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Wednesday, May 21, 2014

'Net Neutrality May Be Harder To Achieve Than We Thought'

Joshua Gans:

Net neutrality may be harder to achieve than we thought, by Joshua Gans, Digitopoly: For the last few weeks I have been working on a paper out of the notes I posted on weak and strong net neutrality. The paper is now done (at least as a working paper) and it seems appropriate to summarize its main findings as some were unexpected. ...[continue]...
The first finding is one that I had already forecast. Net neutrality requires a lot of neutrality to be effective. Put simply, in situations, where consumers have a direct pricing relationship with content providers (such as is the case with Netflix), if you prohibited ISPs from charging different access fees to different content providers, ISPs could use consumer charges to undo any real consequences of that. ... ISPs could build in content-based price discrimination into their charges to consumers and effectively allow them to extract rents from content providers...[continue to other three findings]...

    Posted by on Wednesday, May 21, 2014 at 09:22 AM in Economics | Permalink  Comments (17)


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