To the Editor:
Recently in the state capitol, some lawmakers have been flirting with the latest fad idea about regulating the Internet - the so-called "net neutrality" rules. The corporate giants pushing the proposal - Internet companies like Google and eBay - say that the rules are needed to prevent broadband providers like the telephone and cable companies from blocking access to or discriminating against certain Web sites.
Certainly, a "free" and "open" Internet is a concept that everyone supports, making the idea of net neutrality initially appealing. But, upon closer examination, most lawmakers have grown cold to the proposed net neutrality regulations. Why? The most glaring problem is that the proposed regulations seek to cure a problem on the Internet that doesn't exist. Worse, the regulations could reverse the competitive downward pressure on broadband prices that has enabled Latinos, communities of color and low-income Americans to connect to the Internet.
For years, Google and others have warned that broadband companies like AT&T; would find ways to cloister the Internet and block consumer access to sites and services that the company somehow does not like. But this Internet apocalypse has not come to pass - and it's unlikely it ever will, given the increased competition in the marketplace for broadband consumers. Indeed, there has been not one single complaint that any major telephone or cable company has actually prevented consumers from accessing their favorite sites and content. Meanwhile the market value of companies like Google has soared far past that of the Internet service providers.
The Internet faces two principle challenges - expanding broadband capacity and closing the digital divide - and net neutrality regulations could undermine our capacity to address both.
Broadband capacity is going to have to expand five-fold in order to meet consumer demand for bandwidth-intensive applications like the latest video services. Ironically, net neutrality regulations would give the large Internet companies that run these applications new legal tools to shield themselves from having to pay for the expansion of broadband capacity. Instead, consumers would have to pay the entire cost of increasing broadband infrastructure. A free and open Internet shouldn't mean the big guys get to stick everyone else with the bill. And if the costs of new network capacity are shifted onto consumers, the digital divide is likely to explode. Luckily, as the price of broadband has fallen over the last decade, the digital divide has narrowed and more communities of color have been able to connect from their homes. However, if net neutrality laws protect every new online video Web site from paying the freight for delivering high-quality Internet movies, investors will simply not fund network upgrades. Broadband prices, as a result, will stop going down and will likely rise. Since Latinos, African Americans and middle-income Americans are highly price-sensitive when it comes to broadband, anything that shifts broadband network costs to consumers will actually widen the digital divide.
Finally, the over-regulation of Internet commerce could stifle rather than facilitate entrepreneurialism. Maryland's power-grids can, with some significant investments, be turned into another robust broadband transmission pipe, reaching millions instantly with existing infrastructure. But if a video content company like NetFlix wanted to partner with a utility company to generate those investments, net neutrality rules could give any other video provider the right to veto the partnership under the theory that the partnership could disfavor their own video content. That kind of vertical relationship could be enormously beneficial to the competitive marketplace, but could be illegal under a net neutrality regime.
I fully subscribe to an open Internet, and would be the first to oppose any effort by broadband providers to balkanize it. But the necessities of competition have proven the best antidote for bad behavior by broadband companies, and the net neutrality campaign may be a case where the cure is far worse than the poison.
Robert de Posada
President
The Latino Coalition
Washington, D.C.
