Technology | Academics | Policy - Network Neutrality and Bank of America’s Charges

Technology | Academics | Policy - Network Neutrality and Bank of America’s Charges
This is a very incisive observation, as I begin drafting my response to the recent EU Consultation exercise on Net Neutrality:
The controversy over bank fees is related to a ‘more digital’ issue — net neutrality. That issue involves the possibility that ISPs could charge different content providers different fees. So if Verizon noticed that its consumers used Netflix alot, they could charge Netflix more to access their customers. The claim is that some content providers impose more costs on ISPs and so should pay more to cover common infrastructure costs or manage congestion. Of course, if Netflix was charged more, it would pass those costs onto customers in the form of higher fees or drop off the ISP in question. While a Netflix may be able to use competitive leverage to keep those charges lower, smaller content providers may not be so lucky.
My co-author, Stephen King, suggested a way out of this dilemma for debit card transactions: set the fee to merchants at zero and require consumers to be charged explicitly at the point of sale — just like they are for ATM transactions. The idea is that consumers might hold several debit cards and so if their bank was more expensive, they could switch right there at the counter. The point is that the consumer is causing the costs on the system when they choose how to pay and so should see that. And if enterprising merchants want to absorb that fee, they can do that too; just as a consumer’s bank can do for ATM transactions. The point is that no bank can impose a fee on merchants.