William Taylor, chair of the communications practice at NERA Consulting in Boston and former MIT professor, has just published this concise economic analysis of the Internet and the likely impact of net neutrality.

His report effectively debunks the idea that innovation would suffer if broadband carriers offer different choices in download speeds. Indeed, precisely the opposite would occur, he concludes, noting:

“[A]dvocating regulation to preserve Internet freedoms is inherently inconsistent.

“Indeed, if priority prices reflected the costs of priority as well as consumers’ valuations of the applications that depend on priority, one would expect more valuable innovation in a market-determined network architecture rather than less.”

Equally helpful, Dr. Taylor offers a timely reminder of how government regulation of service quality in another commercial venture – the airlines – devolved into comic absurdity. That included:

“…prescribing the maximum amount of leg-room, requiring that meals be limited to sandwiches, and establishing uniform additional prices for in-flight entertainment.”

This natural mission creep of regulation is exactly what has so many supporters of a vibrant Internet opposed to the calls for net neutrality.

This is a good study and a breath of fresh air for the net neutrality debate.