Comments on: Do Americans Really Want “Net Neutrality” Regulation?

By: The Progress & Freedom Foundation Blog

The Progress & Freedom Foundation Blog — Tue, 29 Sep 2009 21:35:19 +0000

The Washington Post Slams Net Neutrality Regulation...

The Post, hardly a bastion of radical cyber-libertarianism, has come out strongly against FCC Chairman Julius Genachowski's plans to have the FCC issue "Net Neutrality" regulations. The editorial asks the critical threshold question we crazy cyber-l...

By: Steve R.

Steve R. — Tue, 29 Sep 2009 07:50:10 +0000

Letting the market decide is a motherhood Utopian solution. Who in their right mind would argue against it. The reality is that we really need to question what it means to let the market decide. For example you wrote "I think the most important thing is that we have to create an environment where innovation is possible, where experimentation is possible, and where constraints are not imposed on the field [by] any regulatory authority." But what do the words "regulatory authority" really mean?

On this website, it is clearly government agencies such as the FCC. However, we now are experiencing corporatism, not capitalism, and corporations today are the new "regulatory authority". Look at the DCMA and the Copyright Term Extension Act. The RIAA and the MPAA have "created" these laws and are using them to assert that they have the right to "break into" your data stream to make sure that you are not stealing. These laws are repressing the free market in terms of innovation and experimentation. Remember the concept of "reverse engineering" that allowed AMD to compete with Intel? In terms of wiretapping, NSA's wiretaps, are considered "bad" on this website; but if a private company such as the RIAA wiretaps it is considered "good". Obviously the concepts of right and what wrong, are capricious and lack uniform interpretaion. It is unfortunate that continued expansion by corporations to usurp the power of the State has not been challenged here.

By: brettglass

brettglass — Tue, 29 Sep 2009 04:46:59 +0000

“Grandfather of the Internet” Professor David Farber had this to say about Network Neutrality regulation in a brief speech last Friday:

Many of the “religious” discussions that take place in the “net neutrality” world offer the potential of having the technical community faced with this very difficult environment: “Go do your designs, but be careful. Because retroactively, what you do — some regulator might say — is not 'correct.'” It's very hard to work in that environment. Especially when — as you all know — Washington is not noted [for having] organizations which are loaded with technologists. So, there's a real potential hazard [to] your ability to innovate. And that's what worries me a lot about the directions we're going….

I think the most important thing is that we have to create an environment where innovation is possible, where experimentation is possible, and where constraints are not imposed on the field [by] any regulatory authority. Let the marketplace determine what's acceptable or not; so far, that has gotten us a long way. I'm not a true believer that the marketplace will always decide right, but after being in Washington for a year, I'm semi-convinced that I'd rather take a chance on that than [on] many of the regulatory environments.

By: Steve R.

Steve R. — Tue, 29 Sep 2009 03:50:10 +0000

Letting the market decide is a motherhood Utopian solution. Who in their right mind would argue against it. The reality is that we really need to question what it means to let the market decide. For example you wrote "I think the most important thing is that we have to create an environment where innovation is possible, where experimentation is possible, and where constraints are not imposed on the field [by] any regulatory authority." But what do the words "regulatory authority" really mean?

On this website, it is clearly government agencies such as the FCC. However, we now are experiencing corporatism, not capitalism, and corporations today are the new "regulatory authority". Look at the DCMA and the Copyright Term Extension Act. The RIAA and the MPAA have "created" these laws and are using them to assert that they have the right to "break into" your data stream to make sure that you are not stealing. These laws are repressing the free market in terms of innovation and experimentation. Remember the concept of "reverse engineering" that allowed AMD to compete with Intel? If the NSA wiretaps, that is considered "bad" on this website; but if a private company such as the RIAA wiretaps it is considered "good". It is unfortunate that continued expansion by corporations to usurp the power of the State has not been challenged here.

By: brettglass

brettglass — Tue, 29 Sep 2009 00:46:59 +0000

By: The Washington Post Slams Net Neutrality Regulation — Technology Liberation Front

Mon, 28 Sep 2009 13:30:17 +0000

[...] their strong opposition really underscores that preemptive “net neutrality” regulation isn’t the popular cause some in Washington think it is. It is simply infrastructure [...]

By: Adam Thierer

Adam Thierer — Sat, 26 Sep 2009 15:09:07 +0000

Excellent point, Jim! You are absolutely correct that once Internet products and services are brought into the FCC's regulatory world, a bevy of taxes and other "obligations" will follow. We've spent the last decade fighting to keep the Net free of burdensome taxes, but this is how they could get applied via the back door.

