Tuesday, May 20, 2014

Are Net Neutrality Supporters Deeply, Deeply Stupid?

Holman Jenkins weighs in at WSJ:
As the Internet has evolved, net-neut paranoia increasingly has rested on fears of what broadband providers could do, not what they are likely to do or have commercial motive to do. It's as if a noisy interest group developed an unrebuttable fear that farmers might stop growing peas unless strict regulation were imposed. Broadband is one of the most popular, profitable products any business sells. Why would broadband suppliers screw it up?...

America has been without net-neutrality regulation so far, and the Internet has flourished...Netflix already has a deal with Comcast. There's talk of a deal between Comcast and Apple. Just maybe we will see a flowering of new video-based business models that will flow either through the standard Internet or around it as proprietary services.

Note that this doesn't mean "blocking" or "slowing" of the standard Internet. Indeed, standard Internet speeds will continue their steady rise. A customer who buys broadband service would still have unfiltered, indiscriminate access to the Web at whatever speed he's paying for—15 megabits, 100, 1,000. But he may also have additional options—to buy Netflix at a higher bit rate than he uses for his regular browsing, to subscribe to a cable-TV substitute from Apple. How does the possibility of differentiated services make him worse off? It doesn't.

The many ways that IP networks can be used to deliver both proprietary services, like cable TV, as well as undifferentiated, unregulated, unfiltered access to the Web is one of IP's glories. This actual world rudely mocks the procrustean aspirations of the net-neutrality crowd.

Their position, when you come down to it, is that IP networks must be used in one way only—to deliver undifferentiated, unfiltered Web access. Eventually they will insist that cable TV be banned if it uses the same IP technology used by open Web traffic.

This might make them seem stupid—deeply, deeply stupid. But an important factor is rhetorical self-entrapment. Their leaders are not about to give up worshipers by admitting the problem is a nonproblem.

The passion of the net neut is not amenable to reason and is not meant to be.

RW note: I discussed net neutrality with the same conclusions as Jenkins here:  A Further Comment on Net Neutrality


  1. The net neutrality "debate" is probably the clearest indication of the widespread ignorance of economics among the public at large. Vast majorities of the population seem to genuinely believe that the only thing stopping Comcast from charging you $20 a pop per unique website you visit is the threat of government regulation.

  2. As usual, the real problem in all of this is not mentioned.

    The issue is that thanks to govt granted monopolies at all levels of government, broadband users have very little choice in how to consume the internet.

    As most of us here are aware, more laws to try and deal with the other laws is hardly the way to go. However, people have a real - and justifiable - fear of how prices and services could change in the absence of any real competition. To say these companies won't try and wring more out of their customers is just ignoring the reality here.

    And no, people don't HAVE to use the internet, nor stream things via NetFlix. But it sucks to have prices sky rocket and have services degraded from under your feet.

    No, I am no proponent of Net Neutrality rules. I just wish these underlying reasons would be at least mentioned in these types of articles.

    1. "The issue is that thanks to govt granted monopolies at all levels of government, broadband users have very little choice in how to consume the internet."

      This is what I always try to stress when I have a conversation with someone on when it comes to services like electric, water, gas, television/internet, etc to be privatized fully. People think that the current set ups in 90% of towns and cities are actual choices. The reality is it's not choice but government picked services to provide for a government selected area. Net Neutrality is basically another government non-solution to a government created problem.

    2. "To say these companies won't try and wring more out of their customers is just ignoring the reality here."

      Every company, monopoly or no, tries to "wring more out of their customers" in every situation always. Comcast still has to compete with people not wanting to use the Internet at all. As they raise prices, they will sell fewer subscriptions. That's how economics works.

      Also consider that most of us currently value Internet access MUCH more highly than what we are paying for it. Prices are probably due to rise on such an important, vital, and highly valued service.


    3. Anon and NY
      I've tried arguing this very thing in the past. That net neutrality is a patch on system that suffers from not being a free market. Libertarians argue about eliminating patches as winning small battles only to find when they are removed the imbalances of the statist system quickly create another disaster to blame on the free market. It's also the statist argument to never have an entirely free market property rights type system but to talk about the disaster that would occur if the state removed one of its ten fingers from the controls.

      the problem is when the internet is needed to many critical life functions and access comes from a couple players due to government interference, well... it's not hard to wring more out of people. It's always about hitting a sweet spot. If they can make more by charging a few customers a lot that's what they'll do. With market competition that sweet spot doesn't exist unless they can make a much superior product/service.