Features

The Internet in the Public Interest

Written on
Feb 22, 2006 
Author
Michael H. Sproule  |

Major Internet service providers, America Online and Yahoo!, have announced plans to begin charging large volume emailers for the privilege of sending email to the service providers’ customers. Not surprisingly, the plans are controversial.

There is something about the idea of charging for sending email, even spam that seems to run counter to the ethos of the Internet. Charging for email erects a barrier to access in a medium that from its start has embraced an open structure. Email charges will feel like a tax, increasing the cost of interacting in what has so far been an increasingly low-cost market of ideas and commerce. Legitimate concerns are being voiced about free speech and market place economics. Ii is a fair question whether email fees will be in the public interest.

In its short life, the Internet has quickly proven itself to be a boon to free speech. Email particularly serves as a cheap and efficient method for people to voice opinions, assemble and push for change. Beginning with the 2004 presidential campaign, we’ve seen how effective the Internet has been as a fundraising and mobilization tool. It’s no wonder that repressive regimes from China to Saudi Arabia view an open Internet as a threat. What will be the effect of email fees on grass roots organizations?

At the same time, the Internet has been an engine for economic growth. Despite the dotcom crash, the Internet’s effect has been to increase jobs and economic growth around the world. Part of the Internet’s ability to stimulate new business is the way in which it lowers transaction costs. Many online businesses have benefited from the low costs associated with online transactions and in particular email. How will future start ups and low-margin businesses be effected by higher email costs?

Despite the public’s vital interest in these issues, it has no real voice on them. Although email fees will likely have an effect on free speech, the ISPs as private entities are under no Constitutional or other obligation to run an open forum for speech. And AOL and Yahoo! are certainly under no obligation to foster other companies’ businesses, whatever the benefit to the economy.

Theoretically, the public can vote with its feet, deserting service providers who charge fees. But the reality is that switching service providers is not a trivial matter, Switching requires users to give up their email addresses and perhaps bundled services that they depend on. If email fees are adopted widely, there may not even be comparable services without email fees available.

In reality, there is nothing really to stop AOL, Yahoo and other Internet providers from charging for every email. But shouldn’t there be? Water, power, telephone. These are all regulated utilities. So far the Internet has not seen such regulation. But has the time come for the Internet to be treated like a utility and regulated like one too?

In the past couple of decades, regulation has become a sort of dirty word. And indeed, there is always a danger of misguided regulations to do harm, rather than the intended good. But regulation is a society’s way to ensure that public services meet public needs. Whether it is to ensure the quality of drinking water or to ensure every household has access to an affordable telephone, utility regulation requires services to meet the public interest, even when the service providers are in the private sector.

The Internet is a free and open market. But it is also a public service. So far, we’ve been lucky that Adam Smith’s “invisible hand” has led us in the right direction, but we may not always be so lucky. There will likely come a time when society will have to take a more active role in ensuring that the Internet is operated in the public interest. AOL and Yahoo’s announcements may suggest that the time has come.





Michael H. Sproule, a partner with the New York law firm of Akabas & Sproule, focuses his practice on intellectual property (particularly licensing, trademark and copyright practice) and corporate law. His experience includes work with both traditional and new economy clients in fields such as technology, the Internet, media and entertainment. A software programmer himself, Mike is interested in all aspects of technology and its impact on law and our society.

Reader Comments.

Am I reading this right? So as a newsletter publisher, are they saying that in order for my newsletter to reach my AOL and Yahoo opt-in subscribers, I would have to pay to do that?

Posted by Amanda | 12:44 pm on February 22, 2006.

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