THE NETWORK NEUTRALITY DEBATE, INTERNET FRAGMENTATION AND INTERNET DEVELOPMENT

Romina Paola Bocache

When one thinks of the Internet, it is usually described as a unique and dynamic world without borders, in which ideas flow freely and are freely accessible. However, the Internet is, in fact, prone to fragmentation along a multitude of different lines owing to acts or omissions of different actors governments, companies, users!. "mong the principles holding the Internet together is its neutrality. #he Internet was conceived and designed to enable data transfer between end points without discrimination of the network, thus assuring uninterrupted communication between any users. However, a variety of stakeholders currently question this principle$$and for quite different reasons. #he so$called net neutrality debate, which has recently come to the forefront of Internet governance discussions in the %&, is an e'ample. "s with any Internet$ related discussion in the %&, this may have considerable effect on a global level, in particular, on developing countries. Here, we address a number of issues. If net neutrality is worth preservation, it is imperative to define a means to do so. We e'plore briefly the ramifications of imposing a political or legal solution at a national or an international level. We discuss whether it is possible to resolve net neutrality issues with a technical solution, without recourse to legal and political means. "s well, we consider the effects of market forces that may ensure the best outcome without intervention. We conclude with the proposal that net neutrality should be preserved, while at the same time leaving room for other technological and security demands( net diversity.

In e!ne F!a"men a ion# B!oa$ %on e&

#he Internet is often perceived as a system of intersecting pathways, which look the same and can be easily accessed from any of its points. However, the Internet can be fragmented in many ways, as illustrated by a number of images or metaphors. #he Internet may fragment into parallel Internets, which includes initiatives to build nets linked to alternative domain names and roots such as the )pen *oot &erver +etwork of ,ermany, and %nified*oot of Holland!different legal entities, not considered part of the national territory of states from an international law point of view. cyber bunkers or gated communities created for security purposes!a two$tiered Internet, with a .I/ Internet and a standard Internet.

)ne can predict with certainty that the Internet will continue to evolve into fragments. #he loss of net neutrality may be one more dimension of the fragmentation of the Internet with potentially grave implications for developing countries.

Ne Ne' !ali (# De)ini ion*

)ne of the origins of the controversy over the principle of net neutrality lies in different understandings of this concept. 0li +oam outlines seven related, but different meanings associated with this concept( no different quality grades fast lanes! for Internet service no price discrimination among Internet providers no monopoly price charged to content and applications providers no charge to providers for transmitting their content no discrimination on content providers who compete with the carriers1 own content no selectivity by the carriers over the content they transmit no blocking of access of users to websites. 2+3

#he lack of common approach to the issue of network neutrality makes finding a solution as well as analysing the problem itself! more complicated. In the most basic, technical understanding, a neutral network is one that transports data packets without giving any of them priority, not even based on the type of application to which they belong. 4rom this perspective, the Internet should simply be a highway to transport equal bits of information. In this understanding, the principles of net neutrality are( non$discrimination no traffic will have priority!, interconnection users have the right and the duty of connection with other users!, and free access each user can have access to any other user!. In essence, this principle implies that Internet service providers will transport data bits without discrimination, preference, or attention to the content. &ome scholars see the non$discrimination of information packets regardless of application as evidence of the Internet1s non$neutrality- 5olumbia %niversity law professor #im Wu 2 ,3 claims that the completely dumb network is not neutral, as it ignores the needs of particular applications and, hence, effectively discriminates against applications such as streaming video and audio. In Wu1s conception, net neutrality means equal treatment among similar applications, rather than neutral transmissions regardless of applications. 0vidently, the interpretation of net neutrality as the non$discrimination of information packets based on application has important technological and political ramifications, since it runs counter to a widely$held perception of net neutrality as absolute and inherently tied to the 0nd$ to$0nd structure of the Internet. #he relation between net neutrality and the 0nd$to$0nd architecture thus requires more detailed investigation. #he 0nd$to$0nd architecture of the Internet is often described as dumb network 6 smart terminal model. #his means that the network makes no data packet discrimination- all the data manipulation occurs at the end points. #his is quite different, for instance, from the telephone system, where the net is smart and terminals are dumb. However, a dumb network is not a guarantee of net neutrality in a broader sense( the software and hardware in intelligent terminals can also influence the traffic flow, thus affecting the delivery of packets. In other words, it is possible to discriminate against certain content and applications without adding e'tra intelligence to the network. #his means that although net neutrality and 0nd$to$0nd structures seem to overlap, each has its own meaning. +et neutrality is not guaranteed by an 0nd$to$0nd design. Indeed, in #im Wu1s understanding, only the introduction of a smart network can guarantee net neutrality- this smart network would route packets to ensure the best results for all applications. It is important to emphasise that an 0nd$to$0nd structure is a technical arrangement related to the design of the Internet, while net neutrality is a policy related to the management of the information flow inside the system. +et neutrality cannot be guaranteed by purely technical means, that is, by changing a particular architecture, but should be complemented by appropriate legal or political norms.

