The Wireless Double Standard

The largest video provider in the U.S., Netflix, announced last week that it was throttling traffic on some mobile networks without clear notice to its consumers. If your wireless phone provider did the same thing, they would risk running afoul of at least two of the prescriptive rules under the Federal Communications Commission’s new Net Neutrality regime, which applies to wireless providers, but not to content providers like Netflix.

Similarly, JetBlue and Amazon have a partnership that lets you watch Amazon Prime movies for free on your flight over Wi-Fi. This is a good thing for passengers in the sky: free data and free content.

Yet this week, special interest groups demanded that the FCC also outlaw those same free data relationships when provided by a wireless provider because of the FCC’s sweeping general Internet conduct standard under the Net Neutrality regime. All of this despite the fact that consumers have embraced free data services and benefit from a better mobile experience – not just on planes, but everywhere.

Also this week, the FCC will start a process to impose new and intrusive privacy mandates, and – once again – apply those new rules to wireless providers, but not mobile content or app providers who have access to the same, if not more, personal data. In doing so, the FCC will effectively replace the FTC’s approach that has applied to every company in the mobile industry from app provider to device manufacturer. That time-tested approach ensured a consistent standard that governed all players equally and fairly.

The FCC will now seek to subject wireless providers to more inflexible mandates that will do little to actually protect consumer privacy.

Over the last year, the FCC has repeatedly moved aggressively to dictate how and when mobile providers operate and compete. In each instance, the FCC is careful to announce its actions will have no impact on app providers or others. Make no mistake – there is a wireless double standard. This unfortunate and risky pattern stands to distort competition and confuse consumers. The FCC attempts to justify this disparate treatment because it has a historic regulatory relationship governing voice services. Regulatory agencies are limited to the jurisdiction Congress provides them, but the FCC’s historic authority over voice services – dating back to 1934 – is largely irrelevant when it comes to broadband and the Internet.

Today, competition gives us choice to customize our wireless experience, and Americans benefit from the strongest mobile industry in the world thanks to billions invested up and down the mobile economy. Your favorite app, phone and network all compete with rival voice, video and text applications. With the next generation of wireless, 5G, which will fuel the Internet of Things, we’ll see those lines blur even more. All of this convergence can be a great thing for consumers, but only if everyone is allowed to compete on a level playing field.

But by singling out wireless providers for heavier regulation, the FCC’s approach puts that promise at risk, and unfortunately, repeatedly and unnecessarily penalizes one segment of the mobile industry. Tellingly, the FCC’s approach has already resulted in rating agencies warning about the long-term risk to wireless providers – and that means long-term risk to wireless consumers. While the double standard applies to all wired and wireless broadband providers, its impact is most stark on wireless providers that compete every day with each other and the rest of the mobile economy.

Given the stakes, we cannot allow a single regulatory agency to unilaterally make up its own rules and pick which part of the Internet it will regulate. We need a comprehensive and holistic approach that promotes competition and protects consumers. What we need is for Congress to act to set the ground rules for how a trillion-dollar industry will be regulated, and ensure the U.S. remains the global mobile leader.

Meredith Attwell Baker is the president and CEO of CTIA, the trade association that represents the wireless ecosystem.

Morning Consult