None Of The Claimed Benefits Of Killing Net Neutrality Ever Arrived

Broadband

from the fluff-and-nonsense dept

So just over a year ago the FCC quickly rushed to kill net neutrality at telecom lobbyists’ behest. As we noted last week, the repeal did far more than just kill net neutrality protections; it effectively freed uncompetitive telecom providers from most meaningful oversight. With a few notable exceptions, most ISPs have tried to remain on their best behavior for two reasons: one, they’re worried about the ongoing lawsuit from 23 State AGs that could potentially restore the rules any day now. And two, they don’t want to run afoul of the nearly two dozen states that passed their own net neutrality rules in the wake of the repeal.

Of course this all occurred because of the Ajit Pai FCC claim that killing the rules would result in amazing broadband growth, competition, and investment. But as people keep digging into the numbers, they’ve (surprise!) increasingly realized that absolutely none of those promises ever materialized (and aren’t likely to without more competition). The latest case in point comes courtesy of longtime journalist Rob Pegoraro, who again noted how that supposed investment boon never happened, and in fact many ISPs are already pulling back on investment thanks to limited competition and tepid regulatory oversight:

“Figures USTelecom posted in February, for example, show Verizon cutting its investment by 3.4% from 2017 to 2018. And the 3.9% increase shown for AT&T (T) vanishes if you subtract the $1.2 billion the firm spent in 2018 on the government-backed FirstNet emergency-responder network. And last week, AT&T Communications CEO John Donovan told attendees at an investor conference that the firm would slow its fiber build-out.”

Funny, that.

Pegoraro also spoke to a number of small ISPs Ajit Pai said would be particularly aided by the gutting of popular consumer protections. They similarly couldn’t actually provide any concrete examples of how the killing of net neutrality aided them, outside of some vague, unsubstantiated claims that it was harder to get a bank loan with the rules in place. Before the repeal, Pai had circulated all manner of massaged data trying to suggest that small ISPs had been harmed by the fairly modest (by international standards) neutrality protections, something the FCC’s own data disproved.

And while the Pai FCC has been trying in recent weeks to suggest that the net neutrality rules resulted in a huge boost in investment and broadband speed, that too is based on flimsy, massaged data. For example the FCC has tried to claim that killing net neutrality resulted in historic fiber deployment, but at least half of last year’s fiber growth was actually thanks to fiber build out conditions affixed by the previous FCC to AT&T’s 2015 merger with DirecTV. And much of the data cited by the FCC showing broadband speed and coverage improvement was collected before net neutrality was even formally repealed. Go figure.

On the flip side, Pegoraro notes that none of the doomsday scenarios portrayed by net neutrality advocates really occurred either. But he fails to note that’s not because ISPs didn’t want to. ISPs didn’t want to dramatically shift their business models only to have the AG lawsuit restore the FCC’s 2015 rules, making them suddenly out of compliance. And they didn’t want to violate numerous state net neutrality laws that popped up in the wake of the repeal, several of which (like in Washington State) actually go a bit further than the original FCC rules did.

Should the AG lawsuit against the FCC be victorious (a ruling should drop any day now), the FCC’s 2015 rules could be restored, likely triggering an appeal and possible Supreme Court challenge. Should the AG lawsuit fail, it’s likely ISPs will start being far less subtle about their efforts to abuse the lack of competition to nickel-and-dime you in creative new ways. But again, those claiming that net neutrality didn’t matter because it’s been a year and the internet didn’t implode are really only advertising that they have no real idea what they’re talking about.

More importantly, a year’s hindsight has made it clear none of the repeal’s purported benefits were actually real. And they weren’t real because the repeal had only one real purpose: to help entrenched telecom monopolies make more money on the back of a captive customer base. That tends to get lost in the verbose discussion about policy, but it doesn’t make it any less true.

Filed Under: ajit pai, broadband, fcc, fiber, investment, net neutrality, small isps