The big trouble is that we need settlement-free peering, or we'll have a very different sort of internet, or maybe none at all. Though it's hard for some to remember (or to believe), there were big consumer networks prior to the advent of consumer-oriented Internet. Compuserve and AOL were their own networks. And they were abysmal. Peering not only ruined that business model, it managed to co-opt those networks and assimilate them into the Internet proper.
If peering is untenable because it leads to outcomes like the one we have now (Netflix) where it is fundamentally unfair to one party (assuming that is the case) or the other, then we're all screwed. There might not be a fair solution that still manages to resemble the Internet.
In one alternative, the Comcasts and the AT&Ts are smited and no longer exist, and Level 3 goes into the consumer internet business, connecting things end-to-end. That's not something we could trust them with. Same if Comcast replaces Level 3.
In another, Netflix continues to pay the extortion (if it is that) which we have little doubt that Comcast will continue to ratchet up the price for. Or Comcast has to shoulder that burden alone (and can't charge customers extra for doing so, without people screaming "net neutrality!").
Or maybe services like Netflix just can't exist in such an environment. Also a bad outcome.
Or god help us, internet infrastructure is nationalized, and the same people who manage our roads and traffic lights take over.
You could have a situation where the government mandates net neutrality and at the same time compensates the likes of Comcast in some way (recognising their role as public utility and basically sanctioning their monopoly, but without taking over their operations entirely). You could have an anti-monopolistic legal action that splits Comcast but prevents Level3 from taking over / being present in that market. Etc etc...
There are many ways to skin an onion, and full-scale nationalisation is probably the least likely outcome (cash-strapped governments don't need another headache right now). In fact, the real problem here is that one player is leveraging a monopolistic position; remove that position, and the Free Market should start working its magic again.
We tried that once with Bell Telephone. Their profits were dialed down a bit via regulation, and it was an oppressive, horrible, and un-innovative network. You weren't allowed to buy a telephone and plug it into the jack at home... you could only rent them from the company.
Thankfully, that company and environment are gone. Let's not recreate them.
If peering is untenable because it leads to outcomes like the one we have now (Netflix) where it is fundamentally unfair to one party (assuming that is the case) or the other, then we're all screwed. There might not be a fair solution that still manages to resemble the Internet.
In one alternative, the Comcasts and the AT&Ts are smited and no longer exist, and Level 3 goes into the consumer internet business, connecting things end-to-end. That's not something we could trust them with. Same if Comcast replaces Level 3.
In another, Netflix continues to pay the extortion (if it is that) which we have little doubt that Comcast will continue to ratchet up the price for. Or Comcast has to shoulder that burden alone (and can't charge customers extra for doing so, without people screaming "net neutrality!").
Or maybe services like Netflix just can't exist in such an environment. Also a bad outcome.
Or god help us, internet infrastructure is nationalized, and the same people who manage our roads and traffic lights take over.
Am I blowing this out of proportion?