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Two arguments against US net neutrality regulation

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The arguments of the FCC Chairman Ajit Pai seem to amount to the following. Net neutrality regulation will inhibit investment and lead to over-regulation. I am instinctually in favour of some measure of non-discriminatory access to networks, on the basis of Canada's Internet traffic management procedures decision. It is vital to understand those who disagree.

As you will realize, such a regime requires an arbiter among the claims of networks, users and content suppliers. Those who are skeptical of the powers and capacities of regulators are skeptical of net neutrality regulation. I, too, am skeptical of the powers and capacities of regulators, but I am equally if not more skeptical of every other actor in the game.

Here are two examples of such thinking. They each deserve serious consideration. Both assert that the arguments in favour of net neutrality are in effect, barking up the wrong tree. First, because the villains in the piece are no longer just the carriers, but Facebook and Google. The second asserts that the Internet as we imagine it to be does not really exist; that the technology has moved on.

The first argument is by Megan McArdle of Bloomberg View.

She says in effect that we are already living in walled gardens:

Those of us old enough to remember the telephone service looked like in the 1970s, before the FCC unwound a little -- which is to say, pretty much like the service our parents had when they were children, down to the astronomical prices for long distance calls, and the chunky plastic rotary telephones -- can see why critics were concerned about giving the FCC that kind of power to block innovation. No problem, retorted advocates: The FCC just won’t use much of its regulatory power. The technical term is “forbearance,” and the FCC offered to do a lot of it when it brought ISPs under Title II, for example by forgoing its statutory authority to set rates.

But offering not to use the power is not the same thing as not having it. A future commission might change its mind, and in the meantime ISPs would have to plan their investments accordingly -- knowing that the revenue they’d counted on to make some new project pay off might vanish at the stroke of a commissioner’s pen. That kind of regulatory uncertainty does not generally foster innovation, or for that matter, sound business decisions....

The internet will be filled today with denunciations of this move, threats of a dark future in which our access to content will be controlled by a few powerful companies. And sure, that may happen. But in fact, it may already have happened, led not by ISPs, but by the very companies that were fighting so hard for net neutrality.

Meanwhile, our experience of the internet is increasingly controlled by a handful of firms, most especially Google and Facebook.  The argument for regulating these companies as public utilities is arguably at least as strong as the argument for thus regulating ISPs, and very possibly much stronger; while cable monopolies may have local dominance, none of them has the ability that Google and Facebook have to unilaterally shape what Americans see, hear, and read.

In other words, we already live in the walled garden that activists worry about, and the walls are getting higher every day. Is this a problem? I think it is. But that doesn’t mean that the internet would get better if Google and Facebook and Apple and Amazon were required to make every decision with a regulator hanging over their shoulder to decide whether it was sufficiently “neutral.”

The fact that these firms were able to cement their power at the moment when regulators were most focused on keeping the internet open tells you just how difficult it is to get that sort of regulation right; while you are looking hard at one danger, an equally large one may be creeping up just outside the range of your peripheral vision. Indeed, you may be making one problem bigger while trying to solve another. We may indeed be facing a future of less choice and less consumer power. But this decision is unlikely to be what brings us there.


The second approach is taken by Tony Rutkoswski, who is an old hand in the Internet. As I understand it, he argues that what people think of as the Internet may have existed at one time but no longer does so in the form envisaged, and that we are excessively committed to a quasi-religious conception of the Internet which has passed away.

The action [of the FCC in enforcing Title II regulation of carriers]  makes no sense whatsoever from the perspective of network technological change. The most profound contemporary networking development in which industry worldwide is engaged is the virtualization and orchestration of all network infrastructure and instantiated out of cloud data centers. It is known as NFV-SDN (Network Functional Virtualisation — Software Defined Networks), including being manifested as 5G on global mobile network infrastructures with seamless wireline and cable network interoperability. End-points are also virtualized and their addresses using different transport protocols leased as needed. The entire fiction of "the Internet" goes away. FCC's Title II order only makes technological sense if one assumes that the technology is frozen in a world of Internet Kool-Aid that manifests itself only in Washington politics.


So as one of the remaining "old boys" spanning all these diverse worlds over the past six decades, it all begs the question "how did this happen." The basic answers arguably involve a certain arrogance in turning a transitory technology abstraction into an orthodox religion that is then used to attempt regulatory dominion in Washington politics. There are also gulfs among generations of people whom came onto the scene in the late 90s and beyond who had no concept of what went before, or perspective on global network infrastructures. Everything was stuffed into the internet genie bottle that solved the world's ills and deserved the FCC's Title II protection - not realizing that being regulated as a "utility" could just as well apply to large websites, search engines, or any other service relied on by the public.

I think Rutkowski is far less persuasive than McArdle. She is saying our efforts  towards net neutrality are misdirected because they do not affect the content suppliers, hence we should think of remedies for the problems we face. Fair enough; but I do not agree that giving up such protections as we have is called for just because Google and Apple and Amazon may need restraining. The world she describes is the one we live in.

By contrast, Rutkowski adopts the most technologically supremacist attitude conceivable. The Internet is a 'fiction' that is to be replaced by new protocols, so get with the program, fools, and let us engineers virtualize your rights. That is what i hear him saying.

The idea that we ought to control monopoly or market power does not arise from technologies; it arises from ideas about human relationships as mediated through economic institutions. Very simple technologies by today's standards, like ferries, roads, lighthouses and railways, were thought to be affected with the public interest even though they were managed as private property. The idea of Title II -common carrier - regulation does not rest in circuit switching or packet routing; it rests in economic power of one side over the consumer or the user. They are predicated in ideas of justice.

It is totally irrelevant if everything we know to be the Internet will be replaced by quantum phlogisticators and block chain attitudinizers in a wrap of software-encoded PVNR algorithmic mysterium. The rights of people to receive information, and generate content, are not in essence technological concepts, though they are powerfully assisted and enabled by technology.

The idea of of net neutrality , however flawed its execution, however vague its legal expressions, is an attitude towards power and human possibility. McArdle says the horses left the stable while we looking at constraining the powers of carriers. I agree, but just because net neutrality is only aimed at constraining carriers does not mean that we should ignore their power as we turn our attention - perhaps - to content providers.

As to Rutkowski's arguments, they amount to a category error, like trying to pick up the gross national product with a set of tongs. Not even wrong.

This is not to say that Title II regulation is the right answer nor is it to say that the United States should not seek some sort of legislative solution based on mutli-party consensus.  I leave that to another essay.


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Timothy Denton is a lawyer by training who practices principally in telecommunications and Internet policy and domain name issues, with a strong concentration on explaining what the technology is and what it means.


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Guest Thursday, 02 July 2020
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