Should the US Have Net Neutrality Laws? – Top 3 Pros and Cons

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The net neutrality rules adopted in 2015 under the Obama administration regulated the internet as a common carrier, the same category as telephone service, under Title II of the Telecommunications Act of 1996. The Federal Communications Commission (FCC) rules prevented internet service providers (ISPs) from blocking, slowing, prioritizing, or charging consumers extra money to access certain websites. For example, under net neutrality rules, Verizon could not speed up access to websites it owns, such as Yahoo and AOL, and could not slow down traffic, or charge extra fees, to other major websites like Google or YouTube. [5] [4]

On Dec. 14, 2017, under the Trump administration, the FCC voted (3-2) to overturn those net neutrality rules and reclassified internet service as an information source, rather than a common carrier. [1] [5]

Many state attorneys general filed suit against the FCC decision. The US Senate voted 52-47 to approve a resolution to invalidate the decision, however the legislation fell short by 46 votes in the US House of Representatives. The FCC’s removal of net neutrality rules was officially implemented on June 11, 2018. [6] [25] [26] [34]

In Sep. 2018, California passed a net neutrality law and was immediately sued by the Trump Administration Justice Department. On Feb. 8, 2021, the Biden administration Justice Department withdrew the lawsuit against California, and FCC Acting Chairwoman Jessica Rosenworcel indicated support for reinstating net neutrality rules. [35] [36]

According to the National Law Review, as of Mar. 1, 2021, “seven states have adopted net neutrality laws (California, Colorado, Maine, New Jersey, Oregon, Vermont, and Washington), and several other states have introduced some form of net neutrality legislation in the 2021 legislative session (among them Connecticut, Kentucky, Missouri, New York, and South Carolina).” [37]

Should the US Have Net Neutrality Laws?

Pro 1

Net neutrality preserves free speech on the internet by prohibiting internet service providers from blocking content.

ISPs may slow or block websites that disagree with the companies’ political viewpoints or interfere with their monetary interests. [2][7]

In 2017, then FCC Commissioner Jessica Rosenworcel, JD, stated that the removal of net neutrality rules will give ISPs “extraordinary new power” and allow them “to censor online content.” [8]

According to the 2014 D.C. Circuit court ruling, Verizon v. FCC, the power of ISPs to censor content is not “merely theoretical.” Before net neutrality was in place, instances of content censorship actually occurred, including two separate instances of broadband ISPs blocking access to voice over IP applications, and one instance of an ISP blocking an online payment service. [15]

In 2014, President Obama stated that “an open Internet… has been one of the most significant democratizing influences the world has ever known,” and that if content is legal your ISP should not be allowed to block it. [33]

The Electronic Freedom Foundation has argued that, “the meaningful exercise of our constitutional rights—including the freedoms of speech, assembly, and press—has become dependent on broadband Internet access.” This dependency makes net neutrality rules essential for a free society. [16]

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Pro 2

Net neutrality protects consumers by preventing ISPs from speeding, slowing, or charging higher fees for select online content.

Allowing ISPs to speed or slow certain websites, or charge fees for fast lane access, may eventually trickle down to consumers in the form of higher internet costs. For example, a person who gets their internet service from Comcast could be charged extra fees to stream Netflix or Amazon (companies not owned by Comcast), while not being charged extra to stream NBC or Hulu (two companies that Comcast partially owns). [21]

According to US Representative Anna Eshoo (D-CA), without net neutrality, ISPs could “cabel-ize” the internet, meaning that “instead of paying a flat price for access to use any app or service free of charge, companies could start bundling services into ‘social,’ ‘video,’ and so on,” and consumers will have to pay for it. [23]

On Apr. 27, 2017, one day after then FCC Chairman Ajit Pai, JD, announced the plan to eliminate net neutrality, Comcast (the largest US ISP) removed its pledge to not “prioritize internet traffic or create paid fast lanes” from its corporate website. [20][11]

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Pro 3

Net neutrality promotes competition by providing a level playing field for new companies.

According to former Internet Association President & CEO Michael Beckerman, “without net neutrality protections, startups would face discrimination from ISP owned or preferred content that’s granted a speed advantage through paid prioritization,” thus hurting competition and consumer choice. [18][29]

When the FCC implemented net neutrality rules in 2015, it warned “that broadband providers hold all the tools necessary” to “degrade content, or disfavor the content that they don’t like.” [27]

According to Ryan Singel, Fellow at the the Center for Internet and Society at Stanford Law School, without net neutrality “broadband providers will be allowed to charge all websites and services, including startups, simply to reach an ISP’s subscribers. That’s a huge threat to the low cost of starting a company, and it totally up-ends the economics of the internet.” [17]

A group of over 1,000 startup companies, innovators, and investors signed a petition to the FCC stating that “the success of America’s startup ecosystem depends… on an open Internet—including enforceable net neutrality rules.” [19] Google’s CEO Sundar Pichai, MBA, said net neutrality principles must be protected “for the next set of entrepreneurs, building their services and trying to reach users.” [24]

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Con 1

Net neutrality regulations are unnecessary because the internet developed amazingly well in their absence.

