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Net Neutrality and Why I Care

I’ve been trying to provide the reasoning for why the carriers are promoting the concept of charging for QoS. They have clearly done a poor job doing so.

The majority of opinion on the internet among what I like to call the ‘digital elites‘ is not only opposed to the concept, but also harbors an intense hostility towards the telcos. I am spending my personal and professional time trying to defend them because this hostility appears to be leading towards a call for government intervention in the market, which I feel will be a very bad outcome for customers as well as investors.

The idea of bringing the government in to regulate a situation brought on by the creative growth of the internet is abhorrent to me. I see few people on the internet with a dissenting opinion, so I thought it was my duty to step into the fire.

It should also be noted that we are investors in big telco. My dissenting opinions on Net neutrality are not driven by those investments as much as my deep-seated fear that regulation of broadband pricing would be established, killing off innovation and invention only shortly after it has finally arrived. Removing pricing flexibility from the telcos is no different than establishing price controls. Everyone agrees that an end of innovation in the physical infrastructure will stall innovation in the applications that run on top of it.

Schumpeter believed the process of creative destruction would eventually lead to government intervention and socialist policies. More than open access, creative destruction is at the heart of the entire tech industry. From the Wikipedia:

Schumpeter’s most popular book in English is probably Capitalism, Socialism, and Democracy. This book opens with a treatment of Karl Marx. Schumpeter is quite sympathetic to Marx’s analysis, although Schumpeter concludes capitalism will be replaced by socialism for non-Marxist reasons. It is in this book that Schumpeter characterizes capitalism with the famous phrase “creative destruction” in which old ways of doing things are endogenously destroyed and replaced by the new. Schumpeter thinks that the success of capitalism will lead to a form of corporation and a fostering of values, especially among intellectuals, of hostility to capitalism. The intellectual and social climate needed to allow entrepreneurship to thrive will not exist in advanced capitalism and it will be succeeded by socialism of some form or another. There will not be a revolution, but merely a trend in parliaments to elect social democratic parties of one stripe or another. Schumpeter emphasizes that he is analyzing trends, not engaging in political advocacy.

This is exactly what the debate on net neutrality looks like to me. I plan to do my best to delay this process.

I think the next step is to connect the dots on why bandwidth and use of that bandwidth is directly related to QoS. That seems to be the central argument against my previous post on fiber use in Japan.