WEBVTT - FCC Votes to Turn Down Net Neutrality Rules (Audio)

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<v Speaker 1>Republican regulators have begun dismantling Obama era nette neutrality rules,

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<v Speaker 1>opening the way for fewer restrictions on broadband providers and

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<v Speaker 1>raising web companies fears they'll face barriers to reaching customers.

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<v Speaker 1>The net neutrality rules make it illegal for Internet service

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<v Speaker 1>providers such as A T and T, Comcast, and Verizon

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<v Speaker 1>to block website, slow connection speeds, or charge extra for

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<v Speaker 1>faster delivery of certain content. The Federal Communications Commission, in

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<v Speaker 1>a two to one Republican led vote, gave preliminary approval

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<v Speaker 1>to Chairman Agit Pye's plan to replace rules passed in

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<v Speaker 1>twenty fifteen by Democrats. That begins months of public feedback

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<v Speaker 1>and consideration, leading to a second conclusive vote. Our guests

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<v Speaker 1>are Jonathan Spalter, president and CEO of US Telecom, a

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<v Speaker 1>trade group for broadband providers including A, T and T

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<v Speaker 1>and Verizon, and Daniel Lyons, professor at Boston College Law School. Jonathan,

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<v Speaker 1>why do broadband providers object to these rules which prevent

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<v Speaker 1>them from blocking and slowing down websites? Well, first of all,

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<v Speaker 1>it's great to be here, but I think we all

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<v Speaker 1>have to begin this discussion, but by taking a deeper

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<v Speaker 1>act in fact, the broadband industry is four square UH

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<v Speaker 1>supportive of making sure that our Internet will remain UH open,

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<v Speaker 1>that we believe in that neutrality. What we want to

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<v Speaker 1>do is to develop a more modern and enforceable set

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<v Speaker 1>of rules that will enable not only more innovation in

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<v Speaker 1>our networks, but also ensure that we can protect consumers

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<v Speaker 1>we all deeply care about, to ensure that the kind

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<v Speaker 1>of Internet protections that we've all enjoyed over the past

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<v Speaker 1>two decades of our experience with the Internet, that has

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<v Speaker 1>created so much opportunity, so much innovation, can continue to

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<v Speaker 1>proceed proceeded in the future. There's nobody who agrees with

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<v Speaker 1>the idea that our consumers shouldn't be protected and we

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<v Speaker 1>shouldn't preserve an open and free internet. That is the

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<v Speaker 1>bedrock principle for UH the entire industry. What we're seeking

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<v Speaker 1>is a more thoughtful and more modern, more flexible approach

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<v Speaker 1>that will be as equipped to deal with the kind

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<v Speaker 1>of innovation cycles that week yet to experience without inhibiting

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<v Speaker 1>and without slowing down investment, without slowing down innovation, but

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<v Speaker 1>at the same time making sure that we have enforceable

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<v Speaker 1>approaches to make our open Internet their main that way

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<v Speaker 1>that a g PIE has put forward for for getting

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<v Speaker 1>rid of these Obama era rules, and you heard some

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<v Speaker 1>of it from Jonathan. There has been that they discourage

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<v Speaker 1>investment and innovation. Is there evidence to to support that assertion? Well,

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<v Speaker 1>we have done deep is Daniel in the I was

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<v Speaker 1>asking Daniels He on the line, Oh yeah, I am um.

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<v Speaker 1>So the evidence, I think it's fair to say, is mixed.

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<v Speaker 1>There have been a number of studies that have been

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<v Speaker 1>released that have suggested that, uh, since the two thousand

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<v Speaker 1>fifteen rules have come into effect, that in fact, broadband

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<v Speaker 1>investment has gone down by the major providers. There's been

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<v Speaker 1>some on the other side who have challenged those figures

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<v Speaker 1>and released studies of their own. I think the broader

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<v Speaker 1>since here is is uh that Um. The goal of

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<v Speaker 1>the SEC in this case is to encourage broadband investment.

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<v Speaker 1>But I think the broader goal is to try to

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<v Speaker 1>figure out what the right vehicle is by which to

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<v Speaker 1>regulate the Internet going forward. And Jonathan, our consumers supposed

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<v Speaker 1>to trust that their broad broadband providers will always put

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<v Speaker 1>the public interest before their companies or stockholders interests. Well,

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<v Speaker 1>I think it's past as product and the answers renoundingly

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<v Speaker 1>that there's really good reason for them to do so.

