Regulation Could Slow Our Future

The New York Times Room for Debate posted this question:

What should we expect from the F.C.C.'s new rules to regulate Internet providers, and what does the future hold for network neutrality?

Brent Skorup provided the following response:

The Federal Communication Commission’s authority to enforce net neutrality rules against Internet Service Providers has always rested on dubious legal theories. This isn’t surprising considering that the F.C.C. is operating under the 1996 Telecommunications Act. When that law was written, AOL was the world’s largest I.S.P. at five million subscribers — about how many people watched the season premiere of Netflix’s "House of Cards" this year on its opening weekend. Congress certainly didn’t foresee broadband networks becoming a primary source of news, television, music, correspondence and phone service for tens of millions of people. No wonder the F.C.C. struggled for over a decade to find permissible legal authority to regulate the commercial relationships between Silicon Valley, media companies and I.S.P.'s.

Harsh new rules would preclude future prioritized traffic for online gaming, cheaper television packages, and other services.

Net neutrality proponents cite as their goal a seemingly uncontroversial principle about equal treatment of traffic — a misleading slogan. They direct their ire toward prioritized digital traffic, pejoratively called broadband “fast lanes.” Few of them know or acknowledge that the F.C.C. permits and will continue to permit prioritized traffic in some circumstances. Prioritized data allows millions of people to have phone service through cable companies and millions more access to video-on-demand content. Harsh new rules would preclude future prioritized traffic for online gaming, cheaper television packages and other services on the horizon.

An alternative to legally suspect net neutrality rules is for the Federal Trade Commission to investigate and prevent conduct by providers that harms consumers or competition. Before the F.C.C.’s ill-advised net neutrality crusades, the Federal Trade Commission knew the possible threats to the Internet and policed broadband markets. Given the president’s 2008 campaign promise to implement net neutrality, however, it’s nearly certain the F.C.C. will craft new rules this year. In the American economic system, markets should be the default and onerous regulations a last resort. With net neutrality, unfortunately, motivated activists and academics have turned that time-tested principle on its head.