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Sailing Between Scylla and Charybdis: The Economics and Law of Net Neutrality

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Today, the Georgetown Center for Business and Public Policy released a new economic policy vignette by Executive Director John W. Mayo titled “Sailing between Scylla and Charybdis: The Economics and Law of Net Neutrality.”

As the Federal Communications Commission (FCC) explores new Open Internet rules, Professor Mayo suggests that an approach based on Section 706 authority is the clear policy tool available to regulators for establishing Internet-related regulation under existing law. Additional points in the analysis include the following:

  • Because monopolies by definition reduce output, a suite of regulations premised on increasing output is by its very nature capable of ensuring competitive behavior.
  • The authority in Section 706 provides regulators a more economically sound, pro-growth basis for assuring that firm behavior promotes output-deployment and expansion of Internet infrastructure and advanced telecommunications services, which is by definition not possible if firms engage in anti-competitive behavior.
  • Imposing ex ante Title II rules risks banning output-enhancing business practices, sweeping them in with anticompetitive practices that should be halted.
  • Applying Section 706 steers us away from the pitfalls of either a completely unregulated internet or last century’s public-utility regulation model.

To speak with Mayo, who also is a professor of strategy, economics, and public policy at Georgetown University’s McDonough School of Business, contact Teresa Mannix at (202) 687-4080 or tmm53@georgetown.edu.