The Balkans War has started again. If Russia and China have their way, we could see a fragmentation of the World Wide Web that was inconceivable over twenty years ago.

Robert McDowell, admittedly my favorite Federal Communications Commission member, raised this very scary observation in a piece he wrote in yesterday’s The Wall Street Journal. In short, China and Russia would support an assertion of control over the Internet by the International Telecommunications Union.

If it’s not broke, why fix it? “Fixing” it may mean handing nations not known for their celebration of the freedom of expression a new tool to dampen the exchange of ideas, as well as make a little money for their coffers by charging for access to foreign websites.

The United Nations will reportedly start discussing this proposal as part of treaty negotiations that created the ITU. Discussions begin 27 February 2012.

Well, this latest development should make net neutrality proponents here in the United States very happy. It is going to be very tough for the United States to say no to heavy handed regulation of Internet traffic when our own Federal Communications Commission has allowed for the same approach to Internet traffic here in the United States. How can we tell China, Russia, and other members of the new Internet-communist bloc that management of Internet traffic by a government agency is a bad thing when we require transparency on network management via net neutrality rules?

Eric Schmidt, chairman of Google, Inc., recently referred to HR 3261, the Stop Online Piracy Act of 2011, as censorship.

Censorship? Really?

What we have here is an aggregator like Google running scared because of threats to its advertisment revenue. So what if content providers have to sustain an increasingly aggressive attack on their intellectual property. Compound the attacks with the expense of having to defend against a culprit sitting overseas and you can see why Internet piracy is disturbing.

Other critics of SOPA such as Joshua Kopstein are claiming that SOPA will negatively impact the free flow of information and harm the Internet as we know it. Sniff, sniff. I can smell a net neutrality proponent here.

In an evolving economy like ours where citizens are using the Internet as a resource for generating income, the last thing we need is less protection of intellectual property. If we follow the anti-SOPA line of thought, there eventually won’t be any information of worth moving across the Internet.

Jamilah King posted an in-depth article addressing how carriers such as AT&T and Verizon have created cyber-ghettos via their wireless service offerings. Unfortunately this admittedly in-depth article is a poorly veiled attempt to argue for net neutrality; a concept that has never considered how best to promote broadband adoption in minority communities much less increase economic activity. Net neutrality will only drive up the cost minorities pay for access to the Internet as higher compliance costs are passed through in the prices for mobile devices and wireless broadband access.

The article started off well, giving an ample description of the downside of access to the Internet via mobile versus fixed
wire connections. I was hoping that the article would focus on how the disproportionate reliance on handheld wireless
devices hinders our ability to produce content and create other ideas that could be sold for income, especially in a challenging economy such as ours. All I got was more whining about AT&T’s alleged bogey-man status.

It raises the question, however. Is the digital divide being compounded by the marketing of wireless devices toward blacks and Latinos thus giving the market the false sense that minorities are only interested in entertainment?

The Wall Street Journal yesterday reported that the Federal Communications Commission plans to put an order for an administrative hearing on the combination of AT&T and T-Mobile USA. This hearing might occur after the conclusion of the U.S. Department of Justice’s lawsuit against AT&T.

Interesting view on the part of Mr. Genachowski of the role the FCC has in antitrust. I thought all the FCC did was approve the transfer of licenses. If AT&T does win the lawsuit, will it try not to approve the license transfers?

I guess the FCC is feeling emboldened by the Senate’s failure to kill net neutrality rules.

Maybe Mr. Genachowski is hedging his bets. Why seek a hearing on the combination of AT&T and T-Mobile USA unless you thought there was a good chance that AT&T is going to win approval? He could have waited for the conclusion of the lawsuit before signaling a hearing was forthcoming.

Instincts tell me not to count AT&T out yet.

What the U.S. Senate failed to consider last Thursday in its rejection of a repeal of net neutrality rules is the potential loss in consumer surplus that broadband subscribers may face.

The additional compliance, regulatory, and legal costs that broadband access providers may face will more than likely be passed on to subscribers in higher prices. These price increases will eat in to consumer surplus.

Consumer surplus is the difference between the value the consumer places on their broadband access service and the actual dollar amount that they pay. If I value my services at $200 a month, but I only pay $79.95, I have $120.05 of consumer surplus.

Start adding all those additional net neutrality costs, and my consumer surplus starts to shrink.

It’s not like the price increase was the result of a tax, where the decrease in consumer surplus could be offset by refunding tax payers the following year. Proponents of net neutrality might, fool heartedly, argue that the benefits of net neutrality do accrue to consumers. I don’t think consumers are following this debate and won’t have an “aha” moment because someone had a question answered about management practices toward throttling.

So with no offsetting rebates or measurable benefits, consumers will experience deadweight loss. In other words, while producer surplus inadvertently increases by some amount less the new expenses, and Free Press goes home at night feeling satisfied about another onerous rule, consumers are left holding the bag filled with increased pricing and no additional benefits.

Should opponents to net neutrality argue this point in court?