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Internet Regulation: Distasteful But Inevitable

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In the alternate reality known as the world of insurance, the word “regulation” is enough to give most executives the heebie-jeebies.

This is certainly understandable in a business environment that, at its core, is a smoothly-running gambling proposition in which the odds are highly stacked in favor of the house. Those tables of statistics and probabilities work just fine for insurers, and outside interference in the form of regulation is often a cause for concern.

The same kind of trepidation in regard to regulation is apparently felt by those in the information technology (IT) arena. According to a recent survey by the Computer Technology Industry Association (CompTIA) of 600 IT workers, “an overwhelming number [of respondents] thought government should not regulate the Internet like telephones or television (79%).”

What are we to make of such a sentiment? Much of the answer depends on what we mean by “regulation.” Telephones and television are ostensibly regulated to ensure fair competition between providers–and hopefully fair pricing and good service for consumers.

Most of us would have a hard time raising an objection to those goals in principle. As a nation, we are all about fairness, as much as we are all about getting a good deal for our hard-earned money.

Yet there is a downside to this kind of regulation. Undoubtedly, power struggles and money grabs are rife in the TV and telecommunications industries, as players jockey for the best competitive position. Such an atmosphere almost invites corruption, political power plays and back room dealing.

Given the acrid taste such activities leave in one’s mouth, it’s not surprising that many would rather not have this happen with the largest and most potent communications paradigm ever known in our history on planet Earth.

Many of us still hold a romantic view of the Internet as a wild and free frontier open to cyber-pioneers who have enough smarts and gumption to make their success there. At one time, the Internet backbone depended on unpaid volunteers with good hearts who made their computers available for worldwide use.

That party, ladies and gentlemen, is over.

The rarely-discussed truth is that the infrastructure of the Internet is owned and controlled by a number of powerful corporations (mainly telecommunications companies) that can easily exert their influence over what the channel looks like and what kinds of business arrangements are made.

“Just let the Internet take care of itself,” regulation opponents say. And in truth, that worked in the early days of the Internet. The problem is that the Internet has now become the host of a business channel, perhaps the most prodigious business channel ever created–the World Wide Web. With the potential stakes growing astronomically, the potential for abuse is far more serious.

Interestingly, the CompTIA survey also found that 59% of respondents believe that free trade helps the economy. I am in total agreement with that philosophy. Yet even the staunchest free-trade advocates will admit to the need for some regulation–at least to discourage criminal activity.

The reality of the Internet today poses the question: “Is a business channel that is controlled by a select number of interests really representative of free trade?”

Clearly, the Internet many of us grew up with is becoming a far different place than it once was. The anti-regulation view–while appealing at a gut level–assumes that most people are basically good and that they will, overall, do the right thing.

That party, ladies and gentlemen, was over when Adam and Eve dined on the forbidden fruit.

Our very nature as human beings demands that we put some restraints on our baser impulses, especially where money is concerned. The key question then becomes: How much regulation is enough, and how much is too much?

I doubt that anyone can answer that with certainty at this point, but the hard truth is that we will eventually have to regulate this ultra-powerful medium. It may take a major scandal or Enron-style meltdown to make that happen, but such an occurrence seems inevitable.

Yes, I wish the Internet could have remained the fun, new and exciting place that it was in its early days, but a nation that has embraced the concept of “change” must surely see that that particular horse left the barn a long time ago.


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