Free Flow of Internet Traffic Requires Sensible Road Rules

This column is a response to “How to Solve the Net Neutrality Issue,” by Sonia Arrison.

Free marketeers’ primary argument against Net neutrality is that a government watchdog role in protecting neutrality is bound to be “political” — and that any government agency will ultimately start a slippery slide to full-bore regulation of the Internet. This all-or-nothing approach is a false choice that ignores significant factors arguing for a sensible, soft-touch rule to prohibit discrimination against content and applications on the edge of the Net.

The “hands-off” approach would ultimately argue against rules of any sort. Indeed, why give oversight bodies any powers, ask some observers, because these kinds of rules are a lot like potato chips — it’s impossible to have just one. Allow the introduction of a 65 mile-an-hour speed limit, and the next thing you know, the killjoys will make sure it gets ratcheted down to 25 on the interstate.

Just as with traffic laws in the real world, a simple nondiscrimination and transparency rule at the Federal Communications Commission will serve as a sensible virtual traffic law for the network providers who exercise duopoly power in the markets in which they operate. This virtual rule will keep the traffic moving over broadband networks for all content providers, and in turn will promote investment, jobs and consumer choice in this critical marketplace.

All Voices Welcome

In fact, the Federal Communications Commission under Chairman Genachowski is a regulatory body that is one of the best places to vest limited regulatory power over the narrow issue of preserving nondiscrimination of traffic over Internet networks for several key reasons:

The Commission is bipartisan by statute. No more than three of the five commissioners can be from the president’s party; this guarantees a vocal oversight by minority commissioners. In both the Bush era and under the current administration, the minority commissioners exercise a real check on the power of the majority through their ability to disagree publicly, both in formal opinions and in testimony before Congress.

The Commission has professional staff with subject matter expertise. The Commission’s wireless and wireline bureau contains expert economists and legal talent who will help draw a rule for Net neutrality that is based on the available evidence and drawn as narrowly as possible. This helps ensure an approach that will be consistent with both the needs of consumer choice and entrepreneurial innovation.

Congress exercises close oversight over independent agencies. Regulators at commissions such as the FCC, Federal Trade Commission, and others know that powerful Congressional committee chairs are literally looking over their shoulders as they make key decisions. This oversight keeps regulators at these agencies closely focused on the issues and prevents overreach.

The decisions of these agencies are reviewable in federal court. The judicial branch exercises a strong check on the powers of regulatory agencies. Even after a rulemaking process at the FCC, any decisions made or enforcement actions taken under this rule will be reviewable directly in the U.S. Circuit Court for the District of Columbia, the appellate court that oversees federal agency decisions.

Additionally, the procedures under which Chairman Genachowski will develop these rules should help make the case that this Commission is strongly dedicated to having an open and thorough process. A first round of comments will be open until January 14, 2010, and reply comments will be accepted until March 14, 2010. In previous proceedings involving Internet safeguards, the Commission accumulated 100,000 pages of comments — an indication that this will be a fact-based process that will allow all voices to be heard.

Shades of Gray

Some commentators prefer the current situation: The legal status of the Commission’s power to call out neutrality violations is unclear, and consumer groups are tasked with an unofficial beat of watching over network operators for evidence of discrimination. This murky state of affairs serves as a disincentive to investors and entrepreneurs who want to fund new technologies that rely on an open, nondiscriminatory Internet. These investors want legal certainty that these products will work across all networks; private self-regulatory efforts do not offer such clarity and reliability.

This approach has strong, mainstream support — not only from consumer groups, but also from the leaders of the Internet sector. Thirty prominent venture capitalists and investors in Internet companies wrote Chairman Genachowski, saying, “the Commission is absolutely correct to propose clear rules that require competition. The promise of permanently securing an open Internet will deliver consumers and innovators a perfect free market that drives investment, job creation, and consumer welfare.”

Two dozen Internet CEOs, including the chiefs of Twitter, Facebook, Google, Amazon and eBay, agreed that “a process that results in common sense baseline rules is critical to ensuring that the Internet remains a key engine of economic growth, innovation, and global competitiveness.”

The fact that the private sector has stepped up to ask Washington, D.C., for clear but limited rules to ensure continued growth of the Net indicates the importance of this process to the continued growth of the sector, and it is a strong sign of broad support for Chairman Genachowski’s rulemaking.

Markham Erickson is executive director of the Open Internet Coalition.

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