Net Neutrality: The War on Freedom

Although not in the news for a while, the efforts to classify internet access as a utility are not nearly as benign as they may first appear. Net Neutrality, the innocuous, misleading name chosen by proponents of internet regulation, remains an ongoing issue. Recently, President Obama called for the FCC to act unilaterally.

There is a major push on several fronts, including academic publications in favor of regulation. The common flaw in these arguments is confusing correlation with causation—they look to areas with greater poverty and limited internet access and see the latter as a cause rather than the former.

In order to understand the problem with internet regulation, or "net neutrality", we need only look at history. Whether we look to railroads, airlines, telephones, radio, television, or any other industry we can find no example of government regulations resulting in rapid growth. Growth occurred, instead, prior to regulation.

In the telecom industry, for example, regulation was intended to slow growth in order to limit the number of wires erected. A monopoly was granted to Bell and growth was intentionally limited. Similarly, government regulation on other utilities (e.g., electricity, gas, water) prevents the installation of overlapping infrastructure while connecting as many people as possible. This is the typical model for regulation of utilities.

Interestingly, the push for internet regulation has very little to do with infrastructure—at least not in the typical manner. Advocates for regulation are not seeking to prevent an expected explosion in the installation of infrastructure. Instead, advocates are seeking to expand the secondary aspect of utility regulation; social programs that tax one group in order to redistribute the funds to pay service for others. The logic here is that high-speed internet access is every bit as essential as water, electricity, and heat in the winter.

In fact, the argument is that it is more essential. Water and gas are not extended to every household, many homeowners are responsible for supplying their own water via a well and gas via propane tank. Internet benefits from the disproportionate priority that was placed on telecommunications over 100 years ago. Because our ancestors once thought every home should have a telephone, we are now to assume it is a basic human right to be able to stream a movie via Netflix.

Which brings us to another paradox of the regulation movement—there is no neutrality component. Rather than remaining neutral as to the potential options available if bandwidth becomes a limiting issue (e.g., a low-cost plan that does not cover streaming), the regulation movement has decided that it should be illegal for a company like Netflix to purchase bandwidth in order to better serve its customers.

Further, classification as a utility could potentially open the door for an FCC, or similar, regulatory regime. Once it is determined that delivery of content on the internet is subject to regulation, it is a small step to determining that content is similarly subject to regulation. This would correlate to radio and television—the forms of public utility that most directly correlate to the nature of the internet. Because the government awards radio spectrum via licenses, it is free to regulate the content of that broadcast. Why, then, would the government not be able to regulate the content of an internet it also regulates access and use of? Net neutrality is nothing more than a gateway for comprehensive internet regulation. It might happen slowly, but it will happen eventually unless stopped in the early stages.