Freedom Line Blog

The Federal Communications Commission (FCC) voted 3-2 along purely partisan lines today to commence federal government micro-regulation of Internet service.  In response, Timothy Lee, CFIF’s Vice President of Legal and Public Affairs, issued the following statement: 

This spring, a unanimous D.C. Court of Appeals ruled that the FCC doesn’t possess authority to impose so-called ‘Net Neutrality’ over the Internet.  In a brazen ploy to circumvent the Court’s ruling, Chairman Genachowski and the FCC today began the process of classifying the Internet as a public utility under laws drafted for Depression-era landline telephones.  Their ultimate goal is to overregulate one of the few bright spots of the American economy. 

“The Internet sector has prospered over the past two decades precisely because the federal government has refrained from micromanaging it.  That ‘hands off’ policy spans both the Clinton and Bush administrations, during which time the Internet has become the most dynamic, innovative and promising sector of our economy and lives.

“That is why almost 250 members of Congress from both parties wrote the FCC admonishing it to refrain from unnecessary overregulation.  That’s why a unanimous D.C. Court of Appeals ruled that the FCC doesn’t possess authority to impose so-called ‘Net Neutrality’ over the Internet.  And, that’s why the American public opposes ‘Net Neutrality’ by a two-to-one margin. 

“Unfortunately, all that means nothing to Chairman Genachowski and those scheming to impose counterproductive and unnecessary regulations on the Internet by any means necessary. 

“The FCC’s destructive action will only create regulatory uncertainty, which will discourage private investment, Internet innovation, continued broadband expansion and job growth. 

“The Center for Individual Freedom now calls on all Americans to support H.R. 3924, sponsored Representative Marsha Blackburn (R–TN), which will ensure that Congress and the American people determine this matter, not unelected bureaucrats at the FCC.”

Whom do you trust with the future of broadband?  The same federal government that brought us public education, the Post Office and Amtrak?

Or the innovative technology companies that have made the Internet the most vibrant and transformative sector of our modern economy in an atmosphere relatively free from federal overregulation?  Public opinion is unequivocal – we trust technology enterprises, not the federal government.

That question nevertheless remains an important one, because Obama’s Federal Communications Commission (FCC) and its far-left cheerleaders continue their effort to impose “Net Neutrality” and set us on a path toward a federal regulatory takeover of the Internet.  On Thursday, the FCC will hold an open meeting to”consider possible legal frameworks for broadband Internet services,” which is code for its “Net Neutrality” takeover attempt.  On the heels of a unanimous Court of Appeals decision ruling that the FCC doesn’t possess authority to impose “Net Neutrality,” Chairman Genachowski switched to Plan B – simply reclassify Internet service under Depression-era regulations created for 1930s landline telephone service.  That scheme contradicts bipartisan consensus spanning both the Clinton and Bush administrations, which is why Democrats and Republicans in Congress sent letters to the FCC objecting to this maneuver.

If successful, the FCC’s backdoor scheme to impose “Net Neutrality” (a dishonest name if there ever was one) will undermine the freedom of technology companies to innovate and invest, which has been the basis of the Internet’s success thus far.  Instead of triggering broadband expansion, “Net Neutrality” will only invite years of litigation and acrimony if the FCC presses this agenda.

We simply cannot allow the FCC and federal bureaucracy to do to the Internet what it has done for public education in this country.

When was the last time that a scientific survey reported 91% agreement on anything, other than that Senate Majority Leader Harry Reid (D – Nevada) is a really creepy guy?

Yet that’s precisely the consensus contained in a survey released by the very Federal Communications Commission (FCC) that continues to push so-called “Net Neutrality” despite overwhelming public, judicial and bipartisan Congressional opposition.  According to the FCC itself, nine out of ten respondents are happy with their broadband speed:

Fully 91% of broadband users say they are ‘very’ or ‘somewhat’ satisfied with the speed they get at home.”

Yet the FCC continues to concoct an imaginary broadband crisis just around the corner as an alibi for proposed “Net Neutrality” regulation.

