Neutrality and Diversity in the Internet Ecosystem

Abstract

The public policy approach to the Internet has become more and more complex as several markets – including fixed and mobile communications, media and content, IT – converge into one single Internet ecosystem. As in all ecosystems, zones and domains depend on each other, and there is no possibility of touching one layer without affecting all others. This paper reflects on the economics of the Internet and emerging business models, and comments on the current debates in each of the layers of modern all-IP architectures, from the unbundling of network elements to net neutrality and the emerging discussion on search neutrality. The paper concludes that the trend towards ex ante regulation of several Internet services, if not stopped, may extend also to sectors that are still in their infancy, such as cloud computing. Finally, the paper suggests that antitrust laws and current regulatory frameworks for e-communications, in particular in Europe, should reflect the economics of all-IP broadband platforms. This implies, i.a., strengthening the role of countervailing buyer power across layers of the Internet, adopting a layered approach to policymaking and establishing co-regulatory solutions to bridge the informational gap between policymakers and market players.

Keywords: Net Neutrality, Internet, Telecommunications, Competition, Cyberspace

JEL Classification: D40, D42, D43, K20, K21, K23, L10, L12, L13, L51