Regulation of the Internet Is Unnecessary and Will Drive Up Costs | Citizens Against Government Waste

Regulation of the Internet Is Unnecessary and Will Drive Up Costs

The WasteWatcher

Democrats in Congress are once again trying to regulate internet service providers (ISPs) as common carriers like old-fashioned telephone companies.  While legislation is needed to provide certainty for ISPs and other parts of the telecommunications ecosystem, the Net Neutrality and Broadband Justice Act, S. 4676, introduced by Sen. Ed Markey (D-Mass.), and H.R. 8573, introduced by Rep. Doris Matsui (D-Calif.) is the wrong solution at the wrong time.  

If the legislation is passed, closing the digital divide will become more expensive and difficult, which supposedly is not the outcome intended by the sponsors of the legislation.  

The bills would once again place ISPs under Title II of the Telecommunications Act of 1934, which was done in February 2015 through the Open Internet Order (OIO), or net neutrality, by the Federal Communications Commission (FCC) during the Obama-Biden administration.  This regulation was an aberration in the history of light touch regulation of the internet, as first proposed by former President Clinton in 1997, and it was reversed by the FCC in January 2018 through the Restoring Internet Freedom Order.  The impact of the OIO was clear, since it led to a drop of between $24-$30 billion in broadband investment during the time it was in effect.  

The claim that legislation regulating ISPs under Title II is needed to increase access to the internet or reduce costs could not be more absurd.  According to the 2022 Broadband Pricing Index, consumer choice broadband prices dropped by 14.7 percent and speed broadband prices dropped by 11.6 percent between 2021-2022, while inflation rose by 9.1 percent.  More regulation will raise costs at a time when tens of billions of dollars have been made available for broadband deployment across the country through the Infrastructure and Investment Jobs Act and the American Rescue Plan Act.  There is more than enough money available to connect every household that is currently unserved.  Congress needs to get out of the way rather than getting in the way of achieving that goal.

Rather than reclassify broadband as a common carrier and give the FCC the authority to impose price controls through rate setting on internet services, if Congress truly wants to codify some sort of net neutrality rules, it should enact into law the following four basic principles for an open internet:

  • To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to access the lawful Internet content of their choice.
  • To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to run applications and use services of their choice, subject to the needs of law enforcement.
  • To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to connect their choice of legal devices that do not harm the network.
  • To encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet, consumers are entitled to competition among network providers, application and service providers, and content providers.”

These principles helped move development of high-speed broadband services forward to what it is today and will continue to allow this vibrant part of the economy continue to thrive.

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