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Google and the Problem With

‘Net Neutrality’
By BRET SWANSON expansive and legally binding regime. He would flurry of dynamism. Both Motorola and Palm
October 5, 2009; Page A19 not only codify existing nonblocking principles but plummeted in popularity and only now are
would also add a highly controversial attempting real comebacks. BlackBerry and Apple
On Sept. 25, AT&T accused Google of violating the "nondiscrimination" rule. This regulation could vaulted to smart-phone supremacy from out of
very "net neutrality" principles the world's expand bureaucratic oversight to every bit, switch nowhere, Nokia became the world's largest camera
dominant search company has righteously sought and business plan on the Internet. company, and a new wireless reading device
for others. Basic technologies, like packet rekindled Amazon's fortunes.
Net neutrality conjures the benign notion prioritization (voice calls first, spam second), could Wireless carriers invested $100 billion in
of an open and fair Web, where all applications and be banned. So could many business plans based on just the past three years, and the U.S. vaulted past
data packets are treated equally. Net reality is robust and differentiated services. This regime Europe in fast 3G mobile networks. Americans
much more complicated. Google says it doesn't could send all routing algorithms and network enjoy mobile voice prices 60% cheaper than foreign
have to abide by rules meant for telecom services into courtrooms for the next decade. peers. And the once closed mobile ecosystem is
companies. But with the Internet obliterating such Despite the brutal economic downturn, more open, modular and dynamic than ever.
distinctions, this defense exposes net neutrality's Internet-sector growth has been solid. From the All this occurred without net neutrality
inherent flaws. Amazon Kindle and 85,000 iPhone "apps" to Hulu regulation.
The controversy involves Google Voice, a video and broadband health care, Web innovation My research suggests that U.S. Internet
new service that rings all of a user's phone lines flourishes. Mr. Genachowski heartily acknowledges traffic will continue to rise 50% annually through
simultaneously and provides other conference- these happy industry facts but then pivots to assert 2015. Cisco estimates wireless data traffic will rise
calling and voice-mail features. Like myriad digital the Web is at a "crossroads" and only the FCC can 131% per year through 2013. Hundreds of billions
applications, the service is possible because the choose the right path. of dollars in fiber optics, data centers, and fourth-
Web and phone lines have in many ways The events of the last half-decade prove generation mobile networks will be needed. But if
converged. Google can thus offer "free" services otherwise. Since 2004, bandwidth per capita in the network service providers can't design their own
over the world's vast, expensive broadband U.S. grew to three megabits per second from just networks, offer creative services, or make fair
networks. 262 kilobits per second, and monthly Internet business transactions with vendors, will they invest
Google thinks net neutrality should traffic increased to two billion gigabytes from 170 these massive sums to meet (and drive) demand?
regulate only traditional phone and cable million gigabytes—both tenfold leaps. Some question the network companies'
companies. Phone carriers have long been ordered expensive and risky plans, asking if the customers
to connect all calls. And open Internet principles will come. But one thing's for sure: If you don't
agreed to by all sides in 2005 offer similar
Broadband has been a rare build it, they can't come.
guidance for the Web: no blocking of Web sites or bright spot in the economy. If net neutrality applies neutrally to all
players in the Web ecosystem, then it would
applications.
But Google Voice does not connect all calls. Why discourage new regulate every component and entrepreneur in a
vast and unknowable future. If neutrality applies
It blocks access, for example, to some rural areas investment? selectively (oxymoron alert) to only one sliver of
and conferencing services that would impose
heavier interconnection fees on Google. AT&T thus the network, then it is merely a political tool of one
charged Google with cherry-picking. Why, AT&T No sector has boomed more than wireless. set of companies to cripple its competitors.
asks, can Google exploit expensive communications Yet Mr. Genachowski wants to extend his new At a time of continued national economic
networks when it's profitable but refuse neutral regulations to the most technically complicated and peril, the last thing we need is a new heavy hand
service to all customers when it's not? bandwidth-constrained realm—mobile networks weighing down our most promising high-growth
This row unmasks something far more and devices. sector. Better to maintain the existing open-Web
important than Google's hypocrisy: the deep In 2004, Wi-Fi was embryonic, the principles and let the Internet evolve.
structural flaws of net neutrality itself. Last week, Motorola Razr was the hot phone, the BlackBerry Mr. Swanson is president of the technology
Federal Communications Commission (FCC) was a CEO's email device, and Apple's most research and strategy firm Entropy
Chairman Julius Genachowski outlined a more recognizable product was an orange-sicle laptop. Economics LLC.
But then the industry turned upside-down in a