Similarities and the differences between the two modes "tragedy of the commons" and "externality" problem

The tragedy of the Internet commons must be addressed by the stakeholders. At least two such groups are doing so, with differing strategies. First, the major transport service providers are lobbying to turn the single service plane of the Internet into multiple layers: current best effort and something “better.” The network builders are spending a fortune constructing and maintaining the networks that Google intends to ride on with nothing but cheap servers. [Google] is enjoying a free lunch that should, by any rational account, be the lunch of the facilities providers Network externalities exist in markets where 'the utility that a user derives from consumption of a good increases with the number of other agents consuming the good' .Externalities is a direct physical effect of the number of users on the quality of the product or service. The value of a fax machine to one user increases as more fax machines are purchased and used by others. Another source is an indirect effect where the utility of a product increases with the number of users because the quality of the product is higher or there are more complementary products available. A third source of network externalities exists in situations where increasing sales of a durable good produces greater quality and availability of post-purchase services related to the product. The greater the number of people buying a certain brand of washing machine, the greater the likelihood that service for the machines will be provided. AOL and Yahoo have just announced a new “better” email service where companies pay a fraction of a cent to send messages. The fee includes guaranteed delivery to their subscribers and assurance of the message’s true origin. The goal is to limit spam and phishing. Of course, this can be extended to setting up authentication barriers for websites, on-line advertisement, etc. There has been an outcry in the Internet community that this will be the end of the “openness” that fuelled its innovations and growth. That may be true to some extent, but it is the only way to really deal with the tragedy of the commons. AOL and Yahoo are doing is exactly what farmers did. They instituted the notion of private property and fenced their land to keep out the other farmers. It worked for farming and it will work for the Internet. Certifying the source of Web and email traffic can be provided by many organizations. Furthermore, these groups should set up open standards and clearing mechanisms to permit interoperability among the legitimate edge systems. It means that some kid operating out of a bedroom can’t be an ISP, Web host, or email service. We will still have an open market and competition among hundreds of legitimate suppliers of a truly better service. The tragedy of the Internet commons can only be addressed by the edge systems, not by the transport infrastructure. It is natural at this stage of the Internet’s development to have a few strong edge players like Google, Yahoo and AOL lead in this transition. As long as they keep it open and smaller players quickly adopt the mechanisms.