Pai Sees Lightening Rules on Net Neutrality As a Boost to Broadband

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Re-defining the internet as a common carrier inhibited broadband infrastructure investment, especially in rural areas, according to FCC Chairman Ajit Pai. That’s why he  circulated among his colleagues a Notice of Proposed Rulemaking yesterday to seek comment on reversing the two claims of legal authority that underlay the 2010 and 2015 Open Internet Orders. He intends to release the draft text today and have the item up for a vote at the FCC’s next open meeting on May 18.

Pai addressed the future of so-called Net Neutrality at an event at the Newseum in Washington, D.C. yesterday. Pai wants to go back to a “light-touch regulatory framework for the internet,” saying that worked for decades. “Under this framework, the private sector invested about $1.5 trillion to build the networks that gave people high-speed access to the internet,” said Pai.  

At the time, former FCC Chairman Tom Wheeler said the change would prevent ISPs from throttling or slowing service for those customers who didn’t pay as much for their service as others who paid a premium to be on “fast lanes.” Pai’s view is “the FCC decided to slap on an old regulatory framework, designed for Ma Bell, on thousands of ISPs.”

The change introduced regulatory uncertainty into the marketplace and smaller ISPs pulled back their investment, according to Pai. For example, KWISP Internet, which serves 475 customers in rural northern Illinois, delayed its plans to upgrade its network and increase consumers’ speeds from 3 Mbps to 20 Mbps. This week, 22 small ISPs told the FCC the change “affected [their] ability to obtain financing,” which “slowed, if not halted,” development and deployment of new offerings.

When businesses cut back on capex, the areas that provide the most marginal ROI are the first to go; for broadband, that means low-income rural and urban neighborhoods. The so-called Title II changes have widened the digital divide and increased digital redlining—of fencing off lower-income neighborhoods on the map and saying, “It’s not worth the time and money to deploy there,” Pai said.

In the NPRM the FCC proposes to restore the classification of broadband service from a Title II telecommunications service to a Title I information service—that is, light-touch regulation drawn from the Clinton Administration. The agency also proposes to eliminate the so-called internet conduct standard. This 2015 rule gives the FCC a roving mandate to micromanage the internet, according to the chairman.

April 27, 2017

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