En route to get my morning coffee, just noticed an alarmist headline on the cover of the Washington Post Express declaring the death of the internet as we know it.
Meanwhile, a bomb threat interrupted the Federal Communications Commission (FCC) meeting convened yesterday to vote on net neutrality.
These give you an idea of how high feelings were running over a policy that has an Orwellian name and is consistently, and falsely, presented in the media as a benefit for consumers.
After bomb sniffing dogs did their work, the FCC meeting was reconvened and net neutrality, the Obama administration rules allowing the federal government to have tighter control over the internet, was repealed by a 3 to 2 vote on party lines. Democratic FCC Commissioner Mignon Clyburn, daughter of Rep. James Clyburn, immediately pronounced herself “outraged” and issued a stinging dissent.
Net neutrality was about anything but neutrality–it was about giving the government a bigger say in how the internet, one of the freest (and thus successful) segments of our economy. To achieve government control of the internet, the Obama administration redefined internet providers as common carriers under Title II of the Communications Act of 1934.
Title II bans “any unjust or unreasonable discrimination in charges, practices, classifications, regulations, facilities, or services.” Sounds democratic and consumer-oriented, right? But it is not. Supporters of net neutrality have often couched their argument in terms of protecting the consumer. Peter Suderman explains why that was not quite right in Reason magazine:
The Obama-era rules focused the FCC’s regulatory authority on ISPs over other types of internet companies. Although the net neutrality debate is often framed as one that pits consumers versus large internet providers, it can also be understood as a regulatory tug-of-war between two types of companies on the web
Many of the largest internet content companies — so called “edge providers” like Google, Facebook, and Netflix have supported net neutrality in recent years. Recently, however, Netflix, has backed away from its previous support for net neutrality, having made a number of private connection deals that make net neutrality less useful to its business model. “Where net neutrality is really important is the Netflix of 10 years ago,” CEO Reed Hastings said in May. “It’s not our primary battle at this point.”
The shift in strategy is telling: Netflix favored net neutrality rules as a way to preserve a business advantage. As it has grown, it no longer needs that advantage. The debate over net neutrality was always, in part, a tug-of-war over regulatory advantage between tech industry giants. Today, the FCC took steps to stay out of the fight — and remain a neutral regulator over the net.
The Wall Street Journal lays out in an editorial this morning that the repeal of net neutrality is actually a blow for internet freedom;
By effectively deeming the internet a utility, former chairman Tom Wheeler turned the FCC into a political gatekeeper. The rules prohibited broadband providers from blocking, throttling and favoring content, which Mr. Wheeler ostensibly intended to help large content providers like Google and Netflix gain leverage against cable companies.
But as always in politics, treatment under the rules would depend on ideology and partisanship. Even as liberals howl that the Justice Department’s lawsuit to block AT&T’s merger with Time Warner is motivated by President Trump’s animus to CNN, they want FCC control over the internet. The left’s outcry at Mr. Pai “killing” internet freedom has been so overwrought that the FCC meeting room had to be cleared Thursday for a security threat.
Bans on throttling content may poll well, but the regulations have created uncertainty about what the FCC would or wouldn’t allow. This has throttled investment. Price discrimination and paid prioritization are used by many businesses. Netflix charges higher prices to subscribers who stream content on multiple devices. Has this made the internet less free?
Mr. Pai’s rules would require that broadband providers disclose discriminatory practices. Thus cable companies would have to be transparent if they throttle content when users reach a data cap or if they speed up live sports programming. Consumers can choose broadband providers and plans accordingly. The Federal Trade Commission will have authority to police predatory and monopolistic practices, as it had prior to Mr. Wheeler’s power grab.
If you want to understand more about why the left is so upset about the repeal of net neutrality, Barton Hinkle has an excellent piece in Reason magazine. Opponents of net neutrality say that they are against monopolies. Right to be so, says Hinkle, but it is the government monopoly that we should fear. That is what net neutrality is all about: government control.
We’ll see more growth in content and investment thanks to the repeal of net neutrality.