Assessing the Network Neutrality Debate in the United States

Over the last decade in the United States network neutrality has evolved from a primarily technical concern to a national debate about the future of American communications regulation as well as technology and innovation policy in general. In October 2009 the U.S. Federal Communications Commission (FCC) issued a notice of proposed rulemaking (NPRM) to codify six principles of network neutrality. This proceeding which is unlikely to be completed before mid-2010 could have profound economic consequences for consumers content and applications providers and network operators.Network neutrality is a shorthand for a series of policy prescriptions that would restrict the ability of broadband internet service providers (ISPs) to manage network traffic. These restrictions include barring network operators from charging content and applications providers (as opposed to end users) for entering into business-to-business transactions for quality-of-service (QoS) enhancements for packet delivery. Although the initial objective for advocates of network neutrality regulation was to secure regulation of wireline networks the debate has expanded since its inception to include wireless networks

An Antitrust Rule for Software Integration

What is the proper legal standard for product integration involving software? Because software is subject to low marginal costs, network effects, and rapid technological innovation, the Supreme Court\u27s existing antitrust rules on tying arrangements, which evolved from industries not possessing such characteristics, are inappropriate. In this Article, I ask why firms integrate software products. Next, I review the Supreme Court\u27s tying decisions in Jefferson Parish and Eastman Kodak. I propose an approach to judging the lawfulness of product integration in technologically dynamic markets that supplements the Supreme Court\u27s current standard with four additional steps in cases of tying of computer software. Thereafter, I examine the D.C. Circuit\u27s approach to software integration, which arose from that court\u27s 1998 interpretation, in Microsoft II, of an antitrust consent decree between the US. Department of Justice and Microsoft Corporation. I argue that the D.C. Circuit\u27s rule has general applicability and should be recognized as the appropriate standard for software integration under antitrust law. I show how my approach imparts greater clarity to the D.C. Circuit\u27s rule. I examine the competing product integration rule proposed in 2000 by Professor Lawrence Lessig as amicus curiae in the government\u27s subsequent antitrust case against Microsoft, concerning the integration of Internet Explorer and Windows 98. My approach enables Professor Lessig\u27s analysis to be reconciled with the D.C. Circuit\u27s rule, but Professor Lessig\u27s rule, on its own, would contain serious shortcomings. Thereafter, I evaluate Judge Thomas Penfield Jackson\u27s April 2000 findings of law on the integration of Internet Explorer and Windows 98. I conclude that Judge Jackson\u27s approach, in contrast to the D.C. Circuit\u27s rule as refined by my approach, would harm consumers in the technologically dynamic market for computer software

Do Free Mobile Apps Harm Consumers?

Google distributes proprietary applications for its open-source Android mobile operating system (OS) free of charge. Some of those applications (apps) are offered together as a suite of apps known as Google Mobile Services (GMS). Manufacturers of mobile devices can agree, pursuant to Google\u27s Mobile Application Distribution Agreement (MADA), to install the suite of apps on their devices at a price of zero. Some theorize that Google\u27s policy of offering some applications together as a suite of apps harms competitors or menaces consumer welfare. In April 2015, the European Commission expressed such concerns when it initiated a formal antitrust investigation that will scrutinize Google\u27s licensing practice with respect to Android, mobile apps, and mobile services. In April 2014, an antitrust class-action complaint filed against Google by individual mobile device owners in the U.S. District Court for the Northern District of California presented similar allegations. However, the theory that the MADA\u27s requirements have anticompetitive effects is wrong. As a matter of economics, Google\u27s practice of distributing free mobile apps in the GMS suite benefits consumers -- as well as manufacturers, mobile carriers, app developers, and advertisers -- by stimulating demand, by reducing the risk of fragmentation of the Android OS, and by preventing Google\u27s competitors from free riding on its investment to make the Android OS and mobile apps a viable open-source competitor to closed and proprietary -- walled garden -- platforms for mobile devices. As a matter of antitrust law, Google\u27s distribution of apps as part of a larger whole -- GMS -- is lawful under the Supreme Court\u27s four-part test for such arrangements. Google does not force consumers to pay for apps they do not want, and the MADA\u27s requirements enhance competition overall. The same conclusion holds with even greater certainty under the rule-of-reason analysis for software integration that the D.C. Circuit adopted in its historic Microsoft decision. Although European competition law differs in some respects from American antitrust law, the pertinent economic analysis does not vary by jurisdiction. Google\u27s licensing practice has invigorated competition among mobile platforms and mobile devices. Google\u27s distribution of free mobile apps in GMS has produced a market success, not a market failure, and should not be considered anticompetitive

Acquisitions by Partially Privitized Firms: The Case of Deutsche Telekom and Voicestream

A recent phenomenon in competition policy is the acquisition of a private firm by an enterprise that is either wholly owned by government or in the midst of privatization. Such an acquisition poses the question of how public ownership may alter the incentives of a firm to engage in anticompetitive conduct. It also prompts one to examine the process by which such altered incentives revert, as the level of government ownership declines, to the same incentives that face purely private firms. Using Deutsche Telekom\u27s acquisition of VoiceStream Wireless as a case study, this Article presents the economic questions relevant to evaluating the competitive consequences of acquisitions by partially privatized firms. It predicts gains or losses to various constituencies of producer groups. It then analyzes bond ratings and weighted average costs of capital to determine whether such data is consistent with the hypothesis, advanced by parties opposed to such foreign investment, that partially privatized acquirers benefit from government subsidization of their credit

The Price of Experience: The Constitution After September 11, 2001

Part of symposium: Youngstown at fifty: a symposium