A Skeptic’s Primer on Net Neutrality Regulation

Published June 1, 2006

“Net neutrality” has emerged as the most contentious communications and media policy issue. The debate is about whether law and regulation should dictate completely “open” or “dumb” broadband networks or whether “openness” should be left to the marketplace. Net neutrality regulations might weaken the competitive vibrancy of the content, applications and device components of the Internet, for example applications that depend on a steady transfer of data like voice or video. Neutrality mandates and a fixation on “end-to-end” principles could also complicate efforts to keep the Internet safe and reliable. Network providers make money by signing up customers, and have a strong incentive to provide the openness their customers demand. But forcing commoditization of broadband infrastructure prohibits providers from experimenting with different network architectures that could benefit customers, and discourages entry and investment in an industry with high fixed costs and low marginal costs.