Above Photo:Â From arstechnica.com
With its quest to gut net neutrality, privacy and other consumer broadband protections, the FCC is rushing face first toward stripping meaningful oversight of some of the least-liked — and least competitive — companies in America. The FCC’s plan, based on flimsy to no data and in stark contrast to the will of the public, involves gutting most FCC oversight of broadband providers, then shoveling any remaining authority to an FTC we’ve noted is ill-suited, under-funded, and legally ill-equipped for the job. That’s a real problem for a sector that’s actually getting less competitive than ever in many markets.
Giant ISPs and their armies of policy allies often try to frame the effort as a noble quest for deregulation, often insisting they’re somehow “restoring internet freedom” in a bare-knuckled attempt to pander to partisan constituents. But by any sane measure the FCC’s quest is little more than a massive gift to despised duopolies like Comcast — at what might be the worst possible time for a severely dysfunctional industry. But there are signs that even many traditional big ISP allies think Ajit Pai’s plan is absurdly extreme.
Hal Singer is an economist the telecom industry has often hired to manipulate data in order to make all manner of flimsy claims (from falsely stating net neutrality stifled network investment to falsely claiming net neutrality would dramatically raise taxes). But last week even Singer came forward to acknowledge that the FCC’s plan to shovel net neutrality and other ISP oversight to the FTC won’t fly. While Pai has repeatedly claimed that FTC authority and existing antitrust laws are enough to protect consumers from companies like Comcast, Singer disagrees:
“Singer lists several roadblocks to stopping discriminatory paid prioritization via antitrust. “Monopolists are generally free from legal constraints to choose their suppliers and engage in price discrimination under the antitrust laws,” he wrote.
Antitrust laws are designed to protect competition, but “competition is not the only value that net neutrality aims to address: end-to-end neutrality or non-discrimination is a principle that many believe is worth protecting on its own,” he wrote.
“Moreover, antitrust litigation imposes significant costs on private litigants, and it does not provide timely relief; if the net neutrality concern is a loss to edge innovation, a slow-paced antitrust court is not the right venue,” he also wrote.”
Of course there’s also the fact that AT&T is currently engaged in a legal battle with the FTC over its network throttling that could hamstring the agency’s authority over ISPs even further. If AT&T wins that court fight, the FTC has previously warned that it could open the door to all manner of companies dodging responsibility for unfair or deceptive business practices — provided some small fraction of their business enjoys common carrier status. That could result in tiny acquisitions specifically designed to free any number of non-telecom companies from accountability, noted the FTC last year:
“Many companies provide both common-carrier and non-common-carrier services—not just telephone companies like AT&T, but also cable companies like Comcast, technology companies like Google, and energy companies like ExxonMobil (which operate common carrier oil pipelines). Companies that are not common carriers today may gain that status by offering new services or through corporate acquisitions. For example, AOL and Yahoo, which are not common carriers, are (or soon will be) owned by Verizon.”
If you’re the type of non-nuanced thinker that truly believes that all regulation is automatically evil without bothering to actually analyze the regulation, this whole idea probably sounds good to you. But telecom isn’t a normal industry; it suffers from regulatory capture on both the state and federal level, which acts to prop up noncompetitive duopoly fiefdoms nationwide. Removing oversight of this sector without fixing any of the underlying corruption and dysfunction doesn’t magically forge Utopia; it simply makes companies like Comcast less accountable than ever. And again, with broadband competition diminishing as many telcos refuse to upgrade their networks, that’s a recipe for disaster.
Said disaster would likely result in greater calls than ever for tougher oversight and rules governing ISP behavior (aka monumental backlash during any post-Trump Presidency), which is likely why you’re seeing Singer — and even industry-backed groups like the ITIF — calling for a more measured approach than Pai and friends are offering:
Interesting because ITIF was a prominent voice opposing Title II for net neutrality rules. @AjitPaiFCC‘s proposal is pretty extreme. https://t.co/WzL09HWnbL
— The real Jon Brodkin (@jbrodkin) August 28, 2017
Of course this may have been Pai’s plan all along; to offer an extreme frontal assault on net neutrality and FCC authority that would subsequently make any resulting “compromises” seem almost sane. But these end proposals would all likely be far weaker than the somewhat flimsy net neutrality protections we already enjoy. We’ve noted that’s one of the reasons ISPs are pushing for a new Congressional law they claim would “settle the issue once and for all,” hoping the public won’t realize said law would be notably more tepid than the existing FCC protections — since ISP lobbyists and lawyers would be the ones writing it.
Again, there’s a far-simpler trajectory than the chaotic, disruptive and despised one proposed by Ajit Pai: leave FCC authority, and the popular. existing net neutrality rules, alone.