Regulation

What is the FCC’s definition of “competition?” That is the defining question and take-away from FCC Chairman Wheeler’s latest broadband speech, “The Facts and Future of Broadband Competition.”  

Tellingly the Chairman said: “Since my first day as Chairman of the FCC my mantra has been consistent and concise: Competition, Competition, Competition.” Well then, it seems especially important to understand exactly what the FCC Chairman means when he says the FCC is singularly focused on “Competition.”  

There are two core reasons the FCC should not try to preempt State muni-broadband laws.

1. The Supreme Court has already indicated it would be unconstitutional.  
2. It would be anti-competitive, the opposite of the FCC’s statutory purpose and legal mandate.

I.  Why FCC Preemption of States Rights would be Unconstitutional

First, the Supreme Court already has decided this issue effectively in favor of state rights. In Nixon v. Missouri Municipal League (2004) the Supreme Court rejected federal preemption of state prohibitions on telecom services. It specifically rejected the use of the FCC’s Title II section 253(a) authority to preempt state prohibitions of localities offering telecom services on constitutional federalism grounds.

Pro-regulation interests often resort to highly misleading arguments to advance their cause. Fortunately that kind of deception ultimately exposes the weakness of their underlying argument and public policy position.

To promote Netflix’ “strong” version of net neutrality regulation and to oppose the Comcast-TWC acquisition, Consumerist just framed a very deceptive whopper competition argument: “Comcast says mobile data is competitive, but it costs $2k to stream Breaking Bad over LTE.”

The old adage is true here; “if it ain’t broke don’t fix it.”

The Internet peering marketplace works exceptionally well and it has for its entire twenty year history. The unparalleled success, growth, and resiliency of the unregulated model for the Internet backbone peering marketplace has been nothing short of phenomenal in enabling and ensuring everyone reasonable access to the Internet.

Inter-networked computer networks are effectively the opposite of railroad, electricity, and telephone networks; trying to impose telephone interconnection rules on IP inter-networking is akin to forcing a square peg into a round hole. It predictably breaks both the peg and the hole.

Please see NetCompetition’s House CommActUpdate submission on interconnection -- here. (3 pages)

The Daily Record reports that the Maryland Public Service Commission ruled that Uber is a common carrier subject to its regulatory jurisdiction.  

The PSC stated: “[W]hen viewed in their totality, the undisputed facts and circumstances in this case make it clear that Uber is engaged in the public transportation of persons for hire. Thus, Uber is a common carrier and a public service company over whom the Commission has jurisdiction…”

In 60 days, PSC will draft “new regulations that protect the public interest,but also reflect the evolving nature of transportation services like Uber.”

Uber has threatened to leave the state if Uber is treated the same as their regulated taxi and transportation-for-hire competitors are under Maryland law.

Relevance to FCC Open Internet Order

If Silicon Valley folks are indeed the smartest of the smart, how could they be so easily fooled on net neutrality?

Normally smarts distinguish between what’s testable and real versus what is the pixie-dust of dreams.  

So where’s the real data and sound scientific thinking behind Silicon Valley’s grandiose net neutrality presumptions?

Why isn’t Silicon Valley adhering to its own data-driven, scientific decision-making principles?

Summary of Silicon Valley’s 6 Biggest Net Neutrality Fantasies:

Please see my latest Daily Caller op-ed: “Top 10 Failures of FCC Title II Utility Regulation.”

The FCC has had a failure-prone, seventy-year track record implementing Title II telephone regulation.

It is important to remember what the FCC did in the past with Title II authority, because those who don’t learn from the past are doomed to repeat it.  

It is Part 56 of my FCC Open Internet Series.

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FCC Open Internet Order Series

Part 1: The Many Vulnerabilities of an Open Internet [9-24-09]

Some things are way too important to let slip by uncontested.

The FCC has asserted a foundational regulatory premise that warrants rebuttal and disproving, given that the FCC is considering if Internet access, and Internet backbone peering, should be regulated like a utility under Title II telephone common carrier regulation.

In an important speech on Internet interconnection last month to the Progressive Policy Institute, the very able and experienced Ruth Milkman, Chairman Tom Wheeler’s Chief of Staff, asserted that “communications networks are no different” than railroad and electricity networks when it comes to interconnection. “… At bottom… the fact is that a network without connections and interconnections is one that simply doesn’t work. Disconnected networks do not serve the public interest.”

If Netflix’ position on net neutrality was justified on the merits, why does Netflix need to say so many deceptive things that are demonstrably untrue, in order to justify its case for its version of net neutrality?