The FCC's Threat to Internet Freedom

The FCC's Threat to Internet Freedom

Robert M. McDowell
Wall Street Journal
Dec. 19, 2010

Tomorrow morning the Federal Communications Commission (FCC) will mark the winter solstice by taking an unprecedented step to expand government's reach into the Internet by attempting to regulate its inner workings. In doing so, the agency will circumvent Congress and disregard a recent court ruling.

How did the FCC get here?

For years, proponents of so-called "net neutrality" have been calling for strong regulation of broadband "on-ramps" to the Internet, like those provided by your local cable or phone companies. Rules are needed, the argument goes, to ensure that the Internet remains open and free, and to discourage broadband providers from thwarting consumer demand. That sounds good if you say it fast.

Nothing is broken that needs fixing, however. The Internet has been open and freedom-enhancing since it was spun off from a government research project in the early 1990s. Its nature as a diffuse and dynamic global network of networks defies top-down authority. Ample laws to protect consumers already exist. Furthermore, the Obama Justice Department and the European Commission both decided this year that net-neutrality regulation was unnecessary and might deter investment in next-generation Internet technology and infrastructure.

Analysts and broadband companies of all sizes have told the FCC that new rules are likely to have the perverse effect of inhibiting capital investment, deterring innovation, raising operating costs, and ultimately increasing consumer prices. Others maintain that the new rules will kill jobs. By moving forward with Internet rules anyway, the FCC is not living up to its promise of being "data driven" in its pursuit of mandates—i.e., listening to the needs of the market.

It wasn't long ago that bipartisan and international consensus centered on insulating the Internet from regulation. This policy was a bright hallmark of the Clinton administration, which oversaw the Internet's privatization. Over time, however, the call for more Internet regulation became imbedded into a 2008 presidential campaign promise by then-Sen. Barack Obama. So here we are.

Last year, FCC Chairman Julius Genachowski started to fulfill this promise by proposing rules using a legal theory from an earlier commission decision (from which I had dissented in 2008) that was under court review. So confident were they in their case, FCC lawyers told the federal court of appeals in Washington, D.C., that their theory gave the agency the authority to regulate broadband rates, even though Congress has never given the FCC the power to regulate the Internet. FCC leaders seemed caught off guard by the extent of the court's April 6 rebuke of the commission's regulatory overreach.

In May, the FCC leadership floated the idea of deeming complex and dynamic Internet services equivalent to old-fashioned monopoly phone services, thereby triggering price-and-terms regulations that originated in the 1880s. The announcement produced what has become a rare event in Washington: A large, bipartisan majority of Congress agreeing on something. More than 300 members of Congress, including 86 Democrats, contacted the FCC to implore it to stop pursuing Internet regulation and to defer to Capitol Hill.

Facing a powerful congressional backlash, the FCC temporarily changed tack and convened negotiations over the summer with a select group of industry representatives and proponents of Internet regulation. Curiously, the commission abruptly dissolved the talks after Google and Verizon, former Internet-policy rivals, announced their own side agreement for a legislative blueprint. Yes, the effort to reach consensus was derailed by . . . consensus.

After a long August silence, it appeared that the FCC would defer to Congress after all. Agency officials began working with House Energy and Commerce Committee Chairman Henry Waxman on a draft bill codifying network management rules. No Republican members endorsed the measure. Later, proponents abandoned the congressional effort to regulate the Net.

Still feeling quixotic pressure to fight an imaginary problem, the FCC leadership this fall pushed a small group of hand-picked industry players toward a "choice" between a bad option (broad regulation already struck down in April by the D.C. federal appeals court) or a worse option (phone monopoly-style regulation). Experiencing more coercion than consensus or compromise, a smaller industry group on Dec. 1 gave qualified support for the bad option. The FCC's action will spark a billable-hours bonanza as lawyers litigate the meaning of "reasonable" network management for years to come. How's that for regulatory certainty?

