The fight to protect Internet freedom is coming to California this month as the Senate Energy and Utilities Committee (April 17) and Senate Judiciary Committee (April 24) have scheduled hearings and votes on Senator Wiener’s S.B. 822, comprehensive legislation that would utilize the tools available to the state of California to promote net neutrality. As these critical dates approach the large ISPs have filed their opposition (see attached) and it is worth looking at what they say in the context of what they have been doing in D.C. and in the courts. It is also important to see what they are not saying to California Senators.
Parties that Decimated Federal Law are Decrying States Acting in Response
While opponents of S.B. 822 profess to prefer a federal solution, they have never really supported network neutrality at the federal level either. In fact, they spent more than $26 million to support the FCC’s effort to repeal network neutrality and are likely spending millions in California right now to sustain their victory. The money spent helps explain how the FCC reached a decision opposed by roughly 8 out of 10 Americans across the political spectrum.
The ultimate resolution to protecting network neutrality across the country is going to include restoring the 2015 Open Internet Order’s protections. That can happen in three ways: the FCC loses in court, the FCC reverses course, or, most likely, Congress passes a new law. Each of these scenarios are very likely years in the making and, in a matter of weeks, the so-called “Restoring Internet Freedom Order” will take effect. That leaves a very long gap of time for companies like Comcast and AT&T to strike exclusive deals with dominant Internet companies like Facebook to begin prioritizing their services and ensure no future small Internet competitors can compete and replace them (it was not that long ago when Facebook supported AT&T’s antitrust violating merger with T-Mobile).
ISPs Oppose Net Neutrality Because They Want It to Be Legal for Them to Charge More for Access Under Paid Prioritization
The large ISPs pretend they support network neutrality by proclaiming their support for a law banning blocking and throttling. What they consistently leave out in all of their letters is their desire to legalize paid prioritization, the ability for them to pick winners and losers determined by how much they can pay the ISP. This is an especially serious problem when considering the high-speed access market gives more than half of all Americans one choice. Notably, Comcast abandoned its pledge to not engage in paid prioritization the moment the FCC began its process to repeal network neutrality protections and no major ISP has ever fully committed to not begin sorting out the Internet by who can pay them more. They are already relying on their allies in Congress to promote their goal to charge more for Internet access simply because they have the leverage to demand more money.
Making paid prioritization legal gives Comcast, AT&T, and Verizon full control on deciding which Internet products and services get preferential treatment and that has enormous value. In fact, a recent study by Adobe found that close to half of Internet users simply switch to a different service if it is slow loading with up to 85 percent switching if it is a video service that is slow loading. The power to harm online services by slowing them down for other services willing to pay extra is the central danger to a free and open Internet particularly as large ISPs now are vertically integrated with content companies. There is such an extraordinary temptation to self-deal and favor their own content to the detriment of alternatives that it is the central antitrust claim by the Department of Justice’s lawsuit against AT&T’s merger by Time Warner. As they aptly stated, AT&T with control over shows like HBO has “the incentive and ability to use…that control as a weapon to hinder competition.” This is also why zero-rating is a problem (also addressed by SB 822) in the context of companies like AT&T exempting their product (DirecTV) from its own data caps and distorting the market.
The Biggest Myth ISPs perpetrate on Sacramento is There is No Network Neutrality Problem and Repealing Network Neutrality is a Return to the Status Quo
The worst talking point goes to US Telecom, which is effectively AT&T and Verizon, saying we have never had a network neutrality problem. The history of net neutrality is full of violations by ISPs. It is almost humorous that a very old talking point by companies like AT&T used more than ten years ago finds new life at the state level. It is as if the Republican-led FCC that sanctioned Comcast for throttling Bit-Torrent was a figment of our imagination or AT&T itself blocking Skype, Google Voice, or FaceTime (let alone zero-rating its own product DirecTV, which the FCC expressed concerns about until Chairman Ajit Pai was sworn into office).
What the FCC did in 2017 will likely go down as the worst Internet policy decision in history and that is because it was such a radical departure. Despite the fact that the ISP market is more concentrated than ever and that even the Trump Administration’s Department of Justice worries about ISPs exerting power to harm competition this FCC concluded that it was proper for it to absolve itself of responsibility. There is nothing normal about that decision when compared to the previous decades of FCCs that regularly promoted network neutrality and took action against ISPs that violate it. And after years of litigation and losing against ISPs under its efforts to promote network neutrality under Title I of the Communications Act, it is completely insincere to argue that returning ISPs to Title I status is going back to FCC regulation as intended.
If all of this nonsense large ISPs like AT&T, Comcast, and Verizon are pushing at your elected state officials in Sacramento has you upset, then you need to take action and make sure your voice is heard as SB 822 comes to a vote.
Tell California's State Senators to Stand up for Net Neutrality