After a hard-won battle to roll back the harmful broadband regulations at the Federal Communications Commission last year, some lawmakers seem pleased with the FCC’s reduced role, but are inexplicably doubling down on the substance of the regulations themselves.
A brief review of the fundamental problems with banning blocking, throttling, and paid prioritization is in order.
A ban on blocking
The legislation would ban Internet providers from blocking any legal content. This is dubious, at best. Broadband companies own their private lines and should be able to choose what goes over them. Do consumers really need the government dictating a no-blocking policy that so tramples on Internet service providers property rights? That seems unlikely as no actual examples of throttling occurred, even in the many years before net neutrality regulations went into effect in 2015.
We can see how unreasonable a ban on blocking is by applying it to another, more familiar industry. What if the federal government forced grocery stores to carry every conceivable food product because omitting any particular item was tantamount to blocking it? Grocery stores have incentives to give their shoppers as many choices as possible. If a store unwisely chooses not to sell a popular product, it risks losing customers to competitors that do carry that product. Broadband providers operate under the same market pressures. They too have every incentive to offer their customers maximum access to the Internet’s sites and services.
Some net neutrality proponents worry about allowing broadband companies to develop their own content, fearing they will favor it over competitors’ products. But this is akin to supermarkets giving their own store-brand products valuable shelf space alongside recognized national brands. American consumers consistently experience vast and expanding choice at their grocery stores in the absence of federal mandates. Market forces will deliver the same consumer benefits online.
A ban on throttling
The legislation would ban throttling, the intentional limiting of available bandwidth. The practice slows Internet connections to help decrease congestion due to high-use times or sites or services that use large amounts of data, such as streaming services. Throttling can and does happen at various points of connection. Both content providers and broadband providers are capable of throttling, but most net neutrality regulations only outlaw broadband providers from engaging in the practice (but give it a minute, regulation of content companies is surely next).
Bandwidth is a finite resource and its owners need ways to manage its use and alleviate congestion. Offering consumers the options of different price points with commensurate amounts of throttling and other plans that avoid any throttling in exchange for a higher price is similar to hotels charging more for rooms during busy travel seasons. Dynamic pricing offers consumers more options and that, in and of itself, is a benefit to consumers.
Ban on paid prioritization
Finally, many net neutrality supporters want to prevent broadband companies from accepting payment from content providers in exchange for moving their data across the network more quickly. But should paying more to get more be made illegal if both parties benefit?
A thought experiment: imagine Netflix content as a passenger on Broadband Airlines. Without the net neutrality ban, Netflix could pay more for a “direct flight,” getting the content passenger to its destination faster. That benefits the loved one waiting in the destination city — or, in our case, a home subscriber binge-watching season two of Stranger Things. Should this arrangement be a crime?
Federal entities themselves routinely use paid prioritization to better serve consumer-citizens — examples include overnight and priority mail, expedited passport renewal, and airline security pre-check. In these cases, consumers benefit from more options at different price points; broadband service is no exception.
Unnecessary regulations deter investment and limit innovation. These impediments are especially harmful in rapidly evolving industries like telecommunications. Legislators should think twice before bringing net neutrality regulations back rom the dead.
>> Watch CEI’s video on Three Common Net Neutrality Myths.