Yet, the basic point holds. On the whole, the Internet makes people and organizations vastly more productive. Furthermore, morphine and opiates are regularly used when the benefits outweigh the costs (like for anesthesia) so thats not a very effective counterexample.

If one wants to start regulating parts of technology, they must ask the question of whether the expected gains from said regulation would outweigh the costs. With narcotics, its easy: addiction is very expensive, especially for the addicts and productive and non-productive uses are generally easy to tell apart (medical use of morphine v. junkies for example). OTOH, technology is difficult to separate and the side-effects from flash games, irc, et al. are not that significant.