Ne Ne' !ali ( De-a e# Bac."!o'n$

#he net neutrality debate originates within certain practices of Internet service providers I&/s! and Internet bandwidth providers I7/s! in the %& and other countries. #hese practices were, in turn, prompted by various trends in the development of today1s Internet( the broad spread and increasing popularity of applications that operate in real time and cannot tolerate even short delays in data packet delivery so$called low latency applications!, such as streaming video and audio, .oI/, and online gamesthe increasing use of online games, music, and video downloading, including file$sharing via peer$to$peer networks, which demands further investment in network development and which is incompatible with the pricing models of many providers who offer supposedly unlimited access to their subscribersthe increasing use of wireless home networks, which allow neighbours to share an Internet connection, thereby reducing revenues for the service providersthe development of new applications for voice and video transfer over the Internet, which threatens the revenues of traditional telecommunication providersimprovements in networking technology, which make broadband service cheapergovernmental and municipal investment in the construction of Internet infrastructure, including wireless networks. 2/3

#o protect their economic interests in view of these developments, many I&/s introduce practices that many users and observers deem illegal or harmful for the future of the Internet, predominantly so$called traffic shaping. 7y both technical and legal subscriber agreements! means, I&/s try to prevent users from installing wireless routing devices which is termed theft of service!, from using .oI/ and file$sharing software. In addition, some I&/s block access to certain websites and filtered emails that contained criticism about them. #his trend towards a non$neutral Internet is taking different forms around the world. "ccording to 8ichael ,eist 203, in the developing world, where there is frequently limited telecommunications competition, many countries have begun blocking Internet telephony services in order to protect the incumbent telecoms provider. . . . In 0urope, some I&/s have similarly begun to block access to Internet telephony services. 4or e'ample, this summer reports from ,ermany indicated that .odafone had begun to block .oice over I/ .oI/! traffic, treating the popular &kype program as inappropriate content. In addition, some representatives of telecommunication companies have speculated on charging an e'tra fee to content providers who want their pages to download more quickly than the pages of those who do not pay. #hus, the I&/s could give priority to certain bits over others, differentiating service based on content. It is not surprising that these and similar initiatives invite strong opposition on behalf of end$ users and companies, including the opposition of several ma9or content providers. #hose arguing in favour of protecting net neutrality include such companies as "ma:on.com, ,oogle, 0bay, 8icrosoft, ;ahoo<, several consumer rights associations and other non$profit organisations, think tanks /rogress and 4reedom 4oundation!, well$known Internet academics such as =awrence =essig and #im Wu, members of the Internet community both technical specialists, including &ir #im 7erners$=ee, and opinion leaders!, media critics and so on.

