(This is an edited excerpt from an article that originally appeared on Scott Bradford: Off on a Tangent in 2017.)
The federal government, preferably through clear legislation, should make ‘net neutrality’ the law of the land. By doing so, it would help to protect the Internet as the free, vibrant, unrestricted medium that it is today.
If you’re a conservative (as I am), you may be skeptical. I understand. Usually, we don’t want the federal government to do…much of anything. This issue is different.
What is ‘net neutrality?’
The principle of ‘net neutrality’ is the principle that every piece of communication on the Internet should be handled equally by the Internet’s infrastructure. This is not a new principle; in fact, the concept of ‘net neutrality’ is built into the very foundations and protocols that make up the Internet. In its normal configuration, the Internet doesn’t spend time being picky. It routes every bit of data it comes across as quickly and directly as it can. This makes sense; the Internet was originally built by the U.S. government as a technically simple, endlessly-redundant, self-correcting, self-re-routing communication tool that would be able to pass messages intact even after being damaged by a catastrophic nuclear attack. Any unnecessary complexity would just get in the way of that mission.
Following the privatization of the Internet, the ‘net neutrality’ principle stayed in place. Every bit of data that arrives at a node in the network is processed and passed along just the same as any other bit. Your Amazon.com order is handled just the same as your Google search, and your Google search is handled just the same as your Facebook post, and your Facebook post is handled just the same as your slightly-funny meme graphics.
This is part of what makes the Internet great. I can post something on my web site, or on Facebook, or on Twitter, and it has the potential to get as much traffic as the latest article from the New York Times or Washington Post. As long as the server where my post is hosted has the ability to keep up, it can get millions — or even billions — of hits, and they will be transferred over the network no differently than your email to your grandmother, or the latest YouTube viral video, or the latest nonsensical political Tweet.
Why is ‘net neutrality’ important?
Imagine if we dismantled this principle and allowed the companies that manage the Internet to have an unrestricted authority to decide how they want to handle traffic. Some companies might make relatively innocuous, and maybe even beneficial, decisions. For example, some companies might prioritize government authorities’ emergency announcements ahead of other traffic. Okay. But others might choose to prioritize their own traffic and restrict or even block their competitors’ traffic.
Consider Comcast, a company that provides television and phone services in addition to their Internet plans. Why wouldn’t they use their power over their customers’ Internet connections to, say, degrade Netflix video or Vonage phone service? “Hey,” says Comcast to their irate customer on the support line, “obviously our video and phone services are way more reliable than Netflix and Vonage! I can offer you a plan add-on for only $60-per-month!”
And even more troubling, imagine if Comcast decided to block “hate speech” from its customers. That sounds lovely, but do you trust Comcast to define “hate speech” the same way you do? What makes you think they wouldn’t block the latest papal encyclical? Or your preferred political party’s or candidate’s web site? Or the Democratic Underground? Or Breitbart? And what makes you think they wouldn’t block you from sending a PayPal payment to a company or cause they don’t like? What makes you think they wouldn’t redirect Amazon.com traffic to Amazon’s highest-paying competitor if they had the chance?
And if ISPs started charging companies a fee to gain network preference, the large, incumbent companies — YouTube, Facebook, Netflix, etc. — could afford it. Today’s Internet experience probably wouldn’t change much. But what about the next YouTube, Facebook, or Netflix? It will be much harder for newcomers to become big names if, in addition to building their own business and their own infrastructure, they must also pay a kick-back all the major ISPs.
Regardless of what you think about the right government policy solutions, I hope we can all agree that Internet service providers (ISPs) should not be exerting this kind of editorial control, censorship, and extortion in the Internet market.
But isn’t government regulation bad?
Well, that depends on the regulation, doesn’t it?
Like most conservatives, I tend to answer this question with a ‘yes’ more often than a ‘no.’ Most of the government regulations we live under today are overbearing and nonsensical…but that doesn’t mean that all of them are. I think most of us — even the most ardent right-wingers and libertarians — would agree that laws or regulations should prohibit factories from dumping toxic waste in our rivers, and establish a national standard for air traffic control, and prohibit companies from selling pure arsenic with a label that says it’s a good treatment for the common cold.
While the exact contours of what should and shouldn’t be regulated are open for debate, we should not assume that all government regulations are inherently bad. Some government regulations are good. Some are even necessary.
Isn’t federal regulation of the Internet unconstitutional?
Most federal laws and regulations are invalid under the plain text of the U.S. Constitution, having gone far beyond the restrictions of the enumerated powers (Article 1, Section 8) and their clarification in the Bill of Rights (Tenth Amendment). More on that in the section on federalism. But even the most ardent textualist must admit that the Internet naturally falls within the federal purview.
The vast majority of Internet traffic crosses interstate or international lines. Every time you view a banner ad on the Internet — except in the rarest of cases where you, the web site, the advertising service, the advertiser, and the networks routing them all together are all in the same state — you are engaging in interstate or international commerce. That is a federal matter under Article 1, Section 8, Clause 3: “[The Congress shall have Power] to regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.”
