Toward a Neutered Net

Editor's Note: Recently, Contributing Writer Jack Karsten wrote a piece about net neutrality and consumers' interests. Here, Jordan Sotudeh offers up an alternative take.

In May, the Federal Communications Commission (FCC) invited the public to take part in a discussion of how it should address net neutrality and received over a million comments—the most in its history. The FCC proposed a sweeping set of regulations in 2010 that was thrown out of court in 2014 due to a lack of legal grounding in the text itself. A great deal of attention has been paid to the possibility of pay-for-priority deals, as in a previous International Affairs Review article by my colleague, Jack Karsten. The FCC's stated goals of protecting an open Internet and encouraging competitive innovation among Internet Service Providers (ISPs) is a good start, but the regulations need to be more precise in their purview. Specifically, the regulations must prevent practices employed in developing countries where large companies buy the right to have priority access on networks. Such regulations would make clear that neither business nor government can impede public access to the Internet.Internet should be as easily accessible as possible, as shown by research by New York University. In 2012, NYU ran a series of statistical analyses on country-year data of the world's Internet usage and other political and economic indicators against the rate of anti-government demonstrations. The report found that, contrary to hypotheses, the Internet acts more like a public good than a coordination good. Essentially, democracies that impede access to the Internet (via censorship) were more likely on average to experience protests. This does not suggest that corporate control of what types of data the public has access to is the same as censorship, but it does suggest that potential exists unless the public firmly delineates the boundaries of how ISPs can control the data they transport. However, using the traditional method of defining a public good, the Internet would only count when there is more than enough for everyone. Ultimately, treating the Internet like a key piece of infrastructure that enables massive parts of the economy—like roads or education—derives directly from a tally of the Internet's benefits.The most difficult thing about broad reform is that each group with a vested interest will attack the whole scheme based upon individual fears. The breadth of the problem is unavoidable; the FCC would have to change the classification of wired Internet service from an "information service" to a "telecommunications service.” The suggested regulations cover two main points of reform: 1) the ability to prevent companies from denying, throttling, or otherwise degrading service to individual customers and 2) reviewing data plans by ISPs as "commercially viable." Essentially this would mean that ISPs do not seek easy profits while neglecting innovation and investing in infrastructure. For example, Comcast was found to be preventing its customers from sharing files online in 2007. This is the scenario "net neutrality" proponents fear most, despite (or perhaps because of) it has yet to be addressed to their satisfaction in proposed regulatory reforms. For the latter regulation, telecom companies argue that the ability to tailor their pricing to given goods or data will give them the returns needed to invest in newer and better service. Many Internet companies, including Netflix, have challenged the most recent proposed changes, specifically the "fast lane" provision that would let Verizon and Comcast charge companies more for guaranteed access. New and smaller Internet companies that focus on high bandwidth data, like video, would face a barrier to entry in the market that would stifle entrepreneurs and the U.S. economy.The best way to preserve commercial ISPs and encourage them to treat customers well and maintain fair prices is competition. High-priced plans would be rendered irrelevant by a diverse market that gave consumers diverse options to choose from. The same sentiment holds true for businesses. In this, the FCC continues to fall short of adhering to a "laissez-faire means free" attitude. Indeed, U.S. Internet speeds are 31st and 42nd because the U.S. lacks competition, a state of affairs that imposes significant costs on the American economy. The FCC should encourage companies to invest in infrastructure rather than give them the right to levy a new tax on consumers for doing what is in everyone's long term interest: better connections and more data for more people.The FCC should not allow companies to institute discriminatory payment policies, which are essentially monopoly rents, without giving consumers access to alternatives. Instituting the current regulations would give consumers too little protection from companies and burden ISPs with further regulatory constraints without closing the loopholes that limit competition. Whether choosing to attack the problem piecemeal and letting companies develop themselves or trying to leapfrog by encouraging only the most cutting edge connections, the FCC must recognize that the increasingly outdated U.S. Internet infrastructure will require more than just freedom of expression and E-Z pass broadband lanes.The FCC needs to be stronger in its protection of unbiased access to the Internet and encourage competition. This does not exclude the various payment plans suggested, but does suggest steps to preserve the type of access American consumers have come to expect. The FCC regulations accomplish their enforcement of freedom of access and use of the Internet, but do not go far enough in preventing ISPs from being inordinately sensitive to the immediate interest of shareholders, often to the detriment of consumers and the wider infrastructure.