Deceptively named "the Internet Investment, Innovation, and Competition Preservation Act," the draft legislation ironically proposes widespread regulation of the Internet, but seeks to delay any FCC action that would ensure consumer protection until significant harm has already occurred.
Free Press Research Director S. Derek Turner said:
"It is perfectly reasonable to ask the FCC to identify market failures prior to regulating -- that's the central mission of any regulatory agency. We have already demonstrated many failures in this market, all of which have led to ever higher consumer bills and inadequate infrastructure investment. These examples and other market failures, and the stated intent of ISPs to abuse their market power through discriminatory practices, warrant the FCC stepping in to protect consumers and preserve the open Internet.
"But this bill, which purports to be a bulwark against unnecessary regulation, actually includes a requirement that any future Network Neutrality rule be applied to all websites and Internet content, not just to the physical infrastructure of broadband networks. In other words, with this bill Rep. Stearns literally seeks to create a fairness doctrine for the Internet. It is clear that there is no reason for anyone to take this bill seriously."
Free Press offers three reasons why lawmakers, including those who oppose Internet rules, should steer clear of this bill:
1) At its core, this bill is a political stunt – a legislative vehicle for the agenda of the largest incumbent broadband providers. Its central objective, requiring the FCC to submit a report to Congress, amounts to little more than the analysis the FCC normally would do in the course of applying its rules. The bill would serve no functional purpose other than to create additional bureaucratic hassles before the agency could create policy to protect consumers, competition or innovation. The bill would force the FCC to permit massive consumer harm in the broadband marketplace before taking any form of remedial or preventative action.
2) Although it claims to be a safeguard against unnecessary regulation, this bill includes a dramatic expansion of regulations for web content. The bill proposes that any future Net Neutrality rule be applied to websites and Internet applications. It seeks to apply, for the first time, content regulations to websites and Internet applications.
3) The bill wants "proof" of market failure, although the high prices consumers pay and the slow speeds of our networks relative to global leaders already indicate that broadband access providers possess and abuse market power. The FCC and others have already demonstrated plenty of textbook economic examples of market failure, including duopoly, high entry barriers, externalities, public good attributes, and information asymmetries, just to name a few.