ACG's John Kneuer publishes an article in the Hill on the implications of the FCC's repeal of net neutrality. See below for the article.
By John Kneuer
Now that the Federal Communications Commission has voted to repeal the Obama administration’s Title II internet regulation and the dialogue is a little less clouded with catastrophist rhetoric, we should stand back and consider what this decision actually achieved, what the likely impact is, and what policy makers can do now to bring some much needed certainty to internet markets.
Despite the hyperbole adopted by both sides of this debate, adopting Title II in 2015 did not result in a complete collapse in the digital economy. Likewise, returning to the pre-2015 status quo will not result in the “end of the internet” or even more hysterically, the “end of democracy.” What is really at stake is the following question: Who should determine the future of internet innovation — the government, or consumers and innovators?
From 1996 until 2015 under bipartisan congressional leadership and multiple administrations it was agreed that the internet would flourish if exempt from regulations designed for legacy telephone monopolies. And that is exactly what happened.
Consider the market environment prior to 2015 — in particular, consider YouTube. YouTube went from start-up, to internet sensation, to Google/Alphabet subsidiary in less than two years. How could a company like YouTube emerge and prosper, much less survive, when broadband access providers — unrestrained by regulatory mandates — have the “incentive and means” to cut-off YouTube from its customers? Because in the absence of regulation, pro-investment, pro-competition policies created a market where it is essentially impossible for a carrier to deny consumers access to the content and services they want. And yet, recently, it was announced that Alphabet/Google is going to withhold YouTube from Amazon’s Prime Video service and Fire devices as part of an ongoing competitive dispute. The irony is thick. But however this dispute is settled, I think Amazon is going to survive.
But the worry isn’t that we won’t get the “next YouTube” without Title II, the worry is that with Title II future innovators would no longer have consumers as the ultimate arbiter of their success — they would have the FCC as the ultimate arbiter of their market access.
In 2015, when President Obama announced that the only acceptable approach to Net Neutrality was to regulate Broadband providers under Title II, his FCC Chairman Tom Wheeler dutifully agreed. And in doing so, he placed the government at the very center of the internet. Not satisfied with simply applying Title II, Wheeler claimed sweeping new authority over every aspect of the internet — what he referred to as the “general conduct” rule.
As explained by Wheeler, the general conduct rule (despite not appearing anywhere in Title II or any other authorizing statute) establishes the FCC as the “ref on the field” who can “throw the flag” whenever it identifies any course of conduct that it finds objectionable. This would be the equivalent of an NFL referee throwing a penalty flag and instead of calling “pass interference” or “off-sides,” he says “I don’t like the color of your socks.” It sounds absurd but with an “eye of the beholder” standard of Net Neutrality, and the FCC as the self-appointed “beholder” this is just the kind of unpredictability that small innovators have no ability to navigate.
The Title II question is not about which competing corporate behemoths will gain an advantage in selling internet access or content on the Internet or the end of the Internet; and it’s certainly not about the end of American Democracy. By reversing the 2015 Title II classification and returning to the model that worked from 1996 until 2015, Chairman Ajit Pai will restore innovators, competitors, and consumers to the heart of the Internet ecosystem.
While Chairman Pai’s decision was the right one, it may be short-lived. There is nothing to stop the FCC in the next administration from reclassifying broadband once again. That is why it is important for Congress to settle this debate once and for all. By making it clear that consumers have access to all legal content on the Internet — no throttling, no blocking — Congress will restore consumers to center of the internet ecosystem and ensure the most dynamic and productive sector of our economy can continue to flourish. See the full article here.
John Kneuer served first as the deputy assistant secretary, and then as the assistant secretary of Commerce for Communications and Information from October 2003 to November 2007. He is a regular contract professor at the Eisenhower School for National Security and Resource Strategy at the National Defense University.