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Network Neutrality (not simply a question of market vs. government)

Ok, another point that should be made clear. From Spillovers:

The network neutrality debate is filled with arguments that falsely pit “the market” against “the government” in a battle for supremacy as the preferred system for allocating resources. Such arguments conveniently ignore, first, that the government has been, is, and will continue to be involved in the (de)regulatory environment in one way or another and, second, that managing infrastructural resources as commons and letting spillovers flow does not exclusively depend on either market or government allocation. An Internet infrastructure commons built on nondiscrimination rules may be an attractive allocation mechanism precisely because it avoids individualized allocation by either market or government decision makers. [for more detail, see paper]

Christopher Yoo, for example, argues that the government should not intervene and alter the status quo; government forbearance is the answer. Larry Lessig has also argued for maintaining the status quo, but he has argued that the end-to-end principle is what should be sustained. Yoo’s baseline is the network owners’ freedom from government regulation and Lessig’s baseline in users’ freedom from network owners’ discrimination. These conflicting claims of freedom give rise to the network neutrality debate but do not, in isolation, tell us how the debate should be resolved.

The “market versus government” argument is also particularly inappropriate in the telecommunications context because the market in question is not a competitive one, but one characterized by enormous economies of scale, long-term market power, and network effects. Whatever the merits of a free market against government regulation – and we think they are generally great – they have little bearing on a choice between government and an unregulated monopolist not subject to the discipline of market forces.