Last week, the Federal Communications Commission (FCC), under Chairman Ajit Pai, voted to curtail Obama-era regulations on the Internet. This is a positive step for preserving Internet freedom. These regulations meant to enforce net neutrality, known as Title II, hurt consumers, attempted to fix problems that never existed and could make innovation more difficult.
Despite ample media attention, most people don’t know what net neutrality or Title II mean. Net neutrality, as it was originally conceived in the early 2000s, meant all Internet traffic should be treated equally. Today, the idea has been conflated with the massive power grab the FCC took during the Obama administration with its Title II Order. Title II means subjecting ISPs to onerous regulations under the Communications Act of 1934.
Title II regulations hurt consumers by making it harder for small ISPs to grow and by restricting services.
Title II hurts consumers by stunting growth for smaller Internet providers. As Andrew Heaton points out in his video for Reason, many large corporations support “regulatory burdens that mostly affect small startups,” and the same is true for Title II. Pai has pointed out that “small ISPs reported that Title II was preventing them from rolling out new services and deepening their networks.” While large providers have the money to handle the regulatory burden, small companies are hit the hardest since they have to spend more time and money trying to comply.
Title II regulations also hurt consumers by prohibiting providers from charging different prices for different levels of service. Until recently, companies that did not charge for certain data, a practice known as zero-rating, were under investigation for violating Title II. Once the FCC ended the investigations earlier this year, providers began offering unlimited data plans again and consumers benefitted from having more options made available to them.
If Title II hurts businesses and consumers, why does it even exist? Title II was an attempt to solve problems that never existed out of fear of what could happen.
The Internet was free for decades before it was subjected to Title II in 2015. As a result, a multi-billion-dollar industry sprang up without any government intervention. In that time, as Heaton points out, there was never a problem with ISPs slowing down or arbitrarily censoring websites that refused to pay.
Title II was driven by fear rather than real pressing concerns. If we are working in hypotheticals, the proponents of these regulations should at least think about the consequences preemptive regulations like Title II could have on future innovations.
No one knows what the future holds for the Internet. ISPs may one day want to test the waters and stream new services that are very expensive, but they may not even try if they can’t charge different rates. Heaton compares this to forcing all drivers on a highway to go the same speed regardless of lane. If everyone is forced to go the same speed, no one can get ahead. There are already laws in place that offer consumer protections. Restoring a light-touch approach to regulating the Internet will allow new technologies and innovations to enter the market. In such an environment, entrepreneurs can compete to provide the best service for consumers.
Pai’s effort to get rid of shortsighted Title II regulations is the right move. Our government should get out of the business of trying to eliminate every conceivable risk. The Internet thrived on its own, and Title II has only been a pain for consumers and providers.