They were shot down in court. Their plan failed in Congress. Polls have shown strong opposition from the American public. But all this didn’t stop the Federal Communications Commission from moving forward with new “net neutrality” Internet regulations.
Late last month, the FCC finally published its net neutrality rules in the Federal Register, starting a 60-day shot clock for when they will take effect. The move was a long time coming. The FCC voted 3-2 along party lines just days before Christmas last year to pass the “Open Internet Order.”
The new rules will regulate how your data travels across the Internet. They arose out of false claims and scare tactics that Internet service providers (ISPs) were going to start preventing people from visiting data-heavy websites, lest you pay a substantial fee. However, the FCC has yet to show one instance of this occurring or consumer harm to justify the rules.
In truth, ISPs do manage data traffic on their networks, but they do it to prevent congestion and maintain quality of service. Some data requires priority in order to provide good service. Real-time content, like a VoIP phone call or Internet-based TV, requires sufficient and consistent bandwidth, while larger file downloads of movies and music require less. The difference isn’t noticeable to consumers, but the inability to manage traffic to maintain these efficiencies likely will be.
The rules came despite any cost-benefit analysis. Amidst all the political talk of “jobs, jobs, jobs,” note this: a study by New York Law School’s Advanced Communications Law and Policy Institute estimates the rules will cost at least 500,000 jobs over the long run and cause a substantial, multi-billion-dollar drop in GDP. Studies by the Phoenix Center show similar job losses and also show decreased expansion of broadband, especially to rural, high-cost areas.
Perhaps worse, the shaky legal basis for net neutrality rules puts the FCC’s foot in the door for enacting future Internet regulations. The Commission is currently experiencing an existential crisis. The FCC has long held regulatory control of traditional forms of communications, like broadcasting over spectrum and phone lines, but Congress has largely left the Internet outside of its purview. Meanwhile, the Net is engulfing every communication service, bringing TV, phone and radio online — and throwing the FCC’s worldview in a tailspin.
To justify the rules, the FCC relied on Section 706 of the Telecommunications Act, which aimed to “encourage the deployment on a reasonable and timely basis of advanced telecommunications capability” through “regulatory forbearance” — not through new regulations. To enact the rules, the Commission materialized from thin air a completely new interpretation of the section, a 180-degree turn from its original intention of promoting deregulation.
Worse, as FCC Commissioner Robert McDowell stated in an eloquent and forceful dissent, “The order’s expansive grasp for jurisdictional power here is likely to alarm any reviewing court because the effort appears to have no limiting principle.” In short, if the FCC can interpret the law in the polar opposite way in which it was written, its ability to regulate the Internet is virtually without end.