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Posts Tagged ‘Title II’
April 12th, 2019 at 1:39 pm
House Democrats Revive Obama FCC’s Ruinous Effort to Regulate Internet
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What’s old is somehow new again on the political left.

Desperate for what they perceive as street cred, leftists continue to repackage failed policies as somehow novel, in a destructive race to claim the most extreme realms of the political continuum.

Merely three decades after it was consigned to the dustbin of failed ideas, socialism actually maintains renewed popularity on the left.  According to Gallup, a majority of Democrats no longer view capitalism favorably, but almost 60% view socialism positively.

People like Representative Alexandria Ocasio-Cortez (D – New York) advocate a return to income tax rates not seen since President John F. Kennedy began cutting them.  Thirty-five years after Jeane Kirkpatrick delivered her famous 1984 Republican convention speech castigating those who “blame America first,” people like Representative Ilhan Omar (D – Minnesota) tweet, “We must confront that our nation was founded by genocide and we maintain global power through neocolonialism.”

Not to be outdone, Democrats in the House of Representatives have joined the fray by attempting to resuscitate one of the Obama Administration’s most foolish and demonstrably destructive agenda items – to begin regulating the internet as a public utility.

Think of it as socialism for the internet.  What could possibly go wrong?

Plenty, it turns out.

From 1996 through 2015, the internet flourished like no other innovation in human history, precisely because the federal government from the Clinton Administration forward employed a “light-touch” regulatory approach.  Just ask yourself what was “broken” about the internet that somehow cried out for a federal bureaucratic “fix” during that two-decade stretch of unprecedented innovation and transformation of our lives.

But like so many other realms of American economic and civic life, the Obama Administration decided in 2015 that the internet merited its trademark brand of hyper-regulation.  Specifically, its Federal Communications Commission (FCC) suddenly decided to regulate internet service as a “public utility” under statutes enacted in the 1930s for copper-wire telephone service.  In Orwellian fashion, the Obama Administration and its apologists throughout the media and entertainment industries labeled it “Net Neutrality,” when by definition federal commandeering of an entire industry and picking winners and losers via the business model it imposes is anything but “neutral.”

So how did the Obama FCC’s scheme work out?

Disastrously.  For the first time in history outside of a recession, private investment in network infrastructure by service providers actually declined.   By way of comparison, investment in wireless alone had increased almost 33% – from $25 billion to $33 billion – between 2010 and 2013, even amid the most sluggish cyclical economic “recovery” in history under the Obama Administration.  But in the first year alone following the Obama FCC’s bright idea to regulate the internet, investment declined by an astonishing $5.6 billion.

In other words, investment declined in just one year by almost the entire amount that wireless investment had increased from 2010 to 2013.

When the Trump Administration arrived, one of its first priorities under new FCC Chairman Ajit Pai was to reverse that destructive Obama Administration boondoggle.

Latenight comedians and leftists in media and politics attempted to convince Americans that the sky was falling, and that this would “break the internet.”  But as noted above, it was the Obama Administration’s 2015 effort that was breaking the internet, while the Trump FCC under Ajit Pai was merely restoring the light-touch regulatory approach that had allowed the internet to evolve and flourish from 1996 to 2015.

The results have been immediate and positive, as highlighted by a Recode piece entitled “U.S. Internet Speeds Rose Nearly 40 Percent This Year”:

The internet is getting faster, especially fixed broadband internet.  Broadband download speeds in the U.S. rose 35.8 percent and upload speeds are up 22 percent from last year, according to internet speed-test company Ookla in its latest U.S. broadband report.  The growth in speed is important as the internet undergirds more of our daily lives and the wider economy.  As internet service providers continue building out fiber networks around the country, expect speeds to increase…” 

 

But now, House Democrats have introduced legislation to return to the Obama Administration’s destructive internet regulation regime.  Perhaps airheaded latenight comedians like Jimmy Kimmel, Stephen Colbert and John Oliver find that prospect soothing, but nobody else should.

“The United States has turned the page on the failed broadband policies of the Obama Administration,” FCC Commissioner Brendan Carr announced this week.  “By getting government out of the way,” he added, “internet speeds are up 40%, the digital divide is closing across rural America, and the U.S. now has the world’s largest deployment of next-generation 5G networks.”  Carr continued, “There’s a lot of common ground on net neutrality, but this bill studiously avoids it.  It elevates the partisan politics of Title II over widely supported rules of the road, and would turn back the clock on the progress America is making,” he concluded.

Wise words.   We all want net neutrality, but heavy-handed federal regulation of internet service is precisely the opposite.   We’ve already witnessed the unwelcome consequences of that scheme, as well as the beneficial consequences of reversing it under the new FCC leadership.  House Democrats’ legislation must be swiftly rejected accordingly.

