A Response to Andrew McLaughlin on Net Neutrality & “Freedom”

by on July 9, 2011 · 27 comments

Over on his Google+ page, cyber-guru Andrew McLaughlin posted a bit of a rant about libertarians and Net neutrality arguing, among other things, that “the pro-freedom position is to enforce net neutrality.” Needless to say, I disagree and posted a long comment explaining why and trying to help him and others on the Left understand the way libertarians generally look at this issue. For what it’s worth, I thought I would just repost my response to him here:
________

Andrew… I’m happy, as always, to engage in friendly debate with you about this, although I suspect from the tone of some of the others here that nothing I will say will convince them that opposition to Net neutrality regulation can be based on anything other than pure corporate whoring!

I’m always mystified by the highly selective nature of this rhetorical device when employed by some on the Left against libertarians. After all, as Tim Lee already alluded to in his comments above, we never seem to hear our Lefty friends trot out those arguments when they agree with us. For example, Berin Szoka and I filed an amicus brief in the Supreme Court last year in the BROWN v. EMA video game case along with Lee Tien and Cindy Cohn of EFF. Why is it that I did not hear one peep from any Lefties about my obvious corporate whoring in that matter! I mean, clearly, there’s no possible way that a libertarian could support First Amendment rights. I must have just been in it for video game industry money, right?

OK, I’m being snarky here. And I know this is not your position because I’ve known you a long time and know that you do not adopt such tactics even when we do, on occasion, disagree heatedly over a major policy issue.  But, even if I am wasting my breath, let me just say this to others: We libertarians in the academic and think tank world aren’t exactly living “Lifestyles of the Rich and Famous.” If we all just in it for the money than I can tell you that we are doing a tremendously shitty job at it! (In fact, most libertarian think tanks or organizations only have something like 5 to 10% corporate funding. The organization I work for has even less.) Seriously folks, we libertarians believe in our ideas and fight for them with the same passion that you fight for yours because of a heart-felt belief in the inherent rightness of our core principles.

So, returning to Net neutrality regulation, I would hope that folks on the Left could entertain the possibility that libertarians have serious concerns about the wisdom of inviting government to establish a new regulatory regime for the Internet.  If others can be open-minded enough to entertain that possibility, then I hope they will take seriously the three prongs of libertarian opposition to Net neutrality regulation.  I suspect the first and second will be somewhat more compelling (or at least plausible) to the Left than the third.

1) First, government simply does not have a very good historical track record regulating network industries.

I view Net neutrality regulation as a combination of common carriage regulation and “public interest” regulation. We have roughly 100 years’ worth of experience with these regimes in practice in various industries. And when we evaluate the success of those regimes in terms of improving economic efficiency, innovation, competitiveness, consumer welfare, etc., well.. the results have been downright dismal.

Now, it is certainly true that common carriage rules and public interest mandates were well-intentioned. For example, who could possibly be against the idea of more diversity and “balance” in the reporting of news and opinion, as was generally mandated by the so-called Fairness Doctrine? And who could be against common carrier regs that mandated “just and reasonable” rates?

But all the noble intentions in the world don’t matter a bit when stacked against the historical evidence of how well these rules and regulatory regimes worked in practice. Most of these efforts backfired miserably. The unintended consequences were myriad.  Public interest regulation didn’t give us more diversity, it gave us less. It limited the vibrancy of the speech marketplace in the process. Likewise, “just and reasonable” rate regulation gave us nothing of the sort. These rules benefited incumbents more than consumers or new competitors. They did not spur more innovation or entry. And regulatory capture was absolutely rampant across the board.

Thus, by my read of history, these regulatory regimes were viciously anti-consumer.

I suppose some might disagree with this history and suggest that things weren’t as bad as I’ve made them out to be.  I have very little tolerance for that suggestion because I do not believe there is any other way to read this history. I’ve spent the last 20 years attempting to document it in much of my work to remind others – especially policymakers – why we don’t want to go down that path again. But you don’t need to believe me. Read the works of Alfred Kahn (a lifelong liberal Democrat, I might note) or the countless others who have written histories of media and communications regulation. It’s a truly miserable tale.

With all that in mind, can you start to see why the libertarian might be a tad bit suspect of calls for Net neutrality regulation?

2) Second, libertarians tend to be far more optimistic about the possibility of markets, ongoing experimentation, spontaneous/unforeseen innovation, and creative destruction to improve matters long before government regs like Net neutrality get around to doing so.

