Technology Liberation Front: The Technology Liberation Front » Archive » Will Broadband Carriers Block VoIP?
Tim Wu
· 4 years ago
Why Adam Is Wrong
Adam is right about many things but not this. A carrier will rationally block or at least slow Vonage if the carrier offers a competing product. If the carrier can be sure nothing will be done or it can do so unnoticed, its interest in blocking increases.
It is true that public and government pressure can stop a company from blocking Vonage, and indeed that would be preferable to regulation. But what creates public pressure is not arguing that regulation is out of the question, but rather the threat of regulation itself. Indeed the regulatory threat approach is exactly the one Michael Powell takes.
Adam's argument can be (unfairly) compared to an argument that we don't need murder laws because the public is against murder and most people are decent. It is the bad actors that the law cares about, and what people might do in the absence of a regulatory threat. The closest comparison is to antitrust. Today, companies may not engage in anti-competitive behavior, like price-fixing, all that often. But we must ask whether that is because they don't think it advantageous, or whether they threat of enforcement discourages such behavior.
The actions of carriers, if true, are a textbook example of vertical foreclosure. To rule out possible enforcement against such anti-competitive behavior is folly.
All Comments
Adam is right about many things but not this. A carrier will rationally block or at least slow Vonage if the carrier offers a competing product. If the carrier can be sure nothing will be done or it can do so unnoticed, its interest in blocking increases.
It is true that public and government pressure can stop a company from blocking Vonage, and indeed that would be preferable to regulation. But what creates public pressure is not arguing that regulation is out of the question, but rather the threat of regulation itself. Indeed the regulatory threat approach is exactly the one Michael Powell takes.
Adam's argument can be (unfairly) compared to an argument that we don't need murder laws because the public is against murder and most people are decent. It is the bad actors that the law cares about, and what people might do in the absence of a regulatory threat. The closest comparison is to antitrust. Today, companies may not engage in anti-competitive behavior, like price-fixing, all that often. But we must ask whether that is because they don't think it advantageous, or whether they threat of enforcement discourages such behavior.
The actions of carriers, if true, are a textbook example of vertical foreclosure. To rule out possible enforcement against such anti-competitive behavior is folly.
Tim Wu