 

 

August 22nd, 2018 at 3:30 pm
ALERT: Urge Your Member of Congress Not to Become Pelosi’s Next Puppet on Internet Regulation
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Democrats in the House of Representatives – led by Minority Leader Nancy Pelosi (D-Calif.) and Rep. Mike Doyle (D-Pa.) – are pushing to reinstate Obama-era, big-government Title II regulations on the internet through a legislative procedure known as a Congressional Review Act (CRA). Now they are pressuring some Republicans to help them get to the 218 signatures needed to force a vote on the CRA.

The Pelosi-Doyle CRA is not about sound internet policy; it is a politically motived, partisan effort to restore a stifling “Mother-May-I” regulatory framework on the internet that has already proven to slow private investment in internet network infrastructure and cost well-paying jobs.

Call your representative in Congress now.  Tell her/him to not become Pelosi’s next puppet on internet regulation.  Ask her/him to oppose the Pelosi-Doyle CRA.

Make no mistake, Title II regulation is NOT “net neutrality.” Indeed, there is widespread agreement and support – Republicans, Democrats and stakeholders alike – for the core principles of “net neutrality.”

But instead of working on commonsense, bipartisan legislation that will truly protect those principles while at the same time enabling the internet to thrive, Pelosi, Doyle and others want to politicize the issue and are pushing for the internet to be regulated like a public utility under a bureaucratic framework that was crafted way back in the 1930s, well before the internet was ever invented.

Adding insult to injury, the Pelosi-Doyle CRA gives a free pass to big tech companies, like Facebook and others, for how they treat consumer privacy and data online – what most consumers really care about when using the internet.

Unfortunately, Pelosi and Doyle have managed to convince one Republican congressman thus far – Representative Mike Coffman (R – Colorado) – to sign their discharge petition and support the CRA.  And right now, they’re using Coffman’s support to pressure other Republicans to join their effort.

Call your representative in Congress now.  Tell her/him to not become Pelosi’s next puppet on internet regulation.  Ask her/him to oppose the Pelosi-Doyle CRA.

Congress has a golden opportunity to come together on commonsense legislation that holds all internet companies to the same standards and preserves the core principles of “net neutrality” without the hyper-regulatory approach of the CRA and Title II.

The Pelosi-Doyle CRA must be rejected. Please call your representative in Congress now.

May 18th, 2018 at 12:06 pm
Image of the Day: What Obama FCC Internet Regulation Did to U.S. Broadband Investment
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Inexplicably, the U.S. Senate this week narrowly moved to restore 2015 Obama Administration Federal Communications Commission (FCC) crony capitalist internet regulations.  Here’s the effect that Obama FCC regulation immediately had on mobile broadband investment.  It’s now the duty of the House of Representatives and the Trump Administration to kill this mindless Obama-era attempt to regulate the internet, and we encourage everyone to contact their Representatives and the White House to demand that action.

Neutering the Net

Neutering the Net

December 5th, 2017 at 12:26 pm
Image of the Day: Leftist Net Neutrality Illogic
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This actually captures the illogic among those who advocate tighter federal government control over the internet fairly well:

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Net Neut Illogic

Net Neut Illogic

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November 16th, 2017 at 11:21 am
FCC Should Preempt Individual State Attempts to Regulate the Internet
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Among the many positive changes within the federal government since the end of the Obama Administration and the arrival of the Trump Administration, perhaps none surpass those brought by the Federal Communications Commission (FCC) under new Chairman Ajit Pai.

And the most welcome and beneficial change undertaken by the new FCC is its action to rescind Obama FCC decisions to begin regulating the internet as a “public utility” under statutes passed in the 1930s for old-fashioned, copper-wire telephone service.  The Obama FCC’s action instantly began to stifle new broadband investment, and was subject to legal reversal.  The internet thrived for two decades under both the Clinton and Bush administrations precisely due to the federal government’s “light touch” regulatory policy, and there was simply no rational justification for reversing twenty years of success in the name of even more federal government regulation and crony capitalism.

As the new FCC approaches completion on restoring regulatory sanity to internet service, it’s important that it include a preemption against future state efforts to regulate the internet in the same way that the Obama FCC hoped to make permanent.  We at CFIF take a backseat to no one in terms of valuing America’s federalist system, and the ability of individual states to serve as “laboratories of democracy.”  But there’s an important limit, one that is specifically included in the text of the Constitution.  Namely, matters of interstate commerce.  Our Founding Fathers recognized, based upon  economic warfare that they’d witnessed under the Articles of Confederation, that individual states cannot act in ways that disrupt truly interstate commerce in ways that contravene federal policy.  Accordingly, the Constitution specifically and rightfully empowers the federal government to protect interstate commerce against destructive state interference.

