## Monday, December 11, 2017 ... //

### Net neutrality is communism, nationalization

Skillful data transmission engineers need to be appreciated, rewarded, have the freedom to profit from their contributions according to their business plans

On Friday, the FCC is expected to vote and cancel the Obama-era net neutrality, a regulation preventing the Internet Service Providers (ISPs) from doing their business according to their own ideas and according to their interests – profit-seeking. Net neutrality is the idea that all ISPs are obliged to indiscriminately send the superficially similar packets from any place to any other place for the price that may only depend on the bandwidth and perhaps a few other physical characteristics and nothing else. According to net neutrality, the ISPs mustn't look inside packets – they must pretend that they're only transmitting binary digits.

But ISPs must have the freedom to use their assets according to their own choice. In particular, they should have the freedom not to connect someone if they think that they (the ISPs) are not fairly compensated for the connection. They may prioritize one type of traffic if they find it more important for their business – probably because this kind of business is more important for their profits. The principle expressed in the previous sentence is an application of the basic rules of the market economy, the basic respect to the private ownership.

You know, these companies and the people behind them have either built the infrastructure with all the cables and invented or refined the somewhat smart technology in the routers etc.; or they are shareholders who have bought it. Why did they build it or buy it? Because they saw it was hard work that was likely to produce profit. How does an ISP produce profit? It may decide whether it connects someone to the Internet, or not.

To strip the ISPs of this freedom means to rob the shareholders of these companies of a part of their assets because their assets are partly if not mostly hiding in their ability to connect someone or some company to the Internet under some conditions.

Everyone who is at least three years old should be able to remember that before the 2015 net neutrality regulation, the Internet worked just fine. In fact, we know it worked very well. On the contrary, in recent two years, the ISPs have complained that they lost the incentives to invest into the infrastructure.

To demand that the Internet companies must treat all packets equally is analogous to the demand that Apple has to make the iPhone equally affordable to all people on Earth, or that it has to run Windows Phone and Android applications, or it has to release its patents for everybody, or something of the sort. It's clear that any restriction in this class would be extremely harmful to Apple and its shareholders. It would be a form of nationalization. The company would be robbed of some of its rights to do business – and the rights were the original reasons why the investment – either the construction of the infrastructure or the shareholder's purchase of the stocks – looked like a good idea.

Now, leftists – such as the defenders of net neutrality – don't have any moral problems with stealing. In the economic context, a leftist may basically be defined as a thief who steals at least \$1 million at a time. And of course, it's the moral dimension of this dispute that is the source of most of my anger about the net neutrality policies.

But it's not just about the moral dimension. It's also about the progress in the future. You may find it a great idea to team up with your left-wing comrades, steal the ISPs' assets, and create a "more optimal" Internet, as some defenders describe their plans. But such a theft has consequences. One of them is that socialism runs out of steam when it runs out of things to be stolen. You may steal the rights to do all the expected business with the infrastructure owned by the ISPs and such a robbery may look like a good deal for the Obama-style gangsters and their fellow travelers. But a healthy evolution involves the construction and improvement of the infrastructure in the past; but also in the future.

When you prevent the ISPs from doing business – or some kinds of business – you will also strip them, completely or partially, from the motivation to invest and build new infrastructure. So just like in communism in general, similar nationalization or severe regulations unavoidably hurt investments. They stop or slow down the progress in the future. Even now, about three decades after the collapse of communism in the world, certain people are still ignorant – or pretend to be ignorant – about these basic wisdoms about the human society such as the fact that the ability and desire of the people to make profit is a key driving force of their hard work.

Again, the efforts to force all the ISPs to be basically identical and "not to discriminate" are efforts to nationalize the ISPs or at least nationalize their power to do business that would differ from everyone else. Such regulations are an example of communist policies and just like in all examples of nationalization by the communists, it leads to a great injustice at the beginning and profoundly bad consequences for the investment and growth in the future.

