— By any standard, the Internet ranks as one of the leading innovations of our
time. It has revolutionized everything from commerce to medicine to entertainment,
all within the confines of a generation.
yet, it has done so largely without government regulation. So, why would
President Obama think now is the time to turn back the clock to Depression-era
rules written when all telephones were black, hard-wired and hung on a wall?
said this week he believes high-speed Internet service providers should be
regulated through “the strongest possible rules to protect net neutrality,”
thus endorsing a proposal to empower the Federal Communications Commission to
require Internet service providers to treat all web traffic equally and not
charge content providers for better access.
FCC is debating whether Internet service providers, such as Verizon and
Comcast, can choose to block or prioritize delivering traffic to certain
websites. That policy is under consideration because a federal appeals court
decision in January struck down rules that barred companies from doing so.
the FCC appeared on course for a hybrid rule to charge broadband “hogs” while
protecting small users, Obama has proposed to take it a new – or, more
accurately, old – regulatory level. He wants to reclassify ISPs are common
carriers under Title II of the 1934 Telecommunications Act, treating the
service as a public utility.
is the same overly broad approach to regulation that spawned the old Ma Bell
oligarchy and stifled telecom innovation for generations – until the Internet
basically changed everything by coloring outside the lines.
neutrality” is one of those buzzwords that inspires populist support, but it’s
not as simple as the big guys conspiring to shove mom-and-pop websites into the
Internet’s slow lane.
the scenes, it’s also about a small handful of heavy users – the Internet’s
so-called “lane hogs” – hoping to avoid paying for the right to dominate
capacity today is being driven by video in its many forms, not voice, text or
website traffic. Video consumes huge amounts of Internet capacity and most ISPs
are struggling to keep up through investments in wireless networks and other
when Netflix Inc. delivered videos by mail? Today, Netflix and similar services
are accommodating customers through the Internet – and gobbling up capacity in
the process. With 37 million U.S. subscribers, Netflix alone generates
about one-third of U.S. online traffic during the evening hours on weekdays.
pays Comcast, Verizon and AT&T undisclosed fees for a more direct
connection to their networks, an arrangement that could become unnecessary if
Obama’s recommendation is adopted by the FCC.
wonder Netflix is leading the charge for … you guessed it… “net neutrality.”
are Internet corporate elephants on both sides of the debate, of course, so
entrepreneurs are rightfully worried about not getting trampled in the tall
grass. If the Internet had not been free and relatively open over the past
20-plus years, entrepreneurs may well have been deterred from creating a wide
array of services and products. That kind of innovation has transformed the
economy and created millions of jobs.
Internet is one of the uniquely American innovations of the last quarter
century. It has functioned pretty well so far with light-touch regulation and
fact, most Internet governance is currently restricted to a non-profit,
multinational body based in California. The Internet Corporation for Assigned
Names and Numbers maintains a host of technical standards, which allows traffic
to flow throughout the global communications network. ICANN is a private
organization with an international board of directors, but there is already
some oversight by Washington because it’s a U.S.-based corporation.
FCC issued an Open Internet Policy Statement in 2005, and followed that in 2010
with Open Internet Rules. It seems unlikely the FCC would reverse its general
approach to Internet openness – which makes the president’s post-election call
for more heavy-handed regulation all the more curious.
you want less of something, tax it or regulate it. That principle precedes the
birth of the Internet and is hardly out of style in our digital age.