Regulating the Wireless Economy is Senseless and Dangerous

A newly-released poll from Morning Consult found that the majority of American consumers – 61 percent – use an internet-based, music streaming service, and that 81 percent of consumers think music should be available as widely as possible. Given the wireless world in which we live, this undoubtedly means through online services such as Pandora, Spotify or YouTube.

The underlying data confirms much of what we are all observers of and participants in every day: innovative technologies, such as Uber, Facebook, Twitter, Skype, etc., are part of what some have labeled the “shared economy,” and the resulting flood of information therefrom, are all made possible through readily-available wireless technologies. This has fundamentally and dramatically transformed the world, much of which relies solely on wireless communication. To not only preserve and expand upon this empowering resource, but also to spread its reach to those either still offline, or with only basic internet availability, government must do its part to promote growth technologies.

Yet in an ongoing policy debate – government regulation of the internet, so-called net neutrality, a misnomer at best – the government is doing exactly the opposite. Consumers must oppose these heavy-handed measures, and do so quickly.

Internet regulation will be front and center this Friday when a three-judge federal Court of Appeals panel hears oral arguments in a major lawsuit against the Federal Communications Commission (FCC). That agency enacted the burdensome rules in an order earlier this year that was virtually mandated by President Obama, violating once again the separation of powers under the Constitution. Opponents of the onerous regulations will rightly argue that the internet should not be subjected to 20th Century telephone monopoly-era straight-jacket regulations.

While it is anyone’s guess what the panel will decide or when it will do so, some predict that the FCC rules and regulations could be tossed out completely by mistakenly focusing upon the makeup of the panel. Complete evisceration is rather unrealistic. This is the third time the FCC has promulgated rules to prevent the blocking or prioritizing of internet traffic, and clearly all sides are looking to this three-judge panel for finality.

More realistically, however, is an effort that insiders are now advancing for some type of grand bargain – either through legislation championed by Senate Commerce Committee Chairman John Thune, or by retention of some common sense parts of the FCC regulations by the court.

The most egregious and least contentious part of the regulations which should be struck down and vacated entirely by the court is the extension of internet regulation to wireless services, which is unprecedented, without foundation and a blatant power grab.

In today’s economy, there is no wireless monopoly. While traditional, landline internet may at times leave us feeling underwhelmed due to the somewhat calculated decision of major cable providers to not build where a competitor sits, wireless providers are constantly battling for market share. As a result, consumers today can access the aforementioned, transformative technologies through at least four major providers. The cell phone service almost all of us enjoy today is every bit the “information service” it was considered to be under the law – not a “telecommunications service” built to make telephone calls.

Hopefully, the court can and will see this misguided and unfounded miscategorization by the FCC and rescue the competitive wireless industry from the grip of unprecedented, heavy-handed regulations. Particularly galling is that these FCC regulations are based upon a solution to hypothetical future business actions since there is absolutely no evidence today of abusive or harmful effects of wireless offerings. A classic solution in search of a problem.

Today’s business investment climate, especially regarding wireless, is directly linked to the FCC’s Internet regulations. Freedom from government intervention is precisely how all U.S. internet giants were created, including Google, Facebook and Twitter. If the FCC’s new rules stay on the books, Verizon and AT&T have already said that they will not be investing in any new fiber-based, high-speed broadband internet facilities, precisely because of the uncertainty created by the FCC’s regulations. We simply cannot allow the same cessation of investment to occur in wireless services.

If that were to happen, the nation would quickly be transported back to the era of the onset of telephony in the 19th Century, and to the beginnings of the emergence of, and advancement of, technology and telecommunications in the 20th Century. We should all fear the chilling effects of a labyrinth of government regulations on 21st Century entrepreneurship and innovation.

America is on the cusp of the exciting emergence of 5G technology. Who knows what the future holds? To realize our potential, I do know that we must get the government out of the wireless industry, permanently, and enshrine that in law. The wireless industry is simply too much of an indispensable sector of the US economy. I hope that effort begins this Friday during oral arguments before the three judge panel of the US Court of Appeals. We all have too much at stake.

Christopher D. Coursen is founder of The Status Group. He formerly served as majority communications counsel for the Senate Commerce Committee and advised the Ronald Reagan and George H.W. Bush administrations.

Morning Consult