CTN Issue: June 2014

Network Neutrality (NetNeutrality) is a hotly debated topic among telecommunications industry leaders as well as among law and policy makers. The recent EU Draft, the FCC announcement of consultations for rulemaking, and developments in Asia are just some examples of the relevance of and attention given to this topic in recent weeks.

The Internet as we know it has been operating since its inception under “open” principles, i.e. an open standards-based network that treats all the traffic that flows across it in roughly the same way. These “open” principles are referred to as NetNeutrality and may be summarized as supporting no unreasonable discrimination of traffic. Specific NetNeutrality principles include, among others, no connection blocking, bandwidth transparency, universal connectivity, and best effort service.

Evolution and technological innovation in communication systems, digital media, and user behavior may challenge NetNeutrality principles and question if/how NetNeutrality can be sustained in a new word of data-hungry applications such as on-demand video, online gaming, and music streaming. There are questions about how NetNeutrality plays with emerging cloud computing and virtualization technologies (SDN, NFV). And there are also issues to resolve in the new telecommunications marketplace where ISPs, content providers, network operators and content delivery entities operate under disparate business and technical objectives.

Furthermore, in the real world, there are also challenges related to supporting the Quality of Service (QoS) that multiple applications require in the presence of unavoidable peak hour congestion and performance compromises due to bandwidth sharing, admission control for capacity management, consumer packages with data caps, throttling, etc. Some of the widely used mechanisms to cope with these challenges may require implementations that threaten the principles of NetNeutrality, e.g. packet prioritization or bandwidth reservation.

The NetNeutrality-related articles in this issue of CTN are a selection among the ones recently published by IEEE ComSoc on this topic. The selection helps achieving a more in-depth understanding of this subject, and looks into future research and directions in this area.

Keywords

#network #neutrality #NetNeutrality #Internet #communications #ISP #Service #Providers #telecommunications #UX #user #experience #common #carrier #ITU #IEEE #mobile #wireless #trends #technology #innovation #broadband #bandwidth #smartphone #SDN #NFV #CDN #content #distribution #FCC #EUDigitalAgenda #telecommunications #policy #law #regulation #QoS #Universal #Service #USF #peering #IEEEComSoc #elenaneira

1. On Cooperative Settlement between Content, Transit, and Eyeball Internet Service Providers

The authors describe how Internet is operated by thousands of interconnected Internet Service Providers (ISPs), with each ISP interested in maximizing its own profit. Although ISP cooperation is necessary in order to provide Internet services, without an appropriate profit-sharing mechanism, profit-seeking objectives often induce various ‘selfish behaviors’ in routing and peering interconnects, degenerating the performance of the network and the services it provides to the end user. This issue is at the heart of the NetNeutrality debate, and shows the need for an appropriate compensation structure that satisfies all types of ISPs.

One example of this selfish behavior is when US’s Level 3 unilaterally terminated its settlement free peering relationship with Cogent in 2005. This disruption resulted in at least 15% of the Internet being unreachable for the users who utilized either Level 3 or Cogent for Internet access. Although both companies restored peering connections several days later with a new ongoing negotiation, Level 3’s move against Cogent exhibited an escalation of the tension, and showed that new forms of ISP settlements are needed.

Compared to the traditional settlement models in telecommunications, the Internet has exhibited a more versatile and dynamic structure. The most prevalent settlements a decade ago were in the form of bilateral negotiations, with both parties creating either a customer/provider or a zero-dollar peering relationship. Today, because of the heterogeneity in ISPs, simple peering agreements are not always satisfactory to all parties involved, and paid peering has naturally emerged as the preferred form of settlement among the heterogeneous ISPs. Nevertheless, the questions like “which ISP should pay which ISP?” and “how much should ISPs pay each other?” are still unsolved. These open questions are also closely related to the NetNeutrality debate, which argues the appropriateness of providing service and/or price differentiations in the Internet.

