 At the same time, network neutrality threatens to reduce incentives for increased competition through the construction of new networks. Eliminating the potential for short-run supracompetitive returns would also thwart one of the primary mech- anisms upon which markets rely to stimulate entry. Furthermore, by providing all applications and content providers with access to the existing network, network neutrality deprives would-be builders of alternative network capacity of their nat- ural strategic partners. Concerns about reducing investment incentives carry little weight when last-mile competition is infeasible, as was arguably the case when inter- connection and standardization were mandated with respect to CPE, long distance, and enhanced services. They are paramount when entry by new last-mile providers is ongoing and other last-mile technologies are waiting in the wings. Under these circumstances, regulation imposed to curb market concentration can turn into the cause, rather than the consequence, of market failure. What emerges is a vision of competition that is quite different from that envi- sioned by the current debate. This is not to say that network diversity would be a panacea. The underlying welfare calculus is quite complex. Just to highlight a couple of considerations, the aggregate demand and the cost structure may cause the level The Regulation of Broadband Networks and the Internet of competition to be insufficiently robust to yield significant welfare benefits. Fur- thermore, the viability of network diversity depends in no small part on the relative heterogeneity of consumer preferences. If there is no variance in what end users want from networks, there will be no subsegments for smaller network owners to target. In addition, some degree of deadweight loss and redundant entry may be endemic under network diversity, and it is possible that the welfare increases associated with greater product diversity will not completely offset these losses. Furthermore, given that entry is never instantane