Last week, the president called on the Federal Communications Commission (FCC) to reclassify broadband service under Title II of the Telecommunications Act of 1934. We fully agree with the president when it comes to his goals for an open Internet. There should be no blocking, throttling, or paid prioritization by companies looking for faster lanes than their competitors. In addition, ISPs should be completely transparent. The one thing we differ on is regulating the Internet under Title II, a piece of legislation created decades ago for the regulation of obsolete devices.
The president’s approach is the wrong way to go especially when considering the recently released Pew Internet Project report on “Killer Apps in the Gigabit Age.” The report detailed these experts’ beliefs about the breathtaking future that could be possible when connection speeds reach 1,000 megabits of information per second, about 100 times faster than speeds commonly available today in the United States.
These speeds will allow far more data to pass between and through networks. Many experts who responded to Pew’s questions looked forward to the commonplace use of virtual realities and avatars for meetings, sporting events and long-distance family dinners. Daily home check-ins from devices and far away medical professionals could revolutionize healthcare. Shopping could become a completely different experience with consumers choosing new dresses online and having them appear on a home 3-D printer queue soon after.
Ensuring everyone has access to these coming developments should be a major priority in the Internet Age. Twenty years ago, the talk of a digital divide in computer access became commonplace. In recent years, Pew has well-documented the disparity in broadband access for African American, Latino and other under-resourced communities. Since these communities are already at a disadvantage when it comes to broadband access, it makes them significantly more vulnerable to policies that could potentially impede innovation or progress within the industry.
Obama made the right call by taking on the challenge of getting schools and libraries access to faster broadband through his ConnectED initiative and modernizing the Universal Service Fund. Getting those students high-speed broadband access at home requires private sector investment and that means creating more certainty. According to the Progressive Policy Institute, broadband providers spent “roughly $46 billion in broadband investment in 2013.” To continue promoting this type of private sector investment we must not over-regulate innovative broadband providers using antiquated policies that may end up being litigated for years and diminish the certainty of being able to bring high-speed, advanced broadband networks to all Americans.
Technology has surpassed the days of the rotary phone system and has created a dynamically competitive Internet ecosystem that touches virtually every sector of the economy from banking, ordering a taxi, or even receiving medical attention. In the early part of the twentieth century no one could have imagined how the phone would transform and ultimately provide the technological capabilities it offers us today. Similarly, society can only speculate as to the potential benefits that further technological advancement will make possible in 10 or 20 years. Adding another layer of bureaucratic oversight on this dynamic industry will hinder innovation and potentially discourage investment. Innovative and forward thinking companies would face the inevitable requirement to obtain government approvals and investors may be forced to look elsewhere for capital returns to avoid the uncertainty of navigating the labyrinth of bureaucratic approval processes.
A better option exists that would provide the necessary oversight to preserve the Open Internet. The courts have made clear that Section 706 of the Telecommunications Act of 1996 provides the FCC with enough authority to “encourage the deployment on a reasonable and timely basis of advanced telecommunications capability to all Americans.” That would foster an environment for investment flexibility and open access.
Investment flexibility matters not only to broadband companies and individual consumers but also to technology companies founded by African American and Latino entrepreneurs. Though these companies tend to operate with smaller profit margins, they also tend to hire more minorities. That matters when unemployment among Black and Latino communities remains higher than white unemployment. Many companies would not be able to survive the added costs of complying with Title II regulations that may impact “edge providers.”
The FCC should pursue the President’s push for an open Internet, but we recommend using a lighter regulatory approach such as Section 706. Focusing on regulatory solutions that ensure access, innovation and investment will keep all Americans benefitting from these digital advancements.
As Chairman Wheeler himself said in October 2014, “Twenty-first century consumers shouldn’t be shackled to rules that only recognize 20th century technology.”
We couldn’t agree more.
Simmons is co-chair of IIA and Mendoza is executive director of HTTP.