The new Comcast Xbox Xfinity app is the first nail in net neutrality’s coffin (opens in new tab)

Bandwidth is cheap. The bandwidth to give everyone in a mid sized city 100mb internet access costs around 20$/person a month + the cost of the wires. So, if Comcast provides 5mb internet for X$ they can make money providing 100mb for X + 20$. Yet, they want to both charge 3+ times that AND make money on side deals AND keep their local monopoly.

Now, latency is a slightly different issue. I would suggest that it's reasonable to either run an extra line OR host some servers locally to deal with that. But, assuming you have a sane network topology there are vary few cases where latency is actually important. Yet, if Comcast sees an opportunity to profit from the latency game they will do so. They already provide crappy DNS service to slow people down just think what they will do if they think latency is the path to extra profit.

PS: You could replace Comcast with Cox and probably just about any other local cable company and say the same things. But, I just happen to know more about Comcast and they are in the article so I stick with them.

That's not for consumer broadband access. It's not even for commercial broadband access. It's a specific use, point-to-point network connection. It's important to separate general broadband access from special-purpose network connections for net neutrality purposes.

Paying a company to bring fiber into your area and then leveraging their service over that fiber is very different from consumers dealing with (typically) municipal contractually-enforced monopolies that restrict their access to the internet. I'm a capitalist kind of a guy, but monopolies destroy the dynamics of the free market and have to be kept firmly in check.

>Given that ISPs charge each other for transporting traffic [4] it costs more to broker traffi[...]

I don't think anyone is arguing that there isn't a cost motive for providing tiered pricing. Of course there is.

The issue is that monopolies must either be broken up or they must provide special protections for both consumers and the health of the free market in general. Net neutrality is that protection and it trumps Comcast's cost-based-pricing motives.

I doubt Comcast put in data caps because of interconnect costs. I would love to see what a gig of interconnect data costs them.

What does the author mean? Comcast certainly doesn't own the entire Internet, so why is it a meaningless distinction?

One of Comcast's biggest (and most hated) capex expenditures are the cable boxes. They hate with an unholy passion having to upgrade boxes. In this context they're basically trying to get the users to upgrade their boxes on their own dime. When I put on my consultant hat and talk to analysts in this area we've been talking more and more about how connected tv's and OTT Boxes can be beneficial to cable operators. One of the downsides of cable cards is that you never got a guide with it. Combine a cable card and a Samsung Connected TV and you can really do both and get rid of the card all together.

Second they're quickly realizing that maintaining two on-demand infrastructures (Web and traditional VOD) the really sensible thing is to move as much as possible to delivering via your cable modem as opposed to the broadcast channels.

Of course as they do so they're going to have to do something about the bandwidth caps. Stories like this put Comcast in a strange position. They want to deliver more "TV" video content over their internet pipes but apparently can't do so and maintain a cap at the same time.

The fact that this private content is being delivered over an IP network shared with its "public" internet service changes things a little, but not enough I suspect.

Which brings up the question: what does net neutrality mean for the last-mile ISP? It seems not a lot. It ensures equal treatment of sites on the public internet, but if a Microsoft or whoever wants to pay for "premium" service over a private network, they'll always be able to.

TV-style subscription-based services work with users as consumers: the pipes go one-way, because each subscriber is just a dumb set of eyes with a wallet. But with the internet, and new disruptive content models, everyone is also a creator. The real danger of losing net-neutrality is that individuals will become unable create new media for the internet.

So this goes over Comcast's super fast DOCSIS network and never over any internet gateways.

Not sure if this is the NN violation others are assuming it is. It seems like a simple "can we put our junk on your LAN to save bandwidth" deal.

That, and the 250GB cap hasn't changed since 2008. In the meantime I can now fit 250GB into less than 1 cubic cm for around $150.

And without a second lost, watch this: http://www.youtube.com/watch?v=Ik1AK56FtVc

That video has changed my point of view on the entire subject and has allowed me to start striking at the root.

So you end up paying for it in the end, since say, $0.05 of every dollar (totally made up figure) ends up going to AT&T.

So, to coin a somewhat wordy phrase, it's free-as-in-jet-fuel-when-you-buy-a-plane-ticket.

Net neutrality is the safeguard of many things but for entrepreneurs it guarantees they get the same treatment as big companies. In other words what matters most is the quality of your product and not the ties you have with ISP.

It works and guarantee pretty much the same thing as the antitrust laws. Fair competition is a huge source of wealth but requires constant care.

My leitmotif is always: Think about the [negative] externalities!

That's not what Net Neutrality is about.

Truly it's cheaper for, say, Comcast to send VOD data across its own network than it is for Netflix to pay for its own ISP service and the various peering agreements it needs to get its data into Comcast's network. So those differences in costs can be reflected in their respective prices and that's fine. [1]

Net Neutrality concerns come into play if/when Comcast is allowed to set additional arbitrary restrictions on competing services, to make its own offerings more effective. Either by deprioritizing Netflix traffic in favor of its own, interfering with packets connected to services or protocols it would rather Comcast customers not use, outright blocking competing services, charging Netflix an additional fee above and beyond what a non-competing service would pay for a similar amount of packets, or any number of other nefarious schemes that the operator of a network could concoct to degrade the experience of competing services or drive up their prices.

Net Neutrality isn't about taking away an ISP's home court advantage. It's about making sure they can't actively sabotage their competitors.

[1] Trick is: the difference in marginal cost is negligible compared to content costs. So there's no real room for Comcast to 'win' against Netflix on price-advantage alone. Further, Comcast's motivation to violate Net Neutrality isn't to advantage its own IP VOD service against Netflix, but to keep the price of all IP VOD services high, to avoid IP VOD from cannibalizing the profits they earn from broadcast VOD. (Which are priced high because US cable operators often enjoy a local monopoly.)

Since you're usually locked into one or at best two broadband providers in a given area, it's too easy for them to manipulate the system.

Comcast already has a pretty solid history of abusing its monopoly over cable TV. The frustration I've had just using my "digital ready" TV with Comcast when they insist on renting you cable boxes that you shouldn't need has pretty much eaten through any free market sympathy that I might otherwise have had for them.

How isn't this against Net neutrality? Suppose you run a service that competes against Twitter. With Net neutrality you must prove to the users that your service is better thatn Twitter. Without Net neutrality you must prove to your users that your service is so much better than Twitter that it is worth to pay additional money to the phone company to use it. Or you can pay the phone company to add your service to the number of non-data-cap-eating websites.

In the end the phone company is paid twice: a first time by the users and another time by the websites.

What the consumer pays for the bandwidth should be based on the actual cost the ISP incurs for that bandwidth and not on the value the customer is getting. That's none of the ISPs business.

Sorry, but that's a shortsighted view. You're now glad that you only pay +$, but a year from now you could be paying +$/4 if only the competition hadn't been crushed by these deals.