And there are few, if any, sectors of our economy more “interstate” than the internet.  Indeed, the internet is interstate by its very nature.  Doug Brake of the Information Technology & Innovation Foundation summarized the logic well in a commentary this month:

National and regional networks should be subject to uniform rules to keep compliance costs low and reduce complexity.  To the extent the upcoming changes to net neutrality regulation see any changes in business practices, which would be more minor than many expect, a uniform policy that allows for broad scale would be an important benefit…   Network applications now depend on economies of scale independent of the individual state in which they are consumed.  Technological advances are simply erasing the importance of state and local boundaries.  It is in the national interest to give these technologies room to grow unimpeded by artificial borders.

As such, beyond simply declaring broadband an information service, the FCC should make clear that broadband policy is made at the national, not state, level.  Former Chairman Kennard put it well in a 1999 speech titled ‘The Unregulation of the Internet:  Laying a Competitive Course for the Future.’   There he laid out why it was ‘in the national interest that we have a national broadband policy … a de-regulatory approach, an approach that will let this nascent industry flourish.'”

That’s exactly right, and it’s no less true today than it was in 1999.  The internet needed room to grow then, and it needs room and regulatory predictability to continue growing as it plays a progressively important role in  our lives and globally competitive economy.

We cannot allow a spaghetti bowl of individual state regulations to inhibit future internet expansion and innovation, and the FCC should act to preempt that destructive possibility.

September 27th, 2017 at 12:02 pm
Net Neutrality “Day of Advocacy” – A Reality Check

Today, activist organizations, including Free Press, Public Knowledge and Fight for the Future, plan to descend upon Capitol Hill offices to underscore their disapproval of Federal Communications Commission (FCC) Chairman Ajit Pai’s proposed plan to repeal the Obama Administration’s 2015 “Open Internet Order” classifying Internet Service Providers (ISPs) as public utilities under Title II of the 1934 Communications Act.

In anticipation of their effort, the Center for Individual Freedom teamed up with the Taxpayers Protection Alliance to provide Congress with a “Reality Check” of key messaging and themes to expect from those groups as they visit with lawmakers.

Read the document here.

May 18th, 2017 at 12:35 pm
CFIF Applauds FCC Vote to Advance NPRM to Restore Internet Freedom
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ALEXANDRIA, VA – Today, the Federal Communications Commission (“FCC”) voted to advance a Notice of Proposed Rulemaking (NPRM) on the “Restoring Internet Freedom” proposal championed by Chairman Ajit Pai and Commisser Mike O’Reilly that would return federal internet regulatory policy to the light-touch approach that prevailed from the 1990s onward, until the Obama Administration FCC moved to reclassify the internet as a “public utility” in 2015.

In response, Center for Individual Freedom (“CFIF”) Senior Vice President of Legal and Public Affairs Timothy Lee issued the following statement:

“Beginning in the 1990s, the internet flourished and transformed our world like no innovation in history for a simple reason:  Administrations of both political parties over two decades, beginning with Clinton/Gore, wisely chose a ‘light touch’ regulatory approach to the internet.

“Then in 2015, the Obama Administration FCC suddenly and radically reversed two decades of bipartisan consensus by moving to reclassify internet service as a ‘public utility’ under laws enacted in 1934 to regulate old-fashioned copper-wire telephone service.

There was no justification for that sudden reversal, and it was not based upon evidence, law or logic.  The internet obviously wasn’t ‘broken’ or in need of heavy-handed federal regulatory ‘fix.’  It was merely a scheme to extend government control over yet another sector of our economy.

“Nor was reclassifying the internet as a ‘public utility’ something the American public supports.  A recent Morning Consult survey confirms that an overwhelming and bipartisan 78% of voters prefer little or no government regulation of the internet, with only 12% favoring a heavy-handed regulatory approach.  A broad 51% to 33% majority believes that the internet shouldn’t be regulated as a public utility, and a two-to-one majority agrees that regulating the internet as a utility slows innovation and decreases private tech investment.

“Unfortunately, the Obama Administration FCC’s decision to reclassify the internet as some sort of Depression-era ‘public utility’ had immediate negative consequences, confirming the public’s expectation.  Domestic broadband capital expenditures declined by 5.6%, or some $3.6 billion, which marked the first time that such investment declined outside of a recession during the internet era.  That applied to both large and small internet service providers.

