"Pay for Priority" Already is a Widespread Reality of the Consumer Website Experience

Fully 81 percent of consumers surveyed by the University of Delaware Center for Political Communications say they oppose “allowing Internet service providers to charge some websites or streaming video services extra for faster speeds.”

In one sense, the responses are not surprising. At some level, a rational person would likely conclude that if any ISP can charge a website for expedited delivery, that has to be reflected in higher costs to use that website, over time.

Also, past surveys universally have found that consumers dislike advertising embedded into their TV experiences. But when asked whether they would rather pay more, to avoid the commercials, people routinely decline, indicating an acceptance of the irritation of ads if it also means "free" content access.

Something like that undoubtedly is at work here.

Incidentally, one can generate equally unhelpful results asking people whether the Internet should be regulated like television and radio. People say they do not like that either, and that is how one survey probed for attitudes about network neutrality.

One suspects fairly comparable results might therefore have been gotten if the question something like “do you think a network should be able to charge a website or streaming video service extra for faster speeds.” It is logically the same scenario: the website spends money to a transport services provider to gain faster delivery of its packets.

Consumers might rightly guess that would somehow be reflected in higher costs to use the websites that do so.

Consumers cannot be expected to know that just one content delivery network of many (Akamai) provides exactly those services to 33 percent of “Global 500” companies as defined by Fortune magazine, including the largest 30 media and entertainment companies.

Akamai also is paid money for expedited packet delivery by “all 20 top global e-commerce sites,” according to Akamai.

Fully 97 of the top 100 online U.S. retailers also use Akamai to speed up performance.

In addition, Akamai is use dbgy more than 150 of the world's leading news portals, nine of the top 10 U.S banks, seven of the top 10 world banks, eight of the top 10 U.S online brokers, nine of the top 10 largest newspapers, eight of the top 10 online publishers, and nine out of 10 top social media sites, to name just some of the industry segments and leading firms that pay money to Akamai to expedite delivery of their packets.

If such payments are reflected someplace in each of the paying company business models (it has to be), then “higher prices” already are reflected in the websites and services. The upside, of course, is better user experience when interacting with the sites.

The point is that most respondents, if rightly guessing “my costs” have to be higher, also do not understand that such costs already are widely embedded in leading website cost structures, and that better user experience is the benefit such costs enable.

One guesses most respondents also would object to some new policy that slows down packet delivery or speeds. But that would also mean they object to content delivery networks such as Akamai, even if nobody knows payments for expedited delivery are any everyday occurrence for the most-popular websites, and that, yes, those costs are reflected in the cost of the delivered products.

The point is that popular understanding of a complicated subject such as “network neutrality” is further complicated because people do not understand the ways content delivery networks, though representing some incremental cost, also provide experience benefits that app providers widely believe are worth the price.

Consumers who use those sites are benefitting, and also are paying for the expedited delivery. It isn’t much of a problem, if it is a problem at all.

Why Cloud Data Centers Drive WAN Provider Revenue

source: Cisco

Traffic patterns are rapidly shifting from the traditional north-south client server model to an east-west server to server, said Jayshree Ullal, Arista president and CEO.

What that implies is a shift of data traffic. “We found that most of the server generated traffic in

the cloud data centers stays within a rack, while the opposite is truefor campus data centers,” say Theophilus Benson and Aditya Akella of the University of Wisconsin–Madison and David A. Maltz of Microsoft Research–Redmond.

And make no mistake, traffic generated by cloud computing increasingly dominates the pattern of global wide area network, metro and data center traffic. Data center traffic, as measured by Cisco,  includes data center-to-user traffic along with data center-to-data center traffic and traffic that remains within data centers.

Cisco’s latest Global Cloud Index estimates that global data center traffic will grow nearly 300 percent between 2013 and 2018.

By 2018, 76 percent of all data center traffic will come from the cloud, while 75 percent of data center workloads will be processed in the cloud.

But that might not even be the most significant prediction. Quantitatively, the impact of cloud computing on data center traffic is clear, Cisco argues.

Most Internet traffic has originated or terminated in a data center since 2008.

Where in the past most traffic (voice) functionally originated and terminate at a central office, though that traffic was passively transmitted to an end user telephone, now most global traffic originates and terminates at a data center.

And Cisco means that literally. Most traffic that ultimately traverses the WAN will follow communication within a data center between co-located servers.

