Communiqué

The FCC is Hell-Bent to Regulate the Internet

I promised myself that I would not write about the subject of net neutrality ever again.  But I couldn’t resist commenting on the FCC’s latest quest to impose some government regulations on the Internet.  The FCC’s Chairman Tom Wheeler announced last week that the agency would be putting forth a revised and hopefully fair compromise to make sure the Internet is open and neutral.  The DC Circuit Court of Appeals has already said in two previous attempts to impose net neutrality rule that the FCC does not have the authority to do so.  Nevertheless, the FCC is trying again to insert itself into the regulation of the Internet.

Normally, regulations arise out of problems or abuses.  Many regulations are good, fair and needed.  Many others are not.  I suppose if you are a government regulatory agency you feel as though you are not doing your job unless you are regulating something.   If you are a hammer you perceive every problem or opportunity as a nail, as they say.  This is the case here because the Internet is already fully open and there have been no blatant abuses.  If there were problems other organizations like the Federal Trade Commission (FTC) or the Consumer Protection Agency could take care of it using existing regulations.  We do not need any new ones.

With Congress and the Federal agencies, not to mention the 50 state legislatures, cranking out thousands of new regulations daily, it is no wonder our freedom has slowly slipped away.  The government will only say it is imposing the regulations for our own good but I am not sure that we actually feel any good outcomes.  We only see the bad outcomes like more taxes, increased complexity, higher costs of doing business, and less freedom of choice or action.  I have to wonder just how much regulation is more for political agenda and special interests than for any real good outcomes for citizens.  In the case of the Internet, what exactly is the problem?  It’s already open.  Or is this whole thing is just a perceived problem?  Is it an effort to attempt to identify and solve future problems?  Or is it just one agency’s obsession to control the Internet?

Anyway, what the FCC is said to be proposing is to allow Internet service providers to charge for extra speed in delivery of video.  It is video from Netflix, Google (YouTube) and others delivering over-the-top (OTT) video that is causing some streaming delays or glitches because of network speeds.  The idea is that content companies would work out deals with the ISPs to pay for preferential treatment in network speed to make customers happy.  The FCC would have the power to decide just what business arrangements are fair and “competitively reasonable.”   Wow!  Is that subjective or what? 

What the outcome of any new regulations will be is anyone’s guess.  Some will be happy others not.  And will consumers actually get hosed with higher broadband rates so that some companies can have an advantage?  With all the complex interactions possible here it is premature to anticipate who the winners will actually be.  Maybe the real beneficiary will just be the FCC who is determined to insert itself into the Internet business and therefore to pick the ultimate winners and losers.

I say leave things alone and let the market decide.  Think of the customer first and try to put aside the political issues and just the idea that everything has to be regulated to work well.  It does not and the unintended consequences tend to be worse than any proposed benefits.  Haven’t we learned that yet?

The FCC will vote on May 15 about the decision to proceed with the new plan.  Then there will be the required sixty day comment period.  A final vote will occur near the end of the year to instate any new regulations.  Really something not to look forward to.  If the FCC doesn’t get its way, heaven help us if they resort to the provision in Title II of the Communications Act of 1934 that allows them to regulate the Internet as it does telecommunications services.  Then let the legal wars begin.

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