That doesn’t mean that I think the federal government should start enacting heavy-handed Internet restrictions. No, as a general principle the federal government should only regulate things it has the authority to regulate, and then only to the least extent necessary. But the argument that the federal government lacks the authority to regulate the Internet is pure nonsense. Even under the strictest reading of the U.S. Constitution, this is a federal matter.
Shouldn’t we wait until there’s a real problem?
Yes, we should.
One of the strongest arguments against the FCC maintaining its ‘net neutrality’ regulations has been made by the current Chairman of the FCC, Ajit Pai. He argues that ‘net neutrality’ regulations are a solution in search of a problem…or, in other words, that ISPs have not been violating the ‘net neutrality’ principle, and therefore regulation is unnecessary.
I like Pai, although I disagree with him on this issue. He’s a smart guy. I encourage you to listen to what he has to say on the topic. He claims that ISPs were not “willy-nilly blocking traffic, throttling traffic, on the contrary these were all phantoms that were conjured up by people who wanted the FCC, for political reasons, to over-regulate the Internet.”
Unfortunately, Pai is wrong. ISPs were abusing their power, and that is why the FCC got involved with this issue in the first place. For example, Comcast was caught actively interfering with its customers’ BitTorrent file sharing in 2007. Although BitTorrent is sometimes used for illegal file sharing, it is more commonly used to distribute large legal downloads like Linux distributions, open-source office suites, and large commercial applications. After an FCC investigation, Comcast was found to have violated the ‘net neutrality’ rules that were in effect at the time.
ISPs began to violate the longstanding ‘net neutrality’ principle a decade ago. Only after this occurred did the FCC step-in and adopt ‘net neutrality’ rules in an effort to prevent further abuses. Since then, abuses have largely stopped…in large part because of these regulations. There is, indeed, a real problem here. ISPs have already shown that they cannot be trusted to abide by these principles on their own.
Won’t competition solve this?
It would, except that it can’t.
I’m a free-market conservative. I believe in the ‘invisible hand.’ I think Keynesians don’t know what they’re talking about. I’ve read Ludwig von Mises and Milton Friedman. I think that increasing government spending in a recession is stupid. I know that the ‘New Deal’ didn’t work, as hard as it tried.
And if the ISP market was a free market, I would not support ‘net neutrality’ regulation. I would subscribe to the typical free-market libertarian view that, if an ISP was interfering with Internet traffic in a way that its customers didn’t like, its customers would be free to switch to a competitor.
Comcast (for example) might throttle Netflix streaming so that it was unbearably slow, but maybe Comcast would offer its own, better streaming service as part of that package. Some customers would choose Comcast and accept that Netflix would be slow (or blocked entirely) in return for saving some money or getting access to Comcast’s own service. Others would abandon Comcast and subscribe to (say) Cox Cable instead, even if it was more expensive, because Cox might decide to treat all bits equally under the ‘net neutrality’ principle. Let the customers decide!
It sounds lovely. Except, in reality, it would never happen. No single customer at a single location would have the opportunity to choose whether they wanted Comcast’s cheaper-but-throttled plan or Cox’s more-expensive-but-unrestricted plan…because pretty much no home in America is served by both Comcast and Cox. One or the other has a wire into the house, and that is the one that the customer is stuck with until they move.
Most places in the United States have access to only one broadband ISP. Some of the lucky ones in urban and suburban areas — like myself — might have two. In my case, I have a choice between Comcast and Verizon. But even in my case, there’s no reason to assume that either Comcast or Verizon would choose to adhere to the ‘net neutrality’ principle. And if those are my only options, and both choose to throttle Netflix, I’m screwed.
The free-market principles that would otherwise lead me to oppose ‘net neutrality’ regulations simply do not apply in a market that, for the overwhelming majority of Americans, is a tightly-restricted monopoly or duopoly. (This evaluation might change if reliable and affordable satellite-based broadband services become available.)
Why is there little/no competition?
ISPs are infrastructure companies. They need a physical connection to your home to provide you with service. Therefore, they are natural monopolies, just like the companies that provide phone, power, gas, and water utilities.
It wouldn’t make sense for five power companies to run wires to your house, since, in that case, they would only have a one-in-five chance of ever getting that investment back. Likewise, it doesn’t make sense for five ISPs to run wires to your house. One (or maybe two) will do it, and you’re stuck with them. They are ‘common carriers’ just like the other utility companies. And, as a matter of policy, federal and state governments regulate ‘common carriers’ to prevent them from abusing their power.
This regulation is why power companies like Dominion Virginia and PEPCO can’t prohibit you from installing solar panels, or tell you that you can’t use their power grid to run a popcorn machine unless you buy their monthly popcorn subscription, or tell you that they’ll only provide the full 120 volts of power for GE appliances (since GE paid them an ‘advanced power license’) and Samsung appliances must make-do with 90 volts. At least some power companies would do this sort of thing if they could get away with it. But they can’t. Regulations require that they provide neutral power service; it is up to the customers to decide how to use it, and how much of it they want to use. Call it ‘power neutrality’ if you like. And the Internet should be the same way.
It is unlikely that the ISP market will ever become a vibrant free market, at least not until wireless and satellite ISPs can compete on speed and price. And until the ISP market is a vibrant free market, it must be regulated — just like other natural monopolies — to prevent the companies in that market from unfairly exploiting their position.