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April 27, 2017

Brace for Fake News About the Broadband Regulatory Reset

 

Elections have consequences, and the 2016 presidential election is certainly having an impact on internet regulation—a very beneficial impact, in our view. But you won’t get that impression from social media or some of your favorite websites. So this is your warning—and your explanation.

The new chairman of the Federal Communications Commission (FCC), Ajit Pai, is determined to keep both the Trump administration’s commitment to eliminating harmful regulation and his own commitment to undo the two-year-old mistake of regulating the internet under the old analog Bell telephone monopoly laws written in the 1930s.

Chairman Pai is braced for the coming fake news onslaught, and you should be as well.

To steel yourself for the upcoming furor, you must understand that there are players in the internet economy who are not content to allow the internet ecosystem to develop naturally.

Free market economics holds that no one is smart enough to know in advance how a particular industry or market should look. So we allow markets to develop naturally based on the sum total of all the decisions, investments and risk-taking made by all stakeholders, without the heavy hand of government biasing and distorting the outcome.

But some very powerful names you know don’t want a market outcome. They want an outcome that advantages them. They gained from regulation, and they will use their access to consumers and lobbying clout to protect their position.

For almost two decades, beginning with the Clinton administration, Congress and the FCC decided to take a light-touch approach to internet regulation, and the internet rewarded that approach with such incredible innovation that it has become essential to modern life.

Until the Obama administration got swamped in the 2014 mid-term election, that is.

Then, purely to fire up his dispirited troops, President Obama made a YouTube video calling for the reclassification of the internet under 80-year-old laws. And a Democrat-controlled FCC complied.

In the last two years, investment in broadband infrastructure has declined and the rollout of access to unserved areas has slowed. Chairman Pai is absolutely correct to undo this mistake and reset internet regulation to its previous, light-touch approach.

But in coming weeks it’s going to get ugly. Fake news and misleading rhetoric will flood social media, websites will go dark in protest or urge their users to oppose the FCC’s move. They will say the internet is being censored, or turned over to big business, or that your free and open internet will come to an end.

None of this is true. It’s simply a return to the original policies that allowed the internet to grow and flourish, and a reversal of Big Government control over the Internet.

What you’re about to see is special interests trying to hang on to an advantage gained through government regulation, and misleading and manipulating their users. Don’t be one of the manipulated.


 

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