Issue Briefs
Net neutrality
August, 2009
Proponents of net neutrality would have the government regulate the prices, terms and conditions of broadband services. Standing to benefit would be established Internet companies such as Google, Yahoo! and eBay. Many proposals advocating net neutrality seek to specify which business models are permissible, and which ones are not. They would impose by government flat outcomes that benefit established Internet companies to the detriment of network operators (including cable) and new Internet service providers.
The cable industry supports Congress's longstanding policy of leaving the Internet unregulated. This "hands-off" regulatory approach to broadband - in place since passage of the Telecommunications Act of 1996 - has been a success and has encouraged private investment in new services and infrastructure (more than $100 billion by the cable industry alone since 1996). By contrast, network neutrality laws would stifle investment and lead to an increase of needless lawsuits.
Those who call for regulation of the Internet in the name of "network neutrality" are offering a solution in search of a problem. There is no evidence of a market failure to justify the imposition of common carrier-like regulation on broadband services. "One size fits all" net neutrality regulation would replace the workings of the marketplace with government regulation, and have the government pick what works in the marketplace. By contrast, in the current market-driven environment, companies have the freedom to experiment with multiple business models, producing more choices and competition in content and provide for consumers more innovation than ever before.
Again, the existing regulatory approach has been successful, and government regulation is completely unnecessary, as it would: severely limit the Internet's usefulness; threaten to set a precedent for even more intrusive regulation of the Internet; chill investment in competitive networks; and deny network providers the ability to differentiate their services. The current marketplace is working well to bring consumers the services and features they want at fair prices. Lawmakers should be reluctant to replace that market-driven success story with a system of intrusive regulation. At a time when there is widespread agreement that our national policies should maximize broadband for all, Congress should not enact a policy of net neutrality that would stifle innovation in broadband networks and act as an obstacle to broadband, slowing its growth and reach to all Americans.
© 2010 Broadband Cable Association of Pennsylvania