Net Neutrality – Ding Dong The Witch Is Dead

If you’ve heard of Net Neutrality, here, in simple terms, is why, like the Wicked Witch of the West, we should all be glad it’s dead.

Myth: We’re All Gonna Die Without It

Fact: It’s A Big Government Solution Looking For A Problem

Some of the apocalyptic rhetoric about the doing away with Net Neutrality includes:

ACLU:

Federal Communications Commission Chairman Pai is holding a vote on December 14 to allow major corporations – like Verizon and Comcast – the power to block mobile apps, slow websites, and even control which news outlets we can access.

Fight For The Future:

Comcast, Verizon and AT&T … want to gut FCC rules and then pass bad legislation that allows extra fees, throttling & censorship.

Net Neutrality (hereafter referred to as NN, or Not Needed), is nothing more than a big government solution looking for a problem.  Keep reading to learn all the details.


Myth: The Internet Is So Amazing Because Of NN

Fact: NN Is New, And Stifles Internet Growth

  • NN was only started in 2015
  • There is not a single instance of NN being used to “right a wrong”. In fact, the total number of complaints to the FCC around anything that NN would resolve is zero

Myth: Americans Need Protection

Fact: All Disputes Prior To 2015 Were Resolved With Existing Laws, No Need For NN

In 2015, the Obama administration told us all that the freedom of being able to get online and surf the web at our leisure, without being censored by our ISP, was in jeopardy, and we needed the Open Internet Order (the actual name for the Net Neutrality document) to “save” us.  The OIO would classify ISP’s under what is known as Title II of the Communications Act of 1934.  In truth, what was already in place, was full oversight by the Federal Trade Commission (FTC).

The FTC has one purpose: Protect Consumers.  In their own words:

The FTC protects consumers by stopping unfair, deceptive or fraudulent practices in the marketplace. We conduct investigations, sue companies and people that violate the law, develop rules to ensure a vibrant marketplace, and educate consumers and businesses about their rights and responsibilities.

By enforcing antitrust laws, the FTC helps ensure that our markets are open and free. The FTC will challenge anticompetitive mergers and business practices that could harm consumers by resulting in higher prices, lower quality, fewer choices, or reduced rates of innovation.

Further, there are already consumer protections afforded to the FCC by Communications Act of 1934, specifically Section 201(b).  In fact, even Obama’s own FTC commissioner was against Net Neutrality.

As Julian Sanchez, an analyst with the libertarian Cato Institute put it, when on Wisconsin Public Radio,

If the internet was not a terrible dystopia in 2014, there’s not a ton of reasons to think that companies are going to do any of these awful things that they didn’t seem to have any reason to do before.

Were there some issues that happened prior to 2015? Yes, of course there were, and each was dealt with using existing laws.  For example:

  • The FCC stopped Madison River Communications from blocking its own customers’ access to Vonage’s telephone services. This action was punished without expansive Title II regulations to govern net neutrality.
  • AT&T banned Facetime applications on its iPhones, citing concerns about bandwidth usage. The FCC investigated these claims for anti-competitive motives, again without Title II expansion. Although the FCC validated AT&T’s qualms about Facetime, consumer pressure forced the company to renege.
  • Comcast throttled BitTorrent users, and paid $16 million in a settlement for doing so.

There was no NN at the time, and yet everything was resolved. Imagine that! Additional regulations were not needed before 2015, and are still not needed today.


Myth: The Government Can Keep Things “Fair”

Fact: The Government Is A Monopoly That’s Constantly Used To Bully Others

The federal government is explicitly given a few powers through our Constitution. It is also explicitly forbidden from all other powers through the Constitution, by the 10th Amendment

The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.

However, only a fool would believe that our officials in Washington, D.C. are not lusting for more and more power with every breath they draw.  Point in case: The Fairness Doctrine.  In short, the Fairness Doctrine allowed the federal government to dictate what could and could not be broadcast on TV and radio from 1949 to 1987.  It had no impact on print, and, in fact, things that were allowed in print were prohibited by the Fairness Doctrine on TV and radio.  Why? Because the government used it as a tool to control content and to stop the flow of information they didn’t like.  In fact, Bill Ruder, former assistant secretary of commerce under President Kennedy, admitted

Our massive strategy was to use the Fairness Doctrine to challenge and harass right-wing broadcasters and hope that the challenges would be so costly to them that they would be inhibited and decide it was too expensive to continue.

There is no government in history that does not have a record of injecting a tiny bit of control “for fairness”, and then expanding it until it is all-consuming.  To believe that for some crazy reason Net Neutrality will be different is pure folly.


Myth: Net Neutrality Is Good For Competition

Fact: Net Neutrality Allows Unelected Bureaucrats To Decide Winners And Losers

The federal government can’t do anything quickly, economically, or competitively.  The quickly part is by nature, because our founding fathers knew, in their wisdom, a slow moving deadlocked government was beneficial for our individual liberties.  The economical and competitive parts, though, that’s another story.  As a lead-up to how NN kills competition, think about these tidbits:

The FCC was created by statute to enforce the 1934 Federal Communications Act, which was designed with the Bell telephone monopoly in mind, not your iPad streaming Netflix while you post a used couch on Craigslist.  In fact, the Federal Communications Act’s telephone-related provisions were adopted from the 1910 Mann-Elkins Act, which was created to stop “destructive competition” in the railroads!

