Disruptive Internet Innovation and Communications Law

Abstract

The Internet has become a central platform for communications and culture worldwide. In the process, innovation on the Internet has led to tremendous economic, social, and democratic benefits that could not have been predicted in advance. Disruptive technologies, in particular, shape the Internet and produce a vast portion of its value. Disruptive innovation has a transformative effect on markets and produces significant tensions with existing businesses. To defend their business models and revenue streams, embattled incumbents have strong incentives to stifle the development and use of disruptive technologies. As the services, devices, applications, and networks that comprise the Internet evolve, many are shifting away from the Internet’s open roots towards a closed system, in which a company with power at one layer can control the behavior of its horizontal and vertical peers. The result is a potential for significant stifling of disruptive innovation in the mobile Internet ecosystem, and a real risk of lost future social and economic benefits.

Strong legal protections are needed to ensure that the Internet avoids stagnation and remains friendly to valuable disruptive innovations. Recent actions by the FCC to sift through this context and adopt net neutrality rules will have an impact on Internet innovation. However, there is a real possibility that the FCC’s rules, as adopted, will facilitate the emergence of restrictions throughout the Internet’s layers, particularly in the context of mobile broadband networks. This paper engages in a targeted analysis of recent net neutrality regulations adopted to govern Internet access services, concluding that more work must be done to ensure the future of an open, dynamic, and disruptive innovation-friendly Internet.