More on net neutrality

The latest stratechery (now pronounced "strah-tek-ery", apparently) podcast had a lot of good information in it.  There was discussion of what "common carrier" status means, which I should have probably explained better in my last mention of the issue.  And there was an excellent discussion of what "rent seeking" means, in economic terms.

(And a brief sidenote about the Andreeson quote.  Utilities probably did have 10x as much poop to handle every three years for the first decade or more of laying pipes to deal with that.  I wish my grandfather was still around to ask about that; he spent most of his career putting in sewer lines.)

There's also some interesting things I never considered, like how Netflix' behavior might be rent-seeking, and how metered usage would solve a number of problems.

The problem with metered usage is a simple matter of cognitive load.  Until the prices get much lower (in line with the cost of providing the data), it adds much great transaction costs.  Very few people would have signed up for broadband at all, if it had been metered; they had no idea how much they used.  And even now, it'd be a big shift.  But maybe that's where things need to go; I've been solidly against that, but they've got me thinking a bit more about it, and maybe it's inevitable.

But there were a couple places where I thought the discussion fell down.  One was that they failed to mention how, back in the 90's, the telecomms were given hundreds of billions (yes, that's with a B) of dollars in tax breaks to provide Fiber to the Home (FTTH).  How much of that exists?  Yes, basically zero.

Another was that there was no mention of how the governments provide rights of way to put in cables.  That's also a hundreds of billions of dollars subsidy.  Not that I mind it being provided; I do agree with them that, at this point, internet access is a basic right.  But it does bear on the discussion.

A final one (and this is the important one) is the idea of content delivery networks.  The basic idea is that the CDN provider (Akamai, for instance) puts their servers in the ISP's data center, and Netflix, for instance, provides data to the CDN, and the CDN delivers to the customers.

What that means is that, despite the fact that Netflix is the bulk of all internet traffic, most (read: probably 99% or more) of their traffic is only going from CDN to end user.  And that means, as far as the ISP is concerned, the data is staying within the ISP.  And bandwidth within the ISP is, effectively, infinite.  The cost to the ISP is the cost of electricity.  In aggregate, that's a lot, but it's mostly the cost of having the system operating; data traveling adds very little.

So I fundamentally disagree about Netflix being rent-seeking.  And about the reasonability of the ISP charging extra for Netflix.  Netflix pays the CDN, and the CDN pays the ISP, so they're actually looking to triple-charge, not double-charge.

The other major issue is that they missed, as I mentioned, Wheeler mentioning "common carrier" status, and mentioning reclassifying ISPs.  Not a huge deal, as I don't believe Wheeler when he talks about it, but it's worth mentioning that Wheeler did add it to the discussion.

Still, well worth a listen, despite it being quite long.

Netflix addendum

I talked, earlier, about Netflix and bandwidth for 4k video.  I'm a little surprised by a couple of things I've seen.  One is that Netflix' FAQ says that their "Super HD" quality (1080p, I assume) requires only 7Mbps, which is a lot less than stuff I've got.  In fact, thinking about it, it's less than the maximum that a DVD can use (10Mbps; think, for instance, of the ending scene of Much Ado About Nothing, with a blizzard of confetti raining down), let alone what a Blu-Ray requires.

So I wonder about that.

But the other thing that I saw was a reference (I thought on Daring Fireball, but I can't find it now) that said that only 15Mbps was required.

I don't know, but that sounds incredibly low to me.

Card Stream?

A friend pointed me at the announcement that Netflix will be streaming House of Cards in 4k resolution this year.

I find two things interesting about this.  One is that it's only for LG TV users.  The other part, though, is wondering who will have the bandwidth to receive the stream.  I have FiOS; I didn't think that'd be fast enough, but the top two plans ($210/mo or $300/mo; I hadn't looked recently, and didn't know those two were available) might be.  Outside of those people, and Google Fiber people, I'm not sure who has the bandwidth to take advantage (because those are very small groups).

Showtime Has a Problem

I get my internet/tv/phone service via verizon (fios is nice, even if the monopoly nature of verizon bugs me). For reasons unknown, they decided to give me free access to the Showtime channels a couple of months ago. I mostly ignored it, other than saving a couple of movies on the DVR (which I really need to watch, I guess). Well, the free part was about to expire, so I called to cancel it.

Not too interesting, right? Well, they asked why I wanted to cancel it. Well, I never asked for it, what do you think? But to put it a bit more pointedly, it occurred to me right then that it wouldn't ever make sense to pay for it. So I answered, "If I really wanted the movies, I'd just subscribe to netflix". And, you know, I would.

But there's even more of a kicker to the whole thing. While talking, I asked about faster internet service, and agreed to pay $15 more per month for that. No big deal, right? Well, the kicker was that that faster internet service also came with more TV service, including the Showtime channels. Even sillier, the Showtime channels alone, that they were trying to sell me, were going to cost $25.

Showtime has a serious business model problem, as does HBO. I find myself doubting that their original programming is enough to make up the difference. All Netflix has to do is offer a better deal to make their own original programming (which I hear they're now working on), and it's pretty much game over.

(Now to go re-reconsider that Netflix subscription, which I've been mulling over for almost ten years, now.)

Apple's new toys

Today Apple announced new iPods; the new Touch looks pretty sweet, although I'd still prefer to get an iPad with the new display and cameras.

I was hoping for more from the AppleTV, though. Still stuck in 720p *sigh*. That, by itself, is enough to kill it for me. I'm also a bit disappointed by the removal of the drive. Unless I get a Netflix subscription (which I've been debating for a number of years, now), this really doesn't have anything for me. Needing to have a computer on to get to any of my movies is also a deal-breaker for me.

I'll keep my hopes up for the next release (which hopefully won't take as long as this one did).

At this rate, I'll just wait a bit and get an iPad which will do everything I want the AppleTV to do. Oh, well.