korea or Japan, to here.

The problem has already been discussed; the big guys will get privileges at the expense of the little guys and at the expense of consumers. They've admitted they'll do that. Let's stand up for small and innovative businesses. C.J. Cregg [the press secretary in the TV's "West Wing"] would approve.

For example, what's at stake for little guys like us at Craigslist and new innovators is survival. Let's suppose some big guy feels like a schoolyard bully; he slips a telecom a few million [dollars] to accelerate his service and slow ours down. Good way to suppress innovation, which mostly comes from the little guys.

There's a big difference between the FCC having power to do the right thing... and then failure to execute. It's like "you're doing a heckuva job, Brownie."

[Mike McCurry]

Mr. McCurry: "A level playing field" still sounds to me like one-size-fits-all service. These telecom companies want to innovate, too. That's why they want to create products and services that will improve the Internet, not degrade it for a certain set of customers. If that "bully" came along and took the deal you suggest, my co-chair, Chris Wolf, who is a pretty good attorney, would be the first to take the case. I think under existing law there are protections in place to guard against unfair business practices or predatory behavior in the market.

If the little guys and the innovators are getting a raw deal from an ISP, the answer is to pick up and walk. That's why we need more robust competition and we need to lower barriers to entry rather than raise them in the form of new regulations. Those consumers that you care about will gain from more competition and from innovation than they will if the network companies have to send them all the same size bill for building an Internet capable of carrying the load that is coming.

I am worried that in this discussion we still have not defined "discrimination" or "network neutrality" in a way that anyone could understand what the proposed law is supposed to do. The real danger here is that Congress will tell the FCC to go enforce abstract principles and then the legal wrangling will begin. The money that could go to building a more robust Web that works better for everybody will go instead to lawyers and lobbyists. No one wins then. That's why we say hands off for now; there will be plenty of time for government to step in if and when there is a real problem.

[Craig Newmark]

Mr. Newmark concludes: I realize you're cleverly using Colbertian "truthiness," and I just can't compete with that. Nerds are notoriously literal.

What we're looking for is just fairness, a level playing field, no regulation or stuff like that. In America we believe that if you play fair and work hard, you get ahead. We don't want the government to give special privileges to the big guys, particularly not at the expense of small business and consumers. We don't want more regulation and we don't need lawyers involved where the free market functions well. I guess we're for capitalism.

Current net neutrality (as currently conceived) functions well, allowing innovators to create wealth and help us all out. Why should the FCC or Congress fool with that? We've seen that the telecoms don't need more privileges, they need to get serious about using their existing resources.

We're not talking about "one size fits all," since we need improvements to Internet tech for stuff like video. Please do note that the big guys don't innovate much, it's pretty much all from small business. I can't think of any innovation from them. They usually run infrastructure well, not much new.

Even Mike's clients have confessed that they intend to discriminate. They consistently forget who owns the airwaves and public rights of way on which they've built their fortunes. They frequently break their commitments; take a look in the Journal at the Walt Mossberg piece I've cited.

Net neutrality is the embodiment of American values of democracy and fairness. Let's keep it that way. I joined the coalition and signed a petition to Congress. Mike, you talk about preserving competition; when can we expect you to sign up?


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