Some very basic initial thoughts on President Obama's announcement today that he supports "the strongest possible rules to protect net neutrality," including reclassifying broadband as a common carrier under Title II of the Telecommunications Act:
- Well, finally. Title II has always been the answer to net neutrality — the plan Obama's advocating is broadly similar to the plan former FCC Chairman Julius Genachowski first proposed way back in 2010. That plan was killed by telecom companies and the right-wing media machine screaming that Obama wanted to "regulate the internet" — an argument that carries less and less weight with every passing day that consumers spend being mistreated and overcharged by their internet providers.
The FCC is trapped between a rock and a hard placeThe FCC is trapped between a rock and a hard place — the president, liberals, and the tech industry are now firmly in support of Title II, and conservatives and Big Cable are now firmly in support of doing nothing at all. There's no compromise coming out of this, and Tom Wheeler is going to have to move firmly in one direction or another. Given that he's an Obama appointee and there are more Democratic FCC commissioners than Republicans, it's safe to say he'll have to follow the president's lead.
- You can argue that regulation will kill the market for internet service all you want, but the truth is that the market simply doesn't exist, and very probably can't exist. These companies are old, they are entrenched, and they are extraordinarily good at working the system to protect their interests. In the absence of competition to keep the Verizons and Comcasts of the world honest, we need legally-sound regulation that actually reflects the way we use the internet now.
- The only real fights here will be over paid prioritization and throttling. The big cablecos have always supported no-blocking rules (NCTA President Michael Powell was the Republican FCC Chairman who initially proposed that rule) and Comcast itself has agreed to abide by stricter rules until 2018 as a condition of its NBC Universal purchase. You will hear a lot of bellowing from the telcos about not needing any rules and Congress being the only real place for changes of this magnitude, but the reality is far more narrow.
Obama just picked a major fight
- It is extraordinarily important that Obama wants wireless broadband to fall under the same rules as wired. The wireless carriers have gotten away with some of the worst nonsense in the entire game because they insist that spectrum is a scarce resource and they have to act differently, but the reality is that AT&T and Verizon are hoarding huge amounts of unused spectrum and more and more Americans are turning to mobile as their primary internet access.
- The timing here will be the interesting thing. Obama just picked a major fight with the ascendent Republican Party fresh off its huge midterm victories, and they're not going to let this thing just happen overnight. Expect to see this stretch well into 2015 and get muddled into the FCC / DOJ approval process for the Comcast / Time Warner Cable merger.
- It's always been hard to explain net neutrality to the broader public, but if this does run into the Comcast / TWC merger approval it'll get a lot easier. Comcast will be on one side of the fight, and net neutrality on the other. All anyone will have to decide is if they think Comcast should get even more powerful with less oversight. That seems like an easy choice.
We're going to be doing a lot more reporting on this in the days and weeks ahead, but those are my first thoughts. Where else should we start digging?