+et neutrality opponents are financially powerful companies with significant market power telecommunications companies, such as .eri:on, 5omcast, "#>#, cable companies and their associations, equipment vendors!. #hese companies may employ the potential of business associations including the %& 5hamber of 5ommerce! and business$oriented interest groups and en9oy the support of such free$market scholars as 5hristopher ;oo and "dam #hierer to promote their cause. It is important to emphasi:e, however, that the map of the net neutrality debate is far from black$ and$white. 8embers of each of the camps differ on e'act definitions of the term and policies support their side in the argument. 4or instance, some of those who speak in favour of neutrality, such as &ir #im 7erners$=ee also suggest that this result can be best achieved by market forces rather than any e'ternal intervention. #able ? illustrates the positions of different authors with regard to two main dimensions of the net neutrality debate. Table 1: The Net Neutrality Debate /ro /reservation +o regulation &ir #im 7.=ee +et +eutrality "gainst /reservation )rlowski #hierer +et @iversity ;oo! *egulation =essig 5lark and &usan 5rawford +et

+eutralit

Wu supports a different concept of ne 7lumenthal neutrality as equal treatment among equa applications! +et @iversity 5enter for @emocracy and #echnology, Weit:ner!

#wo possible kinds of solutions to protect net neutrality can be identified( technical and non$ technical. #he latter may be legalApolitical by means of government interventions! or economic. #herefore, essential questions remain. Who should impose the solution( national or international authorities or the marketB

The F!ee1Ma!.e 2ol' ion

#he arguments of the opponents of regulatory involvement can be summarised with a few points( political or legal intervention is not necessary market forces, not e'ternal regulatory intervention, will lead to a solution "ccording to #hierer, /ricing is the key to solving CD percent of the questions raised in the debate over +et neutrality 2 33! regulation will cause regulatory capture adherence to net neutrality will not allow achievement of the quality of service for innovative applications, such as streaming video and audio peer$to$peer sharing is unfair and illegal regulation will suffocate innovation, while differentiation of services and prices will foster competition 243!

4rom this perspective, market forces, rather than e'ternal regulatory intervention will lead to a solution that would best satisfy the interests of all stakeholders, including content producers, I7/s and I&/s, and end users.

The Poli ical In e!5en ion 2ol' ion

#hose who support a political solution propose a number of arguments( the Internet requires monitoring by national and international agenciesma9or industries are affected by the Internet( health care, finance, retailing, gamblinghuge tariffs for fast, secure Internet use are sub9ect to discriminatory and e'clusive arrangements with telephone and cable giantsthe prevention of a two$tiered Internet requires a political solution 2 63.

#he advocates of net neutrality are critical of their opponents1 claim that a political intervention solution will improve services for those who pay an e'tra fee, not degrade it for those who do not pay. "ccording to ,igi &ohn, president of /ublic Enowledge, a digital rights advocacy group, /rioriti:ation is 9ust another word for degrading your competitor. . . . If we want to ruin the Internet, we1ll turn it into a cable #. system that carries programming from only those who pay the cable operators for transmission. 273 "mong those who support political intervention in order to preserve net neutrality, some advocate another way of solving the net neutrality problem( public municipal, regional, or national! provision of broadband access. &ome authors such as &tanford %niversity law professor, =awrence =essig! suggest that Internet access should be treated as a universal public good- if government supplies access to its citi:ens, making it available to all, speed will become less important. #his, according to =essig, would restrict carriers1 ability to charge content providers different fees in order to prioriti:e delivery of their data packets across the Internet. 283

The Ne 9o!. Ne' !ali ( De-a e an$ De5elo:in" %o'n !ie*

0ven though the primary problem regarding the Internet in developing countries is access, net neutrality remains a ma9or issue. " tendency to monopoly and overpricing is present in many developing countries. %sers in developing countries are often dependent on one I&/. #hus, the risk of I&/ market concentration is much higher in developing countries. In many developing countries, the leading or monopolist telecommunication company is also the leading or monopolist I&/. #his reduces competitive choices for telecommunications services and cuts consumers off from one of the fastest growing segments of the Internet. +o guarantee e'ists that profits gained from premium services will be channelled into the development of infrastructure for everyone. #his is especially doubtful if this money goes to transnational I7/s interested in building an Internet wherever it may be most profitable most likely not in developing countries!.

