NetFlix and Net Neutrality

This is why net neutrality is a bad idea:

Netflix offers subscribers the option of instantly watching movies on their PCs; New feature will be included in subscribers' monthly membership at no extra charge and will have a phased roll-out over next six months.

If (and I argue, when) the internet becomes so congested with video-on-demand services that none of it works any more the business model will die.

Consumers (and application owners) will consume as much bandwidth as they have available - at some point the median consumer will refuse to pay more for broadband services and top end consumers will suffer for it.

The only way to avoid this outcome is to allow companies like NetFlix to pay companies like Verizon for priority access - the alternative is that NetFlix will not be able to provide online movies and iTV will be merely a dream.

Then, when service providers don't fix this "problem" those that think government is the answer for everything will use this "failure" to justify government control of the tubes that the internet runs on.

I think that lovers of liberty everywhere can agree that is the last thing that we really need.

Tags: net neutrality, NetFlix, technology, economics