Remember “net neutrality”? It’s back. The tech policy debate that just won’t die is soon poised to steal the spotlight once more.
That’s because after 9 months of deliberation, the Biden administration has finally chosen its nominees for the Federal Communications Commission: Jessica Rosenworcel for permanent chair and Gigi Sohn for commissioner. If confirmed by the Senate, the two would return the Commission to 3-2 Democratic control for the first time in nearly 5 years.
Most tech policy discussions in recent months have been focused on Section 230, antitrust, online privacy, and similar substantive issues concerning the tech sector.
But while it hasn’t been a hot topic of late, have no doubt: the dream of net neutrality remains alive and well. The Biden administration’s July Executive Order “Promoting Competition in the American Economy” explicitly teed up the issue, “encouraging” the FCC, improperly, to restore Obama-era Title II regulation of broadband providers via a net neutrality rulemaking. It’s an issue many expect Chairwoman Rosenworcel, steering the helm of a 3-2 Democratic majority, would take up.
As a political matter, it’s not surprising that net neutrality is poised to make a comeback. After all, it’s a concept that has been pushed for nearly two decades. Over the past 13 years, the FCC has issued three orders attempting to regulate broadband providers—each via a different legal argument. After years of costly and prolonged litigation, only one of these was ever upheld. It’s understandable that net neutrality’s proponents wouldn’t want this effort to go to waste.
But as a substantive matter, it’s hard to see how net neutrality’s proponents can make any economic arguments in support of broadband regulation.
The Internet has not just survived, but thrived, in the absence of broadband regulations since their impossible-to-miss rollback under former FCC Chairman Ajit Pai. Then-Chairman Pai was alleged to be “destroy[ing] everything that makes the internet [sic] great.” The Internet was going to load “one word at a time.” According to the New York Times, Pai was applying “the final pillow” to the face of a “dying” Internet.
But of course, these and other similarly cartoonish doomsday predictions never came to pass. The Internet has remained alive and well over the past four years. Just ask the millions of Americans who have attended Zoom classes and meetings, composed emails, played online games, and streamed countless movies and TV shows from home since the rise of COVID-19 a year and a half ago.
While broadband investment declined in the U.S. in 2015 and 2016 following the imposition of net neutrality rules, broadband investment has recovered in recent years following the rules’ repeal. Throughout the COVID crisis, American broadband companies, unfettered from net neutrality rules, provided customers with significantly higher speeds than providers in Europe and elsewhere that were burdened by such rules. This was due in part to the fact that investments per capita by U.S. telecom companies dwarf their highly-regulated counterparts in the EU and comparable nations.
Like most free and open markets, the American broadband market has spoken on this issue. Broadband providers have had no desire or incentive to harm their customers. Competition supports the broadband market, even in previously hard-to-reach areas, thanks to the continued rise of 4G and 5G wireless, fixed wireless, satellite, and other competitive forms of broadband. No rational firm would intentionally harm consumers under such circumstances. Indeed, absent net neutrality rules, American broadband providers have done nothing to stop consumers from reaching the content of their choice without blocking, throttling, or harmful paid prioritization.
Instead, predictably, it’s government interference that’s caused consumer harm in the interim. Earlier this year, California enacted its own form of net neutrality rules that, among other things, explicitly prohibited “zero rating”: the practice of not counting data used by certain applications and websites against a broadband user’s data cap. But as it turned out, wireless carriers had been unanimously zero-rating, for years, veterans’ access to a key telehealth app. Facing legal uncertainty over this matter, at least one mobile carrier ended zero rating for all applications on its network—including the veterans’ telehealth app.
“Net neutrality” won’t just cause damage like this, unfortunately. The reimposition of Title II broadband reclassification, the legal foundation of the FCC’s last attempt to impose net neutrality rules, would explicitly empower the FCC to, among other things, regulate the rates that broadband providers charge for Internet service. In 2015, when Title II classification was initially imposed, then-Chairman Wheeler’s FCC decided to “forebear” from imposing such requirements on broadband providers. But such forebearance was and is purely voluntary. A future FCC, with different views—perhaps under the guise of broadband “affordability”—could decide to impose rate regulations and the entire range of common carrier regulation under a revised Title II framework.
Despite assertions to the contrary, broadband is not a static utility, and should not be regulated as such. At the turn of the century, the “Internet” largely consisted of Americans slowly downloading static images and text over landline telephone lines connected to large, clunky, expensive desktop computers at home. Today, nearly every American carries a relatively inexpensive pocket-sized supercomputer—one that’s far more advanced than those that sent Neil Armstrong to the moon. Paired with today’s mobile broadband networks—let alone home broadband—Americans can hail an Uber, watch a movie, or stream a news event live to millions of followers, all at speeds in the hundreds of Megabits per second.
Even Jimmy Carter might not be a fan of the FCC’s reviving “net neutrality.” But sadly, this appears to be the path that the FCC is likely to follow. Only time will tell the damage this will inflict on American consumers.
