Tech Policy

Net neutrality stifles investment and innovation

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Lawmakers and special interests always seem to title their bills with buzzwords that make them sound like they are going to save humanity. H.R. 1644, otherwise known as the “Save the Internet Act of 2019,” is no different. It’s an attempt to restore net neutrality rules and the legal framework to regulate Internet Service Providers (ISPs) across the country. The bill passed in the United States House of Representatives in April with 232 votes in favor and 190 in opposition.

The Save the Internet Act would allow the Federal Communications Commission to regulate internet service providers like they are utility companies, which includes reinstating net neutrality regulations. 

Net neutrality regulations typically mandate that all internet service providers treat all internet traffic equally, which includes disabling them from blocking content, throttling service or prioritizing content. While proponents of this legislation believe consumers will be mistreated without it, these additional regulations were not necessary to realize unprecedented growth of companies such as Amazon, Google and others. In other words, the internet grew exponentially without net neutrality regulations and it will continue to realize growth without them. 

One of proponents’ biggest fears is that content will be filtered or individuals will not be able to express themselves freely on the internet without net neutrality regulations. Despite this, these regulations exclude big tech companies such as Google and Facebook from filtering search results and throttling what can be read or seen through their services. More than 90 percent of all internet searches are conducted through Google’s platforms alone. If net neutrality supporters are concerned with censorship of the internet, they should be worried about what these platforms can do.

The Save the Internet Act would do more harm than good in rural states like Maine. According to a letter sent from 63 small internet service providers to the Federal Communications Commission, the Title II structure for net neutrality stifles investment, especially in rural areas. For example, service providers’ capital expenditures decreased $2.4 billion from 2014 to 2016, primarily in rural areas. According to a US Telecom Issue Brief, broadband investments increased by at least $1.5 billion after net neutrality regulations under Title II were repealed in 2017. This illuminates the fact that government regulations hinder capital investment, which has an overall negative impact on consumers. In short, you can’t miss what you never had in the first place. 

It should be noted that Maine recently adopted its own net neutrality guidelines this session. LD 1364 prevents ISPs that are contracted by the state of Maine from engaging in throttling their services, paid prioritization of some traffic over other traffic, or blocking some content. However, this law will not affect ISPs that are not contracted by the state of Maine. 

If the United States were to reinstate these regulations on ISPs, it would likely result in reduced private investment in the state of Maine and other rural areas of the country. There were countless proposals this legislative session to make “strategic investments” in broadband infrastructure in rural Maine because areas of the state are underserved. However, if net neutrality regulations are enacted to include all providers at the state or federal level, it will be far more difficult to attract internet service providers to operate in rural Maine.

Our state and federal governments should not be involved in regulating internet services in this fashion, and should instead allow free markets to direct investment across the country.

About Adam Crepeau

Adam Crepeau serves as a policy analyst at The Maine Heritage Policy Center. He can be reached at acrepeau@mainepolicy.org.

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