FCC Internet Regulations Must Be Scaled Back

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FCC Internet Regulations Must Be Scaled Back

Within the next week, the DC Circuit Court will rule on a challenge to the FCC’s net neutrality regulations by entrepreneurs and established Internet Service Providers. It’s likely that the court will prune the regulations and in so doing, curtail the agency’s quest for power. If the DC court doesn’t, we can expect an appeal to the Supreme Court.

It’s unfortunate that we have to rely on the courts to micromanage regulatory agencies, but agency behavior leaves us little choice. While the FCC was established by Congress in 1934 to bring technical expertise to the task of managing communication markets, under Chairman Tom Wheeler’s direction it has become overly engrossed in politics.

The FCC’s proper mission is simply to give technical and economic detail to the broad, general policies Congress enacts for communication-related industries. These policies were last revised in a substantial way in 1996 in the Telecommunications Act. That act makes it clear that Congress intends for the Internet – which includes all of the networks that enable us to communicate with the web services of our choice wherever we are – to be a largely deregulated marketplace disciplined by competition.

Competition in this market has never been perfect. There are rural pockets in the US where consumers and businesses have limited Internet service choices or even none at all. There are places in which the only choices are satellite providers, and others that are served only by aging telephone wires. Much of the US is too sparsely populated to support rich markets.

But advances in technology have enabled much more robust competition than many imagined, and future wireless technologies will offer much more competitive services than we’ve ever seen. The watchword is 5G – the fifth generation mobile technology that will revolutionize communications throughout the nation and around the world.

It’s hard to make a case for substantially altering communication markets that have benefited from the advances that we’ve seen since the Internet was opened to the public in the mid-1990s with a distinctly deregulatory policy. The window of time in which an argument can be made for a heavy-handed approach is rapidly closing. 5G trials are already underway, and by 2020 we’ll see more powerful devices and applications enabled by better, faster, and cheaper networks more ubiquitous than any we’ve seen before.

5G will be a boon to innovators and the public but a disaster for politicians intent on scoring points with complaints about the cable and mobile companies. It’s easy to view the FCC regulations as a cynical ploy to squeeze the last bit of election-year outrage from voters on the brink of falling in love with new technologies created with their whims and wishes in mind.

Emerging communication technologies enable new networks to work the way we want them to work instead of the way restrictive technical barriers require them to behave. Broader horizons are the consequence of Moore’s Law, an axiom of engineering that predicts the phenomenal rate of improvement that has held true for 50 years of electronics engineering.

The only thing that can prevent Moore’s Law from revolutionizing communication in the next five years is a regulatory policy that inhibits investment in new networks. Research by economist Hal Singer indicates that the FCC’s net neutrality regulations are already having that effect.

The FCC can’t stop 5G around the world. If our ISPs can’t raise money to upgrade existing networks, build new towers and small cells, and convert hardware-based networks to software systems infinitely adaptable to user needs at the click of a button, other countries will.

It’s likely that Chairman Wheeler and his inner circle simply don’t realize the damage they’ve done to communication markets. A detailed examination of their regulations finds significant gaps in its understanding of the way the Internet works. I highlighted several of these shortcomings in a friend of the court brief in connection with the challenge.

So we depend on the court to save the nation’s economy from politics, and indeed to save the FCC from itself. I hope that the court delivers the message that regulatory agencies should stick to their knitting rather than seeking to influence election outcomes.

FCC Internet Regulations

by Richard Bennett

FCC Internet Regulations

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