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Why net neutrality is a distraction

Thursday, September 9, 2010

What about the risk that operators will fragment the internet by erecting new road-blocks or toll booths? In theory, competition between providers of internet access should prevent this from happening. Any broadband provider that tries to block particular sites or services, for example, will quickly lose customers to rival firms—provided there are plenty of them.

But that is not the case in America. Its vitriolic net-neutrality debate is a reflection of the lack of competition in broadband access. The best solution would be to require telecoms operators to open their high-speed networks to rivals on a wholesale basis, as is the case almost everywhere in the industrialised world.

America’s big network operators have long argued that being forced to share their networks would undermine their incentives to invest in new infrastructure, and thus hamper the roll-out of broadband. But that has not happened in other countries that have mandated such “open access”, and enjoy faster and cheaper broadband than America. Net neutrality is difficult to define and enforce, and efforts to do so merely address the symptom (concern about discrimination) rather than the underlying cause (lack of competition). Rivalry between access providers offers the best protection against the erection of new barriers to the flow of information online.

This newspaper has always championed free trade, open markets and vigorous competition in the physical world. The same principles should be applied on the internet as well. 


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