By: jimr550

jimr550 — Sat, 26 Sep 2009 14:49:29 +0000

Great discussion, but it seems that an important point has been overlooked. Regulation of any service, product or industry is preceded by definition. Once defined, it is subject to taxation.

This entire subject is a prelude to taxation of Internet products and services. It will likely start with telephony services and proceed accordingly to financial services, and continue from there.

As such, the activity is essentially neutral insofar as technology innovation is concerned -- so long as applicable taxes are paid the government will ensure that the service is not disfavored by the network operators.

By: dm

dm — Fri, 25 Sep 2009 04:25:48 +0000

Disclosure may not always be a good idea, either -- the "bad guys" may take advantage of disclosure to circumvent network management rules that serve a valid purpose.

Both you and Berin have raised this argument. Security doesn't work that way. The bad guys are going to figure out the means of circumvention anyway. All non-disclosure does is harm the innocent.

But that doesn't mean that, absent neutrality rules, providers will succeed in leveraging their supposed "market power" to harm consumers in any systematic way.

Well, not for long (only months to years), perhaps.

I'd like to point out a regulation I am very glad is in place: local phone companies have to provide at-cost access to the last mile to other ISPs. As a result, I can choose the ISP which provides the services I want, instead of being forced to swallow the offering of my local phone company (with the possible duopoly choice of Comcast).

By: Ryan Radia

Ryan Radia — Thu, 24 Sep 2009 23:42:16 +0000

Net neutrality regulation isn't a bad idea because open networks, open protocols, or open access are bad principles. Rather, they're not always best, nor is there any compelling reason why government should force networks to be open (or closed for that matter).

See Tim Lee's paper -- http://www.cato.org/pub_display.php?pub_id=9775 -- he argues that the scenarios that neutrality advocates warn of are unlikely to happen. Mistakes will be made, and some ISPs will make dumb moves, but the Internet is not going back to AOL anytime soon.

Of course, some degree of non-neutrality may well make economic sense in certain cases -- wireless is one excellent example of this -- and emerging networks may not offer exactly the same characteristics that today's open networks do. But that doesn't mean that, absent neutrality rules, providers will succeed in leveraging their supposed "market power" to harm consumers in any systematic way.

Disclosure occurs whether providers like it or not. Comcast didn't tell anybody about Sandvine, but people figured it out anyway. Disclosure may not always be a good idea, either -- the "bad guys" may take advantage of disclosure to circumvent network management rules that serve a valid purpose.

The solution to poor network management tactics is more competition. Regulating otherwise-voluntary arrangements between private parties, however, depresses competition. An entrepreneur considering entering two markets will, ceteris paribus, generally choose that which is more "open" to business models. As Brett Glass has pointed out, small ISPs actually have more to lose from stringent neutrality rules than large ISPs do. Look no further than AT&T's support of neutrality rules (on wired broadband at least) for evidence of this.

By: dm

dm — Thu, 24 Sep 2009 22:26:42 +0000

This is a good point.

The government does regulate weights and measures, it's true. In the telecommunications area, the FCC regulated such things as what could be connected to a phone network (eventually retreating from an ATT-friendly "Western Electric equipment only" to a set of technical specs); in computer communications, in the US, the government has served primarily as a customer --- demanding that the products they buy meet certain open standards, but not controlling the standards-setting process (they have taken an active role in that process, however).

Government also serves to arbitrate among different parties --- in this case, ISPs who are changing their service agreements, and customers (some of whom care very much, some of whom do not). This is also regulation.

And you beg the question: are the business practices in question legitimate or not? That's a key element of what the debate is about, too.

By: dm

dm — Thu, 24 Sep 2009 21:31:09 +0000

I think "net neutrality isn't always and everywhere a good thing" is rather a departure from the point you typically seem to be making, and is welcome news, indeed. It's not polarization we need, but synthesis and mixed solutions.

I suggest you put a bit more stress on the need for synthesis (or give Julian Sanchez room to do so, as he did here a few days ago), instead of wasting time on childish rhetoric like "Bolivarism" and "Bakuninism". I should note that one reason Berkeley and Cambridge might be the sorts of places you hear about "net neutrality" is because they are the sorts of places where the technologies that make up a fair amount of the network first emerged (and continue to emerge, today).

