The Internet has been abuzz lately with talk about the updated Open Internet policies that the FCC has proposed. The main comment is that they're harmful to new businesses that want to open up and start providing different services online. The short version, as I understand it, is that it would become legal for businesses to pay extra to have their traffic prioritized on the network. Netflix, for example, could start paying the consumer ISPs to prioritize their traffic. (This would be unrelated to their direct peering with Comcast) This, it is said, would prevent a new video service from starting up and being able to compete with a moneyed incumbent in the field (which at this point, Netflix is.)
I agree with that sentiment, and I can understand why that's the aspect of it on which people are focusing, but I also wanted to point out that it's not like the FCC has suddenly started down this path today and like this is some kind of brand new game that's being played. Of course, as Karl Bode of DSLReports points out, it's reasonably well known that current FCC chairman Tom Wheeler was formerly a cable industry lobbyist. It goes further back than that, however.
The telecommunications industry as a whole received a win in 1996 when the legislation that affects how different telecom services are governed was passed. The Telecom Act of 1996 said that wireline phone service as provided by the Bell companies and other independent, incumbent local exchange carriers was an essential utility service, but ruled that any Internet service was a luxury. If you just know that factoid, it probably seems like a short-sighted decision on the part of the FCC, something we'd eventually get over.
If you also know that in the 1980s and 1990s, starting almost immediately following the breakup of the Bell system in 1983 was when a lot of the problems we have today in the United States started. Throughout the '80s and '90s, the Bell companies (and everything they absorbed, which was a lot) asked for alternative price capping and profit capping measures, and in basically every state, they were granted permission to both increase rates and remove their obligation to either invest in the network or return profits to customers.
In the 1980s, this was asked for in order to help fund advanced calling features and ISDN, to both make more efficient use of the physical copper networks and to enable high speed data service. (Imagine – up to 128 kilobits per second of data transfer on two ISDN channels in the late 1980s, when in reality it took until the late 1990s for data speeds to reach 56 kilobytes per second.)
In the 1990s, as early as 1993, the big thing was that each of the Bells wanted to deploy a fiber to the home network capable, at the time, of up to 45 megabytes in each direction. The physical lines were to be used for general purpose data connections, delivering video content to homes (competition for the cable companies, that's good right?) and delivering even better and more reliable phone service. In addition, there was all sorts of talk about in-home services such as shopping, video conferencing, video on demand, etc.
The party line was that allowing the Bells to keep all of their revenues and raising the rates would allow them to take on the pretty intensely massive expense involved in deploying a nationwide symmetric fiber networking, especially in the 1990s when the only way to do it was with DS3s and/or with active Ethernet technologies, which aren't really cost-effective when GPON exists (which it didn't until 2008.)
Ultimately, the only deployments to come close were SBC's "Fiber in the Loop" deployment, which at its height allowed for each subscriber to have six megabits of network throughput, and Verizon's FiOS, which didn't even start rolling out until a decade after they were supposed to have hundreds of thousands of subscribers, in 2004. (SBC, now AT&T later started rolling out U-Verse, which today allows for 45 by 6 megabits over a bonded VDSL2 pair, with a single market getting fiber to the premises that allows for faster, symmetric speeds.)
Today, the Bells are essentially getting away with letting the copper networks stagnate, are attempting to gut legislation that requires them to run/maintain the copper networks at all, and are delaying as long as they possibly can on upgrading their wireline infrastructure. Verizon in particular has the most promising technology, fiber to the home capable of performance up to 500 by 100 megabits per second, and can potentially increase performance over time. Fiber to the home technology like FiOS (and some AT&T U-Verse and some of CenturyLink's newest deployments in certain areas) is not limited by physical distance, and as such doesn't require active intervening technologies such as remote terminal DSLAMs.
