Managing the

(Traffic) Managers
TECHNICAL, ECONOMIC AND LEGAL
ISSUES AROUND NET NEUTRALITY
Introduction
• Technical Issues: Managing Capacity
• Economic Interests: Managing Interests and
Externalities
• Legal Issues: Managing Fairness
• Political Issues: Managing Freedoms
• No solutions, only questions!
How to manage internet traffic in a
way that is economically efficient,
legally justifiable, and respects
human rights?
Technical Issues:
Managing Capacity
• New services and digital convergence
• But the same old wires and connections
• The long-term solution – more innovation, better
infrastructure
• But in the short term, traffic is managed… but how?
• By volume?
• By application?
• By IP address?
• And for what motivation?
 or…
Sources: Wikimedia Commons: https://en.wikipedia.org/wiki/The_Traffic_Policeman
Monty Python Wikia: http://montypython.wikia.com/wiki/File:Bridge_of_Death_monty_python_and_the_holy_grail_591679_800_4411271399897.jpg
 Economic Issues (1/3):
Managing Interests and Externalities

The Virtuous Circle:

•Better content and services…
•… over better networks…
•… lead to more demand…
•… and so more investment and
competition
•(and/or the other way around)
Source: OECD
Economic Issues (2/3):
Managing Interests and Externalities
• Consumers want to:
• Get value for money (Closed garden? Open prairie?)
• Risk of abuse?
• Established Content Producers want to:
• Maximise revenue – optimise customer base
• Minimising costs – avoid additional payments
• Potentially do deals?
• New/Non-Commercial Players want to:
• Maximise reach
• Free access a ‘subsidy for creativity’
• Shared interest in high quality, low cost connection
Economic Issues (3/3):
Managing Interests and Externalities
• For ISPs, a long term interest in better content, and
loyal paying customers
• But investment is uncertain
• In the short-term:
• Need to recoup costs of investment, reward shareholders
(and invest), so…
• Find efficiencies through traffic-shaping
• Seek money from other ISPs?
• Seek money from content providers?
• Seek money from consumers?
Legal Issues:
Managing Fairness
• One Gatekeeper or Many?
• Competition – promote consumer welfare, now and
tomorrow
• Can consumers switch?
• Costs?
• Transparency vs confusopoly?
• Lower barriers to entry?
• But if not
• Enforcing quality of service
• Enforcing net neutrality
Political Issues:
Managing Freedoms?
• Not just any type of telecoms network
• Universal

• Non-commercial origin

• A human right?

• Privacy implications

• Fears of reversing freedom of expression and access

to information gains?
Sources
• Lee, Robin S. and Wu, T. (2009), Subsidizing Creativity through Network Design: Zero Pricing
and Net Neutrality, Journal of Economic Perspectives (Vol. 23, No. 3, Summer 2009), pp 61-76
• OECD (2016), Digital Convergence and Beyond – Innovation, Investment and Competition in
Communication Policy and Regulation for the 21st Century – Background Report for 2016
Ministerial Meeting on the Digital Economy
• Evans, D. (2011), Net Neutrality Regulation and the Evolution of the Internet Economy, Paper
submitted for a hearing by the OECD’s Working Party on Competition and Regulation
• Werbach, K. (2013), The Development of Fixed Broadband Networks, OECD Digital Economy
Papers No. 239, OECD Publishing
• Cave, M. (2011), Competition and Consumer Protection Issues in the Net Neutrality Debate, with
Special Reference to Europe, Paper submitted for a hearing by the OECD’s Working Party on
Competition and Regulation
• Wu, T. (2002), A Proposal for Network Neutrality
• Wu, T. (2005), Network Neutrality, Broadband Discrimination, Journal on Telecommunications
and High Tech Law (Vol 2)
• OECD (2007), Internet Traffic Prioritisation: An Overview, OECD Publishing