Borrowing from the well-known economic concept – used in coalition games - called the Shapley value, and applying it to a general network setting, the paper proves that if profits were shared as prescribed by the Shapley value mechanism, not only would the set of desirable properties inherent to the Shapley solution exist, but also that the selfish behaviors of the ISPs would yield globally optimal routing and interconnecting decisions. These results demonstrate the viability of a Shapley value mechanism under the ISP profit-sharing context and the implications on the stability of prevalent bilateral settlements and the pricing structure for differentiated services in the Internet.

The authors look at the Internet as containing three classes of ISPs:

• Eyeball ISPs, such as Time Warner Cable and Comcast specialize in delivery to hundreds of thousands of residential users, i.e., supporting the last-mile connectivity.
• Content ISPs specialize in providing hosting and network access for end-users and commercial companies that offer content, such as Google, and Yahoo. Typical examples are content distribution networks (CDNs).
• Transit ISPs. Transit ISPs model the Tier-1 ISPs, such as Level 3, Qwest, and Global Crossing, which provide transit services for other ISPs and naturally form a full-mesh topology to provide the universal accessibility of the Internet.

The key results cover the following

• Show that:
  1. aggregate revenue can be decomposed by content-side and eyeball-side components; and
  2. costs can be decomposed with respect to individual ISPs. Each revenue/cost component can be distributed as a Shapley value of a canonical subsystem to each ISP in the coalition.
• The Shapley value solution justifies:
  1. why the zero-dollar peering and customer/provider bilateral agreements could be stable in the early stage of the Internet;
  2. why, besides operational reasons, paid-peering has emerged; and
  3. why an unconventional reverse customer/provider relationship should exist in order for the bilateral agreements to be stable.
• Instead of supporting or disproving service differentiations in the NetNeutrality debate, it answers the question what the appropriate pricing structure is for differentiated services that are proved to be beneficial to the society? Based on the Shapley value solution, the implied compensation structures for potential applications of differentiated services are presented.

These results provide guidelines for ISPs to settle bilateral disputes, for regulatory institutions to design pricing regulations, and for developers to negotiate and provide differentiated services on top of the current Internet.

Title and author(s) of the original paper in IEEE Xplore:

Title: On Cooperative Settlement Between Content, Transit, and Eyeball Internet Service Providers
Author(s): R. T. B. Ma, D. M. Chiu, J. C. S. Lui, V. Misra, and D. Rubenstein
This paper appears in: IEEE/ACM Transactions on Networking
Issue Date: June 2011

2. The Public Option: A Nonregulatory Alternative to Network Neutrality

Much of the Network Neutrality (NetNeutrality) debate has centered on the argument whether Internet Service Providers (ISPs) should be allowed to provide service differentiation and/or user discrimination, with the notion of “user” being either content providers (CPs) or consumers. Proponents of NetNeutrality, mostly the CPs, have argued that the Internet has been “neutral” since its inception, and that has been a critical factor in the innovation and rapid growth that has happened on it. The critics of NetNeutrality, mostly ISPs, claim that without some sort of service differentiation, ISPs will lose the incentive to invest in the networks, and the end-user Quality of Experience (QoE) will suffer. Both camps implicitly or explicitly claim that their approach is beneficial for consumers. The controversy rages on, though, with lawsuits challenging the applicability of Universal Access to Internet, with different ISP peering models, with discussion of traffic flow management techniques, and with content delivery all being cast as a NetNeutrality issues. But, are they?

The paper looks at NetNeutrality from the consumer’s point of view under both monopolistic and oligopolistic telecommunication market scenarios. A lot of arguments for, as well as against, NetNeutrality live in an idealized world where economies of scale do not exist and monopolies cannot emerge, and therefore perfect competition solves all problems. The paper reveals that reality is more nuanced, and hence examines monopolistic scenarios too.

