Brian Will has a piece on Net neutrality: the electricity analogy, following up on dburrows explanation of the topic to his grandparents. Brian's point being:
The oblique threats to violate network neutrality coming from the telecom industry essentially come down to one thing: no one wants to be a commodity provider because there’s never an opportunity for turning a commodity into a golden goose. With a commodity, the seller pretty much gets back just what they put into it, never much more.
This explains the greater part of the enthusiasm during the tech boom: startups and investors desperately searched for a position of control, where hard work, a good idea, and being in the right place at the right time once could mean that you won’t have to do any of those things ever again to still rake in the dough.
He then goes on to talk about how that might look, but I don't think he goes far enough or in the right direction.
The electricity company (telcos) want to charge me for how I use their electricity (bandwidth) alright, and they will charge me different rates depending on whether I use it to boil an egg, watch a TV or run a heart/lung machine (boy now THERE'S a premium business)
But on top of that, they don't produce the electricity AND they want to charge the people who DO for carrying that electricity, AND they want to charge the producers based on the "kind" of electricity they produce.
So if most of my electricity is used for boiling eggs I get a cheaper rate than if it is used for running heart lung machines. This would be because I have a contract with the heart/lung patient for security of supply but I have to subcontract delivery to the line company who, naturally, will charge me more for QOS. ie the telcos want a cut of the producer's premium as well.
In other words, these guys want to be the ultimate gatekeepers, or highway robbers. The fact that they also happen to produce electricity (content) complicates matters and moves the whole thing from casual stickups to organised crime territory.
Which, incidentally, is what they should be doing. Profits are unearned income, cashflow without overhead; they owe it to their shareholders to create as much of that as possible.
Which is why we need regulators with half a clue. Its also why we ban slavery and demand that trucks on the road have minimum engineering and maintenance standards. While drugged up slaves driving broken down trucks maximise short term profits for the trucking company, if everyone does it, they will destroy the economy on which they depend for their business.
This is how capitalism (as distinct from open markets) works, right up to the moment when it fails completely. The push for network neutrality is just another effort to save the beast from its worst excesses.
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