Thursday, June 15, 2006

The New Republic supports net neutrality, based on error

The New Republic's editors have come out in favor of net neutrality. As is all-too-common, their reasoning is based, at least in part, on a factual error:
Under the original rules put in place in 1934, telecommunications companies can't give preferential treatment to one set of outgoing calls over another by, say, offering static-free calling to one company's telemarketers but not another's. The same rules initially applied to the Internet. Telecom companies couldn't charge website proprietors to have their content sent to consumers more expeditiously. But, last August, George W. Bush's Federal Communications Commission (FCC) exempted telecoms that provide Internet connections from these restrictions, dealing a blow to both entrepreneurship and political discourse.
I've italicized the false statement. TNR has, like many others, wrongly inferred that rules which applied solely to telco telephony and last-mile networks have also applied to the Internet and Internet Service Providers, when in fact ISPs and backbone providers have been under no such constraints.

If net neutrality proposals were limited to maintaining Title II requirements for unbundling and interconnection for common carriers (which is part of the REFORM proposal advocated by Global Crossing, which includes other points which are far more important than net neutrality for fostering competition in telecommunications), or even adding cable providers into that category, I might support them.

UPDATE: I should point out that some Internet backbones have been or are owned by entities which are common carriers in virtue of the fact that they have owned and operated long-distance telephone networks. This includes MCI, Sprint, and Global Crossing (more accurately, Global Crossing Telecommunications, Inc.). However, the FCC has always held that common carriage requirements do not apply to Internet interconnection.

Eli M. Noam's 1994 paper, "Beyond Liberalization II: The Impending Doom of Common Carriage," appears to have been rather prescient. He argues that common carriage is not sustainable in a competitive environment, and looks at possible hybrid approaches that mix common carriage and contract carriage (I kind of like his "common carrier rights of way" approach, which advocates of open source will find similar to the GPL). He regretfully concludes that common carriage will go away and that the hybrid approaches are not sustainable.

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