Under FCC Title II rules, ISP’s are not allowed to work with various pricing and product packages to find out what consumers will pay for, and what they won’t.  But, that’s how the free market works.  Companies take risks, prices go up, they go down, and they find a sweet spot.  People who will pay more can get more, people who don’t need as much can pay less.  NN prohibits this innovation, and demands the same one-size-fits-all model that the government itself works under… just like telephone service… back in 1934.

Government regulations are written by large, deep-pocketed corporations colluding with the government.  This is why adding additional regulatory burdens to an industry (the Internet) that has grown faster than any other in history, with basically no government intervention, actually saw a decline in investments between 2014 and 2016 by 5.6% when NN was implemented.  It also prohibits, for example, a young software developer from entering the market by creating a cutting edge communication app and platform, as they would be burdened with the same expensive and heavy-handed regulatory reporting as AT&T.


Myth: Consumers Don’t Want A Choice

Fact: Consumers Do Want Choices But NN Prevents Them

NN supporters would have you believe that consumers do not want choices in the internet options they can have.

Example 1: Video Conference vs Computer Update

The speed and latency (delays in milliseconds) for a Windows update must be the same as for your video call with your grandmother.  Will a few milliseconds matter to the download of your computer update? Of course not. But for the video call, they will cause dropouts, delayed voice, and poor picture quality.

Example 2: Video Game vs Shopping On Amazon

Latency is also an issue with people who play video games online.  To someone who is buying stuff on Amazon, though, the delays will never be noticed.

In both of the above example scenarios, it would be illegal for your ISP to offer less latency (less delay, better performance) to the gamer and the video conference user, or for them to offer cheaper service to the person who just uses the Internet for reading online news, checks Facebook, or shops on Amazon or wherever.  You read this correctly – it is illegal under NN for an ISP to give a better deal to someone who wants it.

Think Title II will bring competition and thus even more choices? Nope. In fact, putting ISP’s under Title II makes the FCC the sole arbiter of which business models are acceptable and which are not. So, if an ISP wants to roll out a new technology, innovation, or business model, under NN they would have to first get permission from the FCC, who can then decline it, allow it, or ask for more information. Their decision cannot be appealed, and any approval can be reversed at any time at the FCC’s whim.

This is exactly why there is so little innovation in the highly regulated industries under Title II, and why prices for them are so expensive when compared to the rest of the world.  Larger players will grow larger because they have armies of lawyers to wade through the bureaucratic red tape, while smaller players will either fall by the wayside, or give up before they start.

Myth: Net Neutrality Keeps Everyone On A Level Playing Field

Fact: The Playing Field Isn’t Level And Net Neutrality Does Nothing To Change It

Proponents of NN like to talk about Netflix, and how your evil ISP can “throttle” them, or make them slower.  They cry that Netflix must be allowed to compete with any competitive services also owned by the ISP.  However, they do not tell you that Netflix is already getting preferential treatment through technology called Content Distribution Network, or CDN.

If you live in North Carolina, for example, and turn on your Roku or smart TV and stream a Netflix movie, you are net getting it from a Netflix server in California.  Instead, a copy of the movie resides on servers all over the country on a network for distributing content (thus, Content Distribution Network).  Your movie is streaming from, perhaps, a server in Raleigh.  This means Netflix is being fed from a very close proximity, giving it better performance than a competitor that cannot afford the expense of a CDN.

Is this “fair” to the smaller competitor? Should Netflix be forced to give up it’s CDN and the advantages it provides, degrading the viewing experience for it’s customers?  Or, should taxpayers be forced to pay for providing a CDN to all of the Netflix competitors to make things “neutral”?  NN ignores this very common and real example, as well as countless others.  And, that’s what happens when you want to suddenly put the entire Internet under government control using laws originally created in 1934 to control Ma Bell, and 1910 to control the railroads.


As of this writing, December 21, 2018, it is one week since the FCC made the wise move of tossing out Net Neutrality, and so far my Internet still works, and so does yours if you’re reading this.  Don’t forget, NN was only in place for 2 years, produced zero benefit, cost untold millions in regulations and reporting, prevented competition, stopped innovation, and was nothing more than the start of another Fairness Doctrine.

We do not need to put an entire industry into the heavy hand of government control because someone, somewhere, might do something. To close with another quote from Julian Sachez

The practical rule prior to regulation in 2015 was one of neutrality. If anti-consumer or anti-competition behaviors happen, we can always craft a regulation to address those specific concerns. But if a regulation prevents a good thing from happening, like more flexibility in terms of data speeds for different uses, then we don’t know what we missed out on.

 

 

 

 

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