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Experts: FCC net neutrality proposal would hurt consumers

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When Federal Communications Commission released a proposal to rescind rules that ensure net neutrality, it did so under the guise of “restoring internet freedom.” In fact, it would do the opposite, three experts tell Consumers Digest.

In April 2017, FCC Chairman Ajit Pai issued a proposal that would scrap 2015 regulations that were aimed at maintaining net neutrality in favor of the “light-touch” regulation of the internet that predated the 2015 regulations. Oversight of consumer abuses would return to Federal Trade Commission, and rules that forbid blocking content, throttling, or limiting users’ data, and paid prioritization would be endangered. (Net neutrality is the principle that internet service providers (ISPs) must treat all internet content equally.)

In his proposal, Pai says repealing the 2015 regulations is essential to preserve the future of internet freedom. However, three experts whom we interviewed disagree with Pai’s premise.

“The internet started with the idea that it should be free from outside control,” says John Gasparini of consumer-advocacy organization Public Knowledge. “ISPs don’t get to control what does or does not get viewed—legal content, that is.

“This rule restores [ISPs’] freedom to leverage their monopoly power.”

Ernesto Falcon of Electronic Frontier Foundation, which promotes digital civil liberties, agrees. He says that if the proposal goes through as is, he doesn’t doubt that ISPs will slow popular websites in exchange for more money (paid prioritization), and consumers will pay more for that access, because they have no choice.

“People can’t say, ‘I surrender the internet,’” Falcon says, adding that rate hikes would come gradually, as they do with cable TV. “It’s no longer a luxury, and something that’s that valuable will be priced based on the level of competition, which is none in many cases.”

Gasparini points out that four companies now control 80 percent of broadband, or high-speed internet, access, and reports have found multiples examples of consumers having only one choice for broadband service, even in cities where multiple ISPs operate.

The key issue is reclassification of the internet, experts say. In February 2015, FCC approved reclassifying the internet as a telecommunications service rather than an information service under Title II of the Communications Act of 1934. Title II reclassification gave FCC the capability to enforce rules, such as the so-called bright-line rules that forbid paid prioritization or blocking. This is an important distinction, experts say, because FTC isn’t up to the task.

“FTC’s commissioner has said that they don’t have the expertise to regulate telecoms,” says Ferras Vinh of Center for Democracy & Technology, which is a consumer-advocacy organization. “FTC also is an ex-post agency in that they enforce after the fact. FCC can protect consumers from predatory practices before they happen,” but only as long as the Title II classification remains in place.

None of the experts whom we interviewed say Pai intends for ISPs to run roughshod over consumers. Vinh says Pai wants to get ISPs to commit to upholding the bright-line rules through the companies’ terms of service agreements.

“Any in a number of problems exist in that approach,” he says of the self-regulation. “The agreements can change at any time, and any violation goes to mandatory arbitration, which tends to not favor consumers.”

FCC is expected to advance the proposal at its May 2017 meeting, but experts agree that the ultimate outcome isn’t preordained. (Comments on the proposal would be accepted until Aug. 16, 2017, and a final rule would be determined after that.) All three experts whom we interviewed expect a legal challenge to take place if a final rule follows the proposal, and no one could guess at a timeline for it.

The good news for consumers is that they aren’t alone in fighting to maintain net neutrality. In fact, experts say the only group that would benefit from FCC’s repeal of net neutrality rules would be ISPs. Small businesses, in particular, rely on an open internet to innovate and thrive, they say, and these companies would be the most vulnerable to any change.

“Republicans prioritize business, and when virtually the entire corporate world except for cable and phone companies are saying [net neutrality] is a good rule, this will be hard for Republicans to ignore that,” Falcon says.

Gasparini urges consumers to call their representatives to support net neutrality and say FCC’s proposal isn’t in the best interests of Americans. Vinh says consumers should keep in mind that FCC’s regulation in 2015 accomplishes what Pai’s proposal ironically claims to seek.

“When they say the internet has thrived under [light-touch regulation], it’s important to note that the net neutrality rules were put into place to protect the internet as we know it,” he says, adding that ISPs have shown an inclination to make changes. “When we’re talking about net neutrality, we’re not talking about changing the fundamental nature of the internet but preserving what we have.”

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