The whole rest of the communications network essentially becomes a passive connection between an edge device requesting some operation, and the server that processes and serves up the result.

So in a meaningful sense, data centers are the central offices of the new network. As “switching” in the telco or mobile central offices might have been likened to the “brain” of voice operations, with the rest of the network the nervous system, so now data centers are the brains of the global network.

That will have any number of ramifications. The architecture of a voice network was build on the switching offices. Even the location of specific central offices was built on the amount of signal loss through a pair of copper wires connecting central offices with end user locations.

The architecture of new global networks is built on co-located servers inside data centers, and then connections between data centers over the wide area network, often with more traffic crossing the metro area than transiting the WAN, and then only traffic moving between a metro area data center and an end user location.

Although the amount of global traffic crossing the Internet and IP WAN networks is projected to reach 1.6 ZB per year by 2018,  the amount of annual global data center traffic in 2013 is already estimated to be 3.1 ZB.

The implications could not be clearer. By 2018, data center to end user traffic will constitute 17 percent of total. About nine percent of traffic will move from data center to data center. About 75 percent of global data center traffic will stay within the building, moving from server to server.

That explains the high interest by capacity providers in data centers. In the past, most of the revenue made by wide area network providers was supplying capacity across the wide area network.

In the future, it is likely much wide area network provider revenue will be made supporting data communications between servers and entities within data centers.

In other words, cloud data centers now are a major driver of WAN provider revenues. As potential owners of cloud data centers, WAN providers earn revenue by enabling data communications within the data centers, while also positioning to capture data center to data center revenues.

Network Neutrality Should Not be a "Clever Hack"

Sometimes it takes a brave observer to say the “emperor has no clothes.” You might say some witty British technology observers have done so.

“Almost 20 years ago Congress decided that its regulators couldn't apply old Bell-style phone rules to Internet services,” says Andrew Orlowski, a writer for The Register. “The judicial system is getting fed up with being asked to throw out this distinction: it's not the courts' job to make new laws, or repeal old ones.”

While a couple of times the lawfulness of common carrier regulation of Internet access has been challenged--successfully--in court, some continue to advocate that the Federal Communications Commission do something many argue it has no authority from Congress to do.

“The FCC is the creature of Congress, not its master,” notes Orlowski. There are some other avenues network neutrality supporters could support, that would come under jurisdiction courts have suggested already exist (promoting broadband adoption).

But that is not the remedy some now propose.

Orlowski points out what might be obvious. Zeal for some ends now seems to justify nearly any ends.

Disparaging what he characterizes as an effort to pull off a “clever hack,” Orlowski points out the larger problem of which efforts by some are only an example.

“Why not bypass it (democracy) wherever and whenever you encounter something you don't like?” he rhetorically asks.

The matter is not good intentions or ideas about good policy. Most network neutrality supporters honestly and sincerely believe Internet freedom is served by those policies. 

Perhaps all who oppose net neutrality object only to a very few specific notions about network neutrality. 

Even oppoinents of net neutrality agree that end users have the right to use any lawful application, They agree that no Internet service provider should be able to block or degrade the performance of any lawful application.

The single salient objection is that voluntary or optional use of content delivery networks by end user customers, and the ability of an ISP to offer such services, should be lawful, not unlawful as network neutrality supporters propose.

If There is an LTE "Killer App," it is Speed

Consumption of video content arguably is the end user behavior enabled most by Long Term Evolution fourth generation networks, according to new tests by Ofcom, the United Kingdom telecommunications regulator.

On the other hand, watching video on a smartphone was an activity that just seven percent of respondents had used a smartphone to watch content, and those that did spent an average of 15 minutes per day doing so, Ofcom says.

Perhaps seven percent of users watching video content strikes some observers as confirmation there is a "killer feature or killer app" for LTE. Some of us would not be so sure.

The most likely content to be watched on a smartphone was short online clips. That activity represented 36 percent of all time spent watching audio-visual content.

So oddly enough, at least so far, for most people, LTE has not apparently changed user behavior very much. Most users do the same things using 4G that they do on 3G.

In an April 2014 study, Ofcom found 59 percent of smartphone owners who use 4G had downloaded or streamed video content over a mobile network at least once, compared to 41 percent of non-4G users. But few seem to do so with any regularity.

On the other hand, 4G does not seem to change behavior about use of email, mobile

apps, accessing music content or making VoIP calls. So, at least so far, though use of video might become a killer app for 4G, it is difficult to say there is one key feature of 4G that most users recognize as the key difference from 3G, other than better experience because pages load faster.

