Legislation recently introduced in the state House is a surefire way of killing investment in rural broadband, and it’s being introduced just as over a billion dollars in federal money is about to roll into the Commonwealth to help bridge the digital divide between rural and urban areas.
HB 924 is deceptively being sold as a consumer protection measure. Instead, it’s an unnecessarily burdensome, expensive, and innovation and investment-killing regulatory framework whose only accomplishment would be to put the brakes on efforts to deploy broadband as fast as possible.
At issue is the concept of net-neutrality or, put another way, regulating the Internet. Use any sports analogy you like, but this ball has landed in regulated and unregulated parts of the field/court for the past decade with the most recent federal court decision earlier this year saying that the Federal Communications Commission does not have the authority to regulate the Internet and its service providers.
The ruling was a major victory for those who, like Pennsylvania’s broadband providers, believe that a lighter regulatory touch has helped to forge an environment which has brought us incredible advancements in broadband technology and deployment benefiting millions of our citizens. Numerous studies over the past decade have concluded that investment has risen during times of no net-neutrality and only dropped (outside of recession years) during periods of heavy-handed regulation. And if you believe that regulatory costs aren’t expensive, you’re wrong. One Pennsylvania provider estimated (almost ten years ago) that the costs associated with net neutrality were more than 5,000 extras hours of employee time and almost $150,000 annually. Spread across the entire industry in today’s numbers, that is real money NOT being dedicated to broadband deployment. When net neutrality rules were originally debated by the FCC, one economic report concluded that the mere threat of Internet regulation reduced investment in network upgrades by between $150-200 billion nationwide over a five-year period.
Knowing all of this, why would HB 924 be necessary? Proponents historically have pointed to Internet service providers discriminating against certain subscribers either through blocking lawful content, impeding traffic or engaging in conduct that negatively affects a user’s online experience. When asked for examples, those alleging misconduct rarely have substantial concrete evidence of this type of activity and generally refuse to acknowledge that a competitive environment is the most powerful antidote for anti-customer behavior.
This bill seems to be the proverbial solution in search of a problem. Unfortunately, this “solution” would be a real problem for those Pennsylvanians who need faster broadband and need it now.