Aside from their clear desire to "de facto nationalize the ISPs", the leftist demagogues like to write lots of technically sounding hogwash to defend net neutrality. Boing Boing, a left-wing tech server, wrote a short article yesterday titled

The FCC literally doesn't know how the internet works,
elaborating upon a similar text in Eff.Org that was published three days earlier. Why do these folks say that the FCC – which plans to abolish net neutrality on Friday – don't understand how the Internet works?

Cory Doctorow tries to criticize the FCC as follows:
The FCC insists that there's a thing called "the internet" that your ISP helps you receive "transmissions" from. But the internet -- the network of networks -- is your ISP, and its connections to all the other ISPs. The internet isn't "some vaguely defined other realm that an ISP opens a portal to."
But it's clearly the FCC that understands this aspect of the Internet – while Cory Doctorow doesn't. Your ISP simply isn't the Internet. The set of all ISPs in the world isn't the Internet, either. Just like the FCC says, the Internet is some vaguely defined realm that the ISP connects you to. According to Wikipedia, the Internet is the network of networks.

My real point is that the Internet isn't the stuff in the networks themselves. Instead, it's the "added value" resulting from the connection between all the networks. The Internet is the set of all advantages and services that emerge as soon as the local networks are connected to a whole. It's also possible to say that the Internet has become the "global commons". One may invent various poetic words – "the commons", "added value", "synergy" – but there's some very tangible difference between the Internet and the ISPs and it's the following:
The ISPs are privately owned while the Internet isn't!
It's this extremely simple statement that the leftists want to obscure, reject, deny, hide, or at least cover by tons of their idiotic verbal Marxist šit. The Internet just cannot possibly be the same thing as the ISPs because the latter is privately owned while the former is not. To complete the proof, we can use the fact that$f(x) \neq f(y) \Rightarrow x\neq y$ This proves that they're different things. All the machines, principles, rights, mechanisms that are "related to the Internet" have many layers and aspects but those material ones have to be carefully distinguished – one must remember who owns what. The Internet isn't just the ISPs because aside from ISPs, it "includes" the content, the content providers, the users, the desire of the users to communicate with others or search for the content, and other abstract and material things.

The ISPs own the cables in the same sense in which water or gas companies may own some pipelines. But they don't own the Internet, much like the water companies don't own the rivers, the oceans, the rain, and the snow. The Internet, like the oceans, are owned by everyone or no one. But the cables, like the pipelines, are not. Water companies may connect someone if he pays enough and if he doesn't pollute the water that goes back from him, or whatever are the conditions that the company and the laws impose on the situation. In the same way, the ISPs have certain powers to decide what to do with their cables, where they can be extended, how packets from that consumer may be treated according to the data type etc.

The leftists are obviously insensitive to the difference between the shared ownership and the private ownership because they would ideally love to abolish the latter altogether. So they are already thinking about the ISPs as if they were assets controlled by some left-wing parties or NGOs, something that these harmful parasites have already successfully stolen. But in a civilized society, nothing like that should be allowed.

There's another piece of the techno-legal jargon that Erica Portnoy and Jeremy Gillula at Eff.Org – and also Cory Doctorow at Boing Boing – are wrong about. Eff.Org writes:
A linchpin of that plan is to reclassify broadband as an “information service,” (rather than a “telecommunications service,” or common carrier) and the FCC needs to offer some basis for it. So, we fear, it’s making one up, and hoping no one will notice.
At some level, it's a matter of terminology and habits whether the Internet is clumped with telecommunication services, utilities, information services, whether the transmitted bytes are a commodity, etc. All these words are based on some analogies between the Internet and other things in the world. Most of these analogies are good up to some moment but they fail to be useful at another point. However, one should carefully analyze why the net neutrality advocates are so enthusiastic about promoting words such as "utility" for the ISPs while they angrily criticize the totally sensible term "information service".

It's all about their efforts to strip the ISPs from their freedom to do things according to their own ideas.