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<v Speaker 1>Up until at the last couple of years of the

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<v Speaker 1>Abom administration, our Internet had been guided by a regulatory

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<v Speaker 1>framework that was advanced by President Clinton, supported by a

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<v Speaker 1>Republican Congress, that allowed for an enormous amount of innovation

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<v Speaker 1>and openness to become the dominant teams in the evolution

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<v Speaker 1>of our Internet and consumers experience with it. We have

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<v Speaker 1>all enjoyed an opening Internet that has given rise to

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<v Speaker 1>uninavaginable UM developments, incredible companies like Google and Yahoo, enormous

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<v Speaker 1>amounts of brought down deployment, and you know, close to

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<v Speaker 1>a trillion dollars actually more than a trillion dollars of

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<v Speaker 1>investment in UH making sure that our networks can continue

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<v Speaker 1>to evolve and become faster and more resilient. This is

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<v Speaker 1>all based on a statutory framework that took a light

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<v Speaker 1>touch to making sure that our Internet can remain rather

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<v Speaker 1>than strait Jack didn't in UM the four h idea

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<v Speaker 1>that our Internet, one of the most innovative inventions in

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<v Speaker 1>human kind, should be subject to much more onerous um

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<v Speaker 1>UH strictures as a public utility, as a common carrier Daniel.

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<v Speaker 1>Let me let me ask Daniel to respond to that,

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<v Speaker 1>what do you think about the argument that Jonathan's making there?

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<v Speaker 1>So I actually tend to agree that, Um, regardless of

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<v Speaker 1>the merits of net neutrality, the movement towards reclassification under

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<v Speaker 1>Title two was not the vehicle in which to accomplish

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<v Speaker 1>this goal, right. The Um, the SEC's unfortunately in a

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<v Speaker 1>position where, uh, they're perpetually having to to try to

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<v Speaker 1>fit square pigs into round holes. Right. The last time

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<v Speaker 1>the Communications Act was updated was back in when Uh,

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<v Speaker 1>those of us who are on the Internet, we're doing

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<v Speaker 1>so via dial up. Uh, And the word broadband doesn't

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<v Speaker 1>appear in the Act more than a handful of times.

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<v Speaker 1>So I think, um, it's exactly right that the those

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<v Speaker 1>who were making policy vision the light touch over the

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<v Speaker 1>Internet because they really weren't sure how it was going

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<v Speaker 1>to evolve. But since then, the decision to simply try

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<v Speaker 1>to enact Internet regulation by treating broadband providers essentially as

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<v Speaker 1>phone companies with somewhat misguided. Uh. Ultimately, I think the

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<v Speaker 1>right answer here is going to be uh, some update

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<v Speaker 1>to the Communications Act coming out of Congress. Daniel. Consumer

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<v Speaker 1>advocates argue that these rules take advanced petition, innovation, small businesses,

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<v Speaker 1>and entrepreneurs, and there's hardly an Internet based company that

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<v Speaker 1>has come out in favor of changing the rules. So

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<v Speaker 1>why is there the disconnect between consumer advocates and the

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<v Speaker 1>broadband providers. I think the primary concern here isn't the

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<v Speaker 1>creation of net neutrality rules. I think most people agree

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<v Speaker 1>and not everybody at this point agrees that broadband providers

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<v Speaker 1>shouldn't be in the business of blocking content or throttling content. Um.

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<v Speaker 1>The challenge, I think, is the vehicle by which you

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<v Speaker 1>get there, right. So, by imposing UM title to common

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<v Speaker 1>carriage onto broadband providers, the FCC created a host of

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<v Speaker 1>problems that it wasn't anticipating at the time, one of

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<v Speaker 1>which was the whole that it ripped in data privacy rules.

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<v Speaker 1>So the Federal Trade Commission regulates data privacy, but it

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<v Speaker 1>doesn't have jurisdiction over common carriers. So the moment the

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<v Speaker 1>FCC labeled broadband providers common carriers, suddenly there was no

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<v Speaker 1>privacy law applying to broadband pro writers. I'm gonna have

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<v Speaker 1>to stop. I'm going to have to stop you there.

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<v Speaker 1>We'll continue the discussion another time. Thank you. Daniel Lyons,

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<v Speaker 1>Professor Boston College Law School, and Jonathan Spultor, President and

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<v Speaker 1>CEO of US Telecom. That's it for this edition of

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<v Speaker 1>Bloomberg Law. We'll be back Monday at one pm Wall

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<v Speaker 1>Street Time. Thanks to our technical director Chris tried Comby

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<v Speaker 1>and our producer David Suckerman. You've been listening to Bloomberg

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<v Speaker 1>Law on Bloomberg Radio. This is Bloomberg