A Tighter Net: FCC Hands Strings to Internet Service Providers

There may be no more dishonest political debate in the country right now than the one over “net neutrality.” And, like most dishonest political debates, the lying with fingers plugged in ears and scaremongering with an axe in hand have been done primarily by one side.

Last week the Federal Communications Commission officially began dismantling net neutrality rules the agency prescribed for itself two years ago under then-FCC chairman Tom Wheeler. These “Open Internet” rules were based on a legal recategorization by the FCC of Internet service providers (Verizon, AT&T, Comcast) as providers of “telecommunication services” (fiber optic cables, satellites, and broadcast networks) rather than of “information services” (blogs, social network sites, online encyclopedias) as the FCC had previously categorized them.

The initial categorization of broadband Internet access as an information service was especially bizarre given that the agency had previously considered dial-up Internet access a telecommunication service. The Supreme Court had ruled, however, that the FCC had institutional authority to make these sorts of categorical judgments—although Justice Scalia dissented in the case, saying categorizing broadband Internet access as an information service was an “implausible” interpretation of the term. Adding that the FCC, in doing so, “had exceeded the authority given to it,” which in Supreme Court dissenting opinions can mean what it says (i.e., the government agency doesn’t have the legal authority to do what it’s doing) or, more likely in this case, that the agency knew what it was doing was dubious and that it was over-stretching the credulity of any sane interpreter.

The FCC’s 2015 rules change meant that henceforth ISPs would be regarded as “common carriers” (utility or infrastructure companies that provide the same services to everyone instead of specialized packages) and, under Title II of the 1934 Communications Act, be forbidden from exclusionary or preferential practices (no blocking or slowing down access to particular sites and no “paid prioritizations” where content providers can pay a fee for faster bandwidth).

The 2015 rules came in response to two legal cases the FCC lost because both courts ruled the FCC didn’t have the right to sanction ISPs for slowing Internet access—in one case, Comcast was slowing access for peer-to-peer file sharers it suspected of sharing copyrighted material—as long the agency classified broadband Internet access as an information service. It’s worth noting the FCC’s initial reaction was to throw in the towel. In 2014 it said it would propose rules that would allow content providers to pay for “fast lanes” from ISPs. (In 2013, Comcast had already been trying to extort fees from Netflix by inhibiting its streaming capacities.) Citizens responded en masse to the announcement though, and the FCC eventually backtracked on its capitulation.

Unsurprisingly, the telecommunications industry and its surrogates in the media loathed the 2015 rules and lauded their overturn this past week. For example, Brent Skorup, writing for the National Review, said the 2015 rules “ratifie[d] the FCC’s decade-long transformation from economic regulator to social regulator and, if not reversed, will do lasting damage to US technology and free speech.” Reason’s Andrea O’Sullivan told her readers that current FCC Chairman Ajit Pai’s plan to overturn the rules is a “real win for those who believe businesses should not need government permissions before innovating.” (Both Skorup and O’Sullivan work at the George Mason University-affiliated Mercatus Center, one of those few brave think tanks making sure corporate executives still have a voice in our democracy.) In the week leading up to the FCC’s recent decision, the agency’s website was flooded with fake comments supporting the proposed rollback.

Chairman Pai has been described by his opponents as a “free-market ideologue,” but for an ideologue he seems remarkably uncomfortable with ideas. At his first Senate hearing as FCC head, Pai was asked what he thought about President Trump’s hostile declaration that certain media outlets are the “enemy of the American people,” for which he lachrymosely replied, “I believe that every American enjoys the First Amendment protections guaranteed by the Constitution.” Asked in a subsequent interview to respond to the public ridicule he received for his faint-hearted reply, Pai then played victim and said that those it bothered are “going to oppose anything” he says or does. He then accused those who mocked him of being hypocrites when it comes to free speech for having “nary a word to say about the lack of free speech on college campuses, the censoring of the speech over the Internet in foreign countries.” The self-pity is almost as cringe-inducing as the humorless affectation.

The typical pro-capitalist siren songs about bureaucratic obstacles to innovation, inclusion, and participation were all played in opposition to the FCC’s net neutrality rules. Fear was spread about potential political censorship. (Pai himself entertained the possibility, saying it was “conceivable” that the FCC would eventually seek to regulate the speech of content providers with something like a modern-day Fairness Doctrine.) The free-speech problem of letting ISPs function as the editors and gatekeepers of the Internet was acknowledged, then ignored. After all, wouldn’t you rather have competing telecom businesses control access to online content rather than the government? And won’t ISPs just use this gate-keeping power to offer customers free stuff (e.g., not include popular websites like YouTube and Spotify in data usage)? Some—including Republican senators Ted Cruz, Ron Johnson, and Mike Lee—made the linguistic point that the phrase “net neutrality” wasn’t even around until 2003, and the Internet was working just fine before then.

It’s true that regulations can stifle innovation and give an institutional advantage to larger, more established companies. Larger companies usually have more uncommitted capital for lawyers and entry fees, a revolving-door relationship with the federal agency supposed to be regulating them, and pull at the local level for their financial contributions to sports and culture. However, ISPs already have an innovation problem—mainly, there’s been almost none except for in potential new revenue opportunities. In fact, the industry’s desire for another new revenue opportunity is one half of why ISPs wanted the 2015 rules overturned. The other half of course being the immense power that comes with being gatekeepers to the Internet. As for the argument about regulations giving institutional advantages to larger companies, the big ISPs have already voted on this with their dollars. The telecommunications industry has given federal and state legislators billions of dollars to vote against net neutrality principles. In the choice between an institutional or an access-granting advantage, the industry has clearly chosen the latter.

The rest of the arguments listed are frankly stupid and, as was mentioned at the start, almost certainly dishonest. Pai has repeatedly claimed there have been no actual instances of ISPs controlling speech they disagree with, even though there have been numerous such cases. Concern over a slippery slope to censorship is exactly why the decision-making power should be taken from the FCC and given to Congress—something those who make the argument vehemently oppose. Perhaps only the Treasury Department has a worse revolving-door with the industry it’s meant to regulate than the FCC. Not to mention that the executive branch has already become a state within the state and needs no more power than it currently has. The 2015 rules didn’t give government “control” over the Internet. And Senators Cruz, Johnson, and Lee, things can exist before we have words for them.

The telecommunications industry wants to become the rentier class of the digital age. It also wants the power to censor speech it doesn’t like and promote speech it does. First ISPs will censor terrorists and criminals. Then it’ll be radicals and organizers. Finally it’ll be anyone vaguely endangering the status quo. One already sees a similar process underway with platform providers. So long as long-term solutions that make any real difference are off the table, the best citizens can do is use public institutions to put a check on concentrations of power and capital. In the case of a neutral net, content providers and ISPs have conflicting interests—not necessarily a bad thing, but not a tension that will lead to serious resolutions.