While the healthcare reform debate on Capitol Hill has captured headlines, another important policy issue is also being considered by the FCC with much less attention---and yet it is an issue that could ultimately impact everyone who uses the internet. “Net neutrality” may not be a familiar term to most Americans but as the debate heats up, it is one that can have far-reaching consequences on everything from our healthcare delivery to our economy.
The issue concerns the transmission of data over broadband networks and the increasingly large amounts of data now available on the internet, particularly with the growing popularity of video and audio downloads. Cable and phone companies who offer multimedia broadband are concerned about the growing number of data-heavy content applications. Currently, all data, from video downloads to spam to medical information, is processed in the same way. . Proponents of net neutrality argue that all internet content should be treated equally, and are seeking regulation to mandate such neutrality. Internet service providers want the right to reasonably manage the systems they have built responsibly.
On its face, net neutrality sounds like a good idea. Some argue that it is based on the principles of free speech that led to the development of the information superhighway, which grew out of a military-only predecessor called the ARPAnet. However well-intentioned, regulating net neutrality will have far-reaching negative consequences. In fact, it would result in reductions in competition and innovation, and could even impact the delivery of new technologies in areas as diverse as communications, healthcare and education.
Imagine the internet as an actual information superhighway. As traffic flow increases, we have adopted ways to manage traffic like the use of high occupancy vehicle (HOV) lanes. Just like our highways, internet traffic needs to be managed so that we continue to receive the content we want and need, without interruption. As web content proliferates, and file sizes grow larger to accommodate video and audio files, we must seek ways to prioritize vital content and ensure its quick delivery. Imagine a doctor waiting to receive a patient’s vital electronic medical records having to compete for bandwidth with music or video downloads. Imagine computer viruses, worms and spam having the same priority on the web as online college courses and remote learning data.
Net neutrality regulatory action will also curb new investment in infrastructure, stifling the competition and innovation that have led to the development of so many new modes of communication on the internet today. By barring consumers from purchasing preferred access to networks, the incentive for service providers to invest will be greatly diminished and the prospect for enhancements in network service will diminish as well. Emerging companies will be less likely to build better and smarter networks and invest in new technologies built on innovation and research.
As David Farber, the “Grandfather of the Internet” noted: “[Net neutrality regulations] would impose far-reaching prohibitions affecting all broadband providers, regardless of whether they wielded monopoly power and without any analysis of whether the challenged practice actually harmed competition. If enacted, these proposals would threaten to restrict a wide range of innovative services without providing any compensating customer benefits.”
Without that healthy competition and incentives for investment, fewer companies will grow and that means fewer jobs. Internet service providers and their vendors have invested more than $100 billion and created nearly half of all new jobs in 2008. According to the Brookings Institution, 293,000 private sector jobs are created for each percentage point that broadband usage increases. Government regulation of an industry that has thrived in the open consumer marketplace is not just detrimental to job growth, it’s bad for the economy as a whole. As the Washington Post noted in a 9/28 editorial: “Is this intervention necessary?”
Why is this issue one that Latinos should care about? A recent Pew study found that only 56% of Latinos use the Internet, as compared to 60% of African Americans and 71% of white Americans. A big factor in that discrepancy is connectivity. Only 29% of Latinos have a broadband connection at home, compared with 43% of white adults. In order for Latinos to succeed and compete in our technological economy, we must bridge this digital divide. That means greater access to affordable broadband and wireless technology, which can only be gained through competition rather than regulation. Net neutrality will put shackles on the most innovative and life changing technologies, limiting the prospects for Latino families to educate their children, stay connected to their families, and develop the skills necessary to participate in an increasingly digital workforce.
In a recent letter to the FCC, the National Urban League, NCLR, LULAC, and the Asian American Justice Center echoed that concern, noting: “If the history of civil rights in America teaches us anything, it is that facially neutral laws and regulations are not always applied neutrally to the constituencies we represent. We certainly don’t want that to happen to internet regulation too, and we’re very concerned that, despite your very best intentions, some aspects of net neutrality might not turn out to be neutral as applied to our constituencies.”
Passing net neutrality regulations will not preserve free speech on the web. Rather, it will limit the potential of the internet to continue to grow and develop the innovations that have transformed our society and economy in such a short period of time. It’s been said that a good policy is one that creates public value without leading to unintended consequences. I think it’s clear that net neutrality does not meet the good public policy standard.
Mickey Ibarra is the founder of Mickey Ibarra & Associates, Inc., a Washington D.C. government and public affairs firm.
