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FCC Net Neutrality repeal defies public support, legal battle looms ahead
Critics of the impending repeal point to Portugal's bundling and tiered internet pricing as an example of what the US market will likely look like.
Like all hot-button issues in America today, there is a radical divide in how interest groups perceive the impact of repealing net neutrality. Proponents of the repeal say it will help with “investment and innovation” by ISPs, while net neutrality supporters say it’s nothing more than payback to big telcos and threatens open internet access and even free speech.
Federal Communications Commission (FCC) Chairman Ajit Pai is a former Verizon lawyer. Given that history, it’s challenging not to be at least somewhat cynical about his motives (others are less charitable). But it’s also fair to say we don’t know exactly what will occur if the repeal happens, which it probably will.
The FCC is scheduled to vote in two weeks on the matter, and the repeal proposal is expected to pass by a party line 3-2 vote. (Republicans hold the majority of seats). Those seeking to preserve net neutrality, including Google, Facebook, Amazon and a collection of consumer groups (among others) argue that a repeal will:
- create fast and slow lanes to prioritize or discriminate against content types or publishers.
- create fees that would amount to a kind of blackmail for many content producers.
- negatively impact the ability of smaller content publishers and startups to reach audiences.
- turn the internet into a cable-TV-like experience with undesirable content bundling.
- create new opportunities for corporate abuse and anticompetitive behavior.
- ultimately harm economic growth.
Net neutrality repeal proponents argue that:
- current regulations represent “government overreach” and stifle innovation.
- repeal will motivate new broadband investments.
- create new models and experiments for service delivery.
- before net neutrality, there wasn’t any abuse.
- it’s only fair to charge high bandwidth users (e.g., Netflix) more money to deliver services to consumers.
- it will create more “balance” in the market (i.e., telcos/ISPs vs. Google, Facebook, Amazon).
I don’t think all the “doomsday scenarios” presented above will come to pass. Repeal also isn’t likely yield some explosion of consumer-friendly innovation, either. At least some negative impacts on consumers are almost certain.
For example, repeal critics point to Portugal as a harbinger of a world without net neutrality. In Portugal (and the UK, where there’s no neutrality), there’s content bundling and tiered pricing: basic internet and premium tiers for additional services/content. ISPs in those markets do favor some of their own content and partners over third parties.
Survey evidence argues the majority of US consumers oppose repeal of net neutrality rules. However, Pai and his colleagues appear intent on rolling them back despite this sentiment. But FCC repeal probably isn’t the end of the issue.
There will likely be lawsuits seeking to preserve net neutrality in its current form, arguing that an ideological shift in the composition of the FCC doesn’t justify the rule change by itself. Indeed, with the decision seemingly preordained, the courts may be the last line of defense for net neutrality.