If so, then “speed” is the candidate for “killer app,” though as recently as 2011 many would have said there is no killer app for LTE.  

Some 28 percent of all 3G and 4G users report they limit their data usage to remain inside their usage caps.

The study also shows 4G download speeds were more than twice as fast as 3G speeds. The overall average speed for 4G was 15.1 Mbps, while for 3G average speeds were 6.1 Mbps.

Upload speeds over 4G were more than seven times faster than those on 3G: 12.4 Mbps on 4G and 1.6 Mbps on 3G.

Web browsing also was faster on 4G than on 3G. The average time taken to load a standard web page took 0.78 seconds on 4G; 1.06 seconds on 3G.

Latency on 4G was 55.0 ms; 66.8 ms on 3G.

Nothing ever remains static on a mobile network. In March 2013, EE was the only UK 4G provider, and had 318,000 4G subscriptions at the end of March 2013, accounting for less than 0.5 percent of all U.K. mobile subscriptions.

By March 2014, 4G was offered by all four national mobile network operators, serving six million customers, about eight percent of all mobile accounts in service.

Ahead, Apace or Behind: Methodology Matters

Though few pay much attention, study methodology matters when trying to determine current status of high speed Internet access or income inequality. That likely is one reason recent studies come to such vastly-different conclusions about the state of high speed access in the United States, compared to Europe, for example.

A study by the World Economic Forum ranked the United States 34th in terms of Internet bandwidth available per user. A study by Ookla ranks the United States 26th in terms of typical access speed.

But a study led by Christopher Yoo of the University of Pennsylvania Center for Technology, Innovation and Competition found a far greater percentage of US households had access to next generation networks (25 Mbps) than in Europe.

This was true whether one considered coverage for the entire nation (82 percent in the United States and 54 percent) in Europe, or for rural areas (48 percent in the United States compared to 12 percent in Europe).

The United States had better coverage for fiber-to-the-premises (FTTP) (23 percent compared to 12 percent in Europe).

The U.S. broadband industry invested more than two times more capital per household than the European broadband industry every year from 2007 to 2012.

In 2012, for example, the US industry invested US$ 562 per household, while EU providers invested only US$ 244 per household.

U.S. download speeds during peak times (weekday evenings) averaged 15 Mbps in 2012, which was below the European average of 19 Mbps. But during peak hours, U.S. actual download speeds were 96 percent of what was advertised, compared to Europe where consumers received only 74 percent of advertised download speeds.

The United States also fared better in terms of advertised compared to  actual upload speeds, latency, and packet loss.

Pricing comparisons always are difficult. U.S. high speed access was cheaper than European broadband for all speed tiers below 12 Mbps, though U.S. prices were higher for higher speed tiers/

Still, the picture is complicated. U.S. Internet users on average consumed 50 percent more bandwidth than their European counterparts. To the extent there is a broad but direct connection between consumption and price, that matters.

The point is that assumptions matter.

The choice of specific retail service plans, and the percentage of people in any nation that purchase those plans, make a difference when trying to compare “typical prices” for any good or service, across national boundaries.

In other words, if most people buy high speed access as a feature of a triple-play bundle, then the posted prices for “stand-alone” high speed access are misleading.

That is why one can come to very different conclusions on the state of U.S. high speed access--how fast and how costly--compared to other nations.

Recent research on U.S. levels and trends in income inequality also vary quite substantially based on how these studies measure income. To be sure, there are important social mobility and income inequality issues to be faced in the United States, as elsewhere.

But a fact-based approach remains important, and methodology affects the “facts.” Economists Philip Armour and Richard V. Burkhauser of Cornell University and Jeff Larrimore of Congress’s Joint Committee on Taxation recently studied “income” including all public and private in-kind benefits, taxes, Social Security payments and accounting for household size.

The bottom quintile of U.S. residents saw a 31 percent increase in income from 1979 to 2007 instead of a 33 percent decline as measured by the Piketty-Saez market-income measure alone.

The income of the second quintile, often referred to as the working class, rose by 32 percent, not 0.7 percent. The income of the middle quintile, America’s middle class, increased by 37 percent, not 2.2 percent.

Those significant differences occur because one study omits Social Security, Medicare and Medicaid payments, for example, as well as employer-provided health insurance and capital gains on homes.

