One of the most controversial matters to come before the Federal Communications Commission in recent years, net neutrality, is back on the agency’s agenda.
Under the direction of Chairman Ajit Pai, during its May 18 meeting the FCC will consider a Notice of Proposed Rulemaking that would “propose to restore the Internet to a light-touch regulatory framework by classifying broadband Internet access service as an information service and by seeking comment on the existing rules governing Internet service providers’ practices.”
Pai is using the shorthand “restoring Internet freedom” for the NPR.
Late last month, Pai announced the proposal to “repeal heavy-handed Title II” regulations and return the U.S. to the bipartisan, light-touch framework that preserved a free and open Internet for almost 20 years.”
In 1996, President Clinton and a Republican majority Congress passed the Telecommunications Act of 1996, stating that the U.S. would “preserve the vibrant and competitive free market that presently exists for the Internet . . . unfettered by Federal or State regulation.”
In Pai’s retelling, this bipartisan approach “was tremendously successful” until, two years ago, the FCC suddenly changed course “even though there was no problem that the agency needed to solve.”
On a party-line vote, the FCC applied Title II, or utility-style regulation, to the Internet. This established government control of the Internet.
The results, Pai claims, were disastrous. Plans to deploy new and upgraded broadband infrastructure were shelved; jobs were lost due to less infrastructure investment; amd online privacy was weakened because Title II stripped the FTC of its authority over broadband providers’ privacy and data security practices.
Pai is now “setting the FCC on a course to fix the problems that the prior FCC created” by repealing Obama-era Internet regulations.
The FCC chairman announced his plan during a speech at the Newseum in Washington D.S. on April 26.
“The Internet is the greatest free-market success story in history. And this is in large part due to a landmark decision made by President Clinton and a Republican Congress in the Telecommunications Act of 1996,” Pai said. The light-touch regulatory framework “produced the world’s most successful online companies” including Google, Facebook, and Netflix. Under this framework, “the private sector invested about $1.5 trillion to build the networks that gave people high-speed access to the Internet” and “consumers benefited from unparalleled innovation.”
That changed when the FCC applied Title II, originally designed in the 1930s for the Ma Bell telephone monopoly, to Internet service providers.
Among the nation’s 12 largest Internet service providers, domestic broadband capital expenditures decreased by 5.6 percent percent, or $3.6 billion, between 2014 and 2016, the first two years of the Title II era. “This decline is extremely unusual. It is the first time that such investment has declined outside of a recession in the Internet era,” Pai said.
“What was the problem that Title II was supposed to address? We were warned that without it, the Internet would suddenly devolve into a digital dystopia of fast lanes and slow lanes,” he said. “Did these fast lanes and slow lanes exist? No. The truth of the matter is that we decided to abandon successful policies solely because of hypothetical harms and hysterical prophecies of doom. It’s almost as if the special interests pushing Title II weren’t trying to solve a real problem but instead looking for an excuse to achieve their longstanding goal of forcing the Internet under the federal government’s control.”
The Notice of Proposed Rulemaking proposes to return the classification of broadband service from a Title II telecommunications service to a Title I information service with “light-touch regulation.”
It also proposes eliminating the so-called Internet conduct standard, a 2015 rule gives the FCC “a roving mandate to micromanage the Internet,” Pai said.
The FCC used the Internet conduct standard to launch a wide-ranging investigation of free-data programs. Under these programs, wireless companies offer their customers the ability to stream music, video, and the like free from any data limits.
Pai dismissed claims that Title II regulation is the only way to preserve a free and open Internet. “This is a lie,” he said. “They will repeat it over and over again, but it’s just not true. And you don’t have to be a regulator or a lawyer to figure that out. You just need to have a memory.”
“For decades before 2015, we had a free and open Internet,” he added. “We were not living in some digital dystopia before the partisan imposition of a massive plan hatched in Washington saved all of us.”
FCC Commissioners Mignon Clyburn and Terrell McSweeny have openly criticized the plan.
“Despite the Chairman’s description of the proposal as a way to reduce onerous regulation, stimulate investment, and protect consumer privacy, the proposal would do otherwise,” they wrote in a joint statement. “If adopted, Chairman Pai’s proposal will harm competition and innovation and will leave consumers without any real protection or oversight by either the Federal Trade Commission or FCC for broadband services.”
“The FCC’s majority would have you believe they are supporters of a free and open internet,” they added. “Make no mistake, this proposal is net neutrality in name only. Here is what the proposal would really do. It would allow broadband providers to erect barriers or charge tolls to any application, connected device, or website that the broadband providers’ customers want to reach. It would allow broadband providers to favor their own content over others, and pick winners and losers on the Internet.”
Repealing Title II would also create an environment where neither the FCC nor FTC could protect the privacy of the customers of some of our largest broadband companies. “Ultimately, broadband providers could shape the future of internet content, mine and sell sensitive personal information, and limit consumer access to the internet in whatever manner they think will bring them the most profit,” they wrote.
Industry groups are also weighing in. Among them is the Internet Association, a trade group that counts Netflix and Facebook among its members.
“Consumers pay for access to the entire internet free from blocking, throttling, or paid prioritization,” President and CEO Michael Beckerman said. “The existing 2015 Open Internet Order protects consumers from ISPs looking to play gatekeeper or prioritize their own content at the expense of competition online. Rolling back these rules or reducing the legal sustainability of the Order will result in a worse Internet for consumers and less innovation online.”
An April 26 letter to Federal Communications Chairman Ajit Pai —signed by more than 800 tech startups, investors, and entrepreneurial support organizations from all 50 states—also argued against plans to weaken net neutrality rules.
Net neutrality is the concept that Internet service providers should enable consumer access to available content and applications without either blocking or giving preferred access to specific content providers.
“The success of America’s startup ecosystem depends on an open internet with enforceable net neutrality rules, ensuring that small companies can compete on a level playing field without the threat that their services will be discriminated against by big cable and wireless companies,” the letter says.