The Repeal Of Net Neutrality Is A Bad Thing (But Not For The Reasons You Think)

While much the internet is in an uproar about Federal Communications Commission Chairman Ajit Pai’s plan to roll back Network Neutrality, I’d like the suggest that they’re focusing on the wrong thing. The reason Pai’s decision is the wrong one is not because the lack of net neutrality is, prima facie, a bad thing. Rather, it’s because we don’t have anything close to free market conditions in the U.S. when it comes to broadband.

In 55% of the U.S., there is only one major broadband provider and in most of the remaining 45%, there are two. That means that if that sole provider chooses to be the proverbial “bad actor”, there is no “free market” to correct their actions. If you’re a consumer, you have no other options. What’s more, that situation is unlikely to change anytime soon, because installing a broadband cable network is outrageously expensive. Verizon spent over $20 billion on FIOS and pretty much only managed to wire the upscale suburbs of the Northeast and Los Angeles. There’s 5G mobile broadband, which is looming on the horizon (Verizon just announced today that they’re going to start selling it in areas not covered by FIOS) and it should provide a challenge for wired broadband and allow for the entry of a number of new providers into the market, but for now, we’re stuck with the current Soviet-style system rather than a free market one.