How FCC Regulation Would Change the Internet

November 6, 2009 | Filed Under 1st Amendment, Business, Capitalism, Computers, Congress, Democrats/Leftists, Economy/Finances, Free Trade, Freedom, Google, Government, Corruption, Inernet, Liberals, Media Bias, Net Neutrality, Scott Cleland, Society/Culture, Taxes, Technology |

-By Scott Cleland

The FCC’s claims that their proposed net neutrality regulations would just “preserve” the open Internet are simply not true. The facts clearly state that the FCC’s proposed regulations would: Be a big change in FCC Internet policy; Implement big Internet policy changes without Congressional authorization; and Change the Internet in big ways. (The one-page PDF version of this post is here)

The FCC’s proposed net neutrality regs are a big change in FCC Internet policy; they would:

Replace the FCC’s voluntary net neutrality guidelines with mandated net neutrality regulations;
Selectively apply net neutrality regulations to only broadband and not to applications/content providers like the current principles do;
Add two completely new net neutrality principles that are not found in law or congressional policy:
Mandate the strictest non-discrimination requirement in the last 75 years;
Mandate public disclosure of detailed proprietary network management techniques for the first time;
Expand application of net neutrality to wireless and satellite broadband for the very first time;
Expand consumers access to content entitlement by adding entitlement to send/distribute content as well;
Redefine entitlement to competition in the current fourth principle, to favor resale competition over facilities-based competition;
Subject broadband companies to a new “Mother-may-I” FCC approval process for offering new managed services and for experimenting with new business models; and
Subordinate private standard-setting bodies, like the IETF, to new FCC omni-technical oversight/approval.

The FCC’s proposed Internet policy changes, unauthorized by Congress, would effectively:

Ignore a decade of overwhelming bipartisan consensus to not tax or regulate the Internet;
Declare for all practical purposes that ISPs are a bigger free speech threat than Government, despite the First Amendment;
Abandon existing Congressional Internet policy, which is “to preserve the… competitive free-market… Internet… unfettered by Federal or State regulation”;
Undermine the purpose of the 1996 Telecommunications Act: “to promote competition and reduce regulation” by promoting regulation that would reduce facilities-based competition;
Redefine the well-understood notion of an “open” market that means competition-driven to now mean government-driven:
Replace the current technology-neutral policy with a new industrial policy that openly favors Google, eBay and Amazon over boradband competitors;
Implement the introduced, but never-passed, Markey-Eshoo bill (HR 3458); and
Subordinate current consensus universal broadband policy to new and controversial net neutrality policy.

The FCC’s proposed Internet regulations would likely change the Internet by:

Transforming it from user-driven/centric/governed to more FCC-driven/centric/governed;
Morphing the current privately-run Internet into a government-run Internet;
Revolutionize the current voluntary bottom-up Internet into a coerced top-down Internet;
Introducing new business, investment and operational Internet uncertainty where little existed;
Supplanting the Internet’s inherent efficiency with the Government’s inherent inefficiency;
Setting a new international example of government Net interference rather than restraint;
Barring broadband companies from entering and competing in the cloud computing business;
Forcing one-way convergence, where apps can converge into conduit, but no conduit can converge into apps;
Discouraging investment by everyone to favor investment by Google, eBay, and Amazon.

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Scott Cleland is one of nation’s foremost techcom analysts and experts at the nexus of: capital markets, public policy and techcom industry change. He is widely-respected in industry, government, media and capital markets as a forward thinker, free market proponent, and leading authority on the future of communications. Precursor LLC is an industry research and consulting firm, specializing in the techcom sector, whose mission is to help companies anticipate change for competitive advantage. Cleland is also Chairman of NetCompetition.org, a wholly-owned subsidiary of Precursor LLC and an e-forum on Net Neutrality funded by a wide range of broadband telecom, cable and wireless companies. He previously founded The Precursor Group Inc., which Institutional Investor magazine ranked as the #1 “Best Independent” research firm in communications for two years in a row. His latest op eds can be seen at www.precursorblog.com.

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