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Comcast’s solution to network congestion

Broadband Reports ran an opinion piece by Karl last week discussing the rumors that Comcast will soon adopt a 250GB a month maximum with overage fees for excessive consumption.

As the piece points out, implementing overage fees runs the risk of giving FiOS (and, to a lesser extent, U-Verse) an even bigger edge on cable broadband. Because of AT&T and Verizon’s last-mile network comcast architecture, heavy users aren’t as likely to impact other customers’ experiences as they are on Comcast’s shared cable network, so the telcos can typically get by without terminating heavy users or charging them extra.

Yet right after Karl finishes explaining about how overage fees will change the competitive landscape, he starts ranting about the prospect of “investor pressure constantly forcing caps downward and overage fees upward.”

Competitive pressures make this scenario a remote possibility, especially as content portals serving massive files like Apple TV and Xbox Marketplace gain mainstream appeal. If Comcast wants to deflect criticism from other ISPs over bandwidth limits, any cap must be high enough to ensure very few customers even approach it. Arguably, 250GB a month is enough to satiate even power users, at least for a couple more years.

ISPs are competing fiercely to attract subscribers, so providers regularly make hay out of seemingly trivial product differences such as the “ugly cabinets” that AT&T sometimes installs when upgrading a neighborhood’s DSL speeds. Imagine the ads Verizon will run if Comcast starts charging customers for heavy use—“With Comcast, you never know when you’ll be hit with an enormous monthly bill if your kids go on a YouTube frenzy or your computer is overtaken by hackers. Here in FiOS land, rest assured there are no extra fees, no matter how much you download.” It’s not hard to see this message resonating with customers, especially those living in households with multiple Web-savvy residents.

Making things harder for Comcast is the fact that most U.S. customers aren’t used to explicit bandwidth limits (unlike Canadians). Currently, the only major U.S. ISP with an outright cap on consumption is Cox Cable, but even then enforcement is highly selective. Time Warner is testing the waters with bandwidth caps in a handful of markets, but otherwise most ISPs have either no caps at all or hidden ones affecting a tiny fraction of users.

The “Save the Internet” brigade’s insistence on neutrality and transparency has left Comcast with little choice but to resort to a metered solution to network congestion. Of course, I’m pleased that Sandvine and the “invisi-caps” will soon be history, and I look forward to consuming 249.99 GB each month on my Comcast connection.

But what about non-neutral solutions to last-mile congestion? To be sure, Sandvine was far from perfect, but who knows what innovative network management technologies will go undeveloped because of the stigma, and threat of regulation, against traffic discrimination?

It wouldn’t be surprising if we soon see calls for government to impose price controls because Comcast’s $1.50 per GB is “excessive” and “unfair.” For many proponents of government regulation of private networks, I suspect having neutral ISPs isn’t enough. They yearn for a utopian marketplace that offers limitless bandwidth, neutral networks, and affordable prices. And who doesn’t? But the best way to make this vision a reality is to foster private investment and let emerging technologies fill today’s competitive void.

Tags: bandwidth caps, comcast, net neutrality

05/12/2008 @ 2:16 pm | Tech & Telecom | 2 Comments

A Bill of Rights to enshrine Net Neutrality?

Posted by Ryan Radia

After changing its mind about throttling Bittorrent traffic last month, Comcast has pulled a 180° on network neutrality. Last week, Comcast announced plans to publish a consumers’ “bill of rights and responsibilities,” detailing what subscribers should expect from their ISP and laying out network management best practices.

Naturally, the “Save the Internet” crowd isn’t satisfied with Comcast’s declaration. Being protocol-agnostic wasn’t enough for them, and neither is a consumer bill of rights. Customers will only be safe from evil ISPs, they say, with aggressive neutrality mandates like Rep. Markey’s proposed legislation.

On one hand, Comcast’s declaration is good news for Bittorrent users, and illustrates the responsiveness of market forces. And as a Comcast subscriber, I’m all for non-discriminatory networks. (Though I seed torrents quite rarely, it’s nice to know the option exists.)

But declaring a consumer “Bill of Rights” is a risky approach. Comcast is ceding key ground to interventionists by implicitly admitting that consumers have some inherent right to unfiltered, unmanaged networks. They don’t—despite what lawmakers like Byron Dorgan have suggested.

Essentially, Comcast is saying “If we have to be neutral, then so should all the other guys. Otherwise, they’re violating consumer rights.”

Yet some ISPs are making just the opposite argument, identifying the benefits of curbing bandwidth-intensive applications. In comments filed last week, Bell Canada contended that throttling is in the public interest, explaining that 95% of subscribers suffer on account of file sharing. GigaOM posted a story yesterday that lends further credence to claims that peer-to-peer traffic is a major culprit of network congestion.

Perhaps we shall see a competing bill of rights—one holding that customers have the right to affordable broadband access free from file sharing-induced slowdowns.

As bandwidth demand continues to grow, ISPs must make tough choices. Between price increases, bandwidth caps, and protocol discrimination, it is far from clear what’s best for the average user. If AT&T’s prediction is correct that in three years time, 20 typical households will consume as much bandwidth as the entire Internet does today, then carriers will need to invest billions upgrading both the backbone and last-mile. Discouraging investment through regulation poses a far greater threat to the Internet’s future than hypothetical neutrality violations.

If neutrality truly is as virtuous as its proponents suggest (and I suspect it is) then it will ultimately triumph on its own merits, without the need for government intervention. Still, exclusionary, proprietary networks may yet play an invaluable role in propelling connectivity, despite closed systems’ shortcomings. Who knows what will work out best in the long run? Market experimentation is the only way to find out.

Tags: bandwidth, bill of rights, comcast, Markey, net neutrality, network management, protocol discrimination

04/23/2008 @ 6:07 pm | Tech & Telecom | 5 Comments