How could the free market limit the effects of net neutrality's repeal?

  • How could the free market limit the effects of net neutrality's repeal? Specifically, how will consumers' internet access be protected without government regulation?

    I think your question is based on a faulty premise. Why should the free market limit the effects? Protecting consumers is the point of government regulations, not of the free market.

    That's a good question but formulated somewhat biased. A neutral formulation would be something along the lines of: "How will the net develop in an unregulated free market?". This might actually be more a question for economy than politics because ... well unregulated (no politics involved).

  • PoloHoleSet

    PoloHoleSet Correct answer

    4 years ago

    Almost all high-speed broadband Internet service providers, except in high-density urban populations, have limited competition, if not full monopolies. A small start-up would have to build out their own infrastructure with no existing customer base, which isn't going to happen, in most cases.

    This is why so many people want to treat the providers like a utility. This is why hypothetical "free market" constructs do not apply.

    The best way to use "free market" principles or competition to ensure net neutrality is for citizens to demand their municipalities build their own high-speed infrastructure and sell the services as a municipal utility under a net-neutral format. Then there would be actual choice and competition, but if the competition comes from a non-profit government or quasi-government entity, then the claim is that it's socialism, not free market.

    As the physical infrastructure and regulatory environment currently exists, there is no free market with ISPs, practically speaking, so using something that does not exist is not a possibility.

    Comments are not for extended discussion; this conversation has been moved to chat.

    _"except in high-density urban populations"_ Should read "**even** in high-density urban populations".

    I'm not saying that this is realistic, but the "free market" version of your suggestion is not for the citizens to "demand" their municipalities to build something, but for some subset of the citizens to form their own ISP. This, for example, does not require a majority vote in favor of this proposition. It would be like forming a community credit union or, more relevantly, a utility cooperative.

    This otherwise excellent answer fails to note that, in far too many cases, the problem with starting a new ISP or expanding into a given area is that the municipality stands in the way, preventing the ISP from starting up or expanding.

    @michaelhampton while true, there’s a good reason for that in that cities don’t want duplicated infrastructure everywhere. The main problem is we have privately owned infrastructure that is impractical to duplicate (another argument for making the Internet a public utility)

    @Michael Just compare Internet with Water. The only difference is that unregulated water will result in a higher number of fatalities than unregulated internet. The same reasons that apply for water regulation apply for internet regulation. No, a few citizens banding together and starting up their own water supply company and laying their own pipes will definitely not solve the problems created by unregulated water supply. And for the very same reasons that solution doesn't work for internet connectivity.

    1) WISPA members won't agree - all started as competition to incumbents, and many more are starting every year. 2) Incumbents are over priced because they are big bank financed, their suppliers know this and load their prices, and they know you will pay... 3) Municipalities building infrastructure will only make it worse, because they too will overpay 4) Technology and economies of scale have pushed down infrastructure prices... smaller operators can already out-compete incumbents... Summary: Be careful what you believe or ask for...your wish may make it true, perpetuating a bad situation.

    @JoshCaswell There are areas in the country where there are several competing residential ISPs, although even in those places there are technology monopolies. E.g., In the area where I live, I can choose between three or four high-speed providers, but if I want fiber optic service, I have only one choice, and if I want coaxial service, I have pretty much one other choice, and if I want satellite internet, I have one, maybe two choices. So I might have up to four choices, but each choice has caveats beyond price and service.

    @ToddWilcox Wow, I thought *I* was lucky to have two options with identical poor reputations. You're extremely lucky to have the number of choices you have, even though they're not apples-to-apples. Most of the US has a single local option, and some only have cell or satellite options with no ISP willing to hook them up.

    @Peter: But somehow, municipalities have managed to regulate the laying of water pipes within their borders without the intrusion of the FCC. And outside municipal boundaries, private water service is entirely possible, practical, and practiced.

    @Peter in fact this is exactly what is working in Europe. The initial providers who have have laid down infrastructure, according to EU regulations *have* to allow other ISPs to also use their infrastructure for a regulated rental price. This means that a small company can and does provide access to eg apartment house to which the larger provider doesn't care to put the last mile as the profit margin is too slim. There is plenty of small providers who are usually the guys who live in the house themselves and thus can get Internet for themselves and neighbours.

    @Gnudiff In the US, a similar thing happened with phone service as part of the AT&T breakup in the 70's. Local phone service remained a regulated monopoly (but different companies in different parts of the country), but they had to allow all long distance providers access to the local phone lines. This allowed the growth of MCI and Sprint.

    "*The best way to use "free market" principles or competition to ensure net neutrality is for citizens to demand their municipalities build their own high-speed infrastructure*" That's pretty much exactly what happened in large parts of the Netherlands, and subsequently ISPs started waging a price war to offer the best/cheapest/most featured broadband internet over a now-extant fiber-to-the-home infrastructure.

    @Dagelf - we have a working municipal model in Chattanooga, which has the fastest, most reliable high-speed Internet in the USA, with more bandwidth at cheaper prices than pretty much anywhere in the USA. It's been successful enough that they are looking to upgrade so anyone, anywhere on their network can get 10GbPS speed. I'm not sure where your "they're going to overpay" vs small startups. There are economies in scale, and, again, outside of major cities, the small ISPs don't and can't serve enough customers to be a realistic alternative.

    @PoloHoleSet Is the financing of this model public record? Can you link to it please? I really find it hard to believe, it may look cheap to you now, but perhaps there is just a hidden tax buried down the line...? @ Gnudiff Almost always the "regulated pricing" is under cost, keeping new competition out because they cant get footing to compete @ Carl\ Kevinson Where do you stay? I will move there and start a cheap ISP tomorrow... or help you do it. People, it is the easiest thing on the planet starting an ISP. All the info you need is free. The hardware cheap. I started a $1m ISP with $500.

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Content dated before 7/24/2021 11:53 AM