Also, some of the apparent income inequality is the result of a definitional change.  In 1992 the U.S. Census Bureau began to collect more in-depth data on high-income individuals. This change in survey technique alone, causing a one-time upward shift in the measured income of high-income individuals, is the source of almost 30 percent of the total growth of inequality in the United States since 1979.

Again, the point is not the importance of any developing or existing changes in opportunity for social mobility, or gaps in income or wealth. The point is that methodology matters.

That is as much true for how we measure progress on high speed access or social mobility.

FreedomPop Launches Free International Calling Program

FreedomPop is launching what it calls “the world's first-ever, completely free international calling service.”

Starting immediately, FreedomPop will give any smartphone user with any carrier 100 minutes of free international calls each month to 52 countries, including Mexico, the UK, Canada, China, Hong Kong, Brazil, Argentina and India.

The service will expand to over 170 markets in the coming weeks, FreedomPop says.

Users who want more minutes can upgrade to an international paid plan starting at just $4.99 per month – over 75 percent lower than the rates charged by current carriers and even VoIP providers like Skype. FreedomPop says.

FreedomPop also announced the “first ever program” to provide users anywhere in the world an international number, letting contacts outside the country make international calls as if they are local.  

For example, a customer based in Los Angeles can get a Mexico City phone number so family members based in Mexico can call at local rates, or vice versa, FreedomPop says. The service costs just $4.99 per month, yet can save international callers hundreds of dollars a year.

AT&T Pauses High Speed Access Investment Until Net Neutrality Resolved

Uncertainty is bad for investment, and regulation of rates or prohibitions on new services even worse,  in the telecom and Internet service provider business. So it comes as no surprise that AT&T is pausing investment in faster Internet access facilities until the network neutrality uncertainty is resolved.  

That possibly could affect upgrades in 100 U.S. cities. There are many possible unintended consequences to any move by the Federal Communications Commission to impose common carrier regulation on U.S. Internet service providers.

For starters, the move would bring parts of the U.S. cable TV industry under common carrier regulation for the first time, something industry executives always have fought. That is the camel’s nose under the tent that could eventually affect the other parts of the cable TV business as well.

Nor is it entirely impossible that common carrier regulation of access leads to greater rules for content and app providers, either. That is, after all, what "common carrier" regulation is all about.

Paradoxically, even if such common carrier regulation of access services withstands legal challenge--and many suggest it will not--common carrier regulation could open the way for widespread offering of content delivery services that would allow content providers to voluntarily buy services stretching all the way to end user locations, the “pay for priority” future network neutrality supporters want to avoid.

Under common carrier rules, such services arguably could be offered, so long as all app providers have access, under the same terms and conditions, though volume discounts arguably would be lawful, benefitting bigger content firms more than smaller firms.

Sprint Looking at FreedomPop Acquisition?

Sprint reportedly is considering buying FreedomPop, a Sprint mobile virtual network operator with a disruptive pricing approach that necessarily requires a low-cost marketing effort. The possible acquisition, in itself, is not the story. Larger mobile firms have acquired smaller firms with some regularity over the past couple of decades.

The bigger significance comes because of FreedomPop’s sales model, something that Sprint might be able to leverage on a wider scale, to bolster its prepaid efforts. Whether the model also might have impact on some postpaid marketing also is an issue.

As Sprint shifts its market offers to a “value” approach, Sprint is working to lower its costs of operating its business and marketing its services. If gross revenue is going to drop, then operating and marketing costs also need to drop.

Selling online is one way to do that.

FreedomPop has used a freemium approach, offering no cost basic service and additional plans for a fee. FreedomPop’s free phone plan includes use of 200 voice minutes a month, 500 text messages and 500 MBs of data.

FreedomPop offers mobile service plans that begin at $5 a month, and began operations selling Internet access using the same freemium approach. The firm’s free Internet access option offers 1 Gb of access, with for-fee plans, while consumers who want more data can buy plans starting at about $10 per month. Speeds for the free service use the Sprint 3G network, while the for-fee plans add access to the faster Long Term Evolution network.

The startup, which began life as a provider of Internet access, acquires 95 percent of its subscribers online, with customer acquisition cost of $4 per new add.

That would be attractive for at least some portion of Sprint’s business, starting with prepaid accounts.

