On Net Neutrality

I have received a ton of emails asking me to comment on the recent court ruling regarding net neutrality. Here goes.

The United States Court of Appeals for the District of Columbia struck down a Federal Communications Commission order from 2010 that forced internet service providers like Verizon, AT&T, Comcast and Time Warner Cable to abide by network neutrality regulations.

Net neutrality is the idea that internet service providers should be forced by government to treat all data on the internet equally, that is, the government plays the role of enforcer by not allowing  ISPs to discriminate or charge differentially by user, content, site, platform, application, type of attached equipment, and modes of communication.

The libertarian position is pretty clear cut here. Government should keep its hands off ISPs and allow them to operate any way they want. The ISPs, using their own equipment, are providing a service and should be allowed to use their equipment and provide their service in any fashion they choose without interference from the government. Thus, the court ruling is is consistent with a libertarian view.

The interventionists are up in arms over the ruling. Betsy Isaacson at HuffPo under the headline, Why You Should Be Freaking Out About The End Of Net Neutrality writes:

1. No more net neutrality means ISPs can now discriminate against content they dislike.

Well yeah, but what web site is going to use the service of an ISP that blocks content that user wants?

She goes on:

No more net neutrality means ISPs can now force websites to PAY for faster content delivery.You know how some sites you go to just load slower than others? Usually, that’s just because the slower site is image heavy, poorly coded, or dealing with intense server load. But with net neutrality gone, ISPs can now start charging hefty fees to websites that want quick content delivery — shifting the long load times to poorer sites that can’t pay up.

Isaacson’s “logic” here is just free market hate. Some content will be slow in delivery under any rules, it is just a case of which content. It will either be content where there is huge demand, which allows content suppliers to pay for fast delivery, or poorer sites, with heavy demand on the servers with little public demand for the service, which is why they are poorer. The free market would favor sites that can pay for the services they are using.

And there is more, she writes:

Destroying net neutrality is bad for small businesses. If ISPs force website owners pay for faster load times, tiny retailers and personal websites will be the ones to suffer from slower content delivery.

This is not necessarily so. If a small business has a strong following, it will be able to pay for faster downloads. Again,this is all about the allocation of delivery speed. It has to be allocated in some fashion. The non-interventionist manner is to allow the highest bidders to get the prime speed, samll or large.

Net-neutrality law can be compared to law that would force out of retail malls top retailers to be replaced by, say, a greasy spoon diner in the name of “mall neutrality.”

Bottom line: Net neutrality is evil government meddling. Let the markets rule!

Reprinted with permission from Economic Policy Journal.