As I’ve written before, government policy should focus on making broadband faster and more affordable for all Americans – not putting it out of reach for those that need it most. That’s why I was surprised at Eduardo Porter’s New York Times editorial resurrecting outdated arguments about the Internet and arguing for government regulations that would actually raise the price of Video On Demand (VOD) and broadband service, squeezing many Latino families out of the market.
In support of his call for new regulations, Porter cites Comcast’s new consumer-friendly VOD offering, which allows subscribers to stream content through their Xbox as well as their cable box at no extra charge. Consumer advocates have been pushing for more choice in set-top boxes for years, so you’d expect them to approve. It’s great news for Latino families, many of which already enjoy VOD on their cable set top box. Now, their kids in the playroom can watch their favorite programs on demand without their parents having to pay for another cable box.
Oddly enough, Porter objects to the fact that streaming VOD programs through the Xbox doesn’t count against monthly broadband data caps, which were developed to protect 99% of users from the costs that just a few heavy users impose on the whole system. These users often use as much bandwidth as a small business, the equivalent of downloading tens of thousands of songs a month. That strains Internet networks and slows down service for the rest of us. To prevent that, companies have to build more capacity.
But instead of charging everyone for the infrastructure upgrades, Internet companies have developed different tiers of service. If the one percent of heavy users want more bandwidth, they can pay a little more. Consumer advocates have said that this can be a good thing for consumers.
But Mr. Porter thinks that watching VOD on your Xbox should count against how much bandwidth you use (even though the exact same Video on Demand you use on your cable box doesn’t count), thereby increasing the chance you will have to pay more for your Internet service. He argues that streaming Netflix videos through your Xbox counts against the data caps, so why not VOD programs? Yet that would change the way all Americans have been charged for VOD for many, many years. That doesn’t seem pro-consumer to me.
This all boils down to the FCC’s 2010 ruling that network neutrality principles apply to the public Internet but not to “managed services” like cable TV. If critics like Mr. Porter are able to convince policymakers to stretch network neutrality rules into the world of cable TV – a radical concept – they’ll end up unraveling the entire business model. That would be bad news for the numerous new Latino-oriented programmers – like Robert Rodriguez’s new “El Rey” channel and MundoFox – coming to cable.
It would also be bad news for broadband subscribers. Pushing cable TV onto the Internet would also raise the price of broadband for everyone. That could put broadband out of reach for many Latinos that now use an Internet connection to apply for jobs, access telemedicine, or Skype with relatives in South or Central America.
Everyone – including Mr. Porter – wants faster, cheaper broadband that’s accessible everywhere. Treating cable TV the same as the Internet would set us back years in reaching that goal.
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