“Proponents of heavy-handed internet regulation continue to employ irrational scare tactics and hyperbole in their effort to regulate the internet more heavily, but their claims are contradicted by straightforward history and logic.  All reasonable people agree that the internet should remain free and open, which was how the internet operated for two decades across administrations of both parties under the light-touch regulatory approach.

“Accordingly, today’s FCC vote simply advances the ball to restore the bipartisan, light-touch regulatory consensus that existed for more than two decades.  This is precisely the sort of common sense that is badly needed in Washington, and CFIF applauds FCC Chairman Pai and Commissioner O’Rielly for moving to restore the regulatory wisdom that the American public overwhelmingly prefers.”

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May 17th, 2017 at 11:41 am
Former FCC Commissioner: “The FCC Gets Set to Free Wireless”
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In today’s Wall Street Journal, former Federal Communications Commission (FCC) commissioner Robert McDowell offers a timely and instructive commentary entitled “The FCC Gets Set to Free Wireless,” in which he explains the important work by new FCC Chairman Ajit Pai:

The Federal Communications Commission this month is launching initiatives that will shape the fate of America’s wireless industry.  Last week it started to examine competition in the market, and this week it will propose taking Depression-era utility regulations off mobile broadband while protecting an open internet.  This is only the beginning.  The FCC is acting on a rare opportunity to correct its recent mistakes and restore the Clinton-era light-touch regulatory framework that will drive economic growth and job creation.”

As we at CFIF have detailed, the internet flourished over two decades like no other innovation in human history, precisely because of the light-touch regulatory approach started under Clinton as McDowell notes, and continued through the Bush Administration.  But in 2015, Obama’s FCC under former Chairman Tom Wheeler decided to “fix” an internet that wasn’t broken by regulating it as a “public service” under the 1930s copper-wire telephone laws that McDowell references.  As Chairman Pai recently noted, domestic broadband capital expenditures fell for the first time ever outside of a recession.

McDowell notes how the mobile industry experienced “an explosion of entrepreneurial brilliance,” incredible innovation in just a few short years, massive investment, falling consumer prices (25% in the past decade) and arrival of the app economy.  Importantly, he highlights that, “Three quarters of the companies in the global app economy are American.”  Unfortunately, the Obama FCC’s rush to commandeer yet another sector of the U.S. economy imposed an unnecessary threat to that innovation:

Yet since 2009, the FCC has ignored its own studies and refused to determine that the market is competitive. That would have contradicted the rationale for its regulation binge, but new political and market realities make a fresh start possible.”

Fortunately, new leadership under Chairman Pai offers the opportunity to correct that mistake before the harm intensifies:

The FCC should begin by liberating wireless from the heavy-handed rules of a 1934 law called Title II, which was created when phones were held in two hands.  This antiquated law imposes powerful economic regulations on the internet, chilling investment in broadband.  On Thursday the FCC will propose to unshackle the net from this millstone of a law.  This would restore the bipartisan light-touch policies that nurtured the burgeoning internet Americans enjoy today.”

It’s unfortunate that a federal bureaucracy decided in its wisdom that regulating the thriving internet as a “public utility” under a 1934 law was a good idea in the first instance.  But as McDowell cheerfully notes, the opportunity to prevent further harm and restore the innovation and investment that characterized internet service for over two decades is here.  For that we should thank Chairman Pai and support his common-sense restoration of regulatory sanity at the FCC.

May 12th, 2017 at 1:02 pm
Poll: Americans Overwhelmingly Favor FCC Chairman Pai’s “Light Touch” Internet Regulatory Approach
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Activists advocating heavy-handed internet regulation of the type pushed by the Obama-era Federal Communications Commission (FCC) pretend that they’re the ones crusading on behalf of everyday consumers.  The reality is that the internet flourished as no innovation in human history precisely because both the Clinton Administration and Bush Administration maintained a “light touch” regulatory stance from the FCC.

But then in 2015, the Obama Administration decided that it must “fix” an internet that wasn’t broken, through a narrow party-line FCC vote to regulate internet service as a “public utility” under 1930s laws enacted for copper-wire telephones.

The result:  internet infrastructure investment fell for the first time ever outside of an economic recession.

Fortunately, new FCC Chairman Ajit Pai is restoring common sense by returning internet regulation to the “light touch” approach that worked for two decades and under Clinton and Bush.

Now there’s more good news, highlighted by the good folks over at the Institute for Policy Innovation (IPI).  According to a new Morning Consult survey, Americans overwhelmingly favor a light-touch FCC regulatory approach toward internet service:

–  By an overwhelming 78% to 12% margin, voters support the government having little or no regulation of the internet, with 53% supporting a ‘light touch’ and 25% asserting that the government should not regulate the internet at all.

