The FCC has been deliberating for some time about whether and how the internet should be regulated by the federal government. President Obama made a pitch on Monday for heightened regulation, asking the FCC to regulate the internet as if it were an electrical utility or a phone company.
NYT blogger Eduardo Porter gives a somewhat balanced view of the pros and cons of net neutrality. Net neut advocates worry that monopolistic ISPs will control through pricing what content becomes available. Net neut opponents point out that one needs some mechanism to ration scarce capacity. Since Netflix alone accounts for 30% or more of internet traffic at peak periods, they argue that Netflix directly (and its customers indirectly) should pay for the fast access needed to stream movies.
An even bigger concern is what a regulated internet do to incentives for investing in further capacity.
My take: this argument is another classic case of who do you trust more to act in customers interest -- a federal regulatory agency or a less than perfectly competitive market? Today in Raleigh, Time Warner and AT&T only have to compete with each other for USP business. But over time there will be more competition, especially if Google Fiber decides to play. I think I will take my chances with the market!
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