The merry-go-round of net neutrality continued its seemingly endless ride yesterday, as word came from the Federal Communications Commission (FCC) that the agency is considering yet another try at regulating the Internet.
According to news reports, the new proposal being circulated to the five commissioners by Chairman Tom Wheeler—which would be the FCC’s third bite at this apple in nine years—would allow Internet service providers (ISPs) such as Verizon and AT&T to provide express service to Internet content providers such as YouTube and ESPN. The new rules would ban only outright blocking of web content by the ISPs.
Supporters of comprehensive net neutrality regulation were aghast. The advocacy group Free Press, for instance, called the plan an “insult” to those who support an open Internet and an act of “political cowardice.”
That’s more than a bit overblown. The FCC’s two previous sets of rules were tossed out in 2010 and in January of this year by the D.C. Court of Appeals as exceeding the FCC’s authority. In response to the last defeat, pro-regulation extremists had pushed Wheeler to issue a kind of nuclear option: declaring ISPs to be common carriers, subjecting them to the full anti-discrimination rules along with an untold number of other rules made for early-20th-century public utilities. Such an approach would be disastrous for the 21st-century Internet. Wheeler is wise to reject it.
But while the new proposal excludes the most intrusive option, that doesn’t mean it’s a good plan. ISP service offerings would be subject to FCC review for “commercial reasonableness,” creating a clear opportunity for regulatory mischief. And the bar on blocking websites could still stymie many pro-consumer business strategies. Competition law, in fact, has long recognized the potential benefits of exclusive dealing—just think Apple.
There is also a more fundamental problem with this latest FCC proposal. It gets the agency’s foot in the Internet’s front door, allowing it to move from its traditional role as regulator of telephone companies and broadcasters to become a sort of Federal Internet Commission. That would be bad news for Internet users and for the economy.
The Internet is doing just fine without oversight from the FCC. (And if any competition problems arise, antitrust regulators such as the Federal Trade Commission are well equipped to handle them.) Policymakers should just say no to the FCC’s plan for regulating the Internet.