The debate over “network neutrality,” i.e. the debate over whether governments should establish rules limiting the extent to which network providers can interfere with the applications and content on their networks, has become one of the hottest debates in Internet policy. Governments all over the world, including the European Union, the UK, France, Germany and the US, are investigating whether regulatory action is needed. Beyond rules that prevent network providers from blocking applications or content, non-discrimination rules are a key component of any network neutrality regime. There is, however, a lot of uncertainty about how to best distinguish harmful from beneficial discrimination. The paper sets out criteria for evaluating non-discrimination rules and uses these criteria to evaluate two proposals for a non-discrimination rule:
• A non-discrimination rule that would ban discrimination that causes harm to users or harm to competition. Whether these conditions (anticompetitive, harm to users) are met would be decided by the regulatory agency in case-by-case adjudication. Such a rule was part of the Google-Verizon legislative proposal.
• A non-discrimination rule that would ban all application-specific discrimination (i.e. discrimination based on applications or classes of applications), but would allow application-agnostic discrimination. This rule would allow certain, but not all forms of Quality of Service.
Only the second rule meets the criteria for a good non-discrimination rule: The rule protects the factors that have fostered application innovation in the past, ensuring that the Internet can continue to serve as an engine of innovation and economic growth in the future. It preserves the factors that have allowed the Internet to improve democratic discourse and to provide a decentralized environment for social and cultural interaction in which anyone can participate.
The rule does not constrain the evolution of the network more than is necessary to reach the goals of network neutrality regulation. In particular, it allows certain, but not all forms of Quality of Service. It provides much-needed certainty for industry participants by making it easy to determine which behavior is and is not allowed and keeps the costs of regulation low.