–  By an 18-point margin (51% versus 33%), voters say the internet should not be regulated as a public utility.

–  By a two-to-one margin, voters believe regulating the internet as a utility would slow innovation and decrease private tech investment.

–  Support for light-touch regulation is bipartisan, including 55% of Democrats, 52% of Republicans, and 52% of Independents.  Perhaps surprisingly, 21% of Democrats favor NO government regulation of the internet, along with 27% of Republicans and 26% of Independents.”

Chairman Pai is demonstrating admirable courage and leadership in restoring regulatory sanity at the FCC, and it’s always encouraging to confirm that the American electorate agrees with him.

July 7th, 2016 at 2:36 pm
Second Amendment Sit-Ins and Net Neutrality
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Timothy Lee, CFIF’s Senior Vice President for Legal and Public Affairs, discusses the recent U.S. Court of Appeals for the D.C. Circuit decision upholding the FCC’s net neutrality regulations, what those regulations could ultimately mean for consumers, and the Capitol Hill sit-ins and untruths offered by 2nd Amendment rights opponents.

Listen to the interview here.

June 14th, 2016 at 6:13 pm
Divided Court Allows FCC to Use Law Intended to Reduce Internet Regulation to Increase Internet Regulation
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Like most Americans, you probably had no idea that the Internet was somehow broken and in need of an Obama Administration “fix” via a Depression-era federal statute enacted for copper wire telephone technology.

And with good reason.  For two decades, America’s tech and Internet sectors have remained among the depressingly few areas of our economy that continued to flourish amid an era characterized by stagnating growth, employment and incomes.

Throughout the Obama tenure, however, his Federal Communications Commission (FCC) has attempted over and over to upend the “light touch” regulatory approach of both Democratic (Clinton) and Republican (Bush) administrations that allowed the Internet to flourish as it has.  Today, unfortunately, a sharply divided D.C. Circuit Court of Appeals finally affirmed the FCC’s most recent attempt to impose so-called “Net Neutrality” regulations that essentially equate to ObamaCare for the Internet.

As aptly summarized by Senior Circuit Judge Williams’s dissent, today’s decision allows FCC “use of an Act intended to ‘reduce regulation’ to instead increase regulation.”

Judge Williams cogently captured not only the legal illogic of the majority’s holding, but its real-world unintended consequences as well:

“The ultimate irony of the Commission’s unreasoned patchwork is that, refusing to inquire into competitive conditions, it shuns broadband service onto the legal track suited to natural monopolies.  Because that track provides  little economic space for new firms seeking market entry or relatively small firms seeking expansion through innovations in business models or in technology, the Commission’s decision has a decent chance of bringing about the conditions under which some (but by no means all) of its actions could be grounded – the prevalence of incurable monopoly.”

Fortunately, this doesn’t end the question.  The ruling will likely be appealed, and the FCC’s mismanagement can be corrected via Congressional action or new FCC leadership in a future presidential administration.

But beyond the specific issue in question, today’s unfortunate ruling illustrates again the importance of judicial branch appointments and composition as we approach the election of a president who will make those appointments.

use of an Act intended to “reduce regulation” to
instead increase regulation
March 7th, 2016 at 11:52 am
WSJ’s Crovitz: Emails Expose Obama Administration Illegality in Pushing Internet Regulation
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On this day in 1876, twenty-nine-year-old Alexander Graham Bell received a patent for inventing the telephone.

Now 140 years later, the Obama Administration continues its counterproductive and legally dubious effort to regulate the Internet as if it were little more than an old-fashioned telephone service of the Bell variety.  CFIF and other free-market groups have consistently opposed that effort, and courts have repeatedly rebuked the Obama’s Federal Communications Commission (FCC) various schemes to impose it.

Today, The Wall Street Journal’s “Information Age” columnist Gordon Crovitz details how a Senate committee has discovered evidence that the Obama Administration’s behavior in attempting to regulate the Internet as an old-fashioned utility violated the law.  In fact, even FCC regulators expressed shock at the degree to which their administrative independence was disregarded:

FCC staffers cited nine areas in which the last-minute change violated the Administrative Procedure Act, which requires advance public notice of significant regulatory changes.  Agency staffers noted ‘substantial litigation risk.’  A media aide warned:  ‘Need more on why we no longer think record is thin in some places.’  These emails are a step-by-step display of the destruction of the independence of a regulatory agency…  Mr. Obama’s edict resulted in 400 pages of slapdash regulations the agency’s own chief economist dismissed as an ‘economics-free zone.'”

