Finding the Middle Ground: A Proposed Solution to the Net Neutrality Debate

Posted by Social Science Research Network

Finding the Middle Ground: A Proposed Solution to the Net Neutrality Debate

By Jay S. Kaplan (George Mason University)

Over the last several years, the debate over Internet regulation has become an extremely important and divisive political and policy debate, referred to colloquially as net neutrality. The applicable regulatory framework has shifted several times starting with the light-touch Title I, shifting to the tougher Title II, then reverting to Title I again. Despite an abundance of discourse and an official FCC record that included an unprecedented 22 million comments, no proposed solutions have succeeded in gaining bipartisan support. To do that, this Paper proposes two mechanisms to augment the current Title I regulatory framework. First, the FTC should adopt a mandatory pre-agreement filing so that when ISPs wish to enter into vertical agreements, the FTC is notified and has an ex ante chance to challenge the agreements that the agency believes will be anticompetitive. Second, the FTC should install a special administrative law judge to hear only net neutrality-related cases, so if the government wishes to bring a case alleging an ISP’s anticompetitive activity, or if the parties to an agreement wish to dispute the challenge, it can be litigated in a timely and efficient manner. This hybrid of ex ante and ex post regulation will provide firms the incentives to innovate and enter procompetitive agreements, while protecting consumers from realizing the harms stemming from any anticompetitive activity.