Let's not time travel backwards with the Internet
By Carolyn Cavecche, President & CEO of OCTax
Published in the Orange County Register, September 11, 2014
Time travel into the past is fun and harmless …when it’s limited to fiction.
Who doesn’t love the 1985 movie “Back to the Future,” where teenager Marty McFly (Michael J. Fox) is transported back to 1955? Marty’s means of time travel is a plutonium powered DeLorean customized by his mad scientist mentor “Doc” Brown (Christopher Lloyd). It has a fun plot that gets neatly resolved in two hours.
But I doubt many Californians would be amused by the real life plot being pushed in some circles to transport the way we regulate the Internet back to 1955. That was the heyday of bureaucratic and cumbersome regulations that applied to the equally bureaucratic and cumbersome telephone monopolies of the Bell System era.
Some vested interests are urging the Federal Communications Commission to engage in this dangerous time travel by reclassifying Internet services under Title II of the Federal Communications Act. Title II is where the phone monopoly regulations live and still rule what is left of the utility phone market. And the technology those regulations are based on goes back 100 years.
Imposing them on America’s freewheeling broadband Internet services would be an unconscionable setback for the American economy. Under utility style regulation, ideas for new products and consumer promotions would have to be approved by government agencies.
The lighting fast innovation synonymous with broadband would be slowed to a crawl. Investors who now pump $60 billion a year in private capital into broadband technology and infrastructure would understandably head for the exits.
Damage to California would be particularly severe since we are the global capital of Internet innovation. Internet technology is at the heart of California’s economy – the ninth largest in the world. For Orange County, expanding the Internet technology pie is needed to bring Southern California’s growing tech community more of the economic benefits now generated by the tech giants up north in the Bay Area.
All bets would be off if the FCC were to reclassify the Internet as a Title II service. Of course, the change to a heavily regulated environment wouldn’t happen with the speed of a DeLorean. The initial result would more likely be years of lawsuits and lobbying battles. And regulatory uncertainty is not a friend of investment or market growth.
Just having this national conversation about heavily regulating the Internet is a major irony in itself. Back in the early ‘90s when the development of the worldwide web and web browsers made the Internet widely available to consumers and small businesses, the U.S. regulatory community made a pivotal decision not to weigh this promising new technology down with utility style regulations.
That decision has been justified many times over by the exponential growth of the Internet and broadband services. Nonetheless, some calls for heavy regulation under Title II are now being heard as part of the dispute over the Open Internet, sometimes called Net Neutrality.
The Open Internet basically means an Internet where all providers of legal content can have fair access to the privately operated broadband networks that make up the Internet. An Open Internet is also an environment where consumers at all income levels and small businesses are encouraged to take full advantage of the Internet.
We have that kind of Internet right now and it was built on the strength of minimal regulation. What we don’t have at the moment are legally binding rules to enforce the Open Internet, because the FCC’s 2010 rules were vacated by a court decision.
A new set of light touch regulations proposed by President Barack Obama and FCC Chairman Tom Wheeler would continue the Open Internet without turning the clock back to another era. That kind of time travel should be left to Hollywood.