Great Net Neutrality Debate II

Evidently a Wall Street Journal article sparked a variety of posts related to Network Neutrality. One post was at the Technology Liberation: "Front, Bandwidth, Storewidth, and Net Neutrality", which in turn referenced the testimony of George Gilder before the Senate Commerce Committee in April 2004. What intrigued me with the narrative, was the following narrative.

Although American companies invented almost all the technologies crucial to the Internet, we have fallen behind many other nations in the deployment of these technologies.

The U.S. now ranks eleventh internationally in residential "broadband" access. Using the FCC’s silly 200-kilobit-per-second definition, some now say that 25 percent of American homes have broadband. But by the standards of Asia–where most citizens enjoy access speeds 10 times faster than our fastest links–U.S. residences have no broadband at all. U.S. businesses have far less broadband than South Korean residences. South Korea, for instance, has 40 times the per capita bandwidth of the U.S. Japan is close behind Korea, and countries from China to Italy are removing obstacles to the deployment of vDSL, fiber-to-the-home, and broadband wireless networks.

Asian broadband also proves there was no Internet "bubble." Today, Korea runs over the net between a three and five times larger share of its economy than we do. Riding the bus to work, Koreans watch television news and exchange video mail over their mobile phones. They enjoy full-motion video education and entertainment in their homes. Many of the dot-coms that failed in America due to the lack of robust broadband links are thriving in Korea. Consider that by this time next year Verizon Wireless’s 38 million customers will enjoy faster Internet access via their mobile phones than through their Verizon DSL connections to their homes. Only the most severe disincentives to invest could have yielded such a result, which defies the laws of physics. The American Internet "bubble" was actually a crisis of policy.

The purpose of George Gilder testimony was to establish how America is falling behind due to "oppressive" regulation. The problem with the narrative is that it is logically flawed since Mr. Gilder has not delved into why the Asian internet is better than the US internet. One can't simply say that regulation in the US has made our internet "bad" when compared to the Asian internet. For all I know, the Asian internet could be even more regulated than the US internet. Or they have better network managers than we do? Mr. Gilder has simply overlooked these potential reasons.

The narrative, to me, is logically flawed in another manner. If the technology exists, it can be deployed. If it is not deployed then the corporate leaders have made a willing choice not to use it. I would say this is similar to regulations imposing automobile emission standards. The US auto industry said it couldn't be done and whined to Congress. The Japaneses called in their engineers and did it. Now, because they have failed to adapt the American automotive industry is facing bankruptcy.

If the Asian internet is better then the US internet, we need to examine what they are doing and then adapt that technology so that we will have a better internet. Effective corporate leadership means adapting, not whining to Congress for special breaks such as bailouts or less regulation. If our corporate leaders talk free market principles, they should live it through competition.

I also provided this comment at the Technology Liberation Front.