Net Neutrality Harm Underlined
Net neutrality opponents, including Rep. Gene Green, D- Texas, and Rep. Marsha Blackburn, R-Tenn., were assembled Thursday by the free-market American Consumer Institute Center for Citizen Research (CRI) to warn about its impact on consumer welfare, innovation, competition and investment. CRI also put out a collection of essays from many of the panelists sounding the same themes.
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Blackburn said she spoke for the creative community when she argued that the federal government should stay out of how creators want to get content to consumers via the Internet. Net neutrality is the Fairness Doctrine for the Internet, she said. She cited her Internet Freedom Bill (HR-3942), which would block the FCC’s net neutrality regulations, and a companion bill from Sen. John McCain, R-Ariz., the Internet Freedom Act (S-1836). “We are fighting this and we do think this is something that will be moving forward at the FCC next year,” she said. Further regulation is not the answer to keeping the Internet open; fostering competition and investment in broadband infrastructure is, Green said. Expanding affordable broadband access should be a bipartisan goal, he said. Unlike the Internet search market that has little competition, the broadband market has been very competitive without heavy regulation, he said.
Net neutrality mandates could violate the First Amendment free speech rights of the ISPs, said Randolph May, president of the Free State Foundation, saying ISPs have free speech rights just like newspapers, magazines, movie and CD producers. Net neutrality proposals seek to reverse the Supreme Court’s 2005 decision in National Cable & Telecom Association v. Brand X Internet Services by turning ISPs into common carriers required to carry all messages equally, he said. To do so would also implicate the Fifth Amendment takings clause because it’s questionable whether, in the increasingly competitive broadband space, compelled access to the ISPs’ private property would be found to be a proper public use, he said.
Hal Singer, president of consultancy Empiris, cited a recent speech by FCC Chairman Julius Genachowski that argued wireless firms should open up their systems to potential competitors, notably Skype and Google. Imposing such a “duty to deal” can harm some consumers by raising prices for wireless plans, reducing choice in the near term and reducing innovation in the long term, Singer said.
Larry Darby of ACI said “discrimination” has a very different definition in economics than it does in culture. Discrimination simply refers to a level of sophistication that is a necessary part of the business world, he said. If carriers aren’t allowed to offer different levels of service for different prices, carriers will have to charge a higher average price to cover the full cost of the network, because consumers who would otherwise be willing to pay higher prices for more bandwidth and faster service, won’t be able to do so, he said.