#he negative consequences of a two$tiered Internet for content providers and other businesses in developing countries inhibits progress. 5ompanies from developing countries that cannot pay an e'tra fee to I7/s to ensure prompt access to their pages run the risk of losing markets. #his may lead to the websites of firms, universities, and agencies from developed countries forming part of a .I/ Internet, and to the e'clusion of those from developing countries.

"dam 5ohen, in his article, Why the @emocratic 0thic of the World Wide Web 8ay 7e "bout to 0nd, analyses the effects of a two$tiered Internet on poorer websites, indirectly taking into account the situation in the developing world. He states that Web sites that could not pay the new fees would be accessible at a slower speed, or perhaps not be accessible at all. " tiered Internet poses a threat at many levels. &ervice providers could, for e'ample, shut out Web sites whose politics they dislike. 0ven if they did not discriminate on the basis of content, access fees would automatically marginali:e smaller, poorer Web sites... 2+;3 We conclude that the problem of +et +eutrality is even more important for developing countries than for developed ones. /ro$market arguments, which may be valid in countries with well$ developed I&/ markets and multiple Internet access options for users, are much less persuasive in the case of developing countries. "t the same time, the possible negative effects of abandoning +et +eutrality and building a two$tiered Internet are much more severe for developing countries where adherence to net neutrality principles and their enforcement by means of governmental regulations will ensure that the interests of both businesses and individual users are protected.

Ne Di5e!*i (# A Po**i-le 2ol' ion o! a %om:!omi*e<

We believe that an open, generative and innovative Internet, derived from the net neutrality principle is a positive characteristic that should be preserved, taking in consideration the necessity to create a new balance between openness and other values accountability, security, trust! that are emerging in the changing conte't in which the Internet is embedded. " technical principle such as 0nd$to$0nd should not be the basis for a future Internet governance regime. Internet openness should rest not only on technical assumptions, but also on political and legal mandates. Indeed, a holistic approach legal, social, economic! is vital, since policy$makers should consider the widest possible conte't in which technical solutions arise. =aw, technology, and markets are different mechanisms to achieve a balance of power among different actors and, therefore, their political connotation should be taken into consideration. " possible solution to the net neutrality controversy may lie in the middle, somewhere between its complete abandonment and absolute adherence. #he compromise proposed by some authors ;oo, 5enter for @emocracy and #echnology! is to preserve net neutrality, while at the same time leaving room for other technological and security demands( net diversity. "lthough the supporters of this concept recognise the importance of net neutrality, they argue that certain limitations to this principle would bring benefits for security and technological reasons!, in addition to economic efficiency. #hey state that it would be positive to allow a differentiation of prices and services in order to meet heterogeneous demands and needs. In their vision, a range of specialised nets could arise( a traditional one for email and website access, another one with special security requirements for e$commerce and e$government, and one for latency$sensitive applications such as media streaming and .oI/. While the first would respect the net neutrality principle, the others would abandon it and shift towards another paradigm where intelligence is placed at the core of the Internet thus abandoning the technological architecture based on the 0nd$to$0nd principle!. @ifferentiation in the services provided by multiple nets would reflect the

heterogeneity of preferences and demands, thus encompassing different technological and legal requirements. +et diversity would provide a compromise between various interests, values, and actors involved, respecting equality and non$discrimination inside each net. It would no longer be necessary to have a single smart net capable of discriminating among different applications as proposed by Wu!, but different nets for different purposes. #his option might be the best for developing countries as it would make it possible to meet their needs both for security and openness.

Notes 1. +oam, 0. " third way for net neutrality, 4# "ugust FC FDDG.
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