Net Neutering and Innovation -- Would Google Even Exist Under These New Rules?

From Gordon Crovitz at the WSJ 

FCC Chairman Tom Wheeler justified Obamanet by saying the Internet is “simply too important to be left without rules and without a referee.” He got it backward: Light-handed regulation made today’s Internet possible.

What if at the beginning of the Web, Washington had opted for Obamanet instead of the open Internet? Yellow Pages publishers could have invoked “harm” and “unjust and unreasonable” competition from online telephone directories. This could have strangled Alta Vista and Excite, the early leaders in search, and relegated Google to a Stanford student project. Newspapers could have lobbied against Craigslist for depriving them of classified advertising. Encyclopedia Britannica could have lobbied against Wikipedia.

Competitors could have objected to the “fast lane” that Amazon got from Sprint at the launch of the Kindle to ensure speedy e-book downloads. The FCC could have blocked Apple from integrating Internet access into the iPhone. Activists could have objected toAOL bundling access to The Wall Street Journal in its early dial-up service.

Among the first targets of the FCC’s “unjust and unreasonable” test are mobile-phone contracts that offer unlimited video or music. Netflix , the biggest lobbyist for utility regulation, could be regulated for how it uses encryption to deliver its content.

Until Congress or the courts block Obamanet, expect less innovation. During a TechFreedom conference last week, dissenting FCC commissioner Ajit Pai asked: “If you were an entrepreneur trying to make a splash in a marketplace that’s already competitive, how are you going to differentiate yourself if you have to build into your equation whether or not regulatory permission is going to be forthcoming from the FCC? According to this, permissionless innovation is a thing of the past.”

This is yet another example of an effect I have observed before -- why is it that the media is willing to raise concerns about an expansion of government power only after that expansion has passed.  We saw it before on ethanol and the stimulus bill, and now I think we are going to start to see it on net neutering.  A cynic might say that the media wants these expansions of power to occur, but also want to be able to point to their own prescience when these expansions inevitably cause problems.


  1. NL7:

    The simplest answer, which is mostly conjectural and anecdotal, is that journalists tend to be oppositional and gravitate to stories that criticize the status quo. So they like stories about "kids these days are ruining everything" or "foreign countries these days are the most dangerous in all history" or "powerful interest groups are bent on destroying society." So they disagree with the status quo about policy, finding stories that more or less beg for regulatory intervention; if intervention comes, then they write more stories either about the failure of intervention or about the need for new intervention (or both those in one story).

  2. Joe:

    5 to 10 to 15 years in the future;

    You will never know what internet innovations would have occurred without net neutrality
    You will never know what medical innovations would have occurred without obamacare
    an aborted baby will never know they were aborted.

  3. ECM:

    A cynic might say that the media wants these expansions of power to occur...

    It's a protection racket--they do want it, but they also want to make DC understand that if they don't get special treatment, they'll bring their power to bear.

    (IOW: nice regulation you have there, be a shame if something were to happen to its image...)

  4. Mike Powers:

    [W]hy is it that the media is willing to raise concerns about an expansion
    of government power only after that expansion has passed. [sic]

    Because it's only bad people who make bad things happen in Liberalverse. The idea that good people with the best of intentions might do something bad is just impossiblethink.

  5. Nimrod:

    Notice that in the latest poll shown, a large number started refusing to answer. The emphasis now that this has been widely exposed is not on being more objective, but concealing the degree to which the entire profession is biased.

    Also see which shows an increase in the number claiming to be "independent". While that is the claim and the image they attempt to portray, the actual behavior doesn't match up.

    Overall I think that NL7 is correct, but I'd describe it as a sort of "crusader mentality" which is constantly trying to fight some sort of "injustice" without enough thought put into what is effectively being advocated. So these people will fight for X, then when X actually causes problems they'll fight against X, though the people may not be the same.

  6. obloodyhell:

    The WSJ is a worthless POS that requires logins. I'm not giving them personal information just to read their freaking rag.

  7. Not Rick:

    Years ago, I used to apply a idea I got from Heinlein (no idea were it started) - 'Never attribute to malice, actions that can be attributed to stupidity.' I stopped using that idea a while back. I don't buy that the press is stupid - they're just ideologically corrupted. That absolutely want expansions of power, one simply has to look at the press reaction to Obama and his executive orders to see that - and it didn't start with Obama either, it's simply be much more blatant.

    I guess you'd consider me a cynic because I think the reason they point out the potential problems after the fact is to give the impression that they're unbiased when they (the mass media - on both sides) are clearly not.

    Once or twice might be stupidity, but this behavior is much to consistent to be anything but malice.

  8. JonCB:

    So I don't disagree with your basic point, that power granted will inevitably be used whether that was the original intention or not. However the netflix point in the article is a bum steer. Netflix was being investigated as late as late last year for it's encryption practices, this investigation has nothing to do with the new Title II change as is implied.

  9. Not Sure:

    I don't know what browser/search you use but with IE & Google, if you highlight the hidden article's title, right click and search with
    Google, you get a link to the whole article.