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Net Neutrality 101

What is net neutrality?
"Net neutrality" refers to a controversial set of Internet regulations issued by the Federal Communications Commission (FCC). The concept of net neutrality originally focused on requiring broadband providers to let their subscribers use applications, services, and devices of their choosing.

But net neutrality has come to mean the straightjacketing of the Internet by treating broadband providers like public utilities (like phone or cable companies) under the same 1934 regulatory regime used to govern the old AT&T Ma Bell telephone monopoly. For example, under the FCC's net neutrality regulations, a wireless broadband provider may not prioritize video-chat applications—which can suffer greatly during periods of network congestion—over other applications. Simply put, after decades of enjoying a hands-off approach from Washington that allowed a vibrant, open, and free Internet to flourish, the new FCC rules subject the Internet to more government control than it has ever known in the United States.

Will net neutrality regulation help or hurt the average consumer?
Since the FCC issued rules in 2015 to regulate the Internet, empirical evidence suggests that companies have reduced their investment in broadband deployment and innovation. The brunt of this trend is likely to affect low-income and rural areas where existing broadband infrastructure is in the greatest need of improvement to close what is known as the “digital divide.”As for the harms that net neutrality regulation is supposed to prevent, there is very little evidence that any problems existed before the FCC intervened. Americans have long enjoyed a free and open Internet in the absence of these regulations. 

Why is repealing net neutrality regulations a good first step towards protecting the Internet?
Although the consumer harms that net neutrality regulations are designed to prevent remain largely hypothetical, the harmful unintended consequences of those regulations are very real.

The broadband market in Europe, which has long been regulated like a utility, has experienced only half as much investment in wireline service as the United States. Meanwhile, Europeans' average mobile broadband speeds are 30 percent slower than what Americans enjoy. These figures may not be as entertaining as John Oliver’s schtick advocating for net neutrality regulation, but the dangers of creating an Internet regulator are an economic reality that Americans should understand before turning the Internet into Ma Bell: stagnant, entrenched, and anything but innovative.

What can the FCC and Congress do?
The 2015 net neutrality regulations were an unwarranted government overreach by the FCC and run antithetical to what American consumers want and need online. Eliminating these rigid and harmful regulations on Internet providers would protect Internet freedom and create a more consumer-friendly telecom sector.

Over the past decade, the FCC has sought to transform itself into an Internet regulator in spite of a clear directive from Congress to the contrary.

Instead of trying to regulate the Internet, these rules should be repealed in order to promote competition and innovation in the broadband market, which will result in more choices and better products for Americans at lower prices. If the FCC insists on being an Internet regulator, addressing net neutrality disputes on a case-by-case basis would be a far better approach than the prescriptive rules contained in the 2015 order.

Does blocking, throttling, and paid prioritization help us or harm us?
Blocking, throttling, and paid prioritization are all around us and serve to benefit society. The U.S. Postal Service and other shipping services have expedited shipping—a form of paid prioritization. Carpool or HOV lanes allow for those who meet the qualifications to arrive at their destination faster because other vehicles are blocked from entering those lanes. Express lanes at grocery stores only allow those with a certain number of items to receive expedited checkout. The hypothetical fear that broadband companies will use blocking, throttling, and paid prioritization in order to extort higher prices from users and content providers is unlikely to happen in the current global market. Even if these worst case scenarios come to pass, there are current laws enforced by the Department of Justice and Federal Trade Commission that would protect and reimburse harmed consumers.

In a network as dynamic as the Internet, with its array of known services and countless future unknown services, blocking, throttling, and paid prioritization allow future developers to innovate. Limiting or prohibiting these principles could have negative unintended consequences that are more harmful than helpful because they serve a demonstrated benefit in many areas of society.


RESOURCES

Commentary:

  • A Chance to Improve the FCC | Commentary
    •  "The Open Internet Order, inspired by the net neutrality movement, has thwarted broadband providers’ efforts to give consumers better Internet plans at lower prices."
  • Congress Must Rein in the FCC on Net Neutrality | Commentary
    • "Investing in network infrastructure and developing innovative business models for delivering Internet access to Americans will be crucial as technology evolves. But the market won’t realize its potential if the FCC continues to expand its power over the Internet and micromanage transactions between broadband providers, content companies, and other players in the online ecosystem."
  • Net Neutrality Questions FCC Commissioners Need to Answer | Commentary
    • "​​​​​​​I think the best approach for the members is to frame all questions from the right perspective: that FCC’s entire purpose is outdated and its intervention destabilizing, anti-technology, anti-infrastructure—and just plain anti-Internet, and anti-neutral, for that matter."
  • The Premises of Net Neutrality | Commentary
    • "Yet special interests still want the Federal Communications Commission (FCC) to regulate the content flows and grid infrastructure, the prices and services of the Internet via something called net neutrality. They actually are quite open about wanting government regulated monopoly power."

Research: