Privatization and Commercialization of the Internet Infrastructure: Rethinking Market Intervention into Government and Government Intervention into the Market

Abstract

This article analyzes the following general question: Will the full range of end-users be adequately supplied with the Internet in the long-term to satisfy their particular end-uses if the Internet infrastructure remains privatized and commercialized? In other words, if the Internet infrastructure is a necessary input for producing various public and private goods (i.e., in facilitating different end-uses), will procurement and commercial markets adequately supply society with Internet infrastructure? The article begins with a brief, descriptive account of the establishment, management, and eventual privatization, commercialization, and decommissioning of NSFNET, the precursor of today’s Internet. Then, it develops and applies an economic model of Internet infrastructure to assess both the past and the future of the Internet, focusing primarily on the Internet’s interconnection infrastructure.The article also explores the synergistic role of the Internet and individuals in the production of public goods.