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Home Broadband

Walled Gardens

by Dana Blankenhorn
June 2, 2006
in Broadband, Broadband Gap, business models, Communications Policy, Current Affairs, Internet, network neutrality, politics, regulation
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Mikegodwin
n my continuing effort to help people understand what network neutrality is about I ran into Mike Godwin who said this:

“Subscriber rejection of walled gardens is prettly clearly established.”

That’s the problem in a nutshell. The market continues to reject walled gardens, but these are the only kind the Bells want us to have.

Consider. Some 99% of the available bandwidth you might be able to use in reaching the Internet on your DSL phone connection or cable modem is being hoarded. These bits are defined as “services.” Phone services. TV services.  And you can’t get your bits unless you buy these services first.

Yet IP can replicate all these services, on a general-purpose pipe,  giving you unlimited choice and free phone calls.

The “network neutrality” debate, in the end, represents the Bells’ effort to re-define this last 1% of free bandwidth inside their “services” model, to essentially run a private network, call it the Internet, and then charge both sides of every information transaction.

This is a model that has been rejected countless times by the market. We rejected it as X.25. We rejected it (eventually) as America Online. We rejected it as cellular “online” services.

What we want, as consumers, is the Internet. What we want are the bits. We want to decide what to do with the bits we get. We want to get as many bits as we can afford, and pass along just as many.

This is the market lesson of the last decade, but it is willfully ignored. Instead we’ve had countless legal, regulatory, and now legislative efforts to get around it.

Why?

Walled_garden
Because phone and cable companies don’t want to sell bits. They want to sell services. They make more money from services than they make from bits. (This is a Tudor walled garden, built along similar lines as today’s Bell companies.)

This would be fine, if consumers had a free choice on where to go for bits. If we had bits freely available, from a variety of sources, I’d gladly drop the network neutrality debate and let the phone and cable guys offer their private, walled gardens in competition. I know how that would turn out.

But that is not the way this is being played. Instead, the Bells have eliminated competitors – with lawyers – and now seek to use those lawyers to force us to buy bits only from them, in the way they want to sell them, as services.

That’s an unregulated monopoly. That’s a Mexican Internet.

That’s a formula for economic disaster. Only it won’t just be the Bells falling off the cliff. It will be the U.S.

And if we want to prevent that disaster from happening, then network neutrality is the first vehicle we’ve had. If we can win here, we can fight the walled gardens again, with the full attention of the market. If we fail, we’re all just another brick in the garden wall.

Tags: AstroturfBellsInternet politicsInternet serviceISPISP servicenetwork designnetwork neutrality
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Dana Blankenhorn

Dana Blankenhorn

Dana Blankenhorn began his career as a financial journalist in 1978, began covering technology in 1982, and the Internet in 1985. He started one of the first Internet daily newsletters, the Interactive Age Daily, in 1994. He recently retired from InvestorPlace and lives in Atlanta, GA, preparing for his next great adventure. He's a graduate of Rice University (1977) and Northwestern's Medill School of Journalism (MSJ 1978). He's a native of Massapequa, NY.

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