Rebutting Ebay which says NN is not about price regulation...sure CNET debate thread #9

My friend Chris Libertelli goaded me into explaining why NN cold lead to price regulation which I do with six points below.

UNE-P and NN both overreached!

Posted by Scott Cleland (See profile) - July 14, 2006 1:22 PM PDT


Both UNE-P and NN were/are huge regulatory over-reaching attempts.

From the beginning, your side has irresponsibly argued for an all encompassing concept of NN and drafted legislation that is hugely over-reaching. What do I mean?

CNET's Molly trying to argue the online giants aren't that profitable... CNET #8

The latest back and forth is CNET Molly Wood trying to make the case that the online giants aren't so profitable. Why oh why did she want to take the debate in the direction that undermines her case the most.

My source is Mary Meeker Queen of the Internet
Posted by Scott Cleland (See profile) - July 14, 2006 12:22 PM PDT

No need to back down here.

My source for 80-90% gross profit margins for Google, Yahoo, eBay, and Microsoft -- is Mary Meeker,of Morgan Stanley, who is a leading analyst and authority on Internet and Internet related stocks, and (also dubbed "Queen of the Internet" by the media). She presented these figures as part of a financial presentation to the Warburg Pincus annual conference on May 18th, 2006.

Broadband duopoly BALDERDASH!

Neutrality-ites parade out the charge that the market a "broadband duopoly" in order to justify NN regulation. Balderdash!  Thus, I particularly relished the Business Week's article on Clearwire, which is an emerging nationwide alternative to DSL and cable modems. This great article is just more in a mountain of evidence to anyone that is fair-minded in examing the merits of the broadband duopoly assertion.  

Significance of FCC refusing to impose NN conditions on Adelphis deal -- Senate implications

Its very significant that the FCC refused to impose NN conditions on the Adelphia deal. 

First, after all the huffing and puffing of the liberal blogging community,'s 1 million person petition, and the 700 group coalition -- the neutrality-ites continue to fail. Add FCC (4-1) rejection of NN conditions on the Adelphia transaction to the House defeat of NN (269-152) and the Senate Commerce Committee defeat of NN (11-11) The phrase "more bark than bite" comes to mind when thinking about NN.

Second, it is good to have new Republican Commissioners McDowell and Tate on the offical record against NN. That's important because there now should be a solid Republican FCC majority against NN for the rest of the Bush Adminstration

Agree with CNET's Molly on something... sort of...#7

Found that Molly and I agree that technology is the answer we just continue to disagree on what that means for policy...

This would be much easier if CNET would just agree to do a podcast.

Excellent train of thought to explore!

Posted by Scott Cleland (See profile) - July 13, 2006 11:35 AM PDT

You may not be aware of it but you are making my point for me. If all the Internet needs is bandwidth, why don't the online giants just invest in the last mile? Intel is doing it with $600m in Clearwire. Google, Microsoft Yahoo and the others could easily afford to bid on the current FCC wireless broadband auction. Or they could co-invest with existing telcos of cable companies to build faster pipes? Oh I forgot. Co-investing, sharing the investment cost burden of upgrading the Internet -- among those that benefit the most -- oh, that wouldn't be neutral -- can't have that.

Molly's regulatory "hair trigger" Rebutting CNET's Molly Wood #6

This is a reply to CNET's Molly Wood chiding her for her regulatory "hair trigger."

You ducked my question

Posted by Scott Cleland (See profile) - July 13, 2006 11:02 AM PDT

I asked you why you are supporting legislation that punishes everyone with preemptive regulation for the sins of an extremely limited few (if we accept your latest examples at face value)? Why support legislation that makes no distinction on whether or not a company, industry or technology has had any NN complaints, whether or not the company, industry or technology enjoys any market power or whether or not the company even has any cusomters yet? And why would you support legislation that has no sunset provision, if people eventually had the number of competitive choices you deem enough? Do you believe that competition can succeed or is it impossible warranting no sunset provision?

Rebutting eBay which joined the CNET NN debate -- also Day 14: CNET Equal Time held hostage!

This is a reply to Chris Libertelli's comment on CNET trying to defend CNET Executive Editor Molly Woods blast of my commentary on NPR Morning Edition. I tease him for knowing better than he is letting on.