Again, the FCC just isn’t very good at regulating fast-moving industries and technologies and its track record is particularly poor when it comes to incentivizing new things (remember Video Dialtone? Open Video System rules?) Also, flexibility is crucial for fast-moving technologies and networks and we must be careful not to freeze systems and industries in stone.

While libertarians wouldn’t sympathize with efforts by network intermediaries to “block” any sort of content or traffic, we’d also challenge others to provide serious examples of this being a problem. We don’t think there is a problem here. And if there were such silly corporate efforts to meddle, we are far more optimistic about the power of market and social norms to handle it. Pressure from the press, scholars, engineers, and the general public can help curb the worst excesses. Moreover, corporate screw-ups serve as a good invitation for other innovators to take a stab at offering consumers a better deal.

There’s also the omnipresent threat of the slippery slope of regulation. “Neutrality” mandates could gradually spread to other layers of the Net and cover content and applications. We need to be careful so as not to open the door to comprehensive government regulation of the Internet. The FCC, in particular, has shown itself to be an agency with a healthy appetite for mission creep. Libertarians are highly suspect about giving a bunch of unelected bureaucrats the leeway to determine what a “neutral” Net looks like.

3) Finally, libertarians believe that our Constitution embodies a presumption of liberty. People — including corporations — should be free to pursue their interests so long as they do not violate the rights of others.

This is the “knee-jerk” aspect of libertarianism that alienates many progressives who believe in a different interpretation of rights and the Constitution.  For that reason, I never lead with this argument when debating communications, media, or high-technology policy. Nonetheless, I would hope that you would appreciate why this construction of rights and constitutionally-guaranteed liberties leads the libertarian to resist regulatory regimes imposed from above.

 

Well, I’ve gone on far too long here. I know I have not convinced you to change your mind, Andrew. I understand your position and know how passionately you feel about it. I do hope, however, that you now better understand our position on Net neutrality and realize that it has nothing to do with protecting “big corporate interests,” but rather, it’s about understanding what REAL Internet freedom should be all about!

Alas, our competing conceptions of what “freedom” entails keeps us from being allies on this particular issue.  I look forward to continuing to work with you on the many other issues where our ideological traditions are in closer alignment.

Cheers – Adam Thierer

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  • http://icecreamheadache.wordpress.com Libby_J

    Fab article.  It’s often difficult to argue with the Wu/Lessig acolytes who think “You get money from X” automatically invalidates your argument. I’m frequently surprised by how many of the tech-savvy liberal-leaning crowd – generally a pretty smart cohort, right? – falls for that.

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  • Yonemoto

    You forgot the argument that net neutrality isn’t neutral at all and simply shifts a perceived monopoly/collusive market among service connectors towards a potential monopoly/collusive market among internet content providers.

  • Darren Gasser

    I don’t think your point #1 holds up very well. In order to make it you’ve had to conflate public interest regulation and common carriage regulation in order to tar net neutrality with all the failings of the former. In reality, net neutrality regulations are a fairly good analogue to common carriage regulations, which have, historically, worked out much better than public interest regulations.

    2 is similarly weak for exactly the reasons Yonemoto gets wrong in his comment above. Network providers have a de facto monopoly in many areas of the U.S. that hasn’t been amenable to correction by market forces to date (whereas, contra Yonemoto, content providers have no such history due to much lower barriers to entry), so it’s a rather large leap to hand-wave away this objection with a generic “the market will magically fix it.”

  • Anonymous

    There is a libertarianish doctrine which resembles net neutrality:  if a provider has promised to deliver internet to me at certain speed, quantity and cost, he should do so.  And ISP might choose to give free or faster access to certain services,  but blocking or intentionally slowing down access to the
    general internet, is breaking a promise. 

    And like Darren, I had thought history of common carrier laws was not so dire.  I had thought that the principle is an ancient one going back at least to roman times.  Common solution for a common kind of monopoly-problem.

  • Darren Gasser

    One additional thought on the “all government regulation is evil, and must be resisted/destroyed” thesis:

    Most of the industrialized world has better broadband infrastructure than the U.S. (both in terms of availability and speed) despite having more constrained regulatory regimes. So, the “regulation always suppresses innovation” argument falls flat in this context, too.

  • http://bennett.com/blog Richard Bennett

    The folks like McLaughlin and Lessig who cry corruption are or have been on the payrolls of interested parties in the debate. Lessig’s law center at Stanford was funded by a $2M grant from Google, and McLaughlin was on Google’s payroll before going to DC. So the  charge of shilling looks like simple projection.

