Stearns' Internet Bill Would Impose Heavy Regulations, Enable Further Consumer Harm

On Tuesday, Rep. Cliff Stearns (R-Fla.)
introduced a bill that would block the FCC's recent proposal for light
touch oversight of Internet providers, a proposal that would protect
Internet users and ensure that the agency could carry out key parts of
the National Broadband Plan.

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.