GEEKNOTE: Since the beginning of the Internet, it was always agreed that companies would peer with each other at the major interconnects without charging each other for the data transfers. If you were a top level Internet host, like an ATT or Verizon, things worked out just fine. Smaller players always had to buy their connections to the Internet from a bigger company that had the peering arrangements set up. This all worked fine so long as the traffic was more or less symmetrical, eg. about the same amount of data went both ways.
The Internet has changed over the last 20 years or so, especially with the advent of companies like Netflix that are streaming out massive amounts of data, but receiving very little in return. Internet providers offering connections to consumers have found themselves in the position of needing to provide increasingly large data pipes to get all the data being requested to their customers.
There are two basic solutions to how to pay for this: The first option is for consumers to pay for the data they consume, much the way that most cell phone providers charge for the amount of data traffic their customers use. The second option is for large generators of time sensitive data (eg. Netflix) to kick in and pass that cost on to their customers.
For most of us, the time it takes to send pictures of kittens / puppies / grandchildren to facebook really doesn’t matter. Likewise, if I’m shopping for a new Chevrolet on the Castriota.com website, it really doesn’t matter if it takes an extra second or two to load a page with pictures of a car.
On the other hand, if I’m watching the latest blockbuster on Netflix, I DO care about how fast the data stream arrives.
We are seeing a merging of data feeds into a single TCP/IP structure. Vint Cerf famously made a t-shirt for himself that proclaimed “IP on Everything”. The reverse is actually what is coming to be: Everything on IP. Analog copper phone lines are going the way of rotary phones. When Verizon installs FIOS at your home or office, they generally yank out the copper wires. EVERYTHING on FIOS is bits. Brighthouse cable is headed in the same direction.
You can stuff massive amounts of digital data on a fiber optic cable. In the final analysis, it doesn’t matter if it is digital TV, digital phone, facebook, or a Netflix movie. It is ALL digital and the only real difference is how sensitive it is to delays. In a very real way, Netflix is using the same technology to send you a video stream that the cable company is either using today or will be shortly to send you your regular TV programming.
Cell phone bandwidth is a finite resource, which is why most of the cell phone companies charge for data usage. Because fiber has such massive potential, I don’t see it making any sense for the Verizons and Brighthouses to jack up their consumer prices, at least where we notice. The direction this is headed is amazing. In another few years, the 50 meg service a lot of us has now will seem as quaint as a dialup connection to the Internet. Google is rolling out gigabyte service to a handful of cities and I fully expect to see Verizon and Brighthouse head in that direction sooner rather than later.
The FCC has opened the doors for content providers to pay a premium for faster access to their customers. The FCC may still find a way to screw this all up, but I think things will be sorted out in short order.
An interesting aside is that it costs no more to send a data bit from here to Tokyo than it does to send it from here to Tampa. Expensive international long distance rates are rapidly becoming a thing of the past. That’s probably a good topic for a future GEEKNOTE.
Rob Marlowe, Senior Geek
Gulfcoast Networking, Inc.
GEEKNOTE: Net Neutrality