Network Neutrality: “I wouldn’t start from here”

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Erik Cecil’s recent post on net neutrality is generating discussion on several mailing lists.

I agree with a lot of what Erik says – particularly summing up the underlying problem as “monopoly power in the loop plant”, a point which
seems so obvious to my (European, antitrust-influenced) eyes, that I often stare with bemusement at some of the debates (and court
judgments) in the US.

But I wonder about the implied strategy of abandoning the net neutrality proposals in favour of some form of network access regulation.

Calling for net neutrality to be abandoned because it does not address the most fundamental problem reminds me a little of the old joke about the tourist asking the local for directions and receiving the reply, “Well, I wouldn’t start from here.”

Although the validity of the 1996 Telecom Act and its unbundling provisions has been upheld in principle, the various FCC attempts to implement unbundling in practice were struck down hard by the courts, seemingly giving little or no deference to FCC discretion.  Then with the shift in approach of the FCC under the Bush Administration, came the broadband de-regulation measures of 2003-2005 where first the cable networks, then the telecoms broadband networks were moved out of the scope of Title II of the 1996 Act and into Title I, ruling out any form of mandated third party access.  This was upheld in court, with a ruling that seemed to give the FCC significantly more margin for discretion in deregulating, than the FCC had been given in its earlier attempts at regulating: the most notable example, probably being the court agreeing with the FCC that it need not conduct a market-by-market analysis, looking at where competitive conditions differed across the US, but could take a view as to the appropriate regulation for the US as a whole.  Given the intent of the 1996 Telecoms Act to create the conditions for competition to emerge in telecoms, it is generous  to allow the FCC to ignore actual competitive circumstances.

So even were the FCC now to be convinced that some form of mandated open access regime would be beneficial, it may at the same time feel that such a proposal would still have a problem in court.  Relying on that as their main policy proposal would be risky; making them a one club golfer when they know that that club slices to the right.

So net neutrality is their response to the mistaken broadband deregulation (if you can’t get more competition, at least limit the monopolist’s power)
while at the same time they start to build up an evidence base (eg the Berkman study) for longer term change.

Against the risk that longer term change may fail before the courts, net neutrality seems less harmful than no net neutrality.