SVG
Commentary
Wall Street Journal

Dictators Love the FCC's Plan to Regulate the Internet

Rob McDowell & Gordon Goldstein on the FCC Chairman's misguided policy

rob_mcdowell
rob_mcdowell
Senior Fellow
Managing Director, Silver Lake Partners
Federal Communications Commission Chairman Tom Wheeler delivers opening remarks at the start of a Open Internet Roundtable discussion, September 16, 2014 in Washington, DC. (Mark Wilson/Getty Images)
Caption
Federal Communications Commission Chairman Tom Wheeler delivers opening remarks at the start of a Open Internet Roundtable discussion, September 16, 2014 in Washington, DC. (Mark Wilson/Getty Images)

On Thursday the Federal Communications Commission will stop accepting public comments on the divisive plan to regulate the Internet as a public utility before bringing the matter to vote on Feb. 26. The latest lunge at more Web regulation puts global Internet freedom and prosperity in jeopardy and fatally undermines decades of bipartisan consensus on America鈥檚 foreign policy for the Internet.

Some proponents of more Internet regulation鈥攆or instance, President Obama 鈥攎aintain that 鈥渢he strongest possible鈥� laws are needed to prevent Internet service providers, such as cable and phone companies, from acting in anticompetitive ways and harming consumers by, say, blocking selected Web destinations. They argue that the FCC must declare the Internet a public utility under Title II of the Communications Act of 1934, which was designed for the Ma Bell phone monopoly. FCC Chairman Tom Wheeler announced last month that he would align his proposals with the White House.

This represents a stunning reversal of the policies of the Clinton and Bush administrations. Both presidencies pursued a highly successful 鈥渉ands-off鈥� approach toward the Internet and argued that the dynamic network should not be regulated like a public utility domestically or internationally. The result: The Internet is the greatest global deregulation success story of all time.

President Obama equates 1934 telephone services with the 21st-century Internet. In an unprecedented directive in November to the supposedly independent FCC, he proclaimed that it is 鈥渃ommon sense鈥� to apply old-fashioned utility rules to 鈥渢he transmission of information鈥攚hether a phone call, or a packet of data.鈥�

The more than 1,000 regulations in Title II include the power to set 鈥渞ates, terms and conditions.鈥� Even though the agency promises to refrain, or 鈥渇orbear,鈥� from much of Title II, the agency has recently expanded its agenda to heap even more parts of the law onto the Web. No matter how much the FCC vows to restrain itself, crossing into telephone-style regulation will legitimize international efforts to do the same, a trap the U.S. has tried to avoid.

The FCC鈥檚 new definition of the Internet as a phone network could trigger expanded jurisdiction over the Web through existing treaties of the International Telecommunication Union, a regulatory arm of the United Nations. In reaction to similar proposals in 1998, President Clinton鈥檚 FCC chairman, William Kennard, presciently said 鈥渃lassifying Internet access services as telecommunications services could have significant consequences for the global development of the Internet.鈥�

Similarly, when in 2010 the FCC last examined鈥攁nd rejected鈥攖he Title II idea, Mr. Obama鈥檚 own State Department telecom policy ambassador, Philip Verveer, now a top FCC adviser, expressed deep concern. He cautioned that FCC regulation could provide other nations with a justification for 鈥減reventing unwelcome political, social or cultural information from being disseminated to their citizens.鈥�

In 2012 at the World Conference on International Telecommunications, which we both attended as members of the American delegation, the U.S. led a coalition of 55 nations that refused to sign a global treaty that would presume new authority to regulate disparate aspects of the Internet. Now, however, the Obama administration is signaling to the world that more government regulation of the Internet should be the norm.

The FCC鈥檚 plan could revive a ruinous 2012 proposal by a handful of European phone companies and many member states of the International Telecommunication Union. The plan was to sanction 鈥渟ending party pays鈥� fees for international Internet traffic that terminates on networks owned by foreign phone companies. This would increase costs for consumers as Internet companies would have to pay fees, as a matter of international law, that would be passed on to all Internet users.

China is advancing a proposal to make a special committee of the U.N. General Assembly the dominant body to determine global Internet governance. Does anyone think that鈥檚 a good idea? Meanwhile, Russia has joined China in sponsoring an 鈥渋nternational code of conduct for information security鈥� at the U.N. that would authorize Internet censorship and enshrine multilateral state control of the global network.

Many countries, including Iran, Saudi Arabia, the United Arab Emirates and Brazil, will be advocating their vision of the Internet鈥檚 future at a major international conference at U.N. headquarters in New York at the end of 2015. Global multilateral oversight and regulation of the Internet is their goal.

The Obama administration and its FCC have chosen a perilous moment to reverse decades of bipartisan agreement to limit Internet regulation. They can鈥檛 have it both ways. By creating an irreconcilable contradiction between America鈥檚 domestic and foreign policies, the cause of an open and freedom-enhancing global Internet will suffer.