Game-theory is applied to model the user demand for content and the rate allocation mechanisms in the network. The interplay between the two determines the rate equilibrium for traffic flows, based on which consumer utility can be calculated. Also the model of price discrimination is for the ISPs to offer two classes of service to CPs. The ISP divides its capacity into a premium and an ordinary class, and CPs are charged extra for sending traffic in the premium class. The discussion also identifies and analyzes the strategic games played between ISPs, CPs, and consumers for a monopolistic scenario, and for oligopolistic scenarios. Last, the notion of a Public Option ISP, which is neutral to all CPs, is introduced. The Public Option ISP can be implemented by processes like local loop unbundling, which allows multiple telecommunications operators to use connections from the telephone exchange to the customer’s premises, in a monopolistic market, and either government or a private organization could run the ISP, and still be profitable.

Under this framework, the findings are as follows.

• The impact of NetNeutrality on consumer utility depends on the nature of competition at the ISP level. Concretely, a neutral network might be beneficial for consumers under a monopolistic regime, whereas a non-neutral network is advantageous for consumers under oligopolistic scenarios.
• Introducing a Public Option ISP is advantageous for consumers. In a monopolistic situation, the Public Option ISP offers the best scenario for consumers, followed by network-neutral regulations, and an unregulated market being the worst.
• In oligopolistic situations, the Public Option ISP is still preferable to network-neutral regulations. However, since the incentive for an ISP to gain market share is aligned with maximizing consumer utility, no regulation is needed to protect the consumers.
• Under an oligopolistic competition, any ISP’s optimal pricing and service differentiation strategy, whether network-neutral or not, will be close to the one that maximizes consumer utility. Moreover, under a probable equilibrium where ISPs use homogeneous strategies, their market shares will be proportional to their capacities, which implies that ISPs do have incentives to invest and expand capacity so as to increase their market shares.

The paper sheds light on the NetNeutrality debate and concretely identifies where and how regulation can help. In particular, the identification of the Public Option ISP is especially important as it provides a solution that combines the best of both worlds, protecting consumer interests without enforcing strict regulations on all ISPs.

Title and author(s) of the original paper in IEEE Xplore:

Title: The Public Option: A Nonregulatory Alternative to Network Neutrality
Author(s): R. T. B. Ma and V. Misra
This paper appears in: IEEE/ACM Transactions on Networking
Issue Date: December 2013

3. Traffic Management and Net Neutrality in Wireless Networks

This paper looks at the issue of NetNeutrality in mobile/wireless networks where there is a unique network resource constrain - the radio spectrum – which could require special treatment from the NetNeutrality point of view. Specifically the paper examines whether wireless Internet Service Providers (ISPs) should be able to control/limit applications. After describing how wired and wireless networks differ with respect to traffic management, it concludes that wireless networks often require stronger traffic management than wired networks at and below the network layer.

The paper proposes dual goals of providing a level playing field between applications offered by ISPs and those offered by competing application providers, and guaranteeing wireless ISPs the ability to reasonably manage wireless network resources. It presents three scenarios for how applications may be restricted on wireless networks, but finds that none achieves both goals. The paper presents a set of regulations based on network architecture and communication law that limits an ISP’s ability to restrict applications by requiring an open interface between network and transport layers, it also illustrates how ISPs may deploy Quality of Service (QoS) within such a regulatory framework. And this regulatory framework, i.e. communications law guides what types of network management and traffic discrimination should be allowed or prohibited.

The paper also proposes a set of policies and regulations that limit a wireless ISP’s ability to restrict applications. The new policy is based on the layered structure of wireless networks and on present communications laws. Since the differences between wired and wireless networks lie in lower layers, NetNeutrality in both wired and wireless networks can be effectively accomplished by requiring an open interface between network and transport layers, and that such a layer interface is consistent with current law: It illustrates how ISPs may deploy QoS within such a regulatory framework, and how pricing can be used to define a contract with users removing the need for network control over user applications.

Title and author(s) of the original paper in IEEE Xplore:

Title: Traffic Management and Net Neutrality in Wireless Networks
Author(s): S. Jordan
This paper appears in: IEEE Transactions on Network and Service Management
Issue Date: December 2011

Statements and opinions given in a work published by the IEEE or the IEEE Communications Society are the expressions of the author(s). Responsibility for the content of published articles rests upon the authors(s), not IEEE nor the IEEE Communications Society.