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Is Net Neutrality a Waiting Regulatory Disaster?

Ed Felten voices his concerns that asking for net neutrality is a regulatory disaster in the making. I left this response to his post:

There’s some level of reasonableness that can be achieved in any regulatory system, and, of course, room for abuse. That’s not unique to net neutrality, yet some regulation seems to help some markets. When I first wrote about Comcast’s conflict of interest in throttling heavy bandwidth users as video competition, I linked to an FCC ruling about DSL providers being forbidden to interfere with VOIP traffic. To me, there are some no-brainers that regulators can do like that without hosing the Internet forever.

As far as folks here complaining about the bandwidth hogs – imagine if electricity usage were flat-rate. That’s what we have with bandwidth packages now. In the case of the natural monopoly, such as an ISP with xTTH, history has shown that metered usage with public oversight of rates is the model that is least-bad given the forces involved.

All these issues of TCP resets, port filtering, SPAM zombies, bloated websites, torrent seeding, illegal p2p usage, etc. would work themselves out with a reasonable per-GB fee (20 cents, perhaps) and a minimal connection fee ($10 per mo, maybe). I suspect that those on the $15/mo package now would still pay a similar rate, and those on the $80/mo package would also still pay a similar rate. But there’d be none of this hassle of offering and ‘managing’ free, because ‘free’ doesn’t exist.

What I forgot to add is that this model also would drive the providers to increase speeds to the user, which the US is sorely lagging in. Obviously prices would have to decrease over time, compared with the overall economic environment.

One counterpoint would be all-you-can-talk phone plans. While these are technically ‘unlimited’, nobody actually talks all the time (even teenage girls need to go to school), as that takes labor, whereas a bittorrent client can run 24/7 with no real effort.