The Importance Of The Internet

1424 Words 6 Pages
The internet: a place to express yourself, an innovative opportunity to buy and sell products, an opportunity for small business to grow; and a place for exploitation? Many believe that the current state of the internet is perfect: and that regulation would only harm this perfect world. However, the internet is not perfect, and a lack of government involvement has led to: the absence of net neutrality, an increase in criminal activity, and the formation of monopolistic organizations that harms every internet user. In order to provide a safer internet, preserve net neutrality, and to uphold anti-trust laws, the U.S. Government must regulate the internet. According to, the U.S. has the second highest cybercrime rate in the world …show more content…
government passed the Sherman Anti-Trust Act in 1890, it became illegal for companies to gain unfair advantages that limit competition and prevented innovation. However, internet companies currently have a loophole that gives them an unfair advantage, which makes it harder for regular business to compete. To preserve the Sherman Anti-trust Act and to insure that all companies have an equal opportunity, online Companies need to have the same regulations as regular businesses - by doing so there will be a level playing field that sparks competition and innovation. Megan McArdle, Economics and finance expert for Bloomberg, explains, “Monopolists often operate in markets where there are great returns to scale”. Internet company’s returns to scale are much higher than regular businesses; McArdle’s words don’t alone prove that limited government regulations gave online businesses higher returns to scale and made an unfair advantage. However, Uber’s tax structure, C.V.–B.V., or double dip, shows how limited internet regulations give them an unfair advantage. This loophole allows the Delaware based company to avoid paying the U.S. corporate tax rate of 35 percent. Ubers online status allows them to claim profits anywhere; so Uber claims their profits in Bermuda, where the corporate tax rate is 0 percent, this gives them higher returns to scale (O 'Keefe and Jones). Nearly all major online companies use this loophole, higher profits allow online businesses to charge less than normal companies that don’t have this advantage. “They keep competition out by offering prices too low … to compete” (Mcardle). Kate Toran, Director of taxi’s for San Francisco’s transportation authority, reports how deadly Uber’s advantage was to the competing cab industry in San Francisco when they emerged there in 2012. “The average monthly cab ride per city taxi dropped from 1,424 in 2012 to 504 in July of 2014 when Uber [came]” (Davidson) In roughly two years, Uber’s unfair

Related Documents