Network Neutrality or Internet Innovation?

Abstract:     
Over the past two decades, the Internet has undergone an extensive re-ordering of its topology that has resulted in increased variation in the price and quality of its services. Innovations such as private peering, multihoming, secondary peering, server farms, and content delivery networks have caused the Internet’s traditionally hierarchical architecture to be replaced by one that is more heterogeneous. Relatedly, network providers have begun to employ an increasingly varied array of business arrangements and pricing. This variation has been interpreted by some as network providers attempting to promote their self interest at the expense of the public. In fact, these changes reflect network providers’ attempts to reduce cost, manage congestion, and maintain quality of service. Current policy proposals to constrain this variation risk harming these beneficial developments.

Number of Pages in PDF File: 9

Keywords: Network Neutrality, Private Peering, Multihoming, Secondary Peering, Paid Peering, Partial Transit, Server Farms, Content Delivery Networks, Peer-to-Peer, Client-Server, Two-Sided Markets

JEL Classification: D40, K23, O31

Accepted Paper Series