1. Net Neutrality: An Issue By Any Other Name GMU Information Economy Project Mini-Conference September 28, 2006 Paul Misener / Amazon.com

2. Net Neutrality2 September 28, 2006 Outline Pull is Fundamental Changing Business Model? Net Neutrality The Disagreement Get Paid? Questions/Discussion

3. Net Neutrality3 September 28, 2006 Pull is Fundamental Changing Business Model? Net Neutrality The Disagreement Get Paid? Questions/Discussion

4. Net Neutrality4 September 28, 2006 The Internet: “Pull” is Fundamental ISP Business Business ISP Home Internet Backbone Residential ISP ISP

5. Net Neutrality5 September 28, 2006 The Internet: “Pull” is Fundamental ISP Business Business ISP Home Internet Backbone Residential ISP ISP HTTP “GET”

6. Net Neutrality6 September 28, 2006 The Internet: “Pull” is Fundamental ISP Business Business ISP Home Internet Backbone Residential ISP ISP “Resource”

7. Net Neutrality7 September 28, 2006 The Internet: “Pull” is Fundamental ISP Business Business ISP Home Internet Backbone Residential ISP ISP “Resource” “Resource” gets here only if pulled by end user

8. Net Neutrality8 September 28, 2006 Pull is Fundamental Changing Business Model? Net Neutrality The Disagreement Get Paid? Questions/Discussion

9. Net Neutrality9 September 28, 2006 Internet Access ISP Business Business ISP Home Internet Backbone Residential ISP ISP $ $

10. Net Neutrality10 September 28, 2006 But Residential Internet Access is Changing Concentration Digital Technology FCC Removal of Safeguards Network Operator Plans

11. Net Neutrality11 September 28, 2006 Concentration ISP Business ISP Home Internet Backbone Residential ISP ISP 10s  1 or 2 Business $ $

12. Net Neutrality12 September 28, 2006 Digital Technology ISP Business ISP Home Internet Backbone Residential ISP ISP analog  digital Business $ $

13. Net Neutrality13 September 28, 2006 FCC Removal of Safeguards ISP Business ISP Home Internet Backbone Residential ISP ISP non-discrimination rule  no rule Business $ $

14. Net Neutrality14 September 28, 2006 Network Operator Plans ISP Business ISP Home Internet Backbone Residential ISP ISP Business $ $

15. Net Neutrality15 September 28, 2006 Network Operator Plans ISP Business ISP Home Internet Backbone Residential ISP ISP $ Business $ $

16. Net Neutrality16 September 28, 2006 What is the new $? X% of transactions? X% of online revenue? $X per net op subs that are OSP customers? $X for “special” security measures?

17. Net Neutrality17 September 28, 2006 Internet of Today 3 Cable Business ISPs Homes Internet Backbone n 2 1 Telco Residential ISPs B C N A Business

18. Net Neutrality18 September 28, 2006 Internet of Tomorrow? 3 Cable Business ISPs Homes Internet Backbone n 2 1 Telco Residential ISPs $ B C N A Business

19. Net Neutrality19 September 28, 2006 Pull is Fundamental Changing Business Model? Net Neutrality The Disagreement Get Paid? Questions/Discussion

20. Net Neutrality20 September 28, 2006 Net Neutrality Preserve the openness of the Internet  Good for consumers, innovation Prevent the extension of market power  Not bust up the power a la 96 Act Core idea: no discrimination based on the source or ownership of content

21. Net Neutrality21 September 28, 2006 Pull is Fundamental Changing Business Model? Net Neutrality The Disagreement Get Paid? Questions/Discussion

22. Net Neutrality22 September 28, 2006 Disagree: Facts not Philosophy Let the Competitive Free Market Work  But >98% duopoly Don’t Start Regulating the Internet  But non-discrimination governed most Net Ops Won’t Invest w/out Discrimination  But fast deployment under non-discrimination Common Carriage Bad, Video Competition Good  But it’s not, and video comp bill relies on non-discrimination Net Ops Should be Paid for Services

23. Net Neutrality23 September 28, 2006 Pull is Fundamental Changing Business Model? Net Neutrality The Disagreement Get Paid? Questions/Discussion

24. Net Neutrality24 September 28, 2006 OSP1OSP1 OSP2OSP2 End User B End User A No discrimination based on content source/ownership Basic Model OSP1 $ OSP2 $ EU B $ EU A $ Router functionality operating at the packet and, perhaps, the sub- packet level, and not necessarily a separate physical device.

25. Net Neutrality25 September 28, 2006 OSP1OSP1 OSP2OSP2 End User B End User A No discrimination based on content source/ownership Basic Model OSP1 $ OSP2 $ EU B $ EU A $ Details of the Local Cable or Telco Network Router functionality operating at the packet and, perhaps, the sub- packet level, and not necessarily a separate physical device.

26. Net Neutrality26 September 28, 2006 OSP1OSP1 Edge Server serving OSP1’s content, etc. (by, e.g., Akamai, or RAND by net op) OSP2OSP2 End User A OSP1’s content, etc. OSP Paid RAND Edge Serving End User B OSP1 $ OSP2 $ No discrimination based on content source/ownership EU B $ EU A $

27. Net Neutrality27 September 28, 2006 OSP1OSP1 Private network carrying OSP1’s content, etc. (by, e.g., Level3, or RAND by net op) OSP2OSP2 End User B End User A OSP Paid RAND Private Net Injection OSP1 $ OSP2 $ OSP1 $ No discrimination based on content source/ownership EU B $ EU A $

28. Net Neutrality28 September 28, 2006 OSP1OSP1 OSP2OSP2 End User B End User A User Paid QoS (“turbo button”)? OSP2 $ OSP1 $ No discrimination based on content source/ownership EU B $ EU A $ New

29. Net Neutrality29 September 28, 2006 OSP1OSP1 OSP2OSP2 End User B End User A OSP Paid RAND QoS? OSP1 $ OSP2 $ No discrimination based on content source/ownership EU B $ EU A $ OSP1 $ New

30. Net Neutrality30 September 28, 2006 Pull is Fundamental Changing Business Model? Net Neutrality The Disagreement Get Paid? Questions/Discussion