It was a pleasure to read the recent post by David Weinberger on “Delaminate the Bastards“. It took me back to when I started in the National Office for the Information Economy (R.I.P.) back in 1999 working on the Convergence Review. One of the articles that I distinctly remember is that of the Stupid Network by David Isenberg who has recently written another great piece on making network neutrality sustainable to celebrate the 10th anniversay of his seminal paper.
Weinberger makes the point that the telecommunications companies (the bastards!) that supply us with access to the Internet should not also be selling us services over the Internet (this is the whole notion of structural separation). In the old days, we used to have ISP’s that provided the connectivity between the telco access and the content but they have by and large disappeared. Structural separation means that you have a one company providing access to the Internet and a different one the content and services over the Internet. This is important for network neutrality so that all services on the network are treated equally. Vertically integrated companies providing both Internet and content could provide preferential treatment of their content over other company’s content – which would stifle innovation in service offerings.
Isenberg’s stupid network idea is quite simple. It is that the traditional telecommunications service is smart in the middle (the switch) with the ends (the telephone) being dumb. The Internet on the other hand has the smarts in the terminating equipment (your computer) with the network itself being dumb – all the network does is transfer packets of data. Its beauty is that this encourages innovation in the services at the periphery and away from the centralised service provider. Clayton Christiansen’s Innovator’s Dilemma demonstrated how dominant incumbents tend to stifle innovation to preserve their own profitable business model.
This is why the way that the structure of the information economy develops is so important. Interoperability, net neutrality and service innovation are what will drive the democratic and free (as in free to access, not free as in free beer!) evolution of the Internet. The current debate about broadband somewhat misses the point as while fibre-to-the-node or the home is important, what matters more is who owns it and whether access will be restricted or made preferential in any way.
My personal preference (as I have declared to friends previously) is for a structural separation solution – particularly for the dominant incumbent – for the provision of Internet infrastructure. I like the ideas of former colleague Ross Kelso in a paper he completed with John Murphy and John Burke in their submission to a senate inquiry. This would require a radical rethink of current government policy and would impact on lots of mums and dads shareholders. But this would be a great first step to get the structure of the information economy right so that we can then move on to developing Australia’s knowledge economy.