    Whether NN is good or bad depends on how you actually define it and enforce it. Motherhood is good and everybody supports it. That doesn’t mean that mothers don’t abuse, neglect, and otherwise harm their children. Free and open Internets are good, but how to ensure they exist forever is hard to do without foreclosing some interesting technical and business options. NN is too much like celebrating victory in the middle of the game for my taste.

    Common carrier brings a lot of baggage that’s not really relevant to the Internet anyhow. It’s not really a telecom network, but career telecom regulators like to pretend otherwise.

  • http://profiles.google.com/jamesjhare James Hare

    I’m sympathetic to your argument, but how do you deal with obvious collusion between ISPs?  Such agreements were touted by ALL the major ISPs in the US just recently.  When the incumbent players band together to defeat the free market, what option do you have?

  • http://bennett.com/blog Richard Bennett

    Are you calling the anti-piracy agreement “obvious collusion?” The push for it came from government, so I don’t think that’s a fair characterization.  The ISPs would rather not be involved in anti-piracy efforts.

  • http://kenkinder.com/ Ken

    As for the belief you hold that no problem exists. Comcast has already forced Netflix (through Level3, its business partner) to pay a premium for what would otherwise be a no-cost “peering” arrangement between the two. In other words, Netflix, through Level3, is already being forced to pay extra to get their content to Comcast subscribers. That might not sound so bad until you also consider that Comcast directly competes with Netflix and singled out Level3 (Netflix’s distribution channel) for discrimination. Clearly, this is an abuse, and Comcast has been unapologetic in its extortionary demands. In a shareholder letter, Qwest’s CEO even identified agreements like the one Comcast has with Level3 as a future source of potential, and somehow I doubt he was lying.

    As for the mythology that the open market will let consumers flee ISPs who aren’t acting in their best interests: It might, if such a market existed. Back in the days of dial-up, if one ISP misbehaved, you could choose another. However most Americans are lucky to have two choices for broadband, whereas many (including myself) only have one viable option: I simply cannot buy low-latency high-speed Internet from any company except Comcast. I loathe Comcast’s service and support, and yet, I’m a captive audience. By definition a market has a plurality of buyers and sellers, and no such plurality exists with broadband, so calling it a “free market” isn’t really fair.

    The simple reality is that broadband providers have a near-monopoly on what they offer, and there’s no sign that their exclusive position is in jeopardy. Free markets don’t work when monopolies exist and Comcast’s willingness to extort exorbitant fees from Netflix is just one example of what happens when there’s a lack of competition.

    If you have some ideas on how to create a diverse marketplace for broadband in the United States, I think techies like me (Left, Right, or otherwise) would be all ears. But until that happens, I don’t see any good way of stopping anti-competitive abuses short of regulation.

  • http://kenkinder.com/ Ken

    Lawrence Lessig has been an activist since before Google even exist. Granted that such funding is worthy of disclosure, but I think it’s unfair to Lessig to assume his views are influenced by it.

  • http://bennett.com/blog Richard Bennett

     One of the interesting features of these claims about Comcast’s allegedly “extortionate gouging” of Level 3 is the absence of supporting data as to pricing, and another is the claim that they’re classical no-charge peering. The data for pricing is under non-disclosure so it’s impossible to say whether the price charged is fair or reasonable, but we can say with certainty that the job Comcast is doing for Netflix is more like traditional transit than traditional peering. Level 3 won’t take traffic from me without charge either, but I’m not screaming about it.

    Read: Now Playing: Video over the Internet to get a handle on the Comcast/Netflix issue: http://www.itif.org/publications/now-playing-video-over-internet

  • http://bennett.com/blog Richard Bennett

    Indeed, Lessig has been an activist for a long time. Unfortunately, he poses as an impartial academic and arbiter of network morality. He knows next to nothing about networks.

  • http://kenkinder.com/ Ken

    Actually, under traditional agreements, Comcast would be paying Level3. Level3 is a “tier 1″ network, meaning they are the backbone of the Internet itself and in markets with competition, ISPs have paid tier 1 providers regardless of the direction of traffic. This is the first well-known instance of a consumer ISP actually demanding to be paid by a backbone provider.

    Such a demand would be absurd in a competitive market. Imagine Earthlink in 1998 demanding that Level3 not only upgrade its connection, but also pay it for the privilege of doing so.

