Net Neutrality: Innovation and Differentiation are Not Polar Opposites
11 Pages Posted: 18 Nov 2011
Date Written: November 17, 2011
The expansion of communications infrastructure worldwide entails huge investments and in the European Union alone these will undoubtedly exceed EUR 200 bn by 2020. But the commercial success of the politically desired expansion of high-performance broadband networks in a competitive market environment is closely linked with the issue of the socially correct degree of investment protection. This protection should on the one hand be as strong as necessary, so that the required network investments can be sufficiently profitable. On the other hand, however, the investment protection must not be too extensive, thereby enabling a network operator to systematically exclude (potential) competitors from the market and in turn also resulting in insufficient infrastructure investment from a social point of view. The frequently emotional debates on this subject show that although the experience gathered in other countries can help, it is essential that the desired regulations concerning net neutrality address the country-specific technical and economic conditions – that is, there should definitely be no wholesale adoption of the lessons from other economic areas.
Keywords: telecommunications, internet, net, infrastructure
JEL Classification: K2, L96, O14, O33
Suggested Citation: Suggested Citation