With this reality staring it straight in the face, why does the FCC persist in pushing “Net Neutrality” upon the American public?  Also consider that the D.C. Court of Appeals ruled that the FCC does not possess authority to impose “Net Neutrality,” which merely triggered the FCC shenanigan of announcing that it would reclassify Internet service under Depression-era rules created to govern 1930s landline telephones.  Also consider that the public opposes “Net Neutrality” by a two-to-one margin (a dramatic turnaround since 2008), and both Democrats and Republicans in Congress sent separate letters to the FCC opposing this atrocious proposal.

None of this seems to interrupt Chairman Julius Genachowski and his slim FCC majority.  “Net Neutrality” will be defeated, whether via judicial, Congressional or administrative avenues.  But how long will it take for Genachowski to wake up and smell that coffee?

In an effort to circumvent a unanimous federal appeals court ruling, the Federal Communications Commission (“FCC”) announced earlier this month that it will pursue a “third way” to obtain regulatory control over the Internet.  Specifically, lacking the straightforward authority to impose burdensome and unnecessary regulations on the World Wide Web, the FCC is now seeking “to shoehorn Internet service into regulations drafted in the 1930s for old-fashioned landline telephones” in an effort to dramatically expand its regulatory reach.

CFIF and others have written extensively about how such an unprecedented power grab threatens to suffocate private broadband investment, jobs and Internet innovation.  And, in a rare display of bipartisanship, Congress is now adding its voice of opposition, too.

In a letter sent yesterday to FCC Chairman Julius Genachowski, 74 Congressional Democrats expressed “serious concerns” about the FCC’s actions.  “The significant regulatory impact of reclassifying broadband service is not something that should be taken lightly and should not be done without additional direction from Congress,” the letter reads.  “We urge you not to move forward with a proposal that undermines critically important investment in broadband and the jobs that come with it.”

Also released yesterday was a similar letter to the FCC Chairman signed by 37 Senate Republicans.  The Senators wrote:

We are deeply disappointed by your recent announcement that you intend to reclassify broadband Internet access services as telecommunications services subject to Title II of the Communications Act of 1934.  This move will deter further private sector investment in broadband networks, will negatively impact innovation, and ultimately harm consumers.  We strongly encourage you to abandon this drastic action, and to continue the successful policy of leaving the Internet free from common carrier regulations.”

The people have spoken.  The courts have spoken.  And now, a bipartisan and sizable group of elected officials in Congress have spoken.  Will Obama’s FCC finally listen?

Just last month, the U.S. Court of Appeals for the D.C. Circuit held unanimously that Obama’s Federal Communications Commission (FCC) doesn’t possess authority to nationalize the Internet via so-called “Net Neutrality.” And in the court of public opinion, the American electorate opposes this destructive scheme to dictate Internet traffic flow by a 2-to-1 margin.

So how is the hyper-politicized FCC choosing to respond?  By reverting to decades-old New Deal-era laws to shoehorn the Internet into statutes drafted for 1930s landline telephones. Since the advent of the Internet era in 1996, Congress, the courts and the FCC have rightfully designated the Internet an “information service,” and therefore subject to different rules than archaic early telephone lines.

But according to news reports, FCC Chairman Julius Genachowski will announce today his reckless “damn the torpedoes” approach.  Just as Obama, Nancy Pelosi and Harry Reid reverted to every available scheme to impose ObamaCare on an unwilling public, the FCC will apparently adopt the same approach to federalize Internet service, one of the few sectors that has maintained its dynamism during the economic downturn.  With its humiliating Court of Appeals defeat to one side and looming November elections on the other, yet another Obama Administration arm thus prefers hyperpartisanship over compromise and reasonability.

As always, American consumers and our economy will pay the price for this component of the Obama Agenda, since it will stifle the private investment and broadband buildout necessary to keep pace with ever-increasing Internet use.  Fortunately, this scheme will ultimately meet the same result handed down by the Court of Appeals last month, but only after years of costly litigation, regulatory limbo and acrimony.

Justice will prevail and we will win this battle, but it’s going to take another good fight.  The stakes are too high to relent.

Amidst the endless onslaught of regulatory aggression by the Obama Administration, it’s nice to receive some potentially good news every now and then.