    Comcast’s demands are only tenable because of its position as a notoriously unfriendly monopoly. Instead of paying for an uplink to the backbone of the Internet, Comcast is exploiting the fact that its pipes service millions of American households and Internet companies are helpless if Comcast decides not to serve their content. What amount of money Comcast demand is immaterial, because it’s never reasonable for an ISP to actually demand payment from a tier 1 network.

    In other words, when competition exists, an ISP’s customers are its users. When no competition exists, an ISP’s customers are the content providers.

  • http://bennett.com/blog Richard Bennett

    Comcast is a Tier 1 network in North America, one of the five largest networks. They own their own coast-to-coast backbone network and carry traffic on it for business customers just like Level 3 does. Comcast has 750,000 route miles while Level 3 has 110,000 or so, or did before their Global Crossing merger.

    Traditional settlement free peering is premised on the two networks carrying equal amounts of data for each other, or within a 2:1 margin. With the advent of L3′s CDN agreement with Netflix, the ratio is way out of whack, more like 20:1. Level 3 doesn’t get to use Comcast’s pipes for free, just as Comcast didn’t get to use Level 3′s pipes for free before the Netflix deal reversed the ratios.

  • http://kenkinder.com/ Ken

    Comcast is absolutely NOT a tier 1 network. They’re not even a tier 2 network. They are a end-user ISP. The first time that ludicrous assertion was ever made was in Comcast’s own briefings to the FCC, which are widely and deservedly ridiculed in the industry. You can’t find a list of Tier 1 providers, other than Comcast’s own, that includes them in that category.

    Their hundreds of thousands of “route miles” are almost all cable TV lines. By that standard, a rural telephone provider in India is also a “tier 1″ Internet provide because even without DSL, those phone lines can carry data traffic over an acoustic coupler, and by golly, India’s a big place! Hec, by your standard, cell phone providers are even higher on the food chain than Comcast; if you count the number of data-enabled cell phones out there and estimate the distance to the towers, you have one of the largest networks in the world without even counting the backhaul! Woohey!

    Why stop there? Level3 might have one hell of a connection between Houston and Dallas, but a ham radio operator can bridge that distance easily. And since all we’re counting is route miles, that means we’re peers, right? Right?

    Comparing Level3, which carries a good share of Internet traffic BETWEEN ISPs and Tier 2 networks to Comcast, which simply handles end user traffic, is PATENTLY ABSURD.

    What’s the deal, here? Do you work for Comcast? Maybe Qwest? Time Warner? No simultaneously objective and knowledgeable person could possibly defend Comcast’s actions here.

  • http://bennett.com/blog Richard Bennett

    Comcast has more fiber miles than Level 3 does, and the people who run the Internet consider them a Tier 1 in the North American context. You obviously don’t understand the transit and peering business.

    See Arbor Networks’ Internet Observatory Report presented at NANOG47 on October 19, 2009. NANOG is the club of people who actually run the Internet:

    • Evolution of the Internet Core: Over the last five years, Internet
      traffic has migrated away from the traditional Internet core of 10 to 12
      Tier-1 international transit providers. Today, the majority of Internet
      traffic by volume flows directly between large content providers,
      datacenter / CDNs and consumer networks. Consequently, most Tier-1
      networks have evolved their business models away from IP wholesale
      transit to focus on broader cloud / enterprise services, content hosting
      and VPNs.

    • Rise of the ‘Hyper Giants’: Five years ago, Internet traffic was
      proportionally distributed across tens of thousands of enterprise
      managed web sites and servers around the world. Today, most content has
      increasingly migrated to a small number of very large hosting, cloud and
      content providers. Out of the 40,000 routed end sites in the Internet,
      30 large companies – “hyper giants” like Limelight, Facebook, Google,
      Microsoft and YouTube – now generate and consume a disproportionate 30%
      of all Internet traffic.

    http://www.arbornetworks.com/two-year-study-of-global-internet-traffic-will-be-presented-at-nanog47.html

    And no, I don’t work for any cable company, I work for a non-profit.

  • http://kenkinder.com/ Ken

    Comcast does not maintain anywhere near the overall capacity or peered traffic of Level3 and you know it. I seriously doubt that Comcast has more miles of fiber, but what fiber it does have goes to service its cable network, primarily.

    The point stands that Comcast is not considered a Tier 1 network by anyone other than Comcast. Your article on CDNs doesn’t address or dispute that.

