Internet Title II Regulation Opposed by Industry Group

President Obama said in November he favors extending FCC regulatory powers over the Internet, and the FCC chairman is at least listening. A group of industry leaders, however, oppose such a move.

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Title II regulatory powers by the Federal Communications Commission over the Internet would not be good for American industry and would threaten long-term investment in its infrastructure, according to some 60 members of the Telecommunications Industry Association (TIA) industry group that oppose such proposals.

In a four-page Dec. 10 letter to the FCC and leaders of the U.S. House and Senate, the TIA members argued that recent proposals to reclassify the Internet under Title II of the U.S. Communications Act would be detrimental and could mean losses of up to $45.4 billion in capital investment over the next five years.

"Title II is going to lead to a slowdown, if not a hold, in broadband build out, because if you don't know that you can recover on your investment, you won't make it," the group wrote in its letter. "The investment shortfall would then flow downstream, landing first and squarely on technology companies like ours, and then working its way through the economy overall. Just a few years removed from the worst recession in memory, that's a risk no policymaker should accept, let alone promote."

The letter came in response to comments made back in November about Title II options from President Barack Obama and from FCC Chairman Tom Wheeler. Obama had said he might want to see the FCC adopt Title II as a way to include Internet service providers (ISPs) in existing net neutrality regulations. Title II refers to the Communications Act, which gives the FCC the power to regulate communications in the United States. Title II was originally intended to make sure that telephone companies provided service to anyone in their coverage area.

Wheeler then responded to the president's comments by saying that he and Obama are in agreement about opposing Internet fast lanes and special deals that would "prioritize Internet traffic and harm consumers, competition and innovation," but that reclassification under Title II could "raise substantive legal questions." Wheeler said he wanted to hear more input on the idea before seceding on what direction to take.

The TIA letter argues that the signing companies and their employees, consumers, businesses and public institutions "would be hurt by the reduced capital spend in broadband networks that would occur if broadband is classified under Title II. Such a dramatic reversal in policy is unnecessary to ensure an open Internet."

The TIA letter was sent because Wheeler will soon unveil new open Internet rules that will affect the Internet into the future, and the TIA members want to get their opinions heard before that happens, according to the group.

"For almost twenty years, national leadership, on a bipartisan basis, has nurtured the broadband Internet with a wise, effective, and restrained policy approach that supported the free flow of data, services, and ideas online while creating a climate that supported private investment in broadband networks," the letter states. "The result has been a technological, economic, and social miracle that has boosted economic productivity and enriched lives, and created in America a symbiotic Internet economy that's the envy of the world."

The TIA member companies "are proud to have played a role in that miracle and we look forward to a long future providing the devices, components, and services that fuel the modern Internet," the letter continues. "But this depends on a continued national commitment to building and deploying ever more capable and faster networks—something Title II puts at risk."

The signers of the TIA letter include Cisco, Intel, IBM, Juniper Networks, Alcatel-Lucent, ARRIS, Corning, dLink, Ericsson, KPG, Panasonic Corporation of North America and Qualcomm.

"The robust support for this letter demonstrates that Title II is a significant threat to the tech companies that build and support the Internet," Scott Belcher, the CEO of the TIA, said in a statement. "These companies are at the heart of our economy, and are driving the innovation and investment that has made the Internet the revolutionary force it is today. This letter sends an unambiguous message that reclassifying Title II would be detrimental to today's Internet, harming consumer, job creation and economic growth."

The TIA letter said that the implications of such a reclassification could be huge. "Reversing course now by shifting to Title II means that instead of billions of broadband investment driving other sectors of the economy forward, any reduction in this spending will stifle growth across the entire economy," the letter states.

In October, officials from AT&T, Comcast and Verizon told U.S. leaders that they do not plan to offer faster Internet access, or so-called "fast lanes," to content producers who are willing to pay more to get their messages out in front of competitors' transmissions, according to an earlier eWEEK story.

The issue of net neutrality has been a hotbed for several years, with proponents and opponents arguing their positions and bashing the opposition verbally in public forums and discussions. In September, the FCC announced that it had received a record 3 million comments about proposed rules for net neutrality by a Sept. 15 deadline.

While Obama was running for the presidency in 2007, he pledged to support net neutrality if elected.