A waste of good brainpower

by Scott Bradner

The Virginia Journal of Law and Technology just published an article by Rob Frieden titled "Without Public Peer: The Potential Regulatory and Universal Service Consequences of Internet Balkanization" (http://vjolt.student.virginia.edu/graphics/vol3/home_art8.html) As far as I can tell all of Professor Frieden's assumptions of Internet structure are wrong. This has a negative impact on the usefulness of the conclusions he reaches.

The article looks at the application of the universal service fund (USF) on the Internet, which is an important issue to address.

Reality sometimes hurts. For example things don't cost the same everywhere. Electric power is more expensive in Boston than it is in Seattle. Gasoline is more expensive in Hawaii than it is in Texas. For most people these are facts of life. We evaluate the various features of living someplace and decide where to live based on our priorities. Cambridge may not be the best place to live if I wanted to raise emus but it is quite convenient since I work at Harvard.

This same type of disparity used to be present in telephone service due to the higher cost of wiring up customers in areas of low population density. But since the establishment of the universal service fund (USF) the costs to the consumer have been artificially leveled by levying an extra tax to telephone customers in low-cost areas and using the funds to subsidize telephone customers in high cost areas.

Enter the Internet. The movement of telephone and telephone-like services to the Internet means that regulators are starting to ask if Internet customers should also be charged the USF tax. In addition, some people are beginning to ask if Internet costs should also be artificially leveled using the USF since it is becoming so important.

There are real questions and we will need answers to them soon. A number of scholarly papers on these topics are beginning to show up, unfortunately many of them, like Professor Frieden's, demonstrate an impressive lack of understanding of the current Internet world and thus waste the brainpower of their authors.

I do not have the space to list all of the misunderstandings in this article but they range from not understanding that most Internet service providers (ISPs) have always been paying customers of other ISPs and there are no "free riders", to not understanding how peering points such as MAE East are run and assuming that the CIX is a common model of interconnection. Based on these flawed Professor Frieden finds that the interconnection structure of the Internet is changing for the worse and implies that something should be done about it such as mandating requirements for ISPs to interconnect. He then discusses some FCC rulings and finishes the article by arguing that ISPs should be required to pay into the USF, without actually saying so.

This is clearly a thoughtful article, unfortunately its not based on reality. When people like Professor Frieden are able to get a better understanding of the real world before they start, these articles will become relevant, and that will be very useful.

disclaimer: Harvard thinks it deals with reality, as do I, and the above is a reflection of my understanding.