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[160.94.6.216]) by smtp.gmail.com with ESMTPSA id u36-20020a05622a19a400b0041815bcea29sm657413qtc.19.2023.10.31.10.12.53 (version=TLS1_3 cipher=TLS_AES_256_GCM_SHA384 bits=256/256); Tue, 31 Oct 2023 10:12:54 -0700 (PDT) Date: Tue, 31 Oct 2023 12:12:43 -0500 (CDT) From: odlyzko@umn.edu X-X-Sender: odlyzko@math-vinh511.math.umn.edu To: nnagain@lists.bufferbloat.net Message-ID: User-Agent: Alpine 2.21 (DEB 202 2017-01-01) MIME-Version: 1.0 Content-Type: text/plain; format=flowed; charset=US-ASCII Subject: [NNagain] some comments on old threads on this list X-BeenThere: nnagain@lists.bufferbloat.net X-Mailman-Version: 2.1.20 Precedence: list List-Id: =?utf-8?q?Network_Neutrality_is_back!_Let=C2=B4s_make_the_technical_aspects_heard_this_time!?= List-Unsubscribe: , List-Archive: List-Post: List-Help: List-Subscribe: , X-List-Received-Date: Tue, 31 Oct 2023 17:12:57 -0000 In catching up on accumulate emails, some of the early posts on this list caught my attention, on throttling, roles of governments and monopolies, and so on. This is something I have been looking at since I first got involved in network economics in the late 1990s, and some folks on this list might be interested in a few comments. First of all, although I have been a strong advocate of net neutrality from the start, half a dozen years before the term "net neutrality" was coined (in the context of considering QoS), I concluded that the argument for it should be more subtle than just resistance to discrimination. In designing operations and pricing for an infrastructure, one needs to consider carefully what that infrastructure is for, and also its costs and benefits. Discriminatory practices have often been essential to the provision of a variety of goods and services. Since railroads have been mentioned on this list, it might be worth recalling that one of the most memorable descriptions was written in the 1840s by Jules Dupuit (the most eminent of the French engineers who were the first ones to come up with basic concepts of microeconomics): It is not because of the few thousand francs which would have to be spent to put a roof over the third-class carriages or to upholster the third-class seats that some company or other has open carriages with wooden benches. What the company is trying to do is to prevent the passengers who can pay the second class fare from traveling third class; it hits the poor, not because it wants to hurt them, but to frighten the rich. And it is again for the same reason that the companies, having proved almost cruel to the third-class passengers and mean to the second-class ones, become lavish in dealing with first-class passengers. Having refused the poor what is necessary, they give the rich what is superfluous. (You might like to recall this the next time you board a commercial airplane flight!) It should be emphasized that Dupuit was not exaggerating. I have evidence that on some early British railways third-class carriages had no seats at all, and sometimes passengers had to share the space with pigs. (There was even a suggestion by a director of one railway that they should send chimney sweeps with their equipment in third-class carriages, but I have not found any evidence that this was ever implemented.) So discrimination was common, and was accepted, even if reluctantly. (And so it is today, for example in progressive taxation, where one dollar is not the same as another, or in tuition at American colleges, where effective prices paid by students vary depending on their parents' incomes.) Nowadays the phrase "charging what the traffic will bear" has strongly negative connotations. But in the past it was used to mean that some goods could be charged more, that a canal or railroad fees for carrying pottery or steel would be more than fertilizer "could bear," so one should not charge by weight alone. (This, as might be expected, led to attempts at evasion, loads of pottery hidden underneath fertilizer, and so on. Generations of lawyers thrived on litigating such issues.) It is important to remember that discrimination was not necessarily imposed by governments (which typically imposed limits on it), nor was it always due to monopoly power. As Alissa Cooper showed in her studies of throttling by British ISPs about a decade ago, and as was observed on railroads in the 19th century, increased competition often led to increased discrimination. However, differential charging has always been a very sensitive issue, which is why service and goods providers have often resorted to "market segmentation," with different qualities of service, as with railroads and airlines. The practices that led to the greatest opposition were those verging on what economists call "first degree price discrimination," where each individual is charged the maximum that person is willing to pay. (By sellers have always strived to approach as close as they could to first degree price discrimination, and with modern information technology tools that strip away anonymity, they are getting closer. Uber is an interest example, but not the only one.) That is what led to the first serious federal government intervention in the conduct of business, the Interstate Commerce Act of 1887. It forbade various types of discrimination, but not differential charging for different types of freight, for example, as those were too important to be abandoned. In general, historically, discriminatory practices have been more readily accepted when costs were high. I have written quite a lot about this, and perhaps the best survey of the evidence and arguments is in the paper "Network neutrality, search neutrality, and the never-ending conflict between efficiency and fairness in markets" which was published in Review of Network Economics in 2009, https://www-users.cse.umn.edu/~odlyzko/doc/rne81.pdf (This was, as far as I have been able to ascertain, the first use of the term "search neutrality" in a scholarly paper, and today search neutrality appears to be a more pressing issue than net neutrality.) Hence the argument for net neutrality was based not just on a general desire for having a free Internet, but also on the relatively low costs of this infrastructure (and although it might seem surprising, providing Internet service is very inexpensive when compared to providing rail services in the 19th century), and also on the value that this infrastructure provided. As was pointed out in a paper at the IEEE Globecom'99 conference, "The current state and likely evolution of the Internet," https://www-users.cse.umn.edu/~odlyzko/doc/globecom99.pdf the main service that the Internet provided then, and, as is finally being recognized, provides today, is low transaction latency. That makes it hard to implement effective non-neutral policies. Quite a few other papers and presentation decks on these topics are available on my home page, and they have references to much of the related literature. Andrew ------------------------------------------- University of Minnesota Minneapolis, MN 55455 odlyzko@umn.edu email 612-625-6413 voice phone https://www-users.cse.umn.edu/~odlyzko