Mark Cuban predicts 'net neutrality' will only help Comcast

Cable companies like Comcast (CMCSA) have been among the most vigorous opponents of the so-called "net neutrality" plan the Federal Communications Commission unveiled this week. So who will be the big beneficiaries of the new rules, which prevent broadband carriers from favoring certain types of content over others? Why, cable companies like Comcast, of course.

That's according to Mark Cuban, the Dallas Mavericks owner, HDNet founder and self-styled commentator on all things technological. I spoke to Cuban on Wednesday at the Times Center in New York, where he spoke on a panel about "the Future of Media" as part of Advertising Week. Cuban's prediction that Comcast will get a big boost from net neutrality struck me as counter intuitive, so I cornered him afterwards and asked him to elaborate.

Cuban told me to picture the internet data pipeline as Fifth Avenue: Take away the special lanes for bikes and buses, take away the cops directing traffic flow, and everything gets very, very slow. Even now, he says, watching relatively low-quality videos on YouTube often requires a pause for buffering. "So if it's already difficult to get the low bit-rate things without buffering, and the expectation is a true television experience, in an open-internet environment you can't deliver a true television experience," he says.

And that's just for on-demand videos. When live video enters the picture, the problems worsen. "If it's live, everybody's trying to get at it at the same time. The requirements on the back-end for servers go through the roof," he says. "The value of it being in real time is important. You don't want it to keep on buffering and have the game be over, or get to American Idol and the judging is over."

Moreover, Cuban believes that some internet users may compound the inevitable data-flow issues with intentional acts of sabotage.

"Let's say I hate the Giants and I'm a Jets fan, and I have a high-speed computer and a 100-megabit ethernet connection to my ISP," he says. "I can just set up a PC, hook it up, show my cat and stream it live and nobody in my neighborhood's going to get the game. Just wipe it out, just like that. And I have every right to do that as Comcast or CBS (CBS) does to distribute their live version of the game."

In this scenario, Cuban says, anyone who wants to have reliable access to high-quality, live video will have to subscribe to a television provider like Comcast. All those people now canceling their cable subscriptions in favor of watching all their TV via Hulu, Netflix and Apple's (AAPL) iTunes will soon change their minds. Speaking of which, Cuban predicts that the current abundance of free TV on the Web will be short-lived.

"Where content companies screwed up...they kind of shot themselves in the foot by creating an expectation of it for free," he says. "I think what'll end up happening is they'll yank most of it. The only content you'll see on Hulu is the junk they can't sell DVDs of or sell anywhere else, or the stuff that needs a lot of promotion."

Of course, it should be noted that as the chairman of a cable channel that derives much of its revenue from the carriage fees paid to it by cable providers like Comcast, Cuban will be a happy man if the scenario he outlines above comes to pass, and a less happy man if what he calls the "incredibly greedy people" who want to watch TV free over the internet get their way.
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