Experts All Agree that Internet Regulation will Stifle Investment

The FCC recently passed some new rules for Internet regulation that do not bode well for either our freedom or for the continued advance of Internet technology. A little belatedly many experts have come out against the move describing it as a surefire way to stifle investment and innovation…


Tech companies and members of Congress on Monday blasted the Federal Communications Commission’s decision last week to regulate the internet as a public utility, saying it creates uncertainty for investors.

Last Thursday, in a 3-2 party line vote, the FCC’s Democratic commissioners voted to regulate the internet under Title II of the Communications Act, a law that was originally written for landline telephones. (RELATED: FCC Votes in Favor of Net Neutrality)

At an event hosted by the American Enterprise Institute, Republican Rep. Greg Walden, chairman of the House Subcommittee on Communications and Technology, said he is “deeply troubled that the Commission’s actions step well beyond its authority,” and said Title II represents “the latest chapter in a fight between advocates of regulation and the free market.”

Walden asserted that, in essence, “three people who are not accountable to anyone decided on their own that this was necessary,” which he called “a pretty crummy way to do policy, but a classic example of FCC overreach.”

net neutralityOstensibly, Title II is designed to promote the principles of net neutrality by prohibiting internet providers from blocking, throttling or using paid prioritization of internet content. However, Walden claimed that, “I met with FCC Chairman Wheeler last November, and he assured me he was committed to net neutrality without reclassification.” (RELATED: Net Neutrality Bait and Switch to Title II)

“Any disincentive to broadband deployment is deeply troubling,” he continued, saying that a better solution would be to pass existing net neutrality legislation through Congress.

“Our bill prohibits blocking, throttling, and paid prioritization,” Walden pointed out, claiming that it “draws heavily on net neutrality proposals from Democrats.” (RELATED: Republicans Solicit Feedback on Net Neutrality)

Separately, in a conference call with reporters on Monday, several “tech elders” weighed in on Title II, and likewise concluded that the regulations have the potential to diminish investment in broadband deployment.

“There is singular arrogance in thinking that the US government has any right to regulate something that spans the entire planet,” said Charlie Giancarlo, a former executive at Cisco Systems, adding, “I don’t think the FCC has that right or ability.”

“At the same time,” he noted. “I would say there are problems that do need to be addressed in the United States, which is that there is a monopoly or duopoly on providing internet access in most places.”

“I think we’ve got to have something that breaks up that monopoly or duopoly, but that’s not the FCC’s job,” Giancarlo added. “Their job is to put in place a monopoly, not break one up.”

George Gilder, an investor and tech policy activist, took an even stronger stance, pointing out that, “The last time the government tried to interfere in the internet was the late 90′s, and the result then was the 2000 telecom crash.” (RELATED: Title II Will Kill Internet Investment, Critics Claim)

The experts were equivocal about net neutrality legislation, but unanimous in the belief that regulations would discourage innovation in the industry by creating regulatory uncertainty.

Jeff Pulver, who helped to pioneer “voice-over-internet protocol,” which allows individuals to make phone calls over the internet, said, “I’m concerned that we will see reduced investment as a result of the uncertainty created by Title II.”

“Eleven years ago,” he claimed, “[former FCC] Chairman Powell issued something called the Pulver Order,” which outlined clear, concise principles for ensuring internet freedom, “and we saw innovation flourish under that clarity.”

“I truly believe that we have an era of uncertainty and doubt in front of us, and anyone who dismisses that really doesn’t have an understanding of the industry,” Pulver added, explaining that, “having to go to the FCC for permission to innovate will lead to less innovation.”

 

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