Here’s why it matters in the real world, in terms of economics and innovation:  Crovitz notes that in just one year since Obama’s edict was imposed, “regulatory uncertainty has led to a collapse in investment in broadband.”  As CFIF has also detailed, he is correct in that unfortunate observation.

On a more encouraging note, however, Obama’s latest attempt to regulate the Internet in ObamaCare fashion is back before the same appellate court that has twice rebuked it on this issue.  As Crovitz wryly observes, “The Senate report should make fascinating reading for the federal appellate judges considering whether to invalidate the regulations…  The appeals court has plenty of evidence proving White House meddling with a supposedly independent agency.”

For the good of American consumers and continuing Internet innovation, we certainly hope so.

December 4th, 2015 at 5:10 pm
ObamaNet in Court Again: Positive Early Signs from Today’s Oral Argument
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Today, the D.C. Circuit Court of Appeals, commonly known as the nation’s second-highest court, heard oral argument on the latest attempt by the Obama Administration to regulate Internet service.  On two previous occasions, the same court rejected the administration’s efforts, so now we’re at Round Three.  Lawrence Spiwak of the Phoenix Center offers a helpful summary of today’s hearing, and while it’s impossible to predict the ultimate outcome, early signs are encouraging:

While it is difficult to make accurate prognostications about how a court will ultimately rule based on the questions raised at oral argument, several key points dominated the discussion:

As an initial matter, Judge Tatel clearly took umbrage with the FCC’s rejection of the roadmap under Section 706 the DC Circuit set forth in Verizon v FCC (and initially adopted by the Commission in its May 2014 Notice of Proposed Rulemaking) as the result of direct pressure from the White House. As Judge Tatel observed, given such a short time frame, the Commission’s radical departure ‘could not have been changed facts.’

Notwithstanding this displeasure, the panel generally agreed that they are governed by the Supreme Court’s holding in Brand X which emphasizes a focus on how customers perceive the offer of service provided. However, as the court also recognized that the FCC has great latitude the interpret this offer for purposes of regulatory classification, predicting whether or not the court overturns the FCC on wireline reclassification is a close call.

That said, the court appeared skeptical of the FCC’s reclassification of wireless broadband as a Title II common carrier service due to FCC’s gerrymandering of the definition of the term ‘public switched telephone network.’ Moreover, the court seemed concerned over the lack of public notice of the legal theory the Commission used to reclassify mobile broadband. As such, there is a better chance of the court overturning FCC on this issue.

Finally, as assuming the court upholds the FCC’s decision to reclassify broadband as a Title II common carrier service, the court did not appear convinced that the FCC’s application of Title II was entirely legitimate. In particular, a good part of the oral argument focused heavily on the fact that the FCC — in apparent response to last minute lobbying by edge providers to counter the analysis made in our law law review Tariffing Internet Termination: Pricing Implications of Classifying Broadband as a Title II Telecommunications Service — included ‘terminating access’ (i.e., the relationship between edge providers and BSPs) into ‘broadband Internet access service’ (‘BIAS’), even though they are distinctly different products serving entirely different markets.”

Hopefully, the judicial branch will once again reject this administration’s lawless and destructive overreach, and the light-touch federal regulatory approach to Internet service that existed through both the Clinton and Bush administrations will continue.

September 29th, 2015 at 3:45 pm
Progressive Policy Insitute Agrees: FCC Overregulation Threatens Private Internet Investment
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As we have consistently highlighted, overregulation by Obama’s Federal Communications Commission (FCC) poses a grave threat to private investment in Internet service, which has thrived over two decades during both Democratic (Clinton) and Republican (Bush) presidencies because of a deliberately light regulatory approach.

The Progressive Policy Institute (PPI), in a report released this week, agrees.

In its fourth annual report on investment by American companies entitled “U.S. Investment Heroes of 2015:  Why Innovation Drives Investment,” PPI ranks the top 25 non-financial U.S. companies by their amount of domestic capital spending for 2014.  Notably, the survey highlights the danger that overregulation poses to investment and innovation, particularly in the telecommunications sector:

In the telecom industry, pro-investment policy should support ‘light touch’ regulation.  Here we have the makings of a natural experiment, since the FCC departed from this approach last February by imposing Title II regulations on broadband service.  So far in the first half of 2015, the telecom companies on our list are spending at an 11% slower pace than a year earlier.”

This offers yet another ominous warning, one that cannot be dismissed by Obama or Title II apologists as some sort of right-wing hit job.  The Clinton Administration commenced the regulatory “light touch” approach that PPI’s report references, which continued through the Bush Administration as the Internet remained one of the few bright spots in an otherwise troubled economy since 2008.  The PPI survey shows who the real extremists are, and thankfully offers a bipartisan roadmap for continued Internet investment and innovation:  less federal regulation, not more.

