Friday, September 7, 2007

DOJ: Block Net Neutrality

The soon to be Gonzo-less DOJ sent a filing to the FCC (nearly two months late) weighing in on it's net neutrality ruling. And in a surprise to no one, the still lead by Gonzalez Dept. of Justice stands up for the big business telcos.

DOJ says that there is a paucity of evidence to warrant such regulations and that they could, moreover, actually deter and delay investment and innovation.

If broadband providers were to charge third-party content and application providers fees for priority service, that could, in some circumstances, actually enhance consumer welfare, Justice argues. Differentiating service levels and pricing could be an efficient way of allocating scarce resources, much the way the U.S. Postal Service charges different fees depending on the speed of delivery.

The DOJ is telling us that regulation of the internet is bad. It will slow internet developement, and that's not something we want, obviously (as they put it in their filing).
However well-intentioned, regulatory restraints can inefficiently skew investment, delay innovation, and diminish consumer welfare, and there is reason to believe that the kinds of broad marketplace restrictions proposed in the name of "neutrality" would do just that with respect to the Internet. Congress passed the Telecommunications Act of 1996 to "promote competition and reduce regulation," and to "encourage the rapid deployment of new telecommunications technologies."(3) In response, the Commission has deregulated various aspects of broadband services.(4) Against this background, commenters proposing special regulation of the Internet should bear a substantial burden of demonstrating that it is appropriate.

Now this promoting of competition has been working so well that the U.S. is the world wide leader in broadband users. Of course that's only if you don't break it down per capita, or look at a ratio. The UK has 84%
In total, 84% of web-enabled households said they had a broadband connection, up from 69% in May 2006.

And here in the US, just 72%
53% of all US households now subscribe to a broadband high-speed Internet service at home. Broadband services now account for about 72% of all home Internet subscriptions – compared to 60% in 2006.

Of course that's only comparing US broadband to the UK, so here's a chart with other countries on it too. If you're looking for the US you'll need to go down to line 13, just below Belgium (here's a big report on the US lagging in the broadband realm, if you're into that kind of thing).

Now back to the DOJ's filing, they give us a little more than just competition is better (and a trust us, we'll enforce antitrust laws), they also point out that no one can give them a good reason for enacting net neutrality regulations.
Based on the record in this proceeding to date, proponents of "net neutrality" regulation have failed to show that a sufficient case exists for imposing the sorts of broad marketplace restrictions that have been proposed. Moreover, the Department has grave concerns about the potential negative consequences of such restrictions were they to be enacted. Given the dynamic and evolving nature of the Internet, the Department finds that there are especially strong reasons to be cautious about imposing restrictive regulations in this context.

If you look at the enhancement of competition on an economy wide perspective wouldn't an neutral internet make everything more competitive?
If the phone and cable companies get their way, websites and online service providers who aren’t able to afford these fees would be put in a slow lane. Large media companies who can pay the tax to use the fast lane would dominate what you can access. The less powerful voices would be lost. That would mean a lot less consumer choice and it would strangle individuals and small companies trying to get their businesses off the ground.

And so I ask the justice department to read their own filing as to the reasons why people are pushing for net neutrality. If you want to make everything more competitive, not just more money for the telcos, then you want everyone to have equal access to the internet.

Wasn't the developement of the internet publicly funded to begin with (I'm thinking it had something to do with Al Gore)? How can we justify giving someone better access at a higher cost, when it comes to a public good? Should Walmart's trucks have a higher speed limit on the freeway than me because they can afford to pay some kind of get there quicker fee?

1 comment:

  1. Remember: A public utility isn't a public utility when it's telecommunications. They're more than happy with the status quo of all of the protections with few (if any) of the obligations.

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