How to Solve the Net Neutrality Issue

by on October 28, 2009 · 10 comments

I was stunned last week when I saw many prominent tech VCs and CEOs from Silicon Valley sign letters endorsing the FCC’s move towards Net Neutrality, since, if the rule making goes ahead, it will mean regulating the Internet.  I happen to know a bunch of these folks, so I decided to call them to see if they really were endorsing regulations for the Net or if something else was going on.  Something else was going on.  Because the term “Net neutrality” is notoriously difficult to define, and is often put in terms of “free and open,” some people signed the letters without realizing it could lead to new regulations for the Information superhighway (these are busy people who spend more time running their companies than following the ins and outs of the FCC).   That said, unsurprisingly, there was a lot of suspicion regarding the phone and cable companies.  After many conversations, here is a potential solution that could put an end to Net neutrality games and ensure a bright future for the Net.

The upshot for those of you who don’t want to follow the link:

“If the tech industry and the major ISPs want to avoid government regulation and keep the Internet thriving, they need to come up with a way to solve the disclosure problem on their own in the marketplace.

Verizon has already started taking steps toward a more constructive stance by co-signing a letter with Google supporting an open Internet. Now it is time for all companies involved to take it to the next level. If that happens, U.S. innovators will be much safer from the claims of militant rent-seeking activists and regulators who want to get their hands on the Net.

The creation of TRUSTe helped the tech industry mobilize and avoid heavy-handed privacy regulations like those that befell Europe. Now it is time for ISPs to support an independent, private body to monitor neutrality issues. Such a move would deflate the pro-regulation lobby and allay the concerns of the industry that is driving U.S. growth.”

  • daveburstein

    Sonia – Disclosure is great, but it simply isn't enough when there are only two high speed choices, the foreseeable future of the United States. (Wireless, the experts agree, is great but will be 90% slower than cable and many telcos lines.)

    The “rational” thing for two players in a market to do is “wink and nod” and act much like a monopoly. If degrading video over the net protects their own video revenues, then they would do everything in their power to make it so. Steve Burke of Comcast is already suggesting similar.

    Personally, I'd prefer the threat of regulation leading to the companies behaving reasonably, and avoid formal rules. But the business logic of the two players – as well as the ferocity of their opposition – suggests we need an effective counter.

    Having 5-8 choices would be great, and probably allow “the market” to solve this. But with only two, it's naive to count on “the market.” It what I call “Martian policy” – great in theory, but simply doesn't apply to the real problems on Planet Earth.

    Dave Burstein, Editor, DSL Prime.

  • roberthedges has other plans; more dna centic.

  • roberthedges has other plans; more dna centic.

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