[Infowarrior] - Preserving Network Neutrality without Regulation

[Richard Forno]

November 12, 2008
Policy Analysis no. 626

http://www.cato.org/pub_display.php?pub_id=9775

The Durable Internet: Preserving Network Neutrality without Regulation

by Timothy B. Lee

Timothy B. Lee, an adjunct scholar at the Cato Institute, is pursuing  
a Ph.D. in computer science at Princeton University

Published on November 12, 2008

An important reason for the Internet's remarkable growth over the last  
quarter century is the "end-to-end" principle that networks should  
confine themselves to transmitting generic packets without worrying  
about their contents. Not only has this made deployment of internet  
infrastructure cheap and efficient, but it has created fertile ground  
for entrepreneurship. On a network that respects the end-to-end  
principle, prior approval from network owners is not needed to launch  
new applications, services, or content.

In recent years, self-styled "network neutrality" activists have  
pushed for legislation to prevent network owners from undermining the  
end-to end principle. Although the concern is understandable, such  
legislation would be premature. Physical ownership of internet  
infrastructure does not translate into a practical ability to control  
its use. Regulations are unnecessary because even in the absence of  
robust broadband competition, network owners are likely to find  
deviations from the end-to-end principle unprofitable.

New regulations inevitably come with unintended consequences. Indeed,  
today's network neutrality debate is strikingly similar to the debate  
that produced the first modern regulatory agency, the Interstate  
Commerce Commission. Unfortunately, rather than protecting consumers  
from the railroads, the ICC protected the railroads from competition  
by erecting new barriers to entry in the surface transportation  
marketplace. Other 20th-century regulatory agencies also limited  
competition in the industries they regulated. Like these older  
regulatory regimes, network neutrality regulations are likely not to  
achieve their intended aims. Given the need for more competition in  
the broadband marketplace, policymakers should be especially wary of  
enacting regulations that could become a barrier to entry for new  
broadband firms.

< - >

http://www.cato.org/pub_display.php?pub_id=9775