David Karp, the founder of Tumblr, has an entire column in Politico about the benefits of net neutrality. His central thesis is that without net neutrality he could never have succeeded with Tumblr. It is ironic position, considering that the empirical evidence is 100% against him. He created Tumblr without there being any net neutrality laws in place.
Despite his own experience, Mr. Karp fears that without net neutrality businesses like his might fail because internet service providers might prioritize deeper pocketed players over startups. He cites Vimeo, Etsy and Kickstarter as wonderful concepts that we should have more of in support of his argument for net neutrality, while again failing to realize that all of his examples came into existence without net neutrality rules being in place.
On the other side, Mr. Karp provides no examples of the hulking menace that exists in an internet not subject to net neutrality rules. According to Mr. Karp:
Over the past year, there’s been a real threat to that promise. The Internet providers saw an opportunity to pick winners and losers, rather than let the internet continue to sort those things out for itself. How would they pick? In lots of ways. For example, by charging companies for the ability to prioritize their traffic over everyone else’s. Content from companies that didn’t pay would be slowed down—or potentially never transmitted at all.
The only problem with the above paragraph – it isn’t true. There has been no mass attack on content providers from ISPs. The “threat to that promise” is a threat mostly dreamed up by net neutrality supporters. The ISPs have not, in any meaningful way, picked winners and losers. The only instance I know of (and the fact that there are so few should tell us just how much of a “threat” this is) is Netflix being slowed down. Netflix is a huge bandwidth hog. It seems to me that there is a perfectly rational reason to limit Netflix if a network is reaching capacity and Netflix accounts for a grossly disproportionate share of the bandwidth usage. Moreover, I don’t know how Mr. Karp and net neutrality opponents would classify a “little guy” without deep pockets, but I am guessing Netflix wouldn’t qualify, which means that the single major example where net neutrality might have prevented “predatory” behavior would be to protect one deep pocketed company from the “predations” of another.
The net neutrality platform trades on a David vs. Goliath theme, but that doesn’t mean it’s true. Because there are millions of small content providers (including yours truly) and only a handful of ISPs, the narrative of the story becomes that of the little people vs. the corporations. In reality, you have deep pocketed, powerful players on both sides – ISPs and big-name content providers like Google, Netflix and Amazon. None of this would much matter, except for the fact that the long-term impact of net neutrality is likely to have unexpected, adverse and perverse consequences starting with decreasing investment in infrastructure and ending with the regulation of content.