On that note, reports are surfacing that Obama’s Federal Communications Commission (FCC) and its Chairman Julius Genachowski may be abandoning their effort to regulate the Internet via “Net Neutrality.”  According to sources, Genachowski has smelled the coffee following the D.C. Court of Appeals decision rebuking the FCC’s power grab:

The sources said Genachowski thinks ‘reclassifying’ broadband to allow for more regulation would be overly burdensome on carriers and would deter investment. But they said he also thinks the current regulatory framework would lead to constant legal challenges to the FCC’s authority every time it attempted to pursue a broadband policy.”

That is precisely correct.  “Net Neutrality” would have an effect 180 degrees opposite of what its name implies by increasing governmental interference over the heretofore free Internet, and would trigger a flood of litigation and regulatory limbo.  Ultimately, the FCC would meet a judicial rebuke similar to the one it just suffered in the Court of Appeals.

“Net Neutrality” isn’t dead yet, and this is certainly no time to rest.  Those of us who believe in individual freedom and limited government must keep up our pressure and efforts to stop this big government boondoggle.  Still, it’s nice to receive potentially positive news once in a while to see that our efforts are having a positive effect.

Activists who favor so-called “Net Neutrality,” which would actually make the federal government suddenly non-neutral in overregulating the Internet, possess a natural advantage in the battle for public opinion simply because the term “Net Neutrality” sounds so innocuous.  After all, people unfamiliar with the issue might think to themselves, “what could be so bad about ‘neutrality?'”  Consequently, it became very important for Americans to realize the true nature of this toxic agenda currently being advanced by the Obama Administration, his Federal Communications Commission (FCC) and the political left.

For this reason, the results of a new Rasmussen poll are extremely encouraging.  By a two-to-one margin (53% to 27%), Americans oppose governmental “Net Neutrality” efforts to regulate the Internet in the same way the government seeks to regulate the airwaves via the “Fairness Doctrine.”  Most impressively, this means that public support for “Net Neutrality” has plummeted some 22% since June 2008.  Notably, among those who use the Internet either every day or nearly every day, opposition to “Net Neutrality” rises to 63%.  In other words, those who are most familiar with the Internet and use it most often oppose “Net Neutrality” even more strongly.  They know that “Net Neutrality” advocates’ constant doomsday predictions have been proven nonsense.  Opposition also increases among investors, who realize that “Net Neutrality” would undermine the incentives to continue investment and network expansion, which will be necessary for future Internet growth in America.  That speaks volumes.

The fight isn’t over, despite public opposition and a Court of Appeals decision last week rejecting the FCC’s alleged authority to impose “Net Neutrality.”  Obama’s FCC responded to the Court’s decision in Nancy Pelosi-like fashion, indicating that it will attempt to impose “Net Neutrality” by any means necessary.  Nevertheless, these are encouraging signs in this important battle.

James Pethokoukis, Money and Politics columnist and blogger for Reuters, notes that the FCC’s decision to proceed with a process of imposing so-called Net Neutrality rules on Internet network providers is not only “curious as well as wrongheaded,” it could result in the next “systemic risk” for the U.S. economy.

Questioning the wisdom and necessity of strict Internet regulations to be imposed under the false promise of “neutrality,” Pethokoukis wrote:

The financial crisis that has convulsed the global economy for the past two years should be a potent reminder to communications regulators that the best of government intentions can create horrible, though unintended, consequences. …

“Like physicians and Fed governors, the first goal of regulators should be to do no harm. And that is especially true when they are trying to impose a solution in search of a problem. Broadband prices, for one thing, are on the decline. The average cost of consumer broadband has dropped to less than $20 a month from $50 a month in 2001. And more people have access. As late of 2004, 70 percent of households still used dial-up modems for web access. Today, just 10 percent do with broadband speeds doubling over that period. Tough to find a market failure here. …

“But the FCC — with the full encouragement of the Obama administration — nonetheless intends to push forward with seeming little concern about the unintended consequences of intervening into a well-functioning sector vital to the American economy. At the very least, the FCC will likely face years of court battles over the rule that could serve to paralyze the sector. Now there’s your systemic risk.”

