Internet Analogies

How The Obama Administration Is Rewriting Competition Law At The FCC

Posted by | Antitrust, Broadband Internet, Internet Analogies, Net Neutrality Series 2.0 | No Comments

In his first presidential campaign, then-Senator Obama said “antitrust is the American way to make capitalism work for consumers,” because, “unlike some forms of government regulation, it ensures that firms can reap the rewards of doing a better job” and “insists that customers … are the judges of what best serves their needs.” Obama vowed to “reinvigorate antitrust enforcement” and work with other jurisdictions to “curb the growth of international cartels” so that “all Americans benefit from a growing and healthy competitive free-market economy.”

Regrettably, the Obama presidency’s competition policies have not matched his campaign rhetoric. According to Daniel Crane, a law professor at the University of Michigan, Obama has not reinvigorated antitrust enforcement: “With only a few exceptions, current enforcement looks much like enforcement under the Bush Administration.”

Obama has instead shown a strong preference for relying on other forms of government competition regulation — the kind that prevents firms from reaping the rewards of their investments in American infrastructure and limits what customers can demand — while complaining about the antitrust enforcement efforts of other jurisdictions that might affect U.S corporate interests. In the process, the Obama Administration has slowly been rewriting U.S. competition law in unprecedented ways.

This process has been especially apparent in communications regulation at the Federal Communications Commission (FCC). Though it was once seen as a “sleepy backwater,” the FCC has radically transformed its approach to competition law during the Obama Administration. The FCC’s new approach to competitive analyses runs the risks of spillover to interpretation of antitrust laws and speculation regarding the limits of government intervention in business transactions throughout the economy. Read More

Internet Analogies: Twice as Many Americans Lack Access to Public Water-Supply Systems than Fixed Broadband

Posted by | Broadband Internet, Freedom of Speech, Internet Analogies | No Comments

“If broadband Internet infrastructure had been built to the same extent as public water-supply systems, more than twice as many Americans would lack fixed broadband Internet access.”

After abandoning the “information superhighway” analogy for the Internet, net neutrality advocates began analogizing the Internet to waterworks. I’ve previously discussed the fundamental difference between infrastructure that distributes commodities (e.g., water) and the Internet, which distributes speech protected by the First Amendment – a difference that is alone sufficient to reject any notion that governments should own and control the infrastructure of the Internet. For those who remain unconvinced that the means of disseminating mass communications (e.g., Internet infrastructure) is protected by the First Amendment, however, there is another flaw in the waterworks analogy: If broadband Internet infrastructure had been built to the same extent as public water-supply systems, more than twice as many Americans would lack fixed broadband Internet access. Read More

Internet Analogies: Remember When the Internet Was the Information Superhighway? (Part 2)

Posted by | Internet Analogies | No Comments

Why did the government impose a completely different funding mechanism on the Internet than on the Interstate Highway System? There is no substantive distinction between the shared use of local infrastructure by commercial “edge” providers on the Internet and shared use of the local infrastructure by commercial “edge” providers (e.g., FedEx) on the highways.

In Part 1 of this post, I described the history of government intervention in the funding of the Internet, which has been used to exempt commercial users from paying for the use of local Internet infrastructure. The most recent intervention, known as “net neutrality”, was ostensibly intended to protect consumers, but in practice, requires that consumers bear all the costs of maintaining and upgrading local Internet infrastructure while content and application providers pay nothing. This consumer-funded commercial subsidy model is the opposite of the approach the government took when funding the Interstate Highway System: The federal government makes commercial users pay more for their use of the highways than consumers. This fundamental difference in approach is why net neutrality advocates abandoned the “information superhighway” analogy promoted by the Clinton Administration during the 1990s. Read More

Internet Analogies: Remember When the Internet Was the Information Superhighway? (Part 1)

Posted by | Internet Analogies | 7 Comments

“Many net neutrality advocates would prefer that the FCC return to the regulatory regime that existed during the dial-up era of the Internet. They have fond memories of the artificially low prices charged by the dial-up ISPs of that era, but have forgotten that those artificially low prices were funded by consumers through implied subsidies embedded in their monthly telephone bills.”

Remember when the Internet was the “information superhighway”? As recently as 2009, the Federal Communications Commission (FCC) still referred to the broadband Internet as, “the interstate highway of the 21st century.” Highways remain a close analogy to the Internet, yet by 2010, net neutrality advocates had replaced Internet highway analogies with analogies to waterworks and the electrical grid. They stopped analogizing the Internet to highways when they realized their approach to Internet regulation is inconsistent with government management of the National Highway System, which has always required commercial users of the highways to pay more for their use than ordinary consumers. In contrast, net neutrality is only the latest in a series of government interventions that have exempted commercial users from paying for the use of local Internet infrastructure. Read More

Should We Use the “One Ring” to Control the Internet?

Posted by | Broadband Internet, Freedom of Speech, Internet Analogies, Media | One Comment

Three rings for the broadcast-kings filling the sky,
Seven for the cable-lords in their head-end halls,
Nine for the telco-men doomed to die,
One for the White House to make its calls
On Capitol Hill where the powers lie,
One ring to rule them all, one ring to find them,
One ring to bring them all and without the Court bind them,
On Capitol Hill where the powers lie.

Myths resonate because they illustrate existential truths. In J.R.R. Tolkien’s mythical tale, the Lord of the Rings, the evil Lord Sauron imbued an otherwise very ordinary ring – the “One Ring”– with an extraordinary power: It could influence thought. When Sauron wore the One Ring, he could control the lords of the free peoples of Middle Earth through lesser “rings of power” he helped create. The extraordinary power of the One Ring was also its weakness: It eventually corrupted all who wore it, even those with good intentions. This duality is the central truth in Tolkien’s tale.

It is also central to current debates about freedom of expression and the Internet.

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