September 14th, 2015 at 2:58 pm
TechNotes: “ObamaNet Is Hurting Broadband”
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Throughout the “Net Neutrality” debate over whether the federal government should begin regulating Internet service under 1930s Depression-era laws intended for copper wire telephone service, we and others have warned that Obama Administration efforts to impose such regulation would dangerously stifle private investment and innovation in the telecommunications sector.

In his weekly “Information Age” column today, L. Gordon Crovitz highlights how quickly our somber prediction has proven true.  In “Obamanet Is Hurting Broadband,” Crovitz summarizes how “The predictable effect of more regulation has arrived:  Investment is plummeting”:

New data show the Obama Administration’s decision to regulate the Internet as a utility has already caused a steep drop in Internet Investment…  [I]n the first half of 2015, as the new regulations were being crafted in Washington, major ISPs reduced capital expenditure by an average of 12%, while the overall industry average dropped 8%.  Capital spending was down 29% at AT&T and Charter Communications, 10% at Cablevision, and 4% at Verizon. (Comcast increased capital spending, but on a new home-entertainment operating system, not broadband.)  Until now, spending had fallen year-to-year only twice in the history of broadband:  in 2001 after the dot-com bust, and in 2009 after the recession.”  [emphasis added]

Since the 1996 Telecommunications Act, the Internet has thrived and played a central role in maintaining America’s status as the most prosperous, most entrepreneurial and most innovative nation in human history.  That didn’t happen by accident, nor was it due to coincidence.  Rather, it occurred precisely because the federal government during both the Clinton and Bush administrations refrained from suffocating it with destructive and politically-motivated overregulation.  But Obama apparently thought he had a better idea.  Unfortunately, we’re already witnessing the regrettable result.

Meanwhile, Gallup just released its annual survey of public approval of various sectors of American life.  Standing at or near the top once again are the computer industry, the Internet industry and the telephone industry, all with high net positives.  And at the bottom, once again, is the federal government, with an atrocious -29% net negative.

All of this suggests that we would likely be better off if the computer/Internet/telecom industries regulated the federal government, rather than vice-versa.

July 16th, 2015 at 10:49 am
Georgetown Study: FCC Title II Internet Regulation Will Reduce Internet Investment & Innovation Between 5% – 20%
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As we at CFIF have discussed on numerous occasions, the Federal Communications Commission (FCC) effort to reclassify Internet service under Depression-era Title II regulations meant for copper-wire telephone service is a toxic idea on legal, economic and technological grounds.

Now, a new study from Georgetown University’s McDonough School of Business Center for Business and Public Policy provides additional intellectual heft and confirmation.  Entitled “Regulation and Investment:  A Note on Policy Evaluation Under Uncertainty, with an Application to FCC Title II Regulation of the Internet,” authors Kevin A. Hassett of the American Enterprise Institute and Robert J. Shapiro of the Georgetown Center for Business and Public Policy find that the FCC’s destructive maneuver will reduce Internet investment and innovation by an alarming 5% to 20%:

First, we showed that Title II regulation should be expected to increase costs, and therefore is the type of policy that should be expected to reduce investment.  Second, we reviewed the field-specific evidence that suggested that the scale of the negative effect would be quite large, from about 5.5 percent to as much as 20.8 percent.  Next, we documented that the ratio of investment to the capital stock would be expected to decline to roughly that extent if Title II regulation in the United States would be comparable to the regulatory framework of the OECD continental European countries in the first decade of the 21st century.  Next, we cited an analysis by a legal scholar that suggest that this analogy is reasonable.  Finally, we found that the negative effects on investment may well be significantly understated by these factors because the new regulation’s threshold effect will maximize the negative effects of uncertainty.”

The Internet has flourished to date, and become perhaps the most rapidly and profoundly transformative innovation in human history precisely because the federal government regulated with a light touch.  By reversing that regulatory stance that prevailed throughout both the Clinton and Bush Administrations, the Obama Administration FCC is placing continued innovation and investment at great risk.  This new study provides just the latest confirmation, and offers additional reason for Congress, the courts or even a future presidential administration to put a stop to it.

February 20th, 2015 at 10:36 am
Video: Stop the Government’s Internet Takeover
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In this week’s Freedom Minute video, CFIF’s Renee Giachino discusses the plan by President Obama and the FCC to seize unprecedented regulatory control over the Internet by reclassifying Internet service as a public utility. 

