Tiers for fears

Your humble host has again predicted a teapot tempest. A couple of weeks back I mentioned a new premium email service to be offered by AOL and Yahoo:

My position is that premium services, be it network bandwidth or any other good or service, are part of a healthy, forward-looking market.

Net neutrality advocates are arguing the opposite, that "fairness" must come first, and progress second. It's an old socialist saw that's been disproved in pretty much every industry that offers tiers of quality — the PC market, food, automobiles — all of which are improving apace. [...]

Well, here are two new challenges for the neutrality community to contend with: "certified" email and Skype's deal with Intel.

Apropos, there is a new netroots PR initiative against this which is rife with orthodoxy but short on logic. For example:

This system would create a two-tiered Internet in which affluent mass emailers could pay AOL a fee that amounts to an "email tax" for every email sent, in return for a guarantee that such messages would bypass spam filters and go directly to AOL members' inboxes.

Hmm, voluntarily paying for better treatment is a "tax". By that definition, literally everything that's not free is a tax. I paid a latte tax this morning (better than regular coffee), and a sweater tax last week (I chose Banana Republic over Ross). Where are the activists when you need them?

The more sober counter-argument is, what about Fedex? Does this group really believe premium delivery has been a setback in the world's ability to communicate? How about digital cable?

A diversity of offerings at different price points moves a market forward (PCs, cars...) and everyone benefits, either immediately by buying the premium service, or later when the premium becomes a commodity.

Those who did not pay the "email tax" would increasingly be left behind with unreliable service.

There is no evidence that existing email service will somehow suffer as a result of an improved offering. It's old-school alarmist speculation which is rebutted by economic history. Worst case, non-premium users will receive exactly the same service they are getting today.

Your customers expect that your first obligation is to deliver all of their wanted mail, and this plan is a step away from that obligation

Obligation! (Did I mention the orthodoxy bit?) AOL's customers will stick with the service to the extent that it serves their needs. If the Goodmail system improves their experience, they will stay. If it degrades it, some will leave. I am not imagining mass migration in either direction.

AOL has no obligation to its customers, rather it has an incentive to keep them happy. That's the source of their life force, not the 'net clergy. But...

The bottom-line is that charging an "email tax" actually gives AOL a financial incentive to degrade email for non-paying senders.

Sorry, no. (I love when people use economic terminology to make anti-economic arguments.) AOL has an incentive to make money and the only sustainable way to do that is with happy end users who keep paying, or at least using. That is the more reliable incentive.

AOL's "email tax" is the first step down a slippery slope that will harm the Internet itself.

(Are you getting the idea that "email tax" is the meme they are trying to embed?)

The sky is not falling. It's one more experimental piece of the net quality puzzle, alongside Domain Keys and SenderID and a hundred other mutual agreements that a free market enables. Reports of the free Internet's death have been greatly exaggerated.

For end users and activists, the bottom line is this: the customer makes the call. This innovation will succeed or fail on its merits. For each successful idea there are probably ten failing ones, and the market makes its preferences known. Let 'em give it a try and if it doesn't work for you, take your business elsewhere.

There are some very smart names of that list of signatories. Please, less rending of garments and more trust of customers. Power to the people.

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