Most large internet companies including Google (1998), Facebook (2004), YouTube (2005), and Twitter (2006) were started and grew to success without net neutrality regulations.

According to former FCC Chairman Ajit Pai, JD, “the internet wasn’t broken in 2015,” when net neutrality was implemented and “it certainly wasn’t heavy-handed government regulation” that was responsible for the “phenomenal development of the internet.” [9]

As former FCC Commissioner Michael O’Rielly stated, “periods without net neutrality rules were times of innovation and investment.” [12]

According to economist John W. Mayo, PhD, the entire rationale for net neutrality ignores the “positive economic outcomes in the provision of internet services that resulted from twenty years of light-touch regulation.” [32]

As economist Gerald R. Faulhaber, PhD, argued: “we have had a decade of experience with broadband ISPs with little evidence of wrongdoing.” [3]

A 2017 statement from the Internet & Television Association, signed by 21 large ISPs, stated they remain “committed to an open internet” and “will not block, throttle or otherwise impair your online activity,” once net neutrality regulations are removed. [14]

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Con 2

Net neutrality created burdensome and overreaching regulations to govern the internet.

According to the bipartisan Telecommunications Act of 1996, “the Internet and other interactive computer services have flourished, to the benefit of all Americans, with a minimum of government regulation,” and it should be the policy of the United States “to preserve the vibrant and competitive free market… for the Internet and other interactive computer services unfettered by Federal or State regulation.” [32]

In 2017, the FCC reported that neutrality rules imposed significant and “unnecessary” reporting burdens on ISPs to prove they were in compliance. For example, the ISP CenturyLink estimated that meeting the net neutrality rules created over 5,000 hours of extra paperwork, costing over $134,000 each year. [10]

In addition to being burdensome for ISPs, net neutrality regulations exceed the FCC’s authority. According to the editors of the National Review, the net neutrality rules exceeded “the agency’s statutory mandate,” and “there is no title or provision in the Federal Communication Act that gives the agency a clear mandate to impose pricing and content-management rules on Internet providers, which is what net neutrality does.” [31]

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Con 3

Net neutrality reduces investment in internet services resulting in less access and higher costs for consumers.

Between 2011 and 2015, when neutrality rules were being debated by the FCC, the mere threat of implementing them reduced ISPs investments in network upgrades by 20-30%, a $150-$200 billion reduction in investment. [13]

During the years that net neutrality rules were in place (2015-2017), investment in broadband fell for the first time ever in a non-recession period. [10][28]

According to AT&T, that “chilled investment in broadband,” threatened “to slow the delivery of broadband services to all Americans… particularly in rural America where broadband investment is needed the most.” [30]

Net neutrality regulations also prevent ISPs from charging large content companies (such as video streaming services) additional fees to cover the costs of the massive bandwidth they use. Preventing such paid prioritization fees places the costs of building the additional capacity necessary to carry the content onto ISPs, and these costs will trickle down to consumers in the form of more expensive internet packages – which are paid by all, even those who don’t use the streaming services. [22]

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Discussion Questions

1. Should the United States have federal net neutrality laws? Why or why not?

2. Do net neutrality regulations protect consumers? Explain your answer(s).

3. Do net neutrality regulations unfairly limit internet companies?

Take Action

1. Explore Kevin Taglang’s position that the internet needs net neutrality protections.

2. Consider which states have enacted (or considered enacting) net neutrality legislation according to the National Conference of State Legislatures.

3. Analyze Ken Engelhart’s position that net neutrality laws are not needed because the internet is “inherently neutral.”

4. Consider how you felt about the issue before reading this article. After reading the pros and cons on this topic, has your thinking changed? If so, how? List two to three ways. If your thoughts have not changed, list two to three ways your better understanding of the “other side of the issue” now helps you better argue your position.