Let us ask: Is the Internet a utility? Look at the Wikipedia definition of a public utility. It is an organization that maintains some infrastructure for a public service. The grids with electricity, gas, water, sewage, telephone, and transportation are mentioned as "accepted examples" of public utilities while the broadband Internet is being "increasingly included", we read.

Great. I don't care about one jargon or another. We may very well use a language that clumps the broadband Internet with the other utilities. That's how I was taught what the Internet was sometime in 1994 when I was a volunteer at the Prague-Trója student hostels who was helping to bring the ethernet cables to every single room. Our group of 3 did hundreds of rooms. We were drilling in the walls. Whenever that part of the work was completed, we screamed "orgasm" – that was a signal I invented. For these reasons, I consider myself one of the thousands of pioneers of ISPs except that we didn't really get paid much (or anything) LOL.

But Dan Lukeš who was the mastermind behind the Internet at our faculty in the early 1990s was explaining that the Internet is basically just like electricity or water pipelines. You bring the cables somewhere, connect them with the older cables – sometimes through routers or similar small machines – and you suddenly extend the Internet somewhere. It works nicely. At this level, the ethernet cables are just like the extension cords for electricity.

I think it's a deep, true, and important description of an aspect of the Internet infrastructure. I like it and I have nothing against those who teach the meaning of the Internet infrastructure in this way. What I have a problem with is someone's selective denial or suppression of the differences between the ethernet cables and the water pipelines. OK, the internet providers aren't as clear examples of the "public utility" – and were labeled "an information service" by the current FCC – for some reason. What is the reason?
The reason is that water in the pipelines is always the same while the packets that carry the data over the Internet have lots of different pieces that can be adjusted and treated in zillions of different ways.
This difference indicates that in a free society, the water infrastructure company doesn't have too many original choices what to do with the water. Water is a dull stream of mostly H2O molecules that are identical to each other and what you can do with it is to send it through some hollow geometric shapes. All public utilities end up doing the same thing. When some improvements of the pipelines are invented, it's likely that all of them will agree whether it's better than the previous one, and all of them may be expected to react in the same way.

The example of natural gas is almost the same except that it's not H2O molecules but CH4 molecules of methane. Ethane, propane, butane, and higher alkanes may also be included, along with some gases that can't be burned usefully. However, methane should better dominate. Again, the gas companies do the same thing. I can pretty much say the same thing about the telephone companies – "telecommunication services" in the pre-Internet sense – because those are defined as companies that transmit the voice between the two callers without a modification that could be seen. Again, there aren't too many choices to be made.

But that's simply not the case of the ISPs. The internet data aren't composed of identical H2O or CH4 molecules. The Internet traffic may be said to be composed of "ones" and "zeroes" (the binary code) but it's very important that the ones and zeroes aren't identical. Their difference is what all the information is all about. If your ISPs were transferring just zeroes or just ones, the cables would be pretty badly used! ;-)

And it's not just the overall fraction of ones and zeroes that matters – it's close to 50-to-50, anyway. It's their order. And not only within a byte. The information is hiding in arbitrarily long sequences of the binary digits – it exists at basically every scale. The Internet information is being transmitted in packets or datagrams. When you download or stream a video from the Internet, the information is organized at many levels. They go from the very physical layer to the human layer. This nested structure is very analogous to the classification of natural sciences from the most fundamental one – physics – all the way to social sciences if not humanities.

OK, layer 1 is the physical layer, some physical mechanism and engines that can manipulate individual bits. Layer 2 is the data link layer where some addresses identifying the sender and recipient on a local network start to be identified. Layer 3 is the network layer which already has rules to send the information through routers. The Internet as we know it runs on the TCP/IP protocol which has specific rules for the form of the non-physical layers. On top of the Internet layer that includes the layers I mentioned so far, there are "more social" layers, transport layers, and the application layers. Application layers may already include the Hypertext Transfer Protocol that serves all the data on websites.

