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December 14, 2018

It's Been a Very Good Year for Broadband Since Repeal of Internet Regulation

 

Today is the one-year anniversary of the Federal Communication Commission’s aptly named “Restoring Internet Freedom” order, which rescinded the Obama administration’s radical reclassification of broadband providers as common carrier telecommunications providers under Title II of the Communications Act of 1934.

All previous FCCs had agreed that provision of internet services was a data service, not a telecommunications service. Data services are lightly regulated, while telecommunications services are heavily regulated, including giving the FCC the power to regulate prices.

In fact, part of the rationale for originally classifying the internet as a data service was the understanding that it might never get off the ground under a heavily regulated regime designed for the old Bell System monopoly.

Previous FCCs were correct, as the dramatic and successful expansion of the internet demonstrated. It was not until after a disappointing election that the Obama administration felt it needed to throw a bone to its socialist, anti-corporate activist base that the FCC suddenly determined that the internet was actually much more like your old dial-up analog phone and in need of monopoly regulation.

Numerous studies demonstrate that investment in broadband was strongly affected by the FCC’s ill-advised reclassification. Depending on the analysis, broadband investment went noticeably flat or actually declined as a result of the imposition of regulation, which should not be a surprise to anyone familiar with markets.

After the 2016 election, a priority of the Trump administration was reversing the previous administration’s error. The reaction among activists and in the press was, in some cases, hysterical. “The End of the Internet as We Know It,” proclaimed one infamous CNN headline.

Well, have you noticed any change? Could you detect a disturbance in the Force on this day, one year ago? Has your internet experience significantly deteriorated in the year since? Neither has anyone else’s.

In fact, “U.S. internet speeds rose nearly 40 percent this year,” according to the online tech journal recode. That’s right—the internet got dramatically better in the year since internet regulations were reversed. That’s most likely because broadband investment dropped in 2016 after regulation was imposed, but increased again after regulation was repealed. And it’s investment in broadband networks that upgrades and expands the reach and capacity of those networks.

Repealing internet regulation was the right thing to do. It’s been a good year for broadband.


 

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