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CEI to FCC: Don’t Strangle Broadband Industry

News Releases

Washington, D.C., June 9, 2009—The Competitive Enterprise Institute this week filed comments advising the Federal Communications Commission on how best to proceed with its plan for a national policy on deployment of broadband networks. The comments emphasize that the most growth and innovation comes from companies competing in a free market, while additional mandates and restrictions are likely, in this case, only to slow new investments in broadband technology.

“The best way the Commission can stimulate broadband is not by imposing new layers of regulation, but by adopting a deregulatory stimulus in which government-created entry barriers are eliminated and costly regulations are reduced,” said Competitive Enterprise Institute Vice President for Policy Wayne Crews. “Marketplace investment and private enterprise have driven broadband deployment in the United States, and the Commission would be wise to expand proven, market-driven broadband policies.”

CEI’s comments provide several specific reforms that could substantially liberalize both the telecommunications and broadband marketplaces. Auctioning off further blocks of spectrum, redefining broadband based on functionality rather than delivery method and giving companies the freedom to experiment with different pricing structures would all help stimulate the industry.

“Competition in creation of core networks is just as important as competition in the creation of content delivered over the networks later,” said Crews. “A world safe for mandatory openness and non-discrimination, one in which investors can’t ‘own’ their pipes or spectrum, is a world far less attuned to the infrastructure wealth creation that consumers actually need.”

CEI also cautions the FCC against overreacting to concerns over user privacy. “Forming broadband policy based on speculative privacy fears runs the risk of stifling potentially promising new technologies that may enhance consumer welfare in the future,” said CEI Information Policy Analyst Ryan Radia. “The emergence of deep packet inspection brings with it a range of privacy concerns, and it would be premature for the Commission to impose mandates at this stage. Decentralized marketplace experimentation, subject to competitive discipline and evolving consumer preferences, is best able to balance privacy with wealth creation stemming from advertising and marketing.” 

CEI is a non-profit, non-partisan public policy group dedicated to the principles of free enterprise and limited government.  For more information about CEI, please visit our website at www.cei.org.