Tuesday, March 13, 2007

Net Neutrality Tidbits

Two net neutrality items worthy of note:

Public Knowledge's Art Brodsky here bemoans the demise of the Maryland net neutrality bill. I testified in Annapolis against adoption of the bill, so I am obviously pleased the legislation will not be moving forward. My testimony is here and my Washington Times op-ed opposing the bill is here.

Brodsky is upset that the bill's opponents paid any attention at all to the first provision that said broadband providers "should not" (rather than "shall not") degrade or prioritize any content. He maintains that the entire import of the bill related to the second provision establishing regular reporting requirements for broadband providers concerning deployment, speed and types of service, and the like.

First, anyone that knows anything about American jurisprudence understands that it is not a stretch to imagine a court interpreting what may seem to be a hortatory legislative "suggestion" or "recommendation", as Brodsky characterizes the first provision, into a binding mandate. And, apart from that, once "principles" get embodied in legislation, it is much easier, and more likely, for these principles to be imported as mandates in administrative decisions. See the conditions imposed on AT&T in the FCC's merger approval order.

If legislators want to make suggestions or recommendations to broadband providers--or, for that matter, other regulated entities--a far better way is to simply write a letter, pen an op-ed, or give a speech. This form of making suggestions is far less likely to cause unintended mischief, if the intent is truly not to cause mischief.

And, speaking of problems caused by net neutrality regulation, the Free State Foundation released a paper yesterday by Bruce Owen, one of the nation's leading regulatory economists. Based on his long study of the history of communications regulation since its inception--and the regulation of the railroads back to adoption of the Interstate Commerce Act in 1887-- Professor Owen's concludes: "Net neutrality policies could only be implemented through detailed price regulation, an approach that generally has failed, in the past, to improve consumer welfare relative to what might have been expected under a regulated monopoly."

Of course, in today's competitive broadband environment, we are a long, long way from the "regulated monopoly" communications environment that prevailed during a good part of the twentieth century. That surely counsels against adoption of net neutrality regulation.