Services, Infrastructure & Opportunity

Sunday, June 18, 2006

“Network Neutrality” is essentially about preserving the Internet architecture. If a carrier claims to be providing Internet connectivity it should mean that they are treating all packets the same. But Network Neutrality itself is not enough – the real problem is that the current “telecommunications industry” is must sell services to survive and that puts it competition with its customers and assures scarcity. The entire Regulatorium must be decommissioned so that our economy can thrive and we create our own solutions.

A century ago there were municipal light companies. Today we buy electricity and we choose to buy our own bulbs so we can use some of it to generate light. In 1980 we didn’t even own the phone wires in our homes. Today we should own the wires in our communities.

The Internet is not a “thing”. It is how we use the collection of locally managed networks that are interconnected. Instead of depending on a service provider we can take advantage of local and regional infrastructure simply as a transport just as we just as we use roads, rivers and paths.

We must preserve the principles that allowed us to grow the Internet by using the existing phone network as a transport. The carriers weren’t allowed to prevent us from using modems. Today that principle is under threat – we must preserve “network neutrality” if we are to create the next Internet.

The carriers recognize that this is a battle for their existence. As we establish the principle of neutrality we challenge the fundamental concept that the carriers own the transport for their own use in delivering services. We now create the services ourselves and it must be our infrastructure not the carriers’ private asset.

I’ve been trying to understand why some marketplaces grow very quickly. It’s about our ability to take advantage of opportunities and try out new ideas. In the digital world of the Internet we are continually trying out new ideas and failing. The Internet doesn’t make guarantees so we learn to tolerate failure and move on. When we do succeed we can share the results with others.

This is the essential dynamic that allows everyone to contribute. We aren’t limited to a choice of rigidly-defined and legislated services. It didn’t matter that initially we couldn’t make use of the Internet to make phone calls. We simply communicated using email. As we created solutions we created a demand and a marketplace for inexpensive packets.

I call this the “Opportunity Dynamic” or, if I can, Frankston’s Law – Marketplaces that provide opportunity rather than just solutions allow demand to create supply. It’s a generalization of Moore’s law.

It is this dynamic that we must preserve. “Common Carriage” laws prevented the carriers from blocking our ability to send email over the phone network. Today the carriers are under no requirement to let us create our own solutions. Network neutrality is necessary if we are to assure opportunity to discover the future.

We cannot allow the carriers to pick and choose what we are allowed to create. That would be a terrible tragedy for the economy. It would also prevent us from solving our own problems and leave us dependent upon the carriers’ choice of what is profitable to them.

The real problem is the regulatory system – what I call the Regulatorium. It’s a relic from the 19th and early 20th century concept of communications as a service provided by carriers. It’s a misunderstanding borne of the quirks of century old analog technologies.

The Internet is a dramatic counter-example. With digital technologies we can create the services ourselves.

While “net neutrality” is akin to “separate but equal” – even if the carriers can’t pick and choose what packets they will send it doesn’t obligate to do more than create more billable access. It won’t allow us to assume connectivity as infrastructure.

The Regulatorium is fundamentally at odds with users taking advantage of opportunity and creating their own value because the funding model is based on the carriers’ ability to sell services.

The transport is basic infrastructure like roads and sewers and can and must be funded transparently. If transport exists only for the convenience of the carriers then they must, by necessity, limit the supply of raw connectivity otherwise they cannot charge for services and cannot fund the transport.

We cannot afford to perpetuate the fiction that is the Regulatorium. The carriers have co-evolved with the Regulatorium and if they cannot reinvent themselves they will fail. This is the power of capitalism. Corporations are ways of bounding risk – their failure is an event not a catastrophe. In fact, corporations must fail so new industry can be birthed.

We need regulation when the marketplace has failed. The very existence of the Regulatorium is proof of a marketplace failure. In 1934 we didn’t have an alternative. In 2006 we now understand connectivity. A marketplace based on connectivity has incentives that are in alignment and thus little need for regulation.

We cannot afford to live as if were 1934 in 2006.

For a more detailed explanation read “Carriers: Their Services vs Our Infrastructure”. For the importance of opportunity read about “Achieving Connectivity”. For more about the underlying concepts read “Telecom is just a Phrase”. For those with minimal attention spans you can read about “Connectivity Sound Bites

The threat to net neutrality is immediate and important.

The carriers’ real problem is not neutrality. They face a future in which they have no role. We mustn’t confuse preserving obsolete business models with being pro-business. It’s just the opposite – business is a process and we must move beyond the 19th century’s Regulatorium to create opportunity in the 21st century.

Bob Frankston Site