Deutsche Telekom Setting Up Big Venture Capital Fund

Deutsche Telekom is setting up a new venture capital fund to be funded at EUR 500 million for a five-year period, supplementing investments already being made as part of T-Venture, which has funded 100 companies.

Deutsche Telekom Capital Partners will be one of the largest investment funds in Europe, Deutsche Telekom says.

DTCP will also advise Deutsche Telekom on existing investments in STRATO, Interactive Media, Scout, Deutsche Telekom Innovation Pool (TIP) and T-Venture.

Such efforts aim to help start-ups create new apps and services that are complementary to the core communications network and its features, but also potential services that could extend beyond the core business.

It is the latter that poses the greatest number of questions. As some now urge Apple to buy Tesla to fuel a new stage of growth, the point is that growth might require getting into related businesses (adjacencies) or even entirely separate businesses.

Comcast buying Universal NBC provides an example of getting into an adjacency. Google getting into Google Fiber is another example. For tier one telcos, a similar sort of move might include expanding from mobile access to mobile apps, as in the connected car business, where most of the money will be made by firms supplying connected car services, not connectivity or hardware.

Cable TV and telco firms also are getting into the home security business in a new way, as integrating mobile and other devices as controllers, plus the new potential of sensors and cameras, with high speed access, change the context and features a home security service can offer.

If a possible analogy is that the access business is a supertanker, while the startups are speedboats, the issue is creating successful new apps that have the potential to affect gross revenue in a meaningful way.

Thousands of telco-affiliated apps might not have as much revenue impact as one big new move into an adjacency.

Why Do Tier One Service Providers Switch Course, Then Back Again, So Swiftly?

Back in April 2014, AT&T said it was going to create an in-flight LTE service to enable Internet access services for airline passengers. Now AT&T says it has abandoned plans for the in-flight Wi-Fi service, citing a need to focus use of capital.

In 2007, Vodafone got into the fixed line high speed access market in the United Kingdom. In 2012, it sold all those assets. Now, in 2014, Vodafone is planning to get back in to the fixed line broadband business.

BT was one of the first two mobile operators in the United Kingdom, but got out of the mobile business in 2002.  Now it is planning on getting back into the mobile business, on a niche basis, combining some new spectrum with potential access to Wi-Fi and other untethered spectrum anchored by BT’s fixed network.

Those course reversals might suggest either a highly-fluid strategic context or simply tactical decisions based on overall organization priorities at a point in time.

All the above likely applies in the case of the in-out decisions made by AT&T, BT and Vodafone.

In AT&T’s case, new investments require some hope of revenue scale. It never was clear that the airline Wi-Fi business would be too big, revenue-wise.

Now AT&T has a blockbuster acquisition of DirecTV under review, and also has made an independent move into the Mexican mobile market with its acquisition of Iusacell. Those moves promise a big needle-moving cash flow impact, in the case of DirecTV, and an important long-term growth opportunity, in the case of Iusacell.

Compared to that, the in-flight Wi-Fi opportunity might have been a distraction. To be sure, it is clear why offering in-flight Wi-Fi is significant for airlines. In fact, U.S. airlines make about $6 per passenger per flight profit, or about 2.4 percent net profit margin, according to the International Air and Transport Association.

Service revenue has been pegged at perhaps $1 billion to $2 billion in the relatively near term, globally. That is too small a market to be worth AT&T’s effort, some would argue.

The connected car market might generate four billion euros (about US$5 billion) in access revenue for mobile service providers, by about 2018, by way of comparison. Even that, some might say, is too small to drive significant revenues for any tier-one service provider.

The big carrot is the connected car services market, which, in 2018, would be perhaps 24 billion euros (about US$30 billion). Obviously, that is the bigger reason firms such as AT&T are active in the connected car market.

The in-out-in pattern of interest in either mobile or fixed assets and operations by BT and Vodafone likely have something to do with priorities at the time decisions were made to divest, as well as new thinking about how to grow core access revenues.

Many mobile service providers now see incorporation of fixed assets as a way to drive revenues up and operating costs down, while fixed network operators see expansion into mobile services as a way to escape the revenue-challenged and margin-challenged fixed network business.

But the relatively rapid shifts--selling assets and getting out of lines of business, only to reenter a few years later--suggests the unstable and challenging nature of the business. Strategy can shift rapidly, because the market itself can shift rapidly.

Risk, in other words, has grown, across the whole telecom business.

