Net Neutrality Nonsense

The current system of an unregulated Internet has fundamentally enhanced the way we communicate and conduct business. Unfortunately, several senators with little understanding of technology or economics are pushing for new government regulations called “network neutrality” that would alter what has made the Internet so successful in the first place.

You’ll hear a lot of rhetoric on this issue in the coming months, so I want to make one point absolutely clear, something even proponents of network neutrality legislation won’t deny: network neutrality legislation would give the federal government massive and unprecedented power over the Internet. If government control of the Internet unnerves you, either for economic or privacy reasons, you should be skeptical, at the very least, of net neutrality legislation.

Net Neutrality: A Short Summary

To grasp what net neutrality is, it’s important to understand a little about how the Internet works. Think of the Internet as a network of pipes — these pipes could be made of cables, phone lines, fiber optics, or they could even be invisible wires (WiFi). People are constantly sending each other information through these pipes, which happen to be privately owned by broadband companies like Cox, Comcast or Verizon. There is a limited amount of bandwidth, which is just another way of saying that the pipes are only so wide. Because bandwidth is scarce, it can’t carry all the information through the web as fast as we might like it to.

Net neutrality laws would prevent broadband companies from giving priority to different types of content on the Internet. An example would clear up what this really means. As the pipes get bigger, companies will be able to offer exciting services through the Internet, such as high-definition television or telemedicine. But these services like high-definition television eat up a lot of bandwidth, and therefore require priority for a smooth reception. Net neutrality legislation would prohibit broadband providers offering premium service to these high-bandwidth content providers for an added fee.

Net Neutrality Laws versus Common Sense

The Internet socialists imagine that without net neutrality legislation, providers would block your favorite websites. However, the broadband companies have had the freedom to do this since the Internet’s inception, but didn’t, because the market is a strong check on anti-consumer behavior. The pro-regulation crowd also claims that they will create “toll roads” that will prevent ordinary people from accessing the Internet. Setting aside the little complication that this hasn’t happened, what’s so bad about the differential pricing of content anyway?

Indeed, differential pricing of various goods and services is the foundation of the free market. In fact, we interact with this kind of system everyday. When we shop at Whole Foods instead of Wal-Mart, we pay a premium price on our tomatoes for ripeness and quality. When we send a letter through UPS instead of the Post Office, as Chuck Murth helpfully suggests, we pay more money for faster and more reliable service. In these markets, as with almost any market that allows differential pricing, poor and middle class Americans can send packages, buy groceries, and purchase cars. Why shouldn’t it be any different with Internet service?

This elementary-school principle — pay for what you use — has the Internet socialists up in arms. Their slogan “information wants to be free” belies their mentality of entitlement to an all-you-can-eat buffet of bandwidth. But the Internet socialists cannot have their bandwidth and eat it too, for bandwidth is neither free nor unlimited. After all, the Internet backbone is private property built on billions of dollars in capital investment. Currently, providers are upgrading their networks to offer bigger pipes at even faster speeds, but only on the assumption that they can recover their investments and profit through creative business and pricing models. Destroying the profit motive of Internet providers will only result in underinvestment in America’s broadband structure, which is something we can ill afford in a competitive global economy.

Even worse, as law professor Christopher Yoo argues, prohibiting competitive pricing may have the unintended effect of creating more a concentrated and monopolistic Internet. If providers cannot compete on the basis of price, there is very little that separates one from another in the market, which would naturally lead to a natural advantage for larger companies. The end result would be less choice and higher prices for consumers.

More Government Control or Less?

The Internet is abuzz with hysterical cries from Internet socialists like that “Congress is now pushing a law that would end the free and open Internet as we know it.” But “the Internet as we know it” is actually one without network neutrality regulations. It’s MoveOn and its ilk that wants to end the Internet as it is by granting the federal government new expansive powers.

Even more perverse is the comparison of net neutrality to the first amendment. Net neutrality legislation would give the government the license to control the physical architecture on the Internet, and by extension, the potential power to control what gets said to whom. That’s a far cry from the sacrosanct “Congress shall make no law ….”

Arpan Sura is a researcher with FreedomWorks.