[Talk]: Net Neutrality II

Well, I’m quite surprised to hear that kind of speech from you. – Doubting the omnipotence of the free market and such.

Now, to topic. In a free market it should naturally be in the best interest of any company to provide a good product, so that the customer is willing to buy it. But with the selling of internet access (and traffic) this doesn’t really seem to be the case. So one would think, that a competitor would take adantage of such a situation and step into the gap and supply the customer with what he really wants and therefore earn lots and lots of money. So why isn’t this happening?

In my opinion, there are two problems:

Firstly the current suppliers all don’t seem to be interested in competing with their competitors by selling a better product. – Hell knows why. And secondly I believe, the problem lies with the infrastructure. Only cable and phone companies have the infrastructure to supply broadband internet, and it is simply not profitable to start a new company, if you first have to invest too much money just to get the infrastructure. Of course, you could try to negotiate with the cable and phone companies over usage rights for their cables, but they’re naturally not interested in sharing the market with you. So I guess it is a situation where, at the moment, the free market doesn’t seem to be functioning. So it’s basically a natural monopoly (or how ever you economists call such a thing.)

So what to do about it?

[Talk]: Net Neutrality

I guess my partner will be in favour, eh? I’m not really decided either way as I don’t feel particularly bothered. I do, however, see the importance of the issue.

Firstly, I don’t really know all the ins and outs of the issue but this article kinda made me think about it again. On the one hand, I absolutely can’t see what’s wrong with letting companies sign deals that say ‘you get faster service’ – kinda like road pricing on private roads. Depending on how much traffic there is, the price changes and there’s an efficient solution (if everything works out the way it’s supposed to). On the other hand, I don’t really think that’s how it’s going to work out (i.e. companies that pay more getting better service) but rather the other way round – you have to pay to get any kind of decent service.

And then, that’s just not the service you signed up for when you got your broadband connection. Ignoring for a moment that you rarely get the kind of service you pay for (in terms of speed), it’s really not the consumer’s problem if the company makes bullshit claims that they can’t live up to and then are screwed when their customers actually use the service they are paying for. Usually I’d just say “Change the contract and be done with it – the market will sort out the rest” (i.e. anyone trying to pull shit like that would be out of customers pretty damn soon). The problem, however, as the article points out is that there’s really not that much competition in this market – whether we like it or not. Generally I’m a big believer in saying “everything’s the way it’s supposed to be” but at times you have to take a good hard look (usually at the Economist) and accept reality for what it is – not really a free market but rather some kind of corporatist-oligopoly with plenty of government support.

So yeah, convince me either way.