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One internet company is letting its customers' internet service slow to a crawl

MUNIR UZ ZAMAN/AFP/Getty Images

The network neutrality debate is often framed as a dispute over "fast lanes." Net neutrality supporters warn that regulations are needed to stop big broadband providers from creating a two-tier internet, where websites that can afford it pay for their sites to load faster, while everyone else's content is relegated to the slow lane. Advocates say the Federal Communications Commission needs to act now to prevent this from happening.

But paid fast lanes and unpaid slow lanes are not just a theoretical issue. They already exist, and consumers are suffering as a result.

The latest evidence of this comes from these charts, provided by a networking company called Level 3:

Level 3 operates a big part of the internet's backbone: long-distance lines that carry internet traffic across the country and around the world. Traditionally, broadband providers paid backbone providers to carry their traffic to other ISPs. But lately, at least two of the largest broadband providers — Comcast and Verizon — have begun demanding that backbone providers pay them to deliver content their own customers have requested.

When Level 3 interconnects with a big broadband provider such as Comcast, Verizon, or AT&T, they typically do so at many different locations around the country. For example, there might be connection points in New York, Chicago, Los Angeles, etc. In this chart, each box represents one of those connections. The chart shows how congested Level 3's connections are to three unnamed ISPs in various cities.

A usage rate above 90 percent indicates chronic congestion — if you're unlucky enough to be in one of those cities, you might see a lot of video buffering, slow-loading websites, and slow online gaming. A lower usage rate indicates that there's plenty of spare capacity to handle traffic surges, providing customers with high performance at all times.

You'll notice that Level 3's connections to LEC1 and LEC3 have gotten better over the last six months, while the connection to LEC 2 has gotten worse. Level 3 says that's not a coincidence: Netflix is one of Level 3's biggest customers, and LEC 1 and LEC 3 forced Netflix to pay them tolls to deliver content to their own customers — something that had previously been contrary to internet norms. So far, LEC 2 hasn't gotten paid, and it appears to be retaliating by letting its connections get congested.

Level 3 won't say which broadband providers LEC 1 and LEC 3 are, but we know that Comcast and Verizon are two examples of broadband providers that forced Netflix to pay them to deliver traffic.

The basic issue here is that customers are already paying ISPs to provide them with connectivity to the internet. When ISPs play hardball in interconnection disputes, they're essentially using their paying customers as hostages, degrading their internet experience to force content companies like Netflix to pay more. And because there's so little competition in the broadband market, there isn't much either customers or content providers can do about this.

But ironically, the network neutrality regulations currently being considered by the FCC likely would not affect this kind of business tactic. Conventional network neutrality regulation treats negotiations between broadband ISPs and backbone providers such as Comcast as a separate market from the residential broadband market.

But in practice, this distinction makes no sense. The hardball tactics big ISPs are using to get content companies to pay up have exactly the same effects on consumers and online competition as explicit fast lanes: the internet's level playing field is replaced by a market where some content gets better treatment than others.

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