To date, the FCC hasn't ruled out increasing its power further by using the phone monopoly laws, directly or indirectly regulating rates someday, or expanding its reach deeper into mobile broadband services. The most expansive regulatory regimes frequently started out modest and innocuous before incrementally growing into heavy-handed behemoths.

On this winter solstice, we will witness jaw-dropping interventionist chutzpah as the FCC bypasses branches of our government in the dogged pursuit of needless and harmful regulation. The darkest day of the year may end up marking the beginning of a long winter's night for Internet freedom.

Mr. McDowell is a Republican commissioner of the Federal Communications Commission.

FCC to Vote on Internet Regulation Plan Despite Economic Warnings

FoxNews.com
December 20, 2010


Lawmakers are on high alert as the Federal Communications Commission prepares to vote on a plan to regulate the Internet despite warnings that it could choke industry investment and hurt the economy as a whole.

The five-member commission plans to unveil, and vote on, the so-called "net neutrality" proposal on Tuesday.

Lawmakers on both sides of the aisle have been saying for months that Congress, not the Obama administration, should take the lead role in deciding whether and how much to police the web. But despite a brief backing-off earlier in the year, the FCC has pushed ahead with its new regulatory plan.

The move raises concern that the FCC could soon have its regulatory foot in the door of the wild West of the Internet -- with an eye toward eventually exerting tighter control over content at a time when sites like WikiLeaks openly snub the government.

The FCC proposal is viewed as a major breakthrough, for better or worse, for Internet oversight. And if the plan passes, it could trigger a nasty showdown with Congress next year.

"Congress has not given us the authority to do this," Robert McDowell, one of two Republican commissioners on the FCC, told FoxNews.com. McDowell, who plans to dissent, said that if the FCC follows through on Tuesday, "there really are no bounds to what the FCC could do, so long as it's done in the name of promoting the Internet in their view." That potential ranges from price control to content control, he said.

The net-neutrality plan itself is far more limited, despite concerns about where it could lead. The proposal aims to prevent service providers from discriminating against websites and companies using their networks. In other words, it is meant to ensure companies like Verizon or Comcast can't block or slow access to certain websites while giving favorable treatment to others.

FCC Chairman Julius Genachowski, who has the support of the White House, reportedly has secured the backing of the commission's two other Democratic members. He said earlier this month that the proposal "would ensure that the Internet remains a powerful platform for innovation and job creation." He said it would "empower" consumers and entrepreneurs alike while increasing market "certainty" and spurring investment.

Critics say it would do just the opposite.

They warn that net-neutrality advocates are trying to fix a problem that doesn't exist and will end up burdening the industry with a regulatory spider web in the process. Lawmakers have loudly renewed those concerns as the FCC builds momentum toward its Tuesday vote.

"The cost of that action will be measured in investments foregone, innovations stifled, and most importantly, jobs lost. With America's economy in such a fragile state, the last thing the government needs to do is burden the private sector with more ill-advised regulatory red tape," a pack of nearly 30 Republican senators wrote in a letter to the FCC last week. They argued that the oversight expansion would be "unjustified and unnecessary" and that the Internet does not suffer from the affliction for which the FCC is offering a cure.

Importantly, the letter stated that Congress, "not the commission," should determine what Internet regulation is appropriate.

The warning suggests some lawmakers might try to overrule the regulation should it pass the FCC Tuesday. Under the Congressional Review Act, Congress can strike down a regulation by passing a joint resolution.

McDowell wrote in a column Monday that the FCC was doing an end-run around Congress in order to fight an "imaginary problem." He predicted that the policy, if approved, would trigger a "billable-hours bonanza" as lawyers scramble to interpret it.

"On this winter solstice, we will witness jaw-dropping interventionist chutzpah as the FCC bypasses branches of our government in the dogged pursuit of needless and harmful regulation," he wrote in The Wall Street Journal.

McDowell also said the decision "plants the seeds" for more regulation down the road, with the threat posed by WikiLeaks already being used as a pretext for tougher enforcement plans. McDowell further accused the FCC of disregarding an April ruling from the federal appeals court in the District of Columbia, which challenged the FCC's authority over the Internet.