Title II Regulation of Internet Access Wouldn't Achieve Ban on "Pay for Priority"

“As Democrats who care about the dual priorities of protecting broadband consumers and stimulating broadband investment, we are gravely concerned about President Obama’s endorsement today of monopoly-era, common carrier regulations (called “Title II”) for broadband providers,” say Ev Ehrlich, PPI senior fellow; Michael Mandel, PPI chief economic strategist and Hal Singer, PPI senior fellow.

“The president’s proposal does not balance these goals, nor move us towards compromise on other, arguably more critical, communications issues,” they say.

The Progressive Policy Institute is a policy institute and think tank that claims credit for President Bill Clinton’s “New Democrat” approach.

THe PPI says it concerned both with social equity and economic growth, as well as performance-based government. “We seek to advance progressive, market-friendly ideas that promote American innovation, economic growth and wider opportunity,” the Progressive Policy Institute says.

Ironically, given the widespread concern by network neutrality supporters that “best effort only” remain the only consumer offer for Internet access, “Title II is not necessary to protect consumers from the hypothetical threat of discrimination by broadband providers against edge providers,” PPI says.

In Verizon v. FCC, the D.C. Circuit made clear that the Federal Communications Commission could regulate pay-for-priority deals—and even reverse them after the fact—under Section 706 of the 1996 Act.

More to the point, “Title II itself isn’t guaranteed to stop pay-for-priority by broadband service providers,” they say.

Title II would merely require that the terms of any pay-for-priority deal be extended to all comers.

“The more likely rationale for imposing Title II is to pursue an aggressive regulatory agenda unrelated to net neutrality, in particular, “unbundling,” the policy that requires companies that make investments in broadband infrastructure to share them with competitors at government-set prices,” PPI says.

“Moving backwards to a forced-sharing regime would likely chill broadband investment, along with its job-creation and impact on growth,” PPI says.

“By eschewing real compromise made possible by the D.C. Circuit Court, and instead pursuing a radical prescription of Title II, the FCC guarantees itself a drawn-out litigation battle with broadband providers,” PPI says, when other avenues already exist to achieve network neutrality goals.

Regulation is Correlated with Slower Revenue Growth

All markets are regulated. The question is whether a market is regulated by government or by consumers. Ideally, governments regulate when the market cannot. The problem, some might say, is that the government regulates when it does not have to, or should not regulate.

And some would say appropriate intervention, when required, tends to be more effective when antitrust is the focus, not the more-mundane regulation of market entry, consumer protection or price regulation.

In a study conducted by Antony Davies, associate professor of economics at Duquesne University and Mercatus-affiliated senior scholar at George Mason University, the least-regulated industries grew faster than the most-regulated industries.

To be sure, one might argue that perhaps the least-regulated industries were the fastest growing for other reasons.

The most-regulated industries included motor vehicle and parts dealers; oil and gas; securities, commodity contracts, and other financial investments; railroads; transit and ground passenger transportation and truck transportation, for example.

Building construction; scenic and sightseeing transportation; water transportation; air transportation and insurance also were at the top of the list of “most-regulated industries.

Among the least regulated industries were nursing and residential care facilities; electronics and appliance stores; transportation equipment manufacturing; space research and technology; health and personal care stores ; petroleum and coal products manufacturing; building material and garden equipment and supplies dealers; wood product manufacturing and heavy and civil engineering construction.

Telecommunications is about in the middle, and some might note that telecommunications was in a major deregulation and technology transformation between 1997 and 2010.

Still, in 10 out of the 14 years in the study, the least-regulated industries showed greater annual growth than did the most-regulated industries.

Between 1997 and 2010, the 221 least-regulated industries in each year averaged 3.5 percent annual growth in output per hour.

The 221 most-regulated industries averaged a significantly lower 1.9 percent annual growth.

Accumulating the growth rates over all the years, the least-regulated industries experienced a total of 64 percent growth in output per hour from 1997 through 2010 versus 34 percent for the most-regulated industries.

In 12 out of 14 years, the least-regulated industries had greater growth than the most-regulated industries.

Accumulating the growth rates over all the years, the least-regulated industries experienced 63 percent growth in output per person versus 33 percent growth for the most-regulated industries.

Reasonable people will disagree about the wisdom of common carrier regulation of Internet access, mobile services or fixed line services. Economists might simply point out that more regulation is likely to lead to less revenue growth for Internet service providers, even though some believe application providers might grow faster, as a result.