Google Chief Executive Eric Schmidt, whose company has been lobbying hard in support of Net Neutrality, admitted recently, “It is possible for the government to screw the Internet up, big-time.”

Perhaps Google and other large corporate content providers who wish to use the heavy hand of government to continue to freeload on the backs of ordinary Internet consumers should heed Schmidt’s warning.

CFIF has commented extensively on the imprudent push by Federal Communications Commission (“FCC”) Chairman Julius Genachowski and others in the Obama Administration to impose “Net Neutrality” regulations on Internet network providers.  We’ve discussed how Net Neutrality is a solution in search of a problem that will stifle private investment in high speed networks and work counter to the President’s goal of universal broadband access.

But in addition to the policy arguments against Net Neutrality, the question remains whether the FCC even possesses the statutory authority to impose such regulations without Congress’ consent.

Barbara Esbin, Senior Fellow & Director of the Center for Communications and Competition Policy at The Progress & Freedom Foundation, analyzes that question in a recent paper titled, “The Audacity to Hope Regulatory Restraint Will Prevail.”  Her conclusion: “[N]o, it does not, at least not for the reasons the agency has advanced to date.”

Esbin writes:

The question of regulatory jurisdiction is not so directly implicated when the FCC propounds broad, but unenforceable, policy principles, as it did with its 2005 Internet Policy Statement. But legally binding ‘rules of the road,’ such as those envisioned by the agency’s Chairman, must rest on a convincing factual predicate and must come within the scope of the regulatory powers delegated to the FCC by Congress. And it is the latter that is called into question by the FCC’s reliance on the doctrine of ‘ancillary jurisdiction’ in its Comcast P2P Order, currently on review before the D.C. Circuit Court of Appeals, a court not especially hospitable to such claims. If the FCC’s jurisdictional theory falls before the D.C. Circuit, the most it may be able to achieve with its new rulemaking is an expanded set of policy principles. Well, one can hope.

Read the full paper here (.pdf).

As we at CFIF regularly highlight, among the best ways to boost the American economy is via federal deregulation, which brought us the strongest economy in world history under President Trump.

For that reason CFIF enthusiastically applauds a bill sponsored by Senators Mike Lee (R – Utah), Thom Tillis (R– NOrth Carolina) and Charles Grassley (R – Iowa) entitled the Standard Merger and Acquisition Reviews Through Equal Rules (SMARTER) Act.  Currently, differing antitrust review standards applied by the Department of Justice (DOJ) and the Federal Trade Commission (FTC) create confusion throughout our business and financial sectors, unnecessarily restraining U.S. economic prosperity.  The SMARTER Act changes that by harmonizing that process:

‘The Federal Trade Commission and the Department of Justice unnecessarily apply different procedures and standards for reviewing proposed mergers,’ said Senator Tillis.  ‘This commonsense legislation will streamline the enforcement of our federal antitrust laws by creating a system of consistency that will benefit consumers and businesses.’

The Department of Justice and the Federal Trade Commission share concurrent jurisdiction to review proposed mergers for compliance with the antitrust laws but it is not always clear in advance which agency will review a particular merger.  Although the two antitrust agencies apply the same substantive law to the mergers they review, their procedures differ in important ways.

The SMARTER Act fixes this problem by requiring the Commission to satisfy the same standards that DOJ must meet in order to obtain a preliminary injunction to block a merger and requiring the Commission to litigate the merits of contested merger cases in federal court under the Clayton Act — just as DOJ does — rather than before its own administrative tribunals.

Separately, certain mergers also require approval of the Federal Communications Commission.  However, the Federal Communications Commission’s merger review procedures create an open-ended process that fuels uncertainty and is potentially insulated from judicial review.  This invites regulatory mischief from both sides of the aisle that only leads to an imbalance in the implementation of regulatory policy.  The current process results in an inconsistent merger review process that not only harms the businesses seeking to complete a transaction in a timely manner, but it also hurts workers and consumers alike.  The SMARTER Act fixes this problem by requiring the Commission to issue a decision within 180 days of receiving a completed merger application.  The merger review process should not invite Congress or a regulatory agency to put a thumb on the scale of a particular transaction, but instead it should enable a fair and timely system that affords due process.”