Unfortunately, Verizon has halted new FiOS deployments altogether and is now blaming "some parties" for the halt of this expansion. AT&T U-Verse is expanding, but not very slowly, and CenturyLink's policy on a national level seems to be that if you were lucky enough to have DSL of some sort, you don't need any more or any faster service for the time being. They've decided to focus their experimental "fiber" deployments to just two cities, which Qwest and Embarq previously used as testbeds, and limit the fastest proven DSL technologies to their largest, most lucrative, and presumably easiest to trench markets, like Phoenix.
Worse than the fact that they've all selectively deployed (they were supposed to deploy rural, suburban, and urban fairly equally) and that they've failed to live up to a long list of "Opportunity" deployments meant to be finished by a certain date, and meant to cover 100% of each of the Bells' territories. The due dates are overdue on some of these deployments, and coming up on a few of them.
The whole problem at this point seems to be the fact that Internet service isn't classified as a utility. If it were, the FCC could establish a nationalized carrier, or reign in the Bells again, and require that they provide a certain amount of service by a certain time.
I think if that had happened in the '90s, we would likely never have gone down the road down which we're now going. The main reason this is possible is the Internet, like Disneyland, is regulated like an extraneous and unnecessary entertainment service, even though it is now an important, maybe even mandatory for job hunting, education, and can be used for interacting with government and health care organizations.
Some people ask what a federally funded and regulated Internet would look like. My guess is that it would be a lot like the Inter-state highway system or the United States Post Office. Much like all of the legislation that exists about the public switched telephone system, it would allow competition on the platform that is the wires, even if there's not competition for the wires themselves. The platform will allow for other businesses, such as over-the-top video delivery, e-mail, social media, the sale of computer hardware and other goods, etc.
In addition to the real competition being applications for the wires, every house and business in the country would ultimately be equally served by this new system. If the FCC had classified data transmission services as a utility long ago, and maintained price capping, I'm reasonably sure we could have had a situation where today, every US Citizen has access to fiber based networking capable of a certain speed. I like to imagine that as a bonus for having built the wires and charged for certain access (such as a traditional telephone line) some data access would be free. It would be much like how there is no charge to receive mail from the postal service.
After "American Bell," or whatever the federal government and FCC name their network apparatus, mounts an ONT on every house, I imagine that citizens who plug a computer into it will be greeted by some general information about the service, and then be allowed onto the network at a certain speed. It would probably be pretty low. Presuming this is all done immediately with today's technologies, it's not hard to imagine every house would be capable of a gigabit in both directions. Similar to Google Fiber, providing a 5/1 or 5/5 link for free would be reasonable.
After that, either charge for additional possible throughput (30/30 megabit could be $10 or $20/month, for example), and/or charge for line features. A single static IP might be $5/month, for example. Ideally, the service would be free of transfer quotas, because they don't make sense anyway, and if you want the service to do any more for you other than just giving you a plain Ethernet hand-off (I imagine you would be able to choose your equipment, but something equivalent to today's telco/cableco residential gateways would be provided if you'd like to use it) there could be an additional charge for, say, home computer clean-up, or (in the style of the old Bell) for the lease of a computer or tablet in addition to the line itself. Although if tablet rental is a little bit too close to Shades of Bell, maybe a better idea is that something like a Sun Ray client can be rented or bought and you can use a remote graphical Linux or UNIX environment if you don't already own a computer.
After that, video and voice services could be sold by the incumbent or competitive services over the wire to the ONT, the gateway, or to a computer or device on the LAN. If you don't pay for generic data access, or if you pay for less than your total wire speed, they'd be delivered over the top of your data speed. If you pay for the full wire speed, they'd likely have to coexist with some of your wire-line traffic. (But it's unlikely that there will be a specific "960 megabit/sec!" tier. This would be similar to TelcoTV as it exists today anyway, and let's be honest, if the trade-off for TV is that you can only really use data at 900 megabits per second, I don't think anybody's going to mind.
