Shaping the Battlefield: Net Neutrality and a Review of 2011

18 January 2012

by Barry McKeown

Net Neutrality is a phrase and concept attributed to Tim Wu, a Policy Advocate and Law Professor from Columbia University. In February 2011 he became a senior advisor to the US Federal Trade Commission Office of Policy Planning, subsequent to the passing of Net Neutrality rules by the FCC, in December 2010, concerning: Transparency, No Blocking and No Unreasonable Discrimination.
 

In politics there exists checks and balances between power and influence. Put simply; Tim Wu does not have the power to break up an Apple or Google or indeed both (just as AT&T was broken up) but be assured that Tim has the influence to see that it gets done. People like Tim cannot be bought off. So, the issue that shall soon be upon an unsuspecting public is whether this break up is necessary, at this precise time, in order to preserve the neutrality of the Internet and especially the evolving mobile Internet.

The Master Switch

Can this stance be justified?

I would ask anyone who wishes to challenge the previous statements’ substance to first read Tim’s book “The Master Switch: The rise and fall of information empires”.

In his book Tim charts what he calls “The Cycle” relating the conflicts (technical, business and political) which arise between the proponents of open and closed systems. He advocates that a “Separation Principle” is necessary as “living in a contemporary democracy can lull us into regarding concentrated power as a historical problem we have more or less solved”.

The lessons Tim teaches need to be recognised not just by politicians and regulators but by all scientists, engineers, and especially readers of this magazine as they directly affect you: whether you believe this or not.

After reading Tim’s book, consider to what extent Net Neutrality influenced the abandoned merger between AT&T and T-Mobile(USA) and whether Google’s proposed acquiring of Motorola Mobility in August is as yet a done deal or instead the tipping point with the FTC while it still awaits clearance by the DOJ.

However, the US regulators have indeed learned some lessons and thus intervened to block the AT&T and T-Mobile (USA) acquisition with regulators stating that the takeover would “substantially lessen competition for mobile wireless telecommunications services…resulting in higher prices, poorer quality services, fewer choices and fewer innovative products”. Oh Dear! So why did OFCOM not act accordingly in the UK with Orange and T-Mobile (UK) to create Everything Everywhere?

Further consider the extent of the rationalisation and consolidation currently underway elsewhere with respect to Microsoft acquiring Skype, Texas Instruments acquiring National Semiconductor, Applied Materials acquiring Varian Semiconductor, and importantly Hewlett Packard acquiring the UK’s Autonomy and disposing of its interests as the world’s largest PC maker in revenue terms.
Unheralded IBM acquired the UK’s i2 for a mere $500m.

How long before ARM, CSR, and the Bristol cluster are gobbled up? Recall that when IBM’s CEO was asked why he sold its PC group to Lenovo he replied with just one word: Smartphones. He was wise and saw them coming.

The prime lesson from the debacle with the merger of Time Warner and AOL from 2000 which Tim charts in his book is that “the principal of net neutrality, instilled by the Internet’s founders, is ultimately what wrecked AOL Time Warner”. So true, but they did not see it coming.

What is going on here and what is now coming? The brief answer is: The Cloud.