Why you mustn’t let the Government regulate the Internet – some thoughts on net neutrality

I mean, what do I know? Surely Simon you should steer away from those geek subjects like ‘net neutrality’! But it’s important – very important – because…

…the advocates of ‘net neutrality’ are asking for the Internet to be regulated by Government.

And, you are quite right dear reader; this is not a good thing at all.

But first the argument. Here’s Ed Vaizey upsetting the net neutrality wonks by saying no:

Internet service providers such as BT should be allowed to abandon net neutrality and prioritise users' access to certain content providers, the communications minister Ed Vaizey said in a speech today.

The move away from net neutrality in the UK will prove controversial as it opens the door for ISPs to favour some websites in terms of the volume and speed of the delivery of their content to users, while others given lower priority could see their internet traffic suffer.

This is a bad thing say those wonks (and some vested interests like the search engine providers and the BBC):

In this case the baby they'll eat is the open internet. If ISPs can say to firms, "nice data you've got here. It'd be a shame if anything happened to it" they can ensure that the next YouTube, the next iPlayer never takes off.

Bear in mind that many ISPs aren't just carriers: they're also in the media business, so for example ISPs such as BT, Sky and Virgin have services that could be seen as competitors to, er, YouTube and iPlayer. That should be reason enough to worry about net neutrality.

The problem is that the solution offered by the supporters of ‘net neutrality’ is more Government. Because we think that corporations eat babies, we hand control over to the biggest baby eater of them all – our Government? Now that seems a really good idea! What do you think that Government will do with its regulatory powers? Allow us really free access to the Internet? Any Internet? Who are you trying to kid!

Of course statist apologists like to play games with words – here’s the estimable Left Foot Forward demonstrating how he doesn’t understand what makes a free market:

What does net neutrality actually mean? Net neutrality can be hard to define because of technical issues involved. But according to one of the world’s experts on it, Professor Tim Wu of Columbia Law School in New York, it is a principle that advocates no restrictions by internet service providers, infrastructure providers or the government on content, sites or different ways of using the ’net. It is an online ‘free market’ in its purest sense.

Not really since net neutrality requires enforcement, regulation and controls that are designed externally to the market. But that’s not the big deal here. The big problem is that there are no constitutional protections in the UK – government, that rapacious, lying hobgoblin, can do as it pleases. And it will – even the waving of a tiny stick by Ed Vaizey shows a willingness to order and direct the operation of the market.

In a more considered and less frothing piece on Wired three concerns are raised about ‘net neutrality’ arguments:

First is that bandwidth is not, in fact, unlimited, especially in the wireless world. One reason ISPs are averse to neutrality regulation, they say, is that they need the flexibility to ban or mitigate high-bandwidth uses of their network, like BitTorrent and Hulu.com, which would otherwise run amok. Take away their ability to prioritize traffic, the ISPs say, and overall service will suffer.

Second, enforcement of neutrality regulations is going to be difficult. Comcast may not be able to block Skype traffic altogether, but what’s to prevent the company from slowing it down relative to other traffic it carries? Such preferential “packet shaping” is easy to turn off and on, as network demands ebb and flow. By contrast, proving such infractions of neutrality will be complex, slow and difficult.

Third, the new regulations create an additional layer of government bureaucracy where the free market has already proven its effectiveness. The reason you’re not using AOL to read this right now isn’t because the government mandated AOL’s closed network out of existence: It’s because free and open networks triumphed, and that’s because they were good business.

Now the FCC is proposing taking a free market that works, and adding another layer of innovation-stifling regulations on top of that? This may please the net neutrality advocates…but it doesn’t add up.

I’m somewhat equivocal about this but my instinct is that we should be more concerned with core market constraints - access, oligopolistic power, cartelization – than with introducing new regulations. Especially when Government has already taken to itself the power to act on such anti-competitive actions.


Finally I do not really subscribe to the ‘corporations eat babies’ principle that drives much of the ‘net neutrality’ support. In the main corporations operating in a free market have cause to provide for their customers what those customers want – and not just fifty percent plus one as is the case with government. Government’s duty is not to punish Virgin and News Corp for being successful businesses with strong brands but to ensure that those businesses do not prevent market entry or stifle competition. And we need no new laws to do that.

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