As our economy continues to emerge from the coronavirus pandemic, legislation of this sort is precisely what we need to reover and surpass the old mark.  CFIF applauds Senators Lee, Tillis and Grassley for their leadership.

So it appears that Google isn’t so opposed to intellectual property (IP) rights after all.  As long as it comes to its own, that is.

That’s the upshot of a high-profile federal lawsuit in which Google subsidiary Waymo accuses Uber of stealing its patents and trade secrets:

Waymo LLC, the self-driving car unit of Google parent Alphabet Inc., asked a federal court on Friday to halt Uber Technologies Inc.’s efforts to develop autonomous vehicles allegedly based on stolen design secrets.  The request was made to the U.S. District Court in San Francisco, following a suit filed last month accusing Anthony Levandowski, a former key manager in the Google self-driving car project, of taking 14,000 files before quitting last year to create a self-driving truck maker.  That startup, called Otto, was quickly acquired by Uber last year…

Waymo also filed an expert witness statement to the court from a laser-optics physicist who said he believes Uber’s laser-sensor technology uses Waymo’s trade secrets and infringes on its patents.  Waymo also added a fourth patent to its infringement claims in an amended suit on Friday.”

We take no position on the merits of the case, and maintain no particular grudge against Google as a company.  But its leading role in undermining IP rights in the United States, which made us the most inventive, artistically innovative and prosperous nation in human history, makes its current pleas a bit ironic, to put it mildly.

For years, we’ve been alerting readers to the endless, destructive litany of ways in which Google has undermined IP and public policy for its own benefit:

Here’s the irony.  Google somehow manages to arouse righteous legions of supposed anti-corporatist activists on its behalf (think sunshine anarchists and libertarians of convenience).  Yet Google itself exercises more self-serving, crony capitalist throw weight than any counterpart entity.

For example, consider so-called ‘Net Neutrality,’ with which conservatives and true libertarians are now familiar, that would suddenly empower the federal government to micromanage Internet service.  Google stands to gain enormous free-rider benefits, which explains why it is the chief corporate proponent of that proposed regulatory expansion.

Or think of Google Books, which posts the text of books that Google has gone ahead and scanned for viewing on its site.  Who cares if Google hasn’t first obtained permission from the actual authors and creators, right?  Google counts on the sheer cost and hassle of litigation to discourage individual creators against putting up a legal fight to protect their rights.

How does that square with ‘Don’t Be Evil?’

Or how about this?  Last August, Google voluntarily agreed to a $500 million fine for assisting Canadian online pharmaceutical sellers in accessing American consumers.  That amount is an entire Solyndra, and one of the largest forfeiture penalties in U.S. history.  Google fully admitted that it, ‘improperly assisted Canadian online pharmacy advertisers to run advertisements that targeted the United States,’ and prosecutors added that Google, ‘was fully aware as early as 2003 that generally it was illegal for pharmacies to ship controlled and non-controlled prescription drugs into the United States from Canada.’

But once again, it’s not Google’s health or property at stake, so who cares?”

More recently, Google has used its enormous influence within the Obama Administration to push the Obama Federal Communications Commission’s (FCC’s) destructive cable set-top box proposal, which would have compromised consumer privacy, as well as the Obama FCC’s “privacy” regulation of 2016, which Congress just rightfully rescinded.

Intellectual property rights were so important to our Founding Fathers that they specifically safeguarded them in the text of the Constitution.  Since that time, IP rights have provided the “secret sauce” by which we’ve achieved such incomparable technological, artistic and influential supremacy.

Regardless of the merits of the Google’s litigation against Uber, it has every right to safeguard its own IP rights.  It would be nice if it finally dawned on them that they don’t wear hypocrisy well, however, and that they should stop undermining the same protections for others.

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.

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.

Senator Cruz:  Secure the Border, End the Amnesty, and Celebrate Legal Immigration
Lee:  Blame Obama, Not Bush, for Today’s Bloodbath in Iraq
Ellis:  Obama’s Own Watchdogs Say Administration Violates the Law
Senik:  What Would a Real “Change Election” Look Like?