I am still waiting for a response from Molly to have the opportunity to do a guest column on CNET or have a podcast debate... but they don't seem to have the same jounalistic standard of fair play that NPR and most other news organizations do. Equal Time held hostage day 14.

Welcome to the debate

Posted by Scott Cleland (See profile) - July 13, 2006 9:15 AM PDT

Ah my friend Chris, you too are being literalist. You worked for FCC Chairman Mike Powell at the FCC and know that Reed Hundt crafted UNE-P out of statutory language that did not allow it. It took a decade of court challenges to clean up that mess!

"Broadband duopoly" charge: "code" for not believing in competition

Neutrality-ites continue to misleadingly rail against the problem of a “Broadband Duopoly” and that consumers have no real choice. Saying it is a duopoly and then saying there is no real choice in the same sentence -- is oxymoronic. With all due respect, please see my friend Art’s Brodsky’s Public Knowledge’s commentary as an example of this type of thinking -- that the current successful transition from monopoly markets to duopoly to competition is somehow not happening or is inherently bad. Competition is a process and a dynamic and every indication is that competition is increasing over any time period -- not decreasing -- or not happening as neutrality-ites imply with their somber duopoly rhetoric. (The fatal flaw in their superficial broadband duopoly analysis is that it is static and not dynamic or directional over time.)

FCC Adelphia approval -- another key anti-NN milestone

Today is a big day for opponents of NN. The FCC is poised to finally approve the Adelphia transaction with Time Warner and Comcast – without requiring NN conditions -- according to my sources. While the FCC meeting has reportedly been delayed for a few hours to resolve a non-nn issue, it appears very likely that the Republican majority has resisted the minority’s push for NN conditions on this merger similar to those placed on AT&T-SBC and Verizon-MCI.

There are two very good reasons why the cable outcome is different than that of the big telecom mergers.

Check out the excellent NN analysis by PFF or attend their event

For those wanting a more indepth understanding of NN I highly recommend the following PFF book and event.
  Press Release
July 12, 2006
CONTACT: Amy Smorodin

Academics to Debate Network Neutrality Issues
PFF Network Neutrality Book Launch and Debate to be held Tuesday, July 18th
WASHINGTON D.C. – A book launch and debate on network neutrality issues, hosted by The Progress & Freedom Foundation, will be held this Tuesday, July 18th at the National Press Club. A distinguished group of academics and telecom policy experts will discuss issues raised in "Net Neutrality or Net Neutering: Should Broadband Internet Services be Regulated?," a recently published compilation of essays written by PFF Fellows and other respected communication industry scholars.
The panel discussion will be moderated by PFF Senior Fellow and Senior Vice President for Research, Thomas Lenard. Panelists at the event will include David Farber, Distinguished Career Professor of Computer Science and Public Policy at the University of Pennsylvania; Randolph May, President of the Free State Foundation, a Maryland think tank; and Adam Thierer, PFF Senior Fellow and Director of Center for Digital Media Freedom. Discussion topics will include: the advantages and disadvantages of network neutrality mandates, the effects of such regulation on innovation and economic growth, and suggestions for a regulatory or legal framework for dealing with complaints of application or content discrimination.
"Net Neutrality or Net Neutering: Should Broadband Internet Services be Regulated?" covers such network neutrality topics as vertical integration, competition and property rights in a collection of thought-provoking essays. The book is co-edited by Thomas Lenard and Randolph May. Order forms for purchasing "Net Neutrality or Net Neutering: Should Broadband Internet Services be Regulated?" will be made available at the event. The book is also available for purchase online through the publisher and

The event will be held on Tuesday, July 18th at the National Press Club from 8:30am - 10:00am. A continental breakfast will be served. The National Press Club is located at 529 14th St., NW in Washington, DC. Those wishing to attend should register online. Questions should be addressed to Eileen Goulding at 202-289-8928 or Members of the media should direct questions to Amy Smorodin at 202-289-8928 or

The Progress & Freedom Foundation is a market-oriented think tank that studies the digital revolution and its implications for public policy. It is a 501(c)(3) research & educational organization.