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Net Neutrality Debate

Yesterday, the FCC voted in favor of new net neutrality rules, which will ensure that all Internet service providers will treat all legal content equally. Internet service providers, primarily large cable or telephone companies, will now be prohibited from prioritizing certain content over others, by blocking or slowing transmission speeds, and by requiring fees for faster lanes of their Internet networks, a practice known as “paid prioritization.”

I found this article on Forbes called “Am I The Only Techie Against Net Neutrality?”. While the article is dated (May 2014), I found it to be very interesting. First, author Joshua Steimle notes that he wants, just like everyone else, to see more competition, “Proponents of Net Neutrality say the telecoms have too much power. I agree… But if monopolies are bad, why should we trust the U.S. government, the largest, most powerful monopoly in the world?”. He raises the point that industries such as public schools, health care, higher education, student loans, housing, banking, physical infrastructure, immigration, the space program, the military, the police, AND the post office, are all heavily regulated by the government, and all suffer major problems.

Next, he brings up the issue of privacy, “Should we believe that under Net Neutrality the government will trust the telecoms to police themselves?”. Steimle warns that the government will likely need to install its own hardware and software to monitor Internet traffic. Is this something we want? Lastly, he explains that governments effectively regulate tech companies because they are too inefficient. Technology is constantly changing, and the government simply cannot move fast enough to monitor a resource like the Internet.

What do you all think?


  1. What are our goals? Should we trade off a modicum of inefficiency for providing equal access? Who specifically loses under this regulation [engineering operations that can’t buy priority to link operations in India, China, the EU and the US]? Who benefits [Netflix]?

    As far as the article goes, the author does not seem to use any economics, only to protest that government is bad by throwing around the term “monopoly” while not using it precisely. For example, his list of industries with problems is not limited to monopoly providers and Federally regulated sectors. Furthermore, it was the lifting of regulations that allowed banks to enter risky businesses; the claim that the sector would be healthier with even less regulation ignores history. Ditto healthcare, where the US is unusual in not having a national healthcare system, only a hodge-podge of regulation and piecemeal public insurance programs.

    So this is a thinly veiled ideological rant, not an analysis of the issue.

    Finally, will net neutrality or its lack will affect the larger economy? Maybe not there, but healthcare is different, as its sheer size means that cost controls [we pay 2x as much for most medical services & goods] could matter to the wider economy. So you might ask instead whether policies might shrink that sector towards the size of that in the rest of the world (that is, lower prices), which would represent a significant increase in real incomes. Of course the same issues will arise: who benefits, where do the costs fall, and is there “neutrality” of access, or is healthcare only something for the well-heeled?

  2. moores15 moores15

    I found Steimle’s point brought up at the end of your post to be particularly interesting. The internet is constantly changing and it definitely would be difficult for the government to keep up with these changes. I know Mark Cuban has been in the news recently arguing against Net Neutrality, stating that this is beginning of the government entangling itself with internet regulations and inhibiting innovation. Obviously, Cuban’s words cannot be taken as the final truth, but it has been interesting (and entertaining) to watch how vocal this “celebrity investor” has been on the news recently. While there are good intentions with Net Neutrality, it brings back the constant debate of whether or not government intervention will inhibit efficiency or by how much.

  3. HeeJu HeeJu

    I am a little confused about why Steimle argues that the U.S government is the biggest monopolies in the world. Unlike typical monopolies, a government does not intentionally underproduce its goods and services (in this case, public infrastructures and civil services) in order to artificially deviate the price from market equilibrium. It makes me doubt whether he really understands the economic meaning of monopoly.

  4. deplautt deplautt

    I completely agree with HeeJu about the author’s view on monopolies. I believe that his use of monopoly to describe the US government and the regulation of certain industries undermines his argument. His later claim of collusion between the government and large corporations is an entirely different idea to consider as it implies that the free market is not really free at all. When considering these things with the highly controversial net neutrality debate we have to look at both net neutrality as an idea versus government intervention in practice.

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