The FCC, Keeping An Open Internet (Net Neutrality), And Related Issues

An article in Forbes magazine by Roslyn Layton explored some of the issues surrounding the Federal Communications Commission (FCC), it's approach to net neutrality, and public opinions. You may not know that in a few months five political appointees at the FCC will decide the future of Internet access in the United States. The decision of those five commissioners will affect everyone -- people and corporations, old and young, students, retirees, and workers.

You may not be aware that:

"... as the Pew Research Center reports, net neutrality is not likely to be the topic of dinner conversations. Outside of the many blogs and trade media that have covered the issue, two-thirds of the mainstream coverage has been made by just 6 newspapers, not counting the Wall Street Journal. TV coverage has been even more limited."

Shame on the news media, since it is supposed to cover the news. Changes to the Internet is news. Layton wrote about polling:

"There are just two national public opinion polls on net neutrality. A 2006 poll by the Senate Commerce Committee conducted with 800 registered voters found that in many parts of the US only 5% of voters even knew what net neutrality was. In December 2010, a Rasmussen poll of 1000 voters found that just 21% want the FCC to regulate the Internet and most fear regulation would promote a political agenda."

There are other polls, and consumers support net neutrality. The polls may not be national, but are still applicable -- especially for the politicians whose constitutents are covered. Politicians have a variety of toolls to listen to their constituents: petitions by Senator Markey, MoveOn, Credo Action, Daily Kos, Bold Progressives, and the White House.

Layton wrote about politics:

"In fact, net neutrality rules have been proposed at least six times by Congressional Democrats since 2006, but none has been compelling enough to come to a vote. Counteractions by Republicans have appeared on at least five occasions. Two were brought to a vote. One failed to proceed, and the other, a Joint Resolution disapproving of the FCC’s 2010 Open Internet Report & Order, passed the House with a vote of 240 to 179. Moreover, the Court of Appeals has twice struck down the FCC’s rulemaking on net neutrality."

For context, the GOP-led House has voted at least 50 times to change (and in a few instances, to repeal) Obamacare. Many people would argue that Internet access is as important as health care. Layton seems to want to describe opposition to net neutrality as bipartisan, but the GOP platform in 2012 was clearly to oppose net neutrality.

Layton wrote about jobs:

"The Internet makes up 5% of America’s economy. Digital goods and services are now the third largest American export, and broadband and the related IT industry directly support nearly 11 million jobs in the United States. The US, just 4% of the world’s population, accounted for a quarter of the world’s investment in communication networks in 2013, nearly $70B, according to Infonetics. Fifteen of the world’s top 25 Internet companies come from the US."

Layton conveniently skipped the fact that in May, more than 100 tech companies sent a letter to the FCC demanding it keep open Internet rules. Several venture capitalists have said that the FCC's fast/slow-lanes broadband proposal is already having a negative impact upon business. Start-up executives are forced to raise more money than otherwise because ISPs are already charging fees. This will cause some new ventures to not receive funding (e.g., fewer jobs), and/or venture capitalists shift their funding to other businesses away from Internet/tech. Both impacts are not good for a country serious about maintaining leadership in tech and Internet industries.

Layton seems to argue for less regulation. I find the argument hypocritical since the telecommunications corporations have already lobbied for and won local laws in 19 states (e.g., more regulation) that prohibit local government officials from building their own broadband Internet (e.g., fiber). You can't have it both ways: argue against regulation at the federal level while using regulation at the local level to minimize or kill competition.

With more competition, how much lower would Internet access prices be for consumers in these 19 states? With more competition and lower prices, how many more jobs would have been created in these 19 states?

The FCC's policy shift does not restore Net Neutrality. It kills it. The indicator: no longer is all content treated equally. No longer do consumers decide where to go with the broadband bandwidth they've paid for. ISPs can charge some publishers fees for content they believe and can "reasonably" justify. Think of your favorite video sites, since video consumes more bandwidth than plain text. If a publisher can't pay the fees, then they will have a tougher time getting their content and websites distributed.

Think about your favorite cloud services and all of your files -- text, music, and video -- that you have stored there... assuming unlimited Internet access. Guess what? The ISPs could lump those cloud services sites (e.g., Dropbox, Apple iCloud, etc.) along with other video sites in the fast lane; or in the slow lane if the publishers refuse to pay the fees.

I found the planned FCC policy troublesome because it fails to address the fact that the USA lags many other countries in broadband speeds while leading with the highest prices. Consumers in the USA simply aren't getting the value citizens in other countries get. I don't seen any of Layton's comments addressing this, either.

Public Citizen has documented the telecommunications companies that already inserted binding arbitration clauses into their agreements with consumers. This provides consumers with fewer right in the marketplace. According to the National Association of Consumer Advocates (NACA):

"One of the alleged benefits of arbitration is that it costs less than litigation, but frequently this is not true for consumers and employees. Forced arbitration frequently costs more than taking a case to court and can cost thousands of dollars. Individuals often have to pay a large fee simply to initiate the arbitration process. If they are able to get an in-person hearing, individuals sometimes have to travel thousands of miles on their own dime to attend the arbitration. In the end, the loser (usually the individual) often pays the company’s legal fees."

Layton and other net neutrality opponents never seem to want to ask these and other related questions. The bottomline: all of this plus the FCC's planned net neutrality policy means a playing field that is even more heavily tilted towards telecommunications companies and against consumers.