Law and the Open Internet
47 Pages Posted: 22 Jan 2012
Date Written: August 15, 2010
The Federal Communications Commission (FCC) is poised to issue a new set of internet access regulations and policies. These would prohibit broadband service providers, such as AT&T or Comcast, from “discriminating” against unaffiliated content providers. The FCC’s proceedings, and the network neutrality debate, concentrate on two economic questions (i) whether to broadband service providers can or will steer traffic to affiliated content limiting consumer access and (ii) how to preserve the Internet’s capacity for creativity and innovation.
Despite economics’ prominence in the debate, economic theory cannot answer these questions. Theoretical models of vertical foreclosure are ambiguous and inconclusive and empirical data nonexistent. And, the debate misapplies normative, legal concepts of “discrimination” and “equal treatment” onto internet traffic management engineering. These concepts worked in a circuit switched telephone network in which “equality” can exist at switch points, but make little sense in the packet-switched internet in which “equality of outcomes” of internet experience is what matters.
With its narrow focus, the debate has also missed that actual internet disputes, such as the BitTorrent-Comcast Order, involve many legal concerns, such as privacy, that have little to do with “discrimination” as such. Policymakers lack theoretical understanding and empirical knowledge concerning internet industrial organization. We, therefore, argue for a “bottom up” approach to regulation, analogous to fair use in copyright law, with case-specific adjudications creating a common law of acceptable network practice.
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