Video:  Chaos at the CIA
Podcast:  Interview w/ Media Freedom’s Mike Wendy re: so-called “Net Neutrality” and the FCC
Jester’s Courtroom:  A Prayer for Relief

Editorial Cartoons:  Latest Cartoons of Michael Ramirez
Quiz:  Question of the Week
Notable Quotes:  Quotes of the Week

If you are not already signed up to receive CFIF’s Liberty Update by e-mail, sign up here.

(1)  A new study from the Internet Innovation Alliance (IIA) shows how American consumers continue to abandon old-fashioned wireline telephone service, but Federal Communications Commission (FCC) bureaucratic inaction in the transition to all Internet Protocol networks (the “IP Transition”) threatens harm to consumers, our economy and market competition:

To ensure that ILECs can continue to provide innovative solutions for consumers and compete effectively against other platforms, they must be free to make the best use of their capital. That, in turn, means dedicating their capital to IP – and fiber – based broadband networks, rather than tying it up in obsolete copper-based circuit-switched networks.  At the end of 2012, the ILECs’ share of the consumer voice, broadband-access, and video markets was 34%, 14%, and 10% respectively.  It is time to stop treating the ILECs as monopolies that must be hobbled and start treating them as useful assets whose health is important to this nation’s economy and global competitiveness.”

(2)  Similarly, Raymond J. Keating of the Small Business & Entrepreneurship Council (SBE Council) summarizes how the FCC’s upcoming auction of low-frequency spectrum currently used by TV broadcasters over to wireless firms is fraught with bureaucratic overreach and market interference, citing a study by Duke University’s Leslie Marx:

This incentive auction would have the TV broadcasters getting a split of the proceeds from the auction.  But some, like the Justice Department’s Antitrust Division in a filing with the FCC, argue that the auction rules should be set to provide an advantage for smaller carriers – such as Sprint and T-Mobile – over the largest mobile service providers, i.e., AT&T and Verizon.  Unfortunately, some fail to understand the competitive market process and how businesses gain market share.  Others more cynically are attempting to use government to manipulate the rules of the game in their own favor.”

(3)  Bloomberg.com reports on more positive news for the FCC, however, courtesy of the U.S. Supreme Court:

The U.S. Supreme Court turned away a challenge by five power companies to new federal rules that lower the fees telecommunications companies must pay to attach lines to electric utility poles.”

(4)  Over at The Wall Street Journal, meanwhile, Holman Jenkins puts on his usual must-read clinic.  In his latest piece, Jenkins details successful Internet service providers’ efforts to “tunnel under the regulatory morass that inhibits physical broadband deployment”:

All this renders even more quaint the scrap over ‘net neutrality.’  Verizon is battling in a U.S. appeals court the FCC’s effort to impose this regulatory conceit on the broadband industry – with certain bloggers insisting that if Verizon wins, it will represent “the end of the Internet,” because, you know, there’s not enough competition to make sure broadband operators don’t “censor” the Internet in their own interest by blocking access to websites that compete with their own services.  Uh huh.  The truth is, competition has been more than adequate so far to police the Internet, and now competition is getting jacked up a serious notch as the video explosion stimulates a deluge of new investment. Now if the regulatory establishment would just take ‘yes’ for an answer.”

(5)  USA Today highlights how mobile communications advances have improved natural disaster relief:

Natural disasters are on the rise.  Reported incidents have more than doubled since 1980, and in 2010 alone, the combined impact of earthquakes, hurricanes, floods and other calamities forced 42 million people to flee their homes.  Thankfully, advances in mobile communications have spread to all corners of the globe, providing the victims of disasters much easier contact with relief workers, and each other.”

(6)  The Hill’s Technology Blog details House Energy and Commerce Committee Vice-Chairwoman Marsha Blackburn’s (R – Tennessee) comments on FCC interference with private telecom investment:

The Federal Communications Commission (FCC) has a ‘regulatory addiction and … penchant for picking winners and losers’ and the laws governing the agency need a ‘substantial overhaul,’ House Energy and Commerce Vice-Chairwoman Marsha Blackburn (R – Tenn.) said Wednesday.  The agency is hurting the telecommunications industry and crowding out private investment because it ‘is fixated on growing its jurisdictional footprint and expanding its influence in other areas,’ Blackburn said, speaking at a Telecommunications Industry Association event.”