    My original point that in a competitive market, Comcasts’ shenanigans would be moot stands. Do you believe that the broadband market has a diverse ecosystem of competitors? Do you believe that if Comcast had 8 or 10 competitors with similar offerings, they would have been successful in their demands?

  • http://bennett.com/blog Richard Bennett

    The route miles are public record, do a Google search if you doubt what I’m saying.

    The point is that it’s really easy to be a Tier 1 these days because direct peering between the ISPs and the CDNs has made the traditional Tier 1′s largely irrelevant; L3′s network is shrinking while the ISPs are growing.

    All the ISPs figured out years ago that it was cheaper for them to build their own backbones than to pay for transit, and now that they’ve done that the transit providers like L3 have begun to bleed. L3 is trying to reinvent itself as a CDN because it can’t possibly pay off its debt just with transit.

    The economic battle in today’s Internet it between CDNs who move packets a few feet in a data center and the ISPs who run the actual networks that cover 99% of the packet miles in question. The traditional notions of Tier 1s and captive ISPs are simply irrelevant in this world.

  • TS

    The true libertarian argument, and IMO the only one necessary, is the self-evident immorality of using violence to solve social problems.

  • Anonymous

    You should also point out that the reason the net is in danger right now is because of excess government regulation keeping any start-ups from forming that actually cater to consumers.  Thus, only a handful of massive corporations exist that exist in more of a fascist government/corporate cooperative.

  • http://openid-provider.appspot.com/everlastingphelps Phelps

    I, as a libertarian, would like to see net-neutrality type regulations on some parts of the ISP structure — notably those, like the cable companies, who enjoy monopoly protection due to municipal grants.  No one can compete with Time Warner to deliver cable access to me.  No one can compete with AT&T to provide DSL line service to me.  Both of them have been granted monopolies by my city (Dallas).  

    If you are granted a monopoly by the city, then as a tradeoff, you should have to endure regulation on how you exercise that monopoly, including not using that monopoly to deny or throttle access by competitors to your overall corporation.  The monopoly itself is a market distortion, and unfortunately it has to be maintained to avoid even more distortion.

    I would like to see anything like that limited in time and provisions requiring it to be set aside in any truly competitive situation, but the reality is that while monopolies are still being granted on the two primary forms of end-user service, free market principles will not protect the consumer.  (Hopefully, with more wireless systems coming online, this will all be a moot point in a few years.)

  • Andrew

    Agreed. The problem with the purely libertarian solution to this problem is that these aren’t functioning markets. 

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  • Anonymous

    I certainly agree with Darren Gasser and Ken’s points. It’s not like we have a functioning market here in the USA. If you want to see functioning markets in IP connection, look overseas where they have actual broadband available. However, the point in the article that really begs a response is the throw-away “remember Video Dialtone?” parenthetical comment. Yes I do remember that lie that the carriers told throughout the early nineties while they were scheming their way out of decades-old common carriage requirements, requirements of which net neutrality is a direct descendant. These requirements were totally understandable for a statist monopoly that can trespass upon and dig up my property whenever it wants to, but there just weren’t enough telco executives making tens of millions a year with them in place. “Video Dialtone” was one of the ridiculous, couldn’t-possibly-be-true lies that gave legislators cover to cash in all those telco bribes they were offered and allow the telcos to really shaft the consumer. Read more about the $200 Billion Ripoff:

    http://www.niemanwatchdog.org/index.cfm?fuseaction=ask_this.view&askthisid=00186

    If the carriers really don’t want to be regulated, let’s go ahead and eliminate the FCC. When the spectrum is no longer regulated, even rural customers will have all the bandwidth they need, and they won’t be forced to go to the carriers to get it. Then the carriers will plague us no more. (For those who are tempted to “school” me on “physics”, the 1940s called, and they’d like to know why we’re still using their radio technology. I mean, it’s the future, we have microchips now.) Until then, try not to be so naive.

  • http://www.mactonweb.com web development bangalore

    Most of the industrialized world has better broadband infrastructure than the U.S. (both in terms of availability and speed) despite having more constrained regulatory regimes.Until then try not to be so naive

  • http://www.mactonweb.com Web design London

    The economic battle in today’s Internet it between CDNs who move packets a few feet in a data center and the ISPs who run the actual networks that cover 99% of the packet miles in question. The traditional notions of Tier 1s and captive ISPs are simply irrelevant in this world.

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