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Feed Techdirt: Is Network Neutrality Costlier? Not Really, But Some Will Pretend A New Study S (techdirt.com)

Over the weekend, someone anonymously sent us an announcement about a study, co-authored by some folks at ATT, suggesting that network neutrality is a lot costlier than a non-neutral network. This seemed to go directly against the experience of many others, but it's still an interesting read. The problem is that the report doesn't quite say what ATT wants it to say, but that won't stop people from pretending it does. It doesn't actually say that neutral networks are more expensive. It says that they require more bandwidth to deliver equivalent traffic speeds and delay. That's not news. Everyone already knows that. What's implied is that this excess bandwidth makes things a lot more expensive, but that's not necessarily the case. The paper doesn't bother to explore the actual dollar costs between the two setups, just the amount of bandwidth. It also doesn't consider all the costs associated with a non-neutral network. As David Isenberg points out in the link above, provisioning additional bandwidth isn't directly proportional to the amount of bandwidth. In other words, requiring 60% more bandwidth does not mean 60% additional cost. Furthermore, Isenberg notes that the cost of bandwidth keeps dropping, so it actually gets cheaper and cheaper over time. However, the cost of labor associated with setting up and maintaining a non-neutral network is likely to increase over time. It doesn't appear that the details in the report are wrong or biased, but the implications suggested by those pushing it seem to fall into the same old propaganda positions that are all too common in this debate.

Comment Re:ugh... some points (Score 1) 209

Agreed on the first two paragraphs. They are not walking away for no reason but hey are also not walking away with nothing.

The directors and shareholders of Doubleclick recently bought Abacus databases containing millions of personal user profiles collected from those credit card customers (etc.) that you mentioned. Real and hard data. My guess is that they did not buy that business simply to continue running it as is. They will want to turn a sizeable profit with that purchase.

What elso do they have? They claim to have a database of 100 million _unique_ users. What is the size of the online community? There are about 350 million people in North America and about the same in the EU so say 700 million people in the english speaking world (I know I'm leaving many out in this rough calc. but bear with me). What is the rate of online computer use? In rich westernised (read americanised) geographical areas such as Canada you are looking at about 80% so lets assume a high rate of 75% to correct for people left out of the earlier number. That comes to about 525 million online users. So they claim to have online profiles of at least 20% of users.

That leads (me at least)to one of three conclusions. Either there are many more savvy users out there than this community is (or I am) willing to admit or that doubleclick ads do not have a high market penetrance or that doubleclick has much more data than they let on. I mean really. Who is going to verify those numbers?

What elso do they have? Well, the article states "In the last 16 months, DoubleClick has worked to deflect its dependence on the sickly advertising market. It has built up its research, data and technology divisions while slowly dismantling its media division." And, "Another division operated under Abacus Online called PredictiveMail, a combined e-mail and direct-mail marketing service, was folded into Abacus."

So they have surfing habits, e-mail identities and hard real-world data.

This online data and the Abacus data are corporate assets for the directors and sharholders and will not sit idly collecting virtual dust. The news story clearly state that they are _shifting their focus_ (i.e.giving up on Intelligent Targeting and taking their assets to use in what the poster correctly calls "research and development for online ventures". Think about it. The "not enough money for more servers/equipment" lame excuse is a red herring.

My guess is that in addition to keeping their online business _sans_ those pesky media attracting privacy issues (legal problem solved!), they will quietly be working in the investment community with their combined data and profiles to invest into and launch new online business ventures that target specific nich markets. And that is where they will get their return on investment.

At least that is what I would do if I was motivated by avarice and were morraly so inclined. But this is all speculation...right?

Gools

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