(7)  Fiercetelecom.com reports on the TIA 2013 tradeshow, where keynote speakers from AT&T and Verizon lamented the federal regulatory murkiness that inhibits the TDM-to-IP transition:

AT&T and Verizon envision a blended wireless and wireline service world, but regulatory executives from both telecos said during a policy keynote session at the TIA 2013 tradeshow that a lack of regulatory clarity in transitioning their legacy TDM networks to IP is a key barrier.

‘In 2009, the FCC set some very ambitious objectives, one of which was a complete shutdown of the TDM architecture and merge to IP by 2017,’ said James W. Cicconi, Senior Executive Vice President of External and Legislative Affairs for AT&T.  ‘We’re here in 2013, and no single thing that I can discern has been done to advance that objective.’  Cicconi said that he has gotten little, if any guidance from the FCC on the next step.

And Craig Sillman, Senior Vice President of Public Policy for Verizon, said that while the telco has benefitted from a ‘light touch’ regulatory approach for advancing its wireless business, legacy voice service regulations have hindered its wireline moves.”

(8)  Finally, Mobile World Live reports on a wide range of CEOs repeating their call for lighter regulation:

The opening keynote session at Mobile World Congress brought together the chief executives of AT&T, China Mobile, Telecom Italia, Telefónica and Vodafone.  Under the theme of mobile operator strategies, talk of digital revolution and unprecedented industry transformation – spurred on by LTE and cloud-based technologies – was dominant…   But if the rapid development of networks and digital eco-systems is to continue, and help boost GDP in the process, much more investment will be required.”

The biggest takeaway from this week’s Technotes?  The FCC has its work cut out for it if it truly seeks to advance innovation and modernization.

This week’s edition of the Liberty Update, CFIF’s weekly e-newsletter, is out. Below is a summary of its contents:

Senik:  Obama’s Letter to Santa
Hillyer:  GOP Fails a Gut-Czech
Lee:  Myth Versus Fact: Debunking Dishonest and Inaccurate Claims Against Congressional Legislation to Stop Online Piracy
Ellis:  Holder’s Fast and Furious Sideshow Helps Obama Keep Liberals From Bolting

Freedom Minute Video:  Obama’s Christmas Gift to America: Class Warfare
Podcast:  Why the FCC’s “Net Neutrality” Regulations Must Be Rejected
Jester’s Courtroom:  No Breakfast for Champions Leads to Lawsuit

Editorial Cartoons:  Latest Cartoons of Michael Ramirez
Quiz:  Question of the Week
Notable Quotes:  Quotes of the Week

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The nation’s capital is abuzz today over President Obama’s Wall Street Journal commentary, “Toward a 21st Century Regulatory System.” Astonishingly, Obama actually praises America’s free market system as “the greatest force for prosperity the world has ever known” while promising regulatory reform:

I am signing an executive order that makes clear that this is the operating principle of our government.  This order requires that federal agencies ensure that regulations protect our safety, health and environment while promoting economic growth.  And it orders a government-wide review of the rules already on the books to remove outdated regulations that stifle job creation and make our economy less competitive.  It’s a review that will help bring order to regulations that have become a patchwork of overlapping rules, the result of tinkering by administrations and legislators of both parties and the influence of special interests in Washington over decades.”

Whether Obama speaks honestly, or simply seeks to deceive the electorate in anticipation of 2012, lies beyond our powers of divination.  The available evidence, however, justifies extreme skepticism.

One cause for doubt stands out immediately.  In identifying examples of the federal regulatory state run amok, the best Obama can do is point to saccharine, saying that the Food and Drug Administration (FDA) permits it for consumption in coffee while his Environmental Protection Agency (EPA) labels it a “dangerous chemical.”  That’s it?  That’s the best example he can cite?

