WSJ Fears Innovation: Net Neutrality As Internet Wrecking Ball

andy_kessler_color_headshot_small.jpg Apparently this WSJ opinion writer couldn’t actually argue with Ed Markey’s net neutrality bill, so he made up a straw man:
Imagine a town that has all sorts of gasoline pipelines running by it but only one gas pump. Rationing is inevitable. So are price controls.

Everyone gets equal amounts, except of course first responders like police and ambulances, which should get all the gas they want. And, well, so should the mayor. And if you can make a good business case that you work 60 miles away, you can file paperwork and perhaps pull some strings for more gas. How about those kids hot-rodding around town who can’t drive 55? They get last dibs, and maybe we can sneak in some gas thinner to slow down their engines and not waste gas.

Internet Wrecking Ball, By Andy Kessler, Wall Street Journal, February 25, 2008; Page A15

What’s especially amusing about this strawman is that it’s what the duopoly is planning as they do away with net neutrality, except it’s not first responders or governments that will get favored bandwidth: it’s Hollywood. Meanwhile, Markey’s bill doesn’t say any of that. It doesn’t include any regulation at all.

Kessler invokes Orwell:

This is the essence of the Ed Markey’s (D., Mass.) Orwellian-named Internet Freedom Preservation Act of 2008, which would foist network neutrality on the wild and woolly Internet.
Kessler maybe wasn’t around in the earlier days of the Internet, or he would know that net neutrality is what we used to have, until it got chipped away starting in about the year 2000, as the FCC failed to enforce the Unbundled Network Elements (UNE) of the Telecommunications Act of 1996, and reclassified cable modem access as an information service in August 2002, wireline broadband in August 2005, and wireless broadband in March 2007. The FCC stripped common carriage status from Internet provision, something never done before in the U.S. So what Markey’s bill is actually trying to do is to preserve the freedom the Internet used to have before the present administration and the duopoly systematically tried to do away with it. That’s the opposite of Orwellian: that’s the plain truth.

If Kessler did know Internet history, or had been around when we were making it, he would know not to write things like this:

With net neutrality, there will be no new competition and no incentives for build outs. Bandwidth speeds will stagnate, and new services will wither from bandwidth starvation.
We had net neutrality back when the Internet was the fastest growing communications medium ever seen, so withering isn’t what we should expect: flourishing is.

I could continue fisking every paragraph of this WSJ propaganda piece, for example:

The Federal Communications Commission is holding a public hearing today at Harvard Law School in Cambridge, Mass., to build the case for the ill-conceived idea of preventing, as Mr. Markey’s bill would, network operators from using technologies that may favor one application over another.
This would be the hearing that Comcast packed with shills hired off the street. The hearing wasn’t actually about what Markey is proposing so much as about complaints about what Comcast is already doing. However, if Comcast has such a good case, why is it gaming the hearings?

Let’s cut to the chase:

— or you can just open another gas station across the street. Or one on each corner.

We need policy to help cut a path for more competition, rather than protecting incumbents — a Bandwidth Competition Act of 2008, not bogus net neutrality. All takers should be allowed access to poles or underground conduits. This is where neutrality should be enforced, instead of being a choke point.

Oh, like the UNE provisions of the Telecommunications Act of 1996 that the FCC threw away, declaring in 2005 that there was already enough competition?

Municipal or privately run wireless data services using Wi-Fi or WiMax should be sprouting like weeds. But they aren’t being built because of lack of access to street lights, of all things, to set up access points. Verizon is busy rolling out a fiber optic service, FIOS, that will provide much higher speeds and real competition to Comcast. But it is slow going, as state by state video franchise rules still favor cable over any newcomers.
Ah, video franchise rules. A favorite shibboleth of telcos, because without them, the telcos can lock up yet another way to dominate the local market.

A stroke of a pen can cure these ills, incumbents be damned. They will adjust.
Yeah, they’ll adjust by running FiOS or the like while less well-heeled competitors get left behind again.
I personally would climb telephone poles on my street to run fiber if I could get 100 megabit Internet service. Any takers? Talk about an economic stimulus; this is the type of infrastructure we need. The stock market will fund it all as well as resolve overbuild problems.
This is like saying if we do away with contract law we’ll have burgeoning competition for economic stimulus. Sure, if we have no competition now and we let the existing duopolists have access to even more infrastructure, more competition will magically appear. Or maybe Paul Krugman is right:
…the reality that sometimes you can’t have effective market competition without effective regulation.
Indeed net neutrality is a wrecking ball; it’s The Wrecking Ball of Innovation that will destroy the duopoly if let loose.

The brief bio at the end of Kessler’s piece says he used to be a hedge fund manager. Other bios says he used to be a venture capitalist. So why isn’t he funding some ISP first-mile startups to compete, instead of crying to give the incumbent duopoly access to tie up still more physical infrastructure? Let’s see him put his money where his mouth is.


One thought on “WSJ Fears Innovation: Net Neutrality As Internet Wrecking Ball

  1. Dan needs cable internet in vancouver

    Can I add something?
    Shills By Comcast at FCC Hearing
    comcasttrolls08.jpg This appears to be the week for Comcast to really make a fool of itself.
    Comcast acknowledges that it hired people to take up room at an F.C.C. hearing into its practices.
    — Grassroots Support? Or Astroturf? by Sam Gustin,, Feb 26 2008
    Some reports said the shills were Comcast employees, but it turns out many of them were hired off the street. They were given yellow highlighters to put in their shirt pockets so they could identify themselves to each other.
    Comcast, the company that claims to understand the Internet so well it thinks faking TCP Resets is good network management (which is what that FCC meeting was about), apparently thought in this day of cell phone cameras and blog posts that nobody would notice….

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