DOJ tells California on Net Neutrality: You Can’t Do That

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Posted by Demri Scott on Thursday, October 4th, 2018, 12:01 PM PERMALINK

The Governor of California recently signed a so-called net neutrality bill into law. Within minutes the Department of Justice filed suit against the state for violating federal law.
 
The DOJ released a statement explaining that “that California… is attempting to subvert the Federal Government’s deregulatory approach by imposing burdensome state regulations on the free Internet, which is unlawful and anti-consumer.”
 
It’s easy to see why the DOJ would sue the state for enacting the law. The California law conflicts with federal policy—the internet is borderless and clearly interstate in nature which leaves jurisdiction to the federal government under the Commerce Clause of the US Constitution.
 
It is also understandable why a complicated patchwork of opposing state laws would never work. The internet thrives on the free flow of information across borders, making it difficult for small internet service providers to ever possibly comply with thousands of state and local regulations.
 
But even if California’s net neutrality law was legal, it is still deeply flawed on principle. In addition to a ban on blocking, throttling and, what California deems, “unreasonable” discrimination, the California law would also restrict zero-rating, also known as free streaming data plans, a service that many consumers actually want.
 
A ban on free streaming makes no sense, especially since consumers benefit from these plans. Free data plans prevent consumers from going over their data cap while also using services they love. T-Mobile, for example, came into the spotlight for free data plans with their Binge On campaign that allows consumers to stream services like Netflix and Hulu without taking away from a consumer’s cap on data for the month.
 
Free data plans aren’t solely about providing more entertainment; they also act as a forum to help close the digital divide. Free data plans allow low income Americans who wouldn’t have access to data otherwise, have lower cost data plans that ensure they have tools to advance themselves in society. This free market approach means that lower income Americans have more data at their disposal without hitting their data cap for the month.
 
This is not the first time that the Left has floated a ban on free data plans. The FCC under the Obama Administration unsuccessfully targeted companies that provide consumers with additional services free of charge, claiming that free data plans are "anticompetitive.”
 
If anything, giving consumers more of what they want for free is beneficial to consumers. California and the federal government should allow the market to test ideas and business models, not attack plans to give consumers free data that are actually beneficial.
 
Unfortunately, imposing onerous laws at the state level is just another play in the liberals’ playbook. Following the repeal of Title II regulations, the left forewarned imminent death, societal decay, and loss of civil rights. It has now been over a year since the repeal, and none of which has happened.
 
The claims were extreme to say the least, especially since the Federal Trade Commission now has jurisdiction over net neutrality issues. The agency has a proven track record of successfully investigating and punishing bad actors and has many mechanisms to take action, in the rare cases, against ISPs that have committed actual real consumer harm.
 
Beginning under the Clinton Administration, ISPs were regulated under a bipartisan light touch regulatory framework. The light touch framework survived for nearly two decades from the passage of Republican to Democrat administrations. The internet grew and saw new innovations such as the gigabyte to Netflix and everything in between. Despite a flourishing internet, in 2015 the FCC --under the purview of the Obama Administration--reclassified ISPs as a common carrier, subjecting the internet to outdated Title II regulations initially meant to regulate copper wires in the 1930s. There is a growing body of evidence that the reclassification stymied investment in the economy. In 2017 the FCC rightfully repealed the onerous regulations, moving jurisdiction of net neutrality issues back into the FTC’s wheelhouse.
 
The bottom line is that we can’t afford to play regulatory ping pong between agencies on net neutrality issues. The internet is inherently interconnected and a product of interstate commerce. We need concrete Congressional legislation that reaffirms the light touch regulatory approach instead of states breaking the law in an attempt to subvert the FCC’s ruling.

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