If there are multiple residents of a house, such as with my current situation, a switch between the ONT and each gateway can allow multiple subscribers, each with their own LANs and services, to exist within a single physical residence, and if one of them moves, they take their gateway with them and simply re-connect it at their new location, keeping their static IP if they've bought one and all of their services.
Because essentially everything is TCP/IP data flowing over the wire, it doesn't really matter where you are, physically, in the network, and network services would become a lot more portable. The basic service would, I imagine, be delivered by a fairly basic residential gateway or router, and more advanced gateways and other equipment would be provided by third party Internet service providers, or you could register the WAN MAC address of a third party gateway with the network provider your choose.
This dovetails nicely with my comments from several weeks ago about the different telcos' philosophies about your home network. This would allow competition for services whose express purpose is to manage your whole home network for you to compete with plain Ethernet hand-offs on the same pipes, nationwide, and even to exist within the same house.
Of course, do to that, almost everything about the way networking is currently delivered in the United States needs to be changed, but it tends to be well agreed that this needs to change anyway. I just hope it's not in favor of Google.
The problem is that people who are in the know on the technical issues and also seem to know that the current incumbent carriers are doing a poor job at deploying technology also think that Google Fiber is the solution to all this for some reason. I'll agree that more sensible rules for deploying infrastructure nationally, and at state and municipal levels is a good thing, but I don't think that the solution is to preclude any government involvement whatsoever. In fact, for the issues I listed above, I actually think that putting the control into the hands of the federal government is the best idea, with states, counties, and municipalities likely being asked to feed into the system, much in the way they do with roads.
The other argument is that the government does everything inefficiently and there would be massive cost overruns. I think this is unfair to even talk about for two reasons. The first is that the incumbent network providers may not have been quoting prices correctly anyway. In addition, it's reasonably well known that the combined Bell companies today employ far fewer people than they did in 1983 at the break-up of the bell system. A large fiber deployment and the staffing to both build it out and maintain just the physical elements of it may require more employees than the Bells currently have. The second is that when regulated as a utility, you know that whatever they charge you is pretty close to the actual cost of building and running the network is. Once the network is finished, as the costs go down, so will the prices to subscribers and the costs to competitors offering services on the platform.
The challenging thing is that a lot of people hold the attitude that such an arrangement creates even more of a "government sponsored monopoly." Unfortunately, this type of service is the kind of thing that's probably best as a monopoly. As with railroads and building interstate roadways, there's simply too much work involved and a limited amount of resources with which to do it. Imagine if Ford, Chevrolet, GMC, and Volkswagen each had to build their own road system. Imagine, alternately, if you had a local road provider, (and you didn't have a choice who provided your particular roads) and in order to get anywhere, you had to drive from your house to a large city, wait in congested traffic, and then drive back the other direction to wherever you'd wanted to go, even if they're physically just down the street.
I think the other thing to consider is that by and large, the telcos are already overrunning and incorrectly using the public money that they use to fund the networks they've been building. Commentary about Frontier telling the FCC that they'd need more money to provide ten megabits is pretty telling, for example. Frontier may or may not be right to make these comments, but I imagine it still smarts for their subscribers to hear that the company wants even more money from the government in order to make ten megabit service available to all of its customers.
Regardless, the unfortunate truth is that the "situation" is going to take a long time to get sorted. Firstly, if the government decided to re-coalesce and then acquire the bells, that alone could take years, and then there's the matter of what technology to use to deliver the universal data pipe, and then there's the matter of establishing exactly how (like, from a technical perspective) competition is to happen on those pipes.
To the untrained eye, it may look like just giving Google license to deploy the whole nation would be faster. I don't think that it would speed things up any, in terms of the actual deployment, though. We're in a bad place and it's going to take a while to fix. The challenge now is determining how to fix it, and even that will take time. To roll this all the way back to the beginning, when so much of the nation can't even connect to the Internet at 4/1 megabits per second, I don't honestly think that a "fast lane" for network traffic is really our biggest problem.