I'm a bit humbled by Steve R's patience --- my remarks tend to be a bit snarkier, if only because I know we have our open network built of open protocols is because the government, as the main customer, insisted on it.

By: Berin Szoka

Berin Szoka — Thu, 24 Sep 2009 21:12:57 +0000

But Steve, the whole point here is that Net Neutrality isn't always and everywhere a good thing. Sometimes non-neutral network management really does benefit consumers!

By: Steve R.

Steve R. — Thu, 24 Sep 2009 20:36:57 +0000

Yes, ISP should have the freedom to manage their networks. The concern, however, is whether the network management is legitimate or not. Cracks in network management legitimacy have already appeared. Comcast, in a manner of speaking, is a trend setter in that it has voluntarily broken the concept of honoring net-neutrality. Ed Felten in Freedom to Tinker, wrote: Comcast Blocks Some Traffic, Won't Explain Itself. Other companies have also undertaken questionable actions that don't respect net-neutrality. Of course a few of instances misconduct don't necessarily justify the need to regulate, but it leaves me with that nagging itch of whether companies will honestly implement net-neutrality.

By: Eric B

Eric B — Thu, 24 Sep 2009 20:10:31 +0000

Berin,

This is not a public comment. Just giving you a heads up.

The Google Trends data are very likely not a linear graph (probably some log base), so making a conclusion that someone is x percent of y based upon an index score is probably not a good route to go.

http://www.google.com/trends?q=privacy,+online+...

By: Berin Szoka

Berin Szoka — Thu, 24 Sep 2009 19:52:59 +0000

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.

By: Steve R.

Steve R. — Thu, 24 Sep 2009 19:08:39 +0000

This reminds me of the phony "surveys" that you receive from varies special interest groups. If you walk-up to someone and ask if they are in favor of "regulation" they would naturally respond "No". Furthermore, how many people really understand the implications of the "Net Neutrality" debate?

As for Americans being more concerned about "Identity Theft", it is thrown into your face all the time by firms trying to sell you that service and the media pointing out various security breaches. Furthermore, I suspect our reporters have little interest in and even less understanding of "Net Neutrality". "Identity Theft", unlike "Net Neutrality", is actively in the public conscience. Seems that you are committing a logical fallacy here, asserting that something must not be important, because few people are in-tune with the issue.

Now on "regulation". Regulation can "hurt" innovation, but it can also "help" innovation. Not only can regulation help innovation, it gives us many important standards that help society function. I addressed this in my response to: The Day Real Internet Freedom Died: Our Forbes Op-Ed on Net Neutrality Regulation. In that response, I mentioned that regulations that guarantee that you get a gallon of gas assure you that you do indeed get a gallon of gas. Imagine the mayhem and economic inefficiencies that would result if everyone had to actually measure the gas they bought. Also the regulations that require that a gallon of gas is actually a gallon of gas do not prevent Ford and Toyota from competing. Regulations should be designed to provide a level playing field on which the competitors can compete. Net Neutrality would provide such a level playing field.

Now on "innovation". As with the previous paragraph, regulations can both "help" and "hinder" innovation. The national standard for out electrical system is 60HZ. Consequently if people want to come out with innovative products that work at 50Hz or 70Hz they are naturally going to be at a disadvantage. But wait, they can still innovate by developing the product to work at 60HZ. Not only can they develop an innovative product that will work, but they will be able to immediately sell the product to people who will have the ability to "plug and play" since 60HZ is a national standard.

The argument that "regulation" automatically hurts competition and innovation is fallacious. These assertions are simply being thrown out in the hopes that they will somehow "stick" without being questioned.

By: mwendy

mwendy — Thu, 24 Sep 2009 18:42:28 +0000

Don't let the facts get in the way. This is well beyond that. Few realize that Net Neutrality = Title 2 regulation (more spcecifically the '96 Act's Section 251-like open access regime, minus, of course, the Section 271 inter-LATA sweetener for the RBOCs). We're in feel-good land, where risk exists no longer (or, if it does, the risk part stays with the riskers, and the gain part goes to free loaders).

The FCC has de facto repealed Computer III, and will work through NOI - FNPRM to impose Title 2 + obligations on the industry. Sad, really. But not unexpected. The redistributionists, combined with the "free speechers", have been at this for some time.

It cannot all be "innovation at the edges". Policy must continue to promote - through Computer III-like forbearance - initial infrastructure innovation. Otherwise you don't get to the edges because there'll be no rails on which to ride there.