I have many friends on both sides of the net neutrality issue. Internet advocates like Tim Wu and Lawrence Lessig have long argued that the government needs to intervene to prevent Internet Service Providers from discriminating between different types of content so as to preserve the end-to-end principle.

With Julius Genachowski at the helm, the Federal Communications Commission has proposed new net neutrality regulations. Fawn Johnson and Amy Schatz of The Wall Street Journal have written a very useful account of the announcement and the salient issues. One major concern is that overburdened ISPs will have to start charging customers higher rates:

If the FCC does force U.S. wireless carriers to open their networks to data-heavy applications like streaming video, it could push them beyond the limited capacity they have. Already, in areas like New York and San Francisco, a high concentration of iPhones has caused many AT&T customers to complain about degrading service.
In such a scenario, wireless carriers may have to rethink how much they charge for data plans or even cap how much bandwidth individuals get, said Julie Ask, a wireless analyst at Jupiter Research.
The FCC’s proposal will take into account the bandwidth limitations faced by wireless carriers, according to people familiar with the plan, and would ask how such rules should apply to current networks.
The rules could encourage big Internet companies to launch new data-intensive services by establishing that their traffic can’t be slowed or blocked. In the business market, companies that make Internet-phone services or video-conferencing software may invest more heavily in those services, some analysts say.

Engadget, one of the world’s most popular technology blogs, offered a more accessible take last week:

Based on what we’re hearing, a slate of soon-to-be-proposed FCC rules may stop the likes of Comcast fromdiscriminating against P2P applications on their networks, and AT&T sure will have a tougher time justifying why it won’t let the iPhone’s version of SlingPlayer run on 3G while giving WinMo and BlackBerry users all the bandwidth they can handle. Julius Genachowski, the new chairman of the entity, is slated to discuss the new rules on Monday, though he isn’t expected to dig too deep into the minutiae. Essentially, the guidelines will “prevent wireless companies from blocking internet applications and prevent them from discriminating (or acting as gatekeepers) [against] web content and services.” We know what you’re thinking: “Huzzah!” And in general, that’s probably the right reaction to have as a consumer, but one has to wonder how network quality for all will be affected if everyone is cut loose to, well, cut loose. Oh, and if this forces telecoms to deploy more cell sites to handle the influx in traffic, you can rest assured that the bill will be passed on to you. Ain’t nuthin’ free, kids.

Words to live by.

P.S. Julian Sanchez has written an excellent post on the Genachowski announcement for Cato.

If you foreclose in advance the possibility of cross-subsidies between content and network providers, you probably never get to see the innovations you’ve prevented, while discriminatory routing can generally be detected, and if necessary addressed, if and when it occurs. And the worst possible time to start throwing up barriers to a range of business models, it seems to me, is exactly when we’re finally seeing the roll-out of the next-generation wireless networks that might undermine the broadband duopoly that underpins the rationale for net neutrality in the first place. In a really competitive broadband market, after all, we can expect deviations from neutrality that benefit consumers to be adopted while those that don’t are punished by the market. I’d much rather see the FCC looking at ways to increase competition than adopt regulations that amount to resigning themselves to a broadband duopoly.

This strikes me as exactly right: the real problem is that consumers don’t have enough choices when it comes to broadband providers. In a more competitive environment, consumers would have a better check against broadband than the slow-moving blunt instrument that is the regulatory apparatus. Sanchez also links to a very insightful paper by Tim Lee, a libertarian Internet advocate who opposes onerous net neutrality regulations.