Classroom Companion: Business

22.3 · Internet Regulations

---

342
22
panies (antitrust regulation), the market evolution will most likely follow a path 
where one of them ends up as a new monopoly, while the other will disappear from 
the market. In 
7
Chap. 
11
, a simple mathematical model shows that this evolution 
is indeed possible and quite likely.
Other areas of regulation on the Internet are to protect consumer privacy, to 
ensure that telecom operators pay for their use of public goods (e.g., frequencies), 
and to stop piracy and illegal distribution of content on the Internet. In general, an 
increasing number of regulations of the Internet have been put in force during the 
past decade. These include:
5
The General Data Privacy Regulation of EU (General Data Privacy Regula-
tion, 
2018
).
5
Net neutrality as described in 
7
Chap. 
21
 is by far the most important regula-
tion on the Internet limiting the power Internet service providers have on the 
evolution of the applications and service provisions of the network.
22.4
 Lessig’s Four Modalities
Regulating the Internet may not only be done by laws and legal frameworks. The 
pathetic dot theory developed by Lawrence Lessig (Lessig, 
1997
) defines four 
modalities of regulation, as illustrated in 
.
Fig. 
22.1
:
5
Legal: How the legal framework in a jurisdiction is used to regulate
5
Market: How trade, markets, and economic factors are used to regulate
5
Technology: How the technology is used to regulate
5
Society: How norms and societal factors are used to regulate
Law
Technology
Market
Society
. Fig. 22.1 Lessig’s four modalities of regulation. (Authors’ own figure)