FCC Calls for New Regulations on Internet Raise Alarm

Today, Federal Communications Commission (FCC) Chairman Julius Genachowski announced the agency will initiate a series of rulemakings to create a new regulatory framework for the internet.  The new regulations could have a sweeping reach, affecting everything from content providers, bandwidth usage, and the emerging mobile network for internet access.  The announcement rekindles the net neutrality debate, with the FCC indicating it will take a more pro-active role in shaping the future of the internet.

Specifically, Chairman Genechowski announced the addition of two new principles for network management—non-discrimination and transparency.  This regulatory incursion may be problematic because the internet is a dynamic and evolving network that does not lend itself well to heavy-handed regulations.  New bandwidth intensive applications raise questions about network management that could affect consumer access to the internet.  Deploying the broadband networks required to deliver this content relies crucially on new investments in the network.  Regulatory impediments or uncertainty could thwart larger efforts to expand broadband access.

“In the current economic downturn, the internet remains a bright spot for economic activity,” said FreedomWorks Foundation’s chief economist Wayne Brough.  “Creating a new regulatory regime at this point has the potential to kill the goose that laid the golden egg.”  Currently, the FCC and the Federal Trade Commission have the relevant authority to address concerns on a case-by-case basis, which is more suitable to the dynamic nature of the internet than a regulatory regime that attempts to address such problems ex ante.

As the internet continues to develop, it will play a more critical role in our lives.  New applications and content, from health care to education to consumers at home watching movies all require more bandwidth and more investment in broadband.  The issue of net neutrality is a classic debate on how the investment will be determined; by the market or by regulators.  Historically, consumers have been better served by competition in the marketplace.  FreedomWorks encourages the FCC to avoid new regulatory impediments that could limit investments in the important new networks required to provide consumers access to the content and applications the internet provides.


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