Antitrust Lawyer Blog Commentary on Current Developments

Senate Judiciary Committee holds hearing on “Net Neutrality”

On September 17, the Senate Judiciary Committee held a hearing — “Why Net Neutrality Matters: Protecting Consumers and Competition Through Meaningful Open Internet Rules.”  The witnesses were:

·            Brad Burnham – Managing Partner, Union Square Ventures

·            Ruth Livier – Writer, Independent Producer, and Actress

·            Robert McDowell – Former Commissioner, Federal Communications Commission (FCC)

·            Jeffrey Eisenach – Visiting Scholar, American Enterprise Institute Center for Internet, Communications and Technology Policy

·            Nuala O’Connor – President and CEO, Center for Democracy and Technology

Members of the Senate Judiciary Committee disagreed about the need for the FCC to enact net neutrality rules.  Some, such as Sen. Orrin Hatch (R-UT) and Sen. Ted Cruz (R-TX), argued that additional regulation would inhibit the ongoing growth of the Internet and limit the freedom the Internet represents.  Other senators, such as Chairman Patrick Leahy (D-VT) advocated for the net neutrality rules to prevent the “paid-prioritization” of network traffic by a handful of “corporate gatekeepers” from turning the Internet into a “system of ‘haves and have-nots’.”

The witnesses disagreed with each other.  Mr. Burnham’s solution would be to classify last mile broadband access as a telecommunications service, which would give the FCC the authority to protect open access to the Internet without overly burdensome government regulation.  Ms. Livier also preferred reclassification as a telecommunication service to provide a basis for permanent regulation. She testified that an open Internet empowers minority communities, promoting better representation in media and in professional and creative settings.  Mr. McDowell disagreed. He testified that as a Commissioner, he voted against earlier attempts to enact net neutrality and continues to oppose net neutrality because, among other reasons, there is no evidence there is anything wrong in the Internet access market that needs fixing. He is concerned that regulation of fixed broadband would spill over into other areas, including wireless broadband, harming competition and innovation.

Dr. Eisenach also opposed net neutrality in his testimony. He saw net neutrality as protecting the status quo financial benefits to private parties rather than benefitting consumers or public interest.  Dr. Eisenach stated that existing antitrust laws are better able to preserve competition and to check anticompetitive behavior because they have exhibited the flexibility to address market power abuses. Ms. O’Connor expressed support for a light regulatory hand.  She testified that existing antitrust laws would be insufficient in the absence of net neutrality.

While opinions differ, no one disagrees that debate regarding net neutrality matters.  As the FCC determines how it will regulate the internet going forward in an effort to keep the internet open to everyone, various stakeholders and industry players will lobby and potentially litigate in an effort to keep the status quo.

Andre Barlow
(202) 589-1838
abarlow@dbmlawgroup.com