The Lesson From Europe’s Broadband Breakdown | Commentary

Posted November 19, 2014 at 12:37pm

Today a debate is being waged in Washington. Various approaches to preserving the open Internet are being weighed, and reclassification of broadband services under Title II of the Communications Act is still at the heart of the debate.

Earlier this year, Rep. Bob Latta introduced a bill (HR 4752), that would prevent the Federal Communications Commission from putting broadband Internet service providers under Title II, and just recently, Rep. Henry A. Waxman, D-Calif., sent a 15-page letter to FCC Chairman Tom Wheeler proposing a hybrid approach to net-neutrality rules involving Title II.

Title II reclassification is completely unnecessary. It would retard broadband investment and hobble efforts to create better and faster services.

The harms arising from monopoly-era regulation are clearly demonstrated with a glance toward Europe, where requirements for broadband unbundling and leased access have crippled private investment and left the continent far behind. The U.S. is ahead of Europe on virtually every metric of broadband deployment, from access to next-generation networks, to rural access to broadband and investment per household ($562 vs. $244), with better service here as well. While 4G LTE is widely deployed in the U.S., in Europe it’s more difficult to find.

The U.S. is winning the race for broadband — and future economic competitiveness — because our light-touch regulatory model led to an explosion of private investment and innovation while Europe, with heavier regulation, suffers in comparison.

The lesson is clear: Regulatory structure drives investment and directly affects broadband quality and price.

Everyone concerned about the future of broadband wants to preserve an open Internet. But we do not need to adopt a European or public-utility-style regulatory model to achieve that goal. There is a better, more investment-friendly approach using the FCC’s existing powers and maintaining today’s light-touch regulatory treatment.

Section 706 of the Communications Act directs the FCC to take steps to promote broadband deployment. The U.S. Court of Appeals for the District of Columbia has ruled that the FCC has the power, under section 706, to protect the openness of the Internet and to address any violations. Acting under section 706, the FCC could prohibit any broadband management practice that violates a rule of “commercial reasonableness.” Under this rule, the FCC could, for example, prevent any practice such as paid prioritization that degrades the broadband capacity to which users subscribe.

Make no mistake: The FCC’s upcoming decision will affect the quality and availability of broadband. Light-touch regulation works.

First crafted by the Clinton administration, this model created an environment that fostered the large investments in broadband and the fast speeds we enjoy today. The FCC’s 2010 Open Internet rule followed a similar path. In its wake, companies poured tens of billions of dollars into all types of broadband — wireless, wireline and cable. Since that time, video over broadband, tablet computing and the app economy have grown exponentially. Investment and innovation have prospered, including at the edge of the Internet.

What the FCC has termed the “virtuous circle” of broadband investment and adoption depends on private capital. The flow of investment dollars will continue only if the agency now reaffirms its open Internet authority under section 706 alone, rather than by a reclassification of broadband services to the Title II rules designed for the telephone monopoly.

Net neutrality has taken center stage with President Barack Obama’s recent statement and in the aftermath of three congressional hearings, and one thing is apparent: Subjecting broadband services to heavy, monopoly-era regulation with Title II reclassification is simply not necessary to achieve the assurance of continued Internet openness — and would carry harmful consequences. The FCC can and should proceed on a path that uses its authority under Section 706 to craft new rules that will help protect consumers, promote innovation and help achieve the nation’s twin goals of ubiquitous broadband deployment through private investment and preservation of an open Internet.

Former Rep. Rick Boucher, D-Va., served in the House from 1983 to 2011. He was chairman of the Energy and Commerce Subcommittee on Communications, Technology and the Internet. He is honorary chairman of the Internet Innovation Alliance and leads the government strategies practice at the law firm Sidley Austin.