Wednesday, April 25, 2007
George S. Ford, Phoenix Center for Advanced Legal and Economic Public Policy Studies, has published a paper called "University of Florida Study Shows Only Winners From Network Neutrality Regulation To Be Content Providers, Consumers Lose." Here is the abstract.
This month, three professors at the University of Florida's Warrington College of Business Administration released a new paper on the effects of network neutrality regulation using a stylized game-theoretic model (the “Florida Study”). This analytical investigation of network neutrality is certainly a welcome addition to the debate, which has primarily been driven by emotion. But the conclusions of the Florida Study have been grossly misconstrued by network neutrality proponents, who have seized upon them in claiming that the study shows that the “Internet with Net Neutrality is unequivocally better for consumers.” Even a casual read of the Florida Study shows that those claims are entirely false. In fact, the Florida Study clearly shows that under no circumstances will consumer welfare be improved by network neutrality regulation. In fact, the Florida Study suggests that the only “winners” from network neutrality regulation will be the Internet content providers - with broadband service providers and consumers being worse off (or, in some cases, unaffected). Policymakers should therefore not be misled as to what the Florida Study actually says and should pay heed to the warnings that lie beneath the patina of overzealous advocacy.
Download the entire paper from SSRN here.