5. Push for the position and policies you support by writing US national senators and representatives.

Sources

1.Federal Communications Commission, “FCC Acts to Restore Internet Freedom,” fcc.gov, Dec. 14, 2017
2.American Civil Liberties Union, “What Is Net Neutrality?,” aclu.org, Dec. 2017
3.Gerald R. Faulhaber, “Economics of Net Neutrality: A Review,” Communications & Convergence Review, 2011
4.Brian Fung, “The FCC Just Voted to Repeal Its Net Neutrality Rules, in a Sweeping Act of Deregulation,” washingtonpost.com, Dec. 14, 2017
5.Steve Lohr, “Net Neutrality Repeal: What Could Happen and How It Could Affect You,” nytimes.com, Nov. 21, 2017
6.David Shepardson, “21 States Sue to Keep Net Neutrality as Senate Democrats Reach 50 Votes,” reuters.com, Jan. 16, 2018
7.Roni Jacobson, “Internet Censorship Is Advancing under Trump,” wired.com, Apr. 12, 2017
8.Jessica Rosenworcel, “Dissenting Statement of Commissioner Jessica Rosenworcel,” fcc.gov, Dec. 14, 2017
9.Ajit Pai, “Oral Statement of Chairman Ajit Pai,” fcc.gov, Dec. 14, 2017
10.Federal Communications Commission, “FCC Fact Sheet: Restoring Internet Freedom Declaratory Ruling, Report and Order – WC Docket No. 17-108,” apps.fcc.gov, Nov. 2, 2017
11.Jon Brodkin, “Comcast Deleted Net Neutrality Pledge Same Day FCC Announced Repeal,” arstechnica.com, Nov. 29, 2017
12.Michael O’Rielly, “Oral Statement of Commissioner Michael O’Reilly,” fcc.gov, Dec. 14, 2017
13.George S. Ford, “Net Neutrality, Reclassification and Investment: A Counterfactual Analysis,” Perspectives, Apr. 25, 2017
14.NCTA, “Reaffirming Our Commitment to an Open Internet,” ncta.com, May 17, 2017
15.Verizon v. Federal Communications Commission, cadc.uscorts.gov, Jan. 14, 2014
16.Electronic Freedom Foundation, “Comments of the Electronic Freedom Foundation on Notice of Proposed Rulemaking,” eff.org, July 17, 2017
17.Ryan Singel, “Expect Fewer Great Startups if the FCC Kills Net Neutrality,” wired.com, Dec. 12, 2017
18.Internet Association, “Internet Association Files With FCC and Calls For Net Neutrality Rules to Be Kept in Place,” internetassociation.org, July 17, 2017
19.Startups for Net Neutrality, Letter to FCC Chairman Ajit Pai, engine.is, Apr. 26, 2017
20.Ajit Pai, “Remarks of FCC Chairman Ajit Pai at the Newseum: The Future of Internet Freedom,” fcc.gov, Apr. 26, 2017
21.Steve Kovach, “The FCC Plans to Repeal Net Neutrality This Week – and It Could Ruin the Internet,” businessinsider.com, Dec. 10, 2017
22.Jim Cicconi, “Who Should Pay for Netflix?,” attpublicpolicy.com, Mar. 21, 2014
23.Anna G. Eshoo, “Net Neutrality Repeal Means You’re Going to Hate Your Cable Company Even More,” usatoday.com, Dec. 12, 2017
24.Jordan Malter, “Google CEO: Net Neutrality ‘A Principle We All Need to Fight For,'” money.cnn.com, Jan. 24, 2018
25.Bill Chappell and Susan Davis, “Senate Approves Overturning FCC’s Net Neutrality Repeal,” npr.org, May 16, 2018
26.Erin Carson and Marguerite Reardon, “Net Neutrality Rules Will End June 11th with the FCC’s Final Say-So,” cnet.com, May 10, 2018
27.Federal Communications Commission, “Report and Order on Remand, Declaratory Ruling, and Order,” transition.fcc.gov, Mar. 12, 2015
28.Hal Singer, “Bad Bet by FCC Sparks Capital Flight from Broadband,” forbes.com, Mar. 2, 2017
29.Internet Association, “Principles to Preserve & Protect an Open Internet,” internetassociation.org (accessed May 23, 2018)
30.AT&T, “Open Internet,” about.att.com (accessed May 10, 2018)
31.National Review, “Net Neutrality: Let Congress Decide if It’s Needed,” nationalreview.com, Nov. 11, 2017
32.John W. Mayo, et al., “An Economic Perspective of Title II Regulation of the Internet,” cbpp.georgetown.edu, July 2017
33.The White House Office of the Press Secretary, “Statement by the President on Net Neutrality,” obamawhitehouse.archives.gov, Nov. 10, 2014
34.Jon Brodkin, "Bill to Save Net NeutralityIis 46 Votes Short in US House," arstechnica.com, June 27, 2018
35.Cecilia Kang, "Justice Department Sues to Stop California Net Neutrality Law," nytimes.com, Sep. 30, 2018
36.Federal Communications Commission, "Statement of Acting Chairwoman Rosenworcel on Department of Justice Decision to Withdraw Lawsuit to Block California Net Neutrality Law," docs.fcc.gov, Feb. 8, 2021
37.National Law Review, "State Net Neutrality Laws May Lead to Federal Legislation," natlawreview.com, Mar. 1, 2021