Misnamed "Net Neutrality" Merely Picks Winners and Losers

Net neutrality is the latest overreach by the federal government to censor the web. Rules passed by the Federal Communications Commission in December limit the ability of internet service providers, including wireless providers, cable and phone companies, to offer tiered pricing levels based on content, applications, and other factors related to amount or type of usage. The internet has changed with the rapid rise of online services like YouTube, Netflix and Skype which consume large amounts of bandwidth, slowing down internet service for others.

Proponents of Net neutrality insist that it merely keeps the status quo, prohibiting “discrimination” by a few dominant internet providers, and “ensuring” free speech. In reality, it will increase regulation and costs by restricting companies from making marketwise choices. Moreover, additional government rules and regulations rarely increase freedom of speech.

Leading proponents of Net neutrality include Google, no doubt due to its recent purchase of YouTube, one of the heaviest users of bandwidth on the internet. Companies like Microsoft, IBM, and Amazon have gone along with Net neutrality, believing it was inevitable and hoping to have some say in how the rules were drafted.

There are several left wing public interest groups pushing Net neutrality, led by Free Press. The Federal Communications Commission selectively took information from those left wing organizations to justify its new rules. The Commission’s vote split down party lines, 3-2, with the three Democrats on the Commission voting to ban “unreasonable discrimination” by broadband and wireless providers against internet websites and applications, although more leeway is provided to wireless providers. Obama praised the rules, seeing it as a step towards fulfilling his campaign promise of preserving a level playing field for web developers.

Granted, the FCC’s new rules do not go so far as broadly prohibiting internet providers from charging different pricing based on usage or speed. A user who uploads and downloads movies or mp3s all day long, taking up considerable bandwidth, can still be charged more than someone who infrequently uses the internet to briefly look at the news. However, the rules do limit internet providers’ discretion to pick and choose which applications or websites to block.

There has already been at least one complaint filed with the FCC against a company alleging violations over tiered pricing. MetroPCS, a broadband provider, is offering unlimited internet access for the extremely competitive price of $40 per month. It includes everything except content from a few bandwidth hogging applications like Netflix and Skype (Skype is a competitor of MetroPCS in voice telephony service). Full access is $60 per month.

It is true that that companies like MetroPCS may block certain applications in part because they belong to competitors, not solely due to bandwidth or space usage. Even so, knowing the government’s history at regulating industries, this may be an annoyance worth living with. Remember when the government tried to force Microsoft to include competitors’ applications with its Windows platforms? It ultimately proved unnecessary, as rapid advances in technology provided market correction; consumers can now download any product to their operating systems.

The FCC rules were drafted to appease a few of the largest technology companies, not consumers. What is the likelihood that FCC determinations on what constitutes “unreasonable discrimination” will favor certain favored companies over others?

This is unnecessary government intervention seeking to solve a problem that doesn’t exist. Congress needs to curtail the FCC’s authority. Five appointed members on a commission have no business making such far-reaching decisions affecting all of our lives. Expect to see lawsuits filed by companies like MetroPCS challenging the breadth of the FCC’s oversight.