January 5th, 2015 at 10:17 am
2015: New GOP Congress Pledges to Fight Obama FCC Internet Regulation
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The bad news as 2015 begins is that the Obama Administration’s Federal Communications Commission (FCC) appears set to vote next month to reclassify broadband service as some sort of public utility.  You read that correctly.  After twice having its so-called “Net Neutrality” efforts rejected by federal courts, Obama has called on the FCC to double down on that destructive campaign, hoping to subject one of the few sectors of our economy that has continued to thrive in recent years to more regulation.

The good news, however, is that the incoming Republican Congress appears committed to fight that effort:

Newly fortified Republicans in Congress are considering a number of ways to stymie the Obama Administration’s planned regulations on broadband Internet providers in 2015, making Capitol Hill a new front in the fight over ‘net neutrality.’  Concern about the rules is playing into Republican efforts to rein in what they say is regulatory overreach by the Federal Communications Commission.”

Senator John Thune (R – South Dakota), the new Senate Commerce Committee chairman, struck the right chord in announcing, “The regulatory tools at the FCC’s disposal are outdated, and its previous efforts to create rules to regulate the Internet were struck down by the courts.  It’s hard to imagine that its new attempt will escape legal challenges and avoid the kind of regulatory uncertainty that harms Internet innovation and investment.”  Meanwhile, opposition to Obama’s scheme continues on the House side, with one House Energy and Commerce Committee staffer saying that “all options are on the table.”  That includes legislation to block reclassification as a public utility, cutting FCC budgetary funding and invoking the seldom-used Congressional Review Act to void federal administrative regulations of significant impact.

Word must obviously be met with substantive deed, but it’s nice to at least see 2015 begin with a commitment from both houses of the incoming GOP Congress to fight this ill-advised, illegal and stubborn effort from Obama’s FCC.

November 21st, 2014 at 10:20 am
Video – Title II: Obama Wants to Regulate the Internet
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In this week’s Freedom Minute, CFIF’s Renee Giachino discusses Barack Obama’s misguided push to have the Federal Communications Commission regulate the Internet like a public utility under telephone and railroad laws drafted in the 1930s – long before the Internet (or computers, for that matter) was even invented.

 

October 27th, 2014 at 10:22 am
Title II Reclassification: Not Just Unwise, But Also Illegal
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Those of us who oppose the Obama Federal Communications Commission’s (FCC’s) effort to bridle the Internet  with so-called “net neutrality” regulation have explained at length why reclassifying the Internet as some sort of 1930s-style public utility under Title II is a dangerous idea.

Perhaps we we haven’t devoted appropriate time, however, to explaining why it’s almost certainly illegal.

As a broader policy matter, the vague and muddled calls from the extremist left to reclassify broadband typically don’t extend beyond an emotional demand for federal bureaucrats at the FCC to “do something.”  Or, as we often put it, they seek to impose a “fix” for an Internet that isn’t at all “broken.”  Accordingly, they go about offering substantive policy proposals as if lunching at a salad bar stocked with bad ingredients.  They pick and choose bad items, assembling what they consider a perfect combination.

But what they instead create is a Frankenstein-like monstrosity.

And in terms of legality more specifically, the FCC would be treading onto extremely unstable ground if it opts to follow the demands of far-left activists by rushing headlong into this dubious Title II reclassification proposal.  The fact of the matter is that the FCC has long contended that the Internet is a Title I service.  Therefore, in order to reclassify, the law requires it to meet a higher burden of proof as to why it got the initial classification wrong.  Hysterical activism from the far left that has tended to characterize this debate won’t suffice, whether as a matter of law or a matter of logic.  The FCC has already twice lost this legal battle in court (first in 2010, and again in 2014).  Rather than stubbornly tempt a third judicial rebuke of its effort to impose “net neutrality,” it would be better to learn its lesson as it proceeds with its rulemaking effort.

And that’s only with regard to traditional wired networks.  When it comes to wireless Internet (like the 4G/LTE smartphone technology), the law actually expressly prohibits the FCC from imposing Title II-type rules.  That clarity may not discourage the net-roots fringe from demanding reclassification, but it most certainly should stop the FCC from exceeding its legal mandate and once again blatantly flouting both the letter and spirit of applicable law.

Despite six years of effort to the contrary from the Obama Administration, we remain a nation of laws, not men.  That timeless principle does not yield to extremists’ pursuit of the “net neutrality” unicorn.

To date, and through previous administrations of both parties over the past two decades, the FCC has avoided attempting to classify Internet service under Title II for good reason:  it is bad policy and bad law.  Everyone except those clinging to an ideologically extreme position on the matter have recognized that reality.  We therefore cannot allow such Title II extremists to suddenly divert us from the “light touch” regulatory course that has made the Internet one of the most beneficial and revolutionary innovations in human history.  There’s too much to lose.