A month after that ruling came out, dozens of congressional lawmakers from both sides of the aisle wrote to Genachowski to warn of "serious concerns" with regulatory proposals for the Internet and broadband. They warned the proposal would create uncertainty and "jeopardize jobs," calling for Congress to step in and call the shots.

But the case for more regulation, even if it's issued by the FCC, is building in some corners.

While some argue that the free market alone will ensure service providers do not block access -- after all, consumers demand access -- others say the tinkering is already happening. Netflix, for instance, has accused Comcast of getting in the way of its online video service by charging a new fee.

Rep. Ed Markey, D-Mass., the author of a net-neutrality bill in Congress, issued a statement commending Genachowski for his latest plan earlier this month -- though he called for the concerns of net-neutrality proponents to be addressed. Some proponents have criticized the FCC plan as not strong enough, complaining that it lets mobile carriers off the hook and still could allow companies under some circumstances to pay for better service.

The White House, meanwhile, continues to support the idea. Aneesh Chopra, the chief technology officer in the administration, called the plan an "important step in preventing abuses and continuing to advance the Internet as an engine of productivity growth and innovation" in a White House blog earlier this month.

FCC to vote Tuesday on 'net neutrality' rules

Doug Gross
CNN
December 20, 2010

(CNN) -- The Federal Communications Commission is set to vote Tuesday on a set of regulations designed to ensure that internet providers grant everyone equal access to the Web.

The "net neutrality" rules, proposed by the Obama administration, would be the government's biggest foray yet into one of the Web's fiercest debates.

In announcing the proposed rules earlier this month, FCC Chairman Julius Genachowski said they would require high-speed internet providers to treat all types of Web content equally.

The rules would, in effect, keep the companies that own the internet's real-world infrastructure from slowing down some types of websites or apps -- say, those belonging to a competitor -- or speeding up others from high-paying clients.

The commission's agenda says the vote will address "basic rules of the road to preserve the open internet as a platform for innovation, investment, competition and free expression."

If it passes, as it is expected to do, the plan will go before Congress for final approval. That isn't expected to happen until the new Congress, elected in November, takes office next year.

Internet-freedom advocates have called the rules a step in the right direction but say they don't go far enough.

For example, the proposal doesn't set the same set of rules for mobile communications as it does for Web-based ones. And it wouldn't let the government strictly regulate internet providers in the way some advocates would like.

In fact, the proposal is similar to one put forward earlier this year by Google and Verizon, two of the internet's biggest stakeholders.

Sen. Al Franken, a Minnesota Democrat and one of Congress' most vocal net-neutrality advocates, calls the issue "the most important free-speech issue of our time." In a column Monday for the Huffington Post, Franken said some of the current proposal's language could actually weaken protections.

"[T]his Tuesday, when the FCC meets to discuss this badly flawed proposal, I'll be watching," he wrote. "If they approve it as is, I'll be outraged. And you should be, too."

Michael Copps, a Democrat and one of the commission's five members, said in a written statement that he won't block the plan after weeks of trying to make it tougher.

"The item we will vote on tomorrow is not the one I would have crafted," Copps said. "But I believe we have been able to make the current iteration better than what was originally circulated.

"If vigilantly and vigorously implemented by the commission -- and if upheld by the courts -- it could represent an important milestone in the ongoing struggle to safeguard the awesome opportunity-creating power of the open internet."

Technically, Copps said he will vote to concur, which means not endorsing all parts of the plan but letting it move forward and, theoretically, be tweaked later.

Copps' two fellow Democrats also are expected to concur, while its two Republicans likely will vote no.

One of those Republicans, Robert M. McDowell, criticized Genachowski's proposal Sunday in a Wall Street Journal column.

"Nothing is broken that needs fixing ... " he wrote. "Analysts and broadband companies of all sizes have told the FCC that new rules are likely to have the perverse effect of inhibiting capital investment, deterring innovation, raising operating costs and ultimately increasing consumer prices."