Network Neutrality and Internet Regulation: Warranted or More Harm than Good?

The House Commerce Committee's Subcommittee on Communications and Technology, chaired by Rep Greg Walden (R-OR), convened a hearing on the Federal Communications Commission's recently-adopted open Internet/network neutrality rules. The five FCC Commissioners testified about the rules that regulate how Internet service providers can mange their networks.

Chairman Walden said, "We all want an open and thriving Internet. That Internet exists today. Consumers can access anything they want with the click of a mouse thanks to our historical hands-off approach. Changing direction now will only harm innovation and the economy." Chairman Walden also challenged the FCC's authority to regulate broadband services. He announced that he is offering an amendment to the Continuing Resolution to prohibit the FCC from using funds to implement the controversial Internet regulations that the commission adopted in December. The amendment reads: “None of the funds made available by this Act may be used to implement the Report and Order of the Federal Communications Commission relating to the matter of preserving the open Internet and broadband industry practices (FCC 10-201, adopted by the Commission on December 21, 2010).”

Republican House and Senate leaders on communications and technology policy also formally introduced a Resolution of Disapproval under the Congressional Review Act to reverse the FCC’s rules. Leading the effort in the House are Chairmen Walden and Upton. Senate Commerce, Science, and Transportation Committee Ranking Member Senator Kay Bailey Hutchison (R-TX) joined Senate Republican Leader Mitch McConnell and others to introduce identical legislation in the Senate. The Resolution of Disapproval reverses the FCC’s network neutrality rules with a simple majority in both chambers. Rep Henry Waxman (D-CA), Ranking Member of the House Commerce Committee, released letters from a diverse group of organizations voicing their opposition to the resolution of disapproval. “I join with these organizations in expressing my opposition to any Republican effort to nullify the FCC’s new rules on net neutrality,” said Rep. Waxman. “These regulations are necessary for not only protecting consumers but also promoting an open and robust Internet that can spur technological innovation and economic growth.” The Committee received multiple letters expressing the support of over 100 organizations, coalitions, and other interested parties

House Commerce Committee Chairman Fred Upton (R-MI) said, "The FCC’s recent adoption of network neutrality rules to regulate the Internet is perhaps the most striking example of a troubling trend we have seen at this important agency. Rather than serving as an impartial expert and authority, the commission seems to be advancing a policy agenda of its own ­ often, by twisting the arms of those who come before it. This activist agenda is particularly embodied in the network neutrality regulations that are the subject of today’s hearing."

Rep. Lee Terry (R-Nebraska) expressed disappointment that the FCC hadn't conducted a serious analysis of threats to the open Internet as he had requested. FCC Chairman Julius Genachowski answered, “We did do a market analysis in our order."

Chairman Genachowski stood by the position that he acted within legal bounds when he cemented the controversial rules over Republican opposition. Genachowski appeared to go further than usual in standing up the legal basis. He suggested the Supreme Court would not affirm a decision against the FCC if it were based on the ruling by the D.C. Circuit Court of Appeals. The decision had struck down a net-neutrality enforcement effort last year. Chairman Genachowski said there is "some open ground for the Supreme Court to overturn" the reasoning of that appellate court ruling.

Chairman Genachowski also said a dispute between content delivery service Level 3 and Comcast over traffic delivery charges don't fall under the new rules. The net neutrality order "doesn't change anything to existing peering arrangements," Genachowski said in the hearing. He added that he "hopes those parties settle and resolve it."

Rep Ed Markey (D-MA), a veteran of telecommunications policy, came to the defense of the commission and slammed the large carriers. “I wish the FCC had gone further,” said Rep Markey, who argued that some regulations are needed to guard against the dangers of monopolistic behavior. Rep Markey called the big providers “broadband barons” that will oppose competition “anytime they have control of something.” Without some regulation from the FCC, smaller innovative companies won't have a chance, Rep Markey noted.