For a glimpse of what you're after, take a look at AOL circa 1996, or Compuserve for the decade or more before: controlled walled gardens trailing behind the open internet in technology and innovation.

Or try practicing free speech in a shopping mall.

That network was opened at government insistence on (and funding for) open protocols). Yeah, yeah, I know, it's politically correct here to rewrite history and say that “ARPANET languished under non-commercial restrictions until 1992″, though, of course Compuserve was even more moribund at that time, and those non-commercial restrictions were were there so that private firms like Compuserve didn't have to compete against a government-subsidized network. Well, the market failed to deliver, so the Internet was opened up, and a hundred technologies bloomed.

What you don't seem to realize is that government also creates the situation in which markets can grow and thrive. That's what's behind the net-neutrality movement. Net neutrality, device neutrality, and application neutrality are all big improvements over the alternative.

I've got to admit that the ability to charge differential prices for different services might, indeed, prove a mechanism for encouraging a few new services. The question is whether it wouldn't stifle more services than it creates.

You're absolutely right here, Bob, that government-created monopolies have limited broadband competition.

Government “franchise” licensing has proven lucrative for state and local governments (and sometimes officials) but has blocked new wireline entrants like fiber based on another fiction of scarcity—this time in publicly owned “rights of way.” Worse, not until December 2006 did the FCC finally act to allow telecom companies to begin offering video service. The local franchising roadblock had discouraged Verizon, AT&T and others from building fiber networks that could offer high-speed broadband (instead of just DSL). Finally, through central planning of spectrum use, the FCC has retarded the development of wireless broadband offerings that could serve fixed and mobile users, from high-speed cellular networks to satellite systems to ground-based technologies like Wi-Max.

But instead of seeking to break these chains on free enterprise, regulatory advocates blame markets for failing to provide “enough” competition—and propose more regulation as the solution.

So if the problem is insufficient competition between broadband networks, let's start getting the government out of the way!

There are good regulations and there are bad regulations. There are good companies and there are bad companies. But endlessly repetitive assertions that regulation somehow squelches all innovation is simply wrong and misleading.

For example, when I go to the gas station a buy a gallon of gas, I will get a gallon of gas because of regulation. But that does not stop Toyota or Ford from being innovative and competitive. Lets take a look at our electric network, it works on 60Hz cycle. Because of this standard, we can buy a wide range of products that will work reliably when plugged in. Do you really think that we will get more innovation if some manufactures sell products that require 50Hz and others sell products that require 80HZ?

Apple with its rejection of Google's Voice on the iPhone is an example of private industry taking the initiative to squelch innovation. So it appears that we don't need government regulation to really squelch innovation. Private industry, it seems, is able to it without government help. Amazing!

It's a shame that this bit is getting all the reactions, when the much better piece by Julian Sanchez just two posts down (“Net Neutrality and Architecture Avoidance”) goes unremarked.

Steve, you are you conflating two very different kinds of “regulation.”
1) Setting common standards and units
2) Prohibiting certain legitimate business practices

The former is simply a way of preventing businesses from deceiving consumers, or standardizing trade. It is “regulation” in the most literal sense: “making regular.” But it is a FAR cry from dictating to someone what they can and can't do with their property (including communications networks) subject to appropriate disclosure.

If the complaint were simply that network owners weren't adequately disclosing to consumers that there certain traffic management techniques would be used that might result in faster or slower data transfers for them depending on the circumstances or application at issue, we could have a serious debate about just what those disclosures should be. In general, I'm all in favor of open disclosure but we certainly couldn't expect network operators to tell the 5% of their users who would consume 80% of their bandwidth how to circumvent legitimate traffic management practices intended to protect the remaining 95% of consumers.

As Richard Bennett has pointed out, if you ban such practices in the name of neutrality, networks will be forced to abandon all-you-can-eat pricing and move to some kind of tiered offering. There again some form of disclosure would be perfectly appropriate.

But we're talking about two very different kinds of regulation here.

You write, “Without network neutrality there would be no Google.”

This is not true. No Internet provider has any interest in blocking search engines — whether it is Google or Bing or Jeeves or any other.

In fact, Google's intent, in lobbying for regulation of the Internet, is to prevent another Google from arising to challenge it.

We've certainly seen non-neutral policies in the past — AOL and its walled garden, for example. Sure, those don't necessarily survive long, but that doesn't keep the business model from reappearing and inconveniencing customers and potential customers. For example, viewed from a safe distance (so I could be mistaken), Facebook appears to be repeating some of that walled-garden mentality.

I can assure you that Verizon would love to pull the plug on the independent ISPs to whom it must give equal access to the last mile.

They probably won't, either, unless they serve a purpose.

True. However, the question is: whose purpose? The ISP's or the customer's? In the duopoly situation that most customers find themselves in — phone company or cable company — that can be an important question.

There simply is no evidence that “device” or “application” neutrality are universally superior to device or application non-neutrality from an innovation standpoint

It sounds as though someone needs to learn about this thing called “the Internet”, and the role that open protocols and the end-to-end principle played in its development. No evidence, indeed.