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December 16, 2008

Net Neutrality and The Obama Stimulus Package - Discussion

Good challenging questions from reader brooke oberwetter showed up on CircleID where Fractals of Change is sometimes cross-posted in reponse to yesterday's post on net neutrality. Since those don't show up in the comment stream for the original post so I'm reposting his questions and my responses here. I'm also urging CircleID and other places which cross-post FOC to support DISQUS for comments along with it so that commenters in one place can see comments and responses on the other and we can have one discussion instead of fragmenting the discussion across sites.

If it ain't broke...


You say that "with a few exceptions" we've had a neutral Internet (and all of those exceptions fell within the FCC's already-existing statutory authority). So why the need for regulation? Why the need for nationalized infrastructure? You seem very familiar with the dangers of regulation--the rent seeking of the incumbents, the possibility of unintended consequences--but still call for more far-reaching regulation to respond to a problem that you admit doesn't really exist?

And most disturbingly, you think nationalization of the infrastructure will be BETTER? Have you seen a lot of efficient or effective repairs made to interstate highways? Is there a lot of investment going into making the highway system better or more efficient? Does anyone have an incentive to make sure the highways operate as smoothly and effectively as possible? And most important, is traffic well managed on the interstate highway system? Try I-95 my friend.  The answer to all of this questions is a resounding "NO!"

My responses:


You're correct that my concerns are proactive and not reactive. The reason I think that danger is growing is that the concentration of Internet access provision in the US is growing. There were many dialup ISPs; in most locations there are just two broadband choices (in rural areas one or none). Moreover, at various times the telcos have announced their intent of using this monopoly power to double-dip by charging providers both for their own access (which is fair) and for the access to the subscribers who have already paid (which is double dipping but is the way telephony works).

Further evidence of monopoly behavior is the failure to improve quality evidenced by the US' slipping rank as a country with broadband access and the slow trend towards capping "unlimited" monthly access. So I think the danger is real.

I'd prefer to see more competition without the need for the government to provide any infrastructure or regulate further. Perhaps this will happen with the enlightened policy of making the TV white spaces available for unlicensed use.

I think the Obama economic stimulus will and should include a broadband component. That money can either make the problem worse in my view by subsidizing the incumbent duopoly OR it can provide a basis for expanded competition.

As former transportation secretary in Vermont, I do agree that the states and the feds have done a less than ideal job of maintaining the transportation infrastructure. Hopefully that'll change. You are right that a broadband backbone as bad as the I-95 corridor would be a disaster. But the Interstate system in general provided the US with a splendid transportation infrastructure despite some of the unintended consequences of having such excellent transportation.



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