FCC chairman Ajit Pai took his pitch for rolling back Title II regs to the Midwest, saying "net neutrality" was about marketing, but the issue was about government dictates.
That came in a joint interview (with Republican Sen. Ron Johnson of Wisconsin) about broadband expansion, Title II and internet fast and slow lanes on WTMJ (AM) Milwaukee during Pai's tour of the Midwest. Pai also neatly summed up his broadband regulatory philosophy toward the internet, saying that with the Department of Justice and the Federal Trade Commission to handle potential anti-competitive conduct, “you don't need an FCC preemptively regulating every single internet service provider and every single business practice." He said, instead, the FCC needs to focus on “investment and infrastructure."
Asked about net neutrality, Pai suggested the term was a great marketing slogan, but that in reality it was about internet regulation and the question of "whether you want the government deciding how the internet is run." Pai argued that the Clinton-era light-touch regulation had allowed the marketplace to evolve, but the 2015 Title II reclassification had taken it in another direction, putting the government, rather than the private sector, in the forefront.
He said his proposal was to return to that Clinton-era light-touch model.
Pai was asked whether Title II didn't protect smaller companies from larger ones, "like Comcast or someone like that."
He responded that, no, on the contrary it hurt smaller businesses, saying "complex regulations are always benefitting the bigger companies"—at least relatively speaking since Pai argues that such regs should not be applied to any size company. "Those [larger] companies will always have the compliance resources, the lawyers, the accountants, the lobbyists, to comply with our rules," he said. "It's those smaller companies that are going to suffer, and they have told us over the past several weeks that they have suffered because of these Title II regulations."
Johnson agreed: "Network neutrality is a slogan. What you really want is expansion of high-speed broadband, and in order to do that you need to create an incentive for those smaller ISPs to invest."
Pai has said broadband deployment, particularly in rural areas, is a key priority of the FCC under his watch.
Johnson put in a pitch for prioritizing traffic, talking about the ability to prioritize life-saving diagnoses ahead of movie streaming, for instance.
Asked who would decide who is going to be in each lane if there is to be a high-speed and a slow-speed lane on the internet, Pai said that the priority is ubiquitous access for everyone. He turned the question toward deploying broadband and the expense, particularly in rural areas. He suggested that allowing flexibility of business models would allow companies to get a return on the kind of investments they would need to close the digital divide.
"Obviously, we want to have ubiquitous access," Pai said in response to the question. "Laying fiber in the ground, putting up towers, all this stuff is very expensive, especially in rural areas. In sparsely populated parts of Wisconsin, a lot of companies might just say: 'You know what, we just can't see the return on investment there; we're not going to invest in the first place.'"
"So, our primary goal at the FCC is closing that digital divide and making sure everyone in Wisconsin has internet access if he or she wants it. It shouldn't matter where you live."
To do that, he said, there needs to be a regulatory framework that gives companies an incentive to invest. He said that was FCC's first mission.
Johnson argued that "the more pipeline you have laid, there won't be a problem… there haven't really been any clogs." Johnson agreed with Pai that businesses need economic incentive to invest capital.
The interviewer—the segment was on the station's morning news program—said the fear he had was that removing Title II appeared to be treating the internet as a commodity rather than a utility, and ISPs could decide to favor their own content and slow others. "This wide open pipe is going to be monetized for the provider's profit."
Pai said he understood the concern, but had two responses. He said the internet had been free and open before Title II reclassification, and if there was anticompetitive conduct, there was a Justice Department, Federal Trade Commission and state agencies who oversee competition and consumer protection. "You don't need an FCC preemptively regulating every single internet service provider and every single business practice in order to address that concern," he said. "We at the FCC need to be focused on investment and infrastructure."
Johnson was asked how, if the FCC loosens regs, ISPs are going to "do the right thing."
Johnson said that it is in their best business interest to advance high-speed broadband. Johnson conceded that some government help is needed—via the Universal Service Fund subsidies.