Just one month ago, Obama’s own Federal Communications Commission (FCC) flagrantly defied two-to-one public opposition, a unanimous Court of Appeals and a bipartisan group of 300 members of Congress by voting to regulate the Internet via “Net Neutrality.” Obama claims in his column that he aims to prevent “regulations that stifle job creation and make our economy less competitive,” but that’s exactly what “Net Neutrality” will do.  The FCC seeks to regulate an Internet sector that has thrived over the past two decades precisely because the federal government has refrained from interfering with regulations such as this.  The result will be fewer incentives for continued Internet investment, expansion and innovation, as well as declining service as capacity fails to keep pace with demand.

Additionally, Obama’s Labor Department seeks to impose “card check,” which will end secret ballot voting in union elections, and his EPA seeks to impose global warming carbon cap-and-tax regulations.  Both of those agenda items failed miserably in Congress even when controlled by Democratic supermajorities, but Obama’s regulatory agencies now seek to impose them anyway.

So Obama talks a good game in today’s op/ed.  But unless he issues an immediate cease-and-desist order on “Net Neutrality,” card check and cap-and-tax, his words will prove just as meaningless as his other broken promises.

This week’s edition of the Liberty Update, CFIF’s weekly e-newsletter, is out.  Below is a summary of its contents:

Senik:  Five Good Ideas from Conservative U.S. Senate Candidates
Lee:  “Net Neutrality” Regulation: Obama’s Imperious FCC Shifts to Plan B  
Ellis:  The Facts About the Failed Times Square Bomber: Why the Liberal Establishment Can’t Face Reality
CFIF Staff:  I Read the News Today, Oh Boy!

Freedom Minute Video:  Then They Came for the Internet
Podcast:  Author Discusses How Afghan President Hamid Karzai Came to Power
Jester’s Courtroom:  Man Sues Goldman Sachs for Giving Good Advice

Editorial Cartoons:  Latest Cartoons of Michael Ramirez
Quiz:  Question of the Week
Notable Quotes:  Quotes of the Week

If you are not already signed up to receive CFIF’s Liberty Update by e-mail, sign up here.

This week’s edition of the Liberty Update, CFIF’s weekly e-newsletter, is out.  For those readers who don’t receive it in their e-mail inboxes or if you haven’t had a chance to read it yet, below is a summary of its contents:

CFIF Staff:  Here Come the VAT, the Mother of All Taxes
Ellis:  The GOP’s ‘Doc Fix’ to ObamaCare: Doctors as Congressional Candidates
Lee:  Thwarting the Aggressive Obama Agenda: Appellate Court Quashes FCC’s “Net Neutrality” Scheme
Senik:  Deconstructing America, One Industry at a Time

Freedom Minute Video:  Professor Obama in the Classroom
Podcast:  Florida Senate President Discusses Need for Federal Balanced Budget
Jester’s Courtroom:  Can You Hear Me Now?

Editorial Cartoons:  Latest Cartoons of Michael Ramirez
Quiz:  Question of the Week
Notable Quotes:  Quotes of the Week

If you are not already signed up to receive CFIF’s Liberty Update, sign up here.

This week’s edition of the Liberty Update, CFIF’s weekly e-newsletter, is out.  For those readers who don’t receive it in their e-mail inboxes or if you haven’t had a chance to read it yet, below is a summary of its contents:

Lee:  The Obama Administration Plays the Role of Sybil
Senik:  Terror and Honesty
CFIF Release:  CFIF to FCC – Proposed “Net Neutrality” Rules Would Smother Internet Innovation and Damage the American Economy
Batkins:  President Obama’s Health Care Snake Oil
Ellis:  National Security After the “Undie-Bomber”
CFIF Staff:  Martha Coakley: Candidate-at-Large

Freedom Minute Video:  50 Way to Defeat ObamaCare
Podcast:  How Will ObamaCare Affect You? – Interview with Vincent Frakes
Jester’s Courtroom:  Caution: Lawsuit

Editorial Cartoons:  Latest Cartoons of Michael Ramirez
Quiz:  Question of the Week
Notable Quotes:  Quotes of the Week

If you are not already signed up to receive CFIF’s Liberty Update, sign up here.