You need lots of other layers or choices that are responsible for cryptography and lots of other things. Let me copy a Wikipedia template window summarizing the Internet protocol suite (the blockquote below is only written to intimidate you and remind you of the complexity, it's not supposed to be too useful as a source of the details):
Internet protocol suite Application layer BGP DHCP DNS FTP HTTP IMAP LDAP MGCP MQTT NNTP NTP POP ONC/RPC RTP RTSP RIP SIP SMTP SNMP SSH Telnet TLS/SSL XMPP more... Transport layer TCP UDP DCCP SCTP RSVP more... Internet layer IP IPv4 IPv6 ICMP ICMPv6 ECN IGMP IPsec more... Link layer ARP NDP OSPF Tunnels L2TP PPP MAC Ethernet DSL ISDN FDDI more... v t e
If you remember a nice talk by late Michael Crichton, the people who were worried about the exponentially growing manure in the New York City a century ago didn't know almost any of these acronyms! ;-) There's just a lot of structure. Some of it is rather standardized and universally used, others are competing with each other, some of these things may be proprietary etc. These dozens of acronyms just describe some concepts that are used on the Internet today. Each concept has tens of pages of documentation that needs to be taken seriously by professionals who actually work with this stuff.

It looks nothing like a boring stream of H2O molecules brought to you by your water company. The Internet data are immensely structured and complex information that has emergent structures at least at 5 recognizable levels or layers. Lots of things have to be invented to make the Internet as useful as it is today, lots of the existing ones may be improved, and lots of the new ones may be invented in the future. All these layers require some work of the people – sometimes workers, sometimes qualified tech experts – and in a market economy, all these people are ultimately paid from some profit.

So a dumb left-wing Internet user who is watching mostly junk movies on Netflix may think that the Internet data is just like water – it's a stream of porn, or whatever he or she watches. But that's just the stupid consumer's perspective on what's going on. Underneath the human feelings or the "humanities" layer, there are lots of other layers and processes going on and some companies and their parts are responsible for them. All the layers contain information but the humanities-level information – the information that you're watching a likable movie via Netflix – isn't the only information in the sequences of emergent structures and concepts. All the lower-level structure in the Internet traffic deals with structured information, too. It has to be dealt with in some way and it's the job of the Internet and other companies to deal with all these structures in the emergent Internet information.

Most ordinary clients don't even care about the packets and protocols – they care about the porn – but that doesn't mean that the protocols and packets don't exist or that they're not information or that they didn't have to be invented or that their successors won't have to be invented in the future. They are information, they had to be invented, they can be served or solved in various ways, new technologies of this kind have to be invented in the future, and those who will invent, produce, and market these new technologies have to be motivated in some way and they're motivated by the profit.

That's why it's essential for the progress on the Internet to appreciate that the Internet providers aren't just examples of dull public utilities – but they're also or primarily information services. They deal with the information at some level, this layer of the data is as essential for things to work as other layers, they need to be appreciated for the work, and they need to be allowed to make the profits that their assets were built for to emerge if the consumers are willing to pay correspondingly. This freedom to realize the profits that can be made and that were planned is essential for the evolution of the structures, the data types on the Internet, and lots of other things.

To force everyone to believe that the Internet providers are just dull public utilities that deserve to earn almost nothing – while their clients, various content providers, earn hundreds of billions – means to take the attitude of an excessively arrogant uneducated porn watcher who doesn't really understand what made it possible for him to watch the porn, who doesn't appreciate the tech folks who made it possible, and whose arrogance basically means to force the Internet systems to stagnate in their current form so that further progress is impossible. That's wrong and that's why net neutrality is – or was – wrong.

I have argued that net neutrality isn't just a typical left-wing, ideologically driven misguided plan building on egalitarianism and the government's "right" to ban, command, confiscate, and regulate. It is also a reflection of the pathological view that the humanities – and the ultimate "content providers" that may be seen on the Internet – are at the top and the companies full of engineers should be treated on par with the Hollywood empty brains' janitors. That's a harmful perspective that disagrees with the reality because the content providers still depend on the technologists and ISPs just like biology or psychology depend on the laws of physics.

And that's the memo.