This is how the FT explains the Net Neutrality debate:

The rapid rise of high-bandwidth internet content, such as video, has led several telecommunications companies in the US to push for higher fees from the content providers in recent months, which could raise costs to not only established internet companies such as Google and Yahoo!, but smaller start-ups.

Advocates of “net neutrality” argue that such a move would go against the very nature of the internet, which they say has fostered innovation because its architecture is based on open and equal access. Charging content providers more, they argue, could stop tomorrow’s Googles from even starting.

However, the telecommunications industry has spent vast amounts in its high-bandwidth infrastructure and argues that it should be entitled to a share of profits gained by using its networks. Furthermore, they say that demand for faster broadband will mean even more money is spent upgrading to “next generation” networks.

The position of net neutrality supporters took a blow when proposed network neutrality price controls in the US suffered a key defeat in late April. Meanwhile some European telecoms companies have indicated they will also seek a new charging regime for internet content providers.

It is interesting to see that this debate is now moving to Europe. To me this debate is not really about net neutrality. I think what´s happening here is that telcos see the market caps of internet companies and they get greedy and would like to eat some of their lunch. But currently telcos can charge as much as the market will bear to connect to the servers of internet companies. Now what happens is that the market at the server level is very competitive as many carriers reach data centers, but the market at the consumer level is quite monopolistic, especially in the United States, so taking advantage of the oligopoly power at the consumer end to get more money from content providers does not seem reasonable to me. What does seem reasonable to me and ISPs already do is to charge more to the people who use more and that´s why they have offers for 1MB, or 8MB or 20MB, etc.

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