On Friday, TechFreedom and the International Center for Law & Economics (ICLE) filed joint comments with the FCC, explaining why the FCC has no sound legal basis for micromanaging the Internet and why “net neutrality” regulation would actually prove harmful for consumers. Below are some of the highlights from the filing, the longest filed.
The following quotes are from the joint filings:
Proposed regulations would outlaw innovative business models, harming consumers.
- “A truly open Internet would preserve for all players the right to experiment with innovative content delivery methods and business models.”
- “It isn’t hard to imagine myriad business models that could be prohibited under a pure net neutrality framework.”
- “The [economics] literature directly contradicts the assumption that neutrality improves consumer welfare or encourages infrastructure investment. In fact, the opposite appears to be true, and non-neutrality actually generally benefits both content providers as well as consumers.”
Startups and small businesses could benefit from non-neutrality.
- “Startup content providers are at least as likely to benefit from a non-neutral net as to be hurt by it.”
- “Non-neutrality offers the prospect that a startup might be able to buy priority access to overcome the inherent disadvantage of newness, and to better compete with an established company.”
- “Bob Loblaw’s Law Blog may seem to be at the mercy of its Internet provider, standing on its own. But if it uses WordPress’s platform it doesn’t actually stand on its own. The same is true for independent artists plying their music or videos on the web. It isn’t Adele vs. Comcast; it’s YouTube vs. Comcast. “
Title II would be a disaster — without actually doing what regulatory advocates want.
- “So-called ‘reclassification’ would not even accomplish what those advocating for Title II demand: a ban on prioritization.”
- “There is no bright line by which the FCC can limit the effects of ‘reclassification’ to the last-mile ISP connections in particular or even to broadband more generally.”
- “It will be difficult for the Commission to reject efforts by complainants and policy advocates to expand the reach of the NPRM’s logic to an ever-expanding range of companies and relationships, bringing a wider range of pro-consumer practices under scrutiny and threat.”
- “The the key to promoting more competition lies in removing remaining barriers to entry at the federal and state level, not returning to monopoly-era regulation.”
Re-interpreting “telecommunications” would likely fail in court.
- “It simply is not clear that the FCC can impose Title II common carrier status on broadband carriers that have either always, or long, been regulated under Title I – no matter how well the FCC explains this change of interpretation.”
Forbearance is an empty promise that the FCC can’t keep.
- “Promising to clean up the mess through forbearance is, essentially, an empty promise, on which the FCC simply cannot deliver — and certainly not in a timely fashion. Those pushing the Commission to “reclassify and forbear” are either insincere about forbearance or are simply misinformed about what forbearance would require.”
- “The FCC is not proposing simply to chip away at the margins of the Title II regime, but to adopt it wholesale — and then undo most of it. The more the FCC tries to rush the process of building a record to justify its case, the more likely it is to lose in court and have to start over.”
- “Assuming the FCC does have the discretion to make forbearance much easier, as a legal matter, will it actually be willing to lower the bar for forbearance going forward, knowing that a more deregulatory-minded FCC could, in the future, use forbearance to effectively gut the entire Communications Act?”
- “The prospect of easy unforbearance means that forbearance decisions will be, at best, temporary reprieves. – hardly a sound basis for continued broadband investment.”
Section 706 creates a duty to promote broadband, not a power to invent a new regulatory framework.
- “By re-interpreting Section 706 as an independent grant of authority, the FCC has opened the Pandora’s Box of broader Internet regulation…. Reclassifying broadband under Title II … will in no way solve that problem. “
- “Far from being the vast grant of discretion the FCC now claims, the FCC had, until 2010, always understood Section 706 to be what any reasonable lay person reading the text would have understood Congress to have meant: a command to the FCC to promote broadband deployment and investment: a duty, not a power.”
New regulation would raise constitutional problems not yet addressed in court.
- “Net neutrality regulation compels broadband providers, who are speakers with First Amendment rights of their own, to carry the speech of others.”
- “Net neutrality regulation, as proposed by the FCC, violates the Fifth Amendment’s prohibition on takings without just compensation…It’s difficult to imagine a larger, more draconian regulatory taking than imposing Title II on broadband.”
The FCC should ask Congress to update the Communications Act.
- “There is no shame in the FCC admitting it does not have a sound legal basis for regulating net neutrality. Indeed, the first duty of every regulatory agency is not to push the boundaries of the agency’s authority in increasingly creative ways, but to defer to Congress and await clear instructions.”
- “Given the FCC’s stubborn insistence that it has all the legal authority, despite losing twice at the D.C. Circuit, what possible incentive could there be for Congress to take this issue seriously? It is hardly surprising Congress has not invested the time and effort required to forge a legislative compromise.”
- “Understanding Net(flix) Neutrality,” an op-ed by Geoffrey Manne in the Detroit News on Netflix’s strategy to confuse interconnection costs with neutrality issues
- “The Feds Lost on Net Neutrality, But Won Control of the Internet,” an op-ed by Berin Szoka and Geoffrey Manne in Wired.com
- “That startup investors’ letter on net neutrality is a revealing look at what the debate is really about,” a post by Geoffrey Manne in Truth on the Market
- “Bipartisan Consensus: Rewrite of ‘96 Telecom Act is Long Overdue,” a post on TF’s blog highlighting the key points from TechFreedom and ICLE’s joint comments on updating the Communications Act
TechFreedom is a non-profit, non-partisan technology policy think tank. We work to chart a path forward for policymakers towards a bright future where technology enhances freedom, and freedom enhances technology.
About The International Center for Law and Economics:
The International Center for Law and Economics is a non-profit, non-partisan research center aimed at fostering rigorous policy analysis and evidence-based regulation.