TIA, NCTA: The FCC Shouldn’t Reclassify Broadband

In a letter sent this week, a diverse group of technology manufacturers and suppliers have warned U.S. Commerce Secretary Penny Pritzker that classifying the Internet as a public utility would have harmful implications for the Internet and the broader national economy.

The FCC has weighed makingthat move after it lost a court case to Verizon Communications, which had the effect of defanging its ability to enforce Net neutrality rules.

Many organizations are calling for the FCC to bring broadband back under its purview in order to protect a free and open Internet that has no “toll roads.”

On the other side of the fence, the companies in the letter said that investment in broadband networks and equipment has flourished under the current light regulatory approach.  Infrastructure equipment spending by businesses is expected to grow from $38.6 billion in 2013 to $42.9 billion in 2017.  The companies make the case that this investment in the American economy will be jeopardized if Internet access is classified as a public utility under Title II, a move they write would “threaten demand for Internet infrastructure, reduce incentives for investment, hinder innovation and jeopardize this success.”

The 33 companies go on to state, “A sudden shift from the existing light-touch approach – which has been an unqualified success and the basis for billions of dollars in investments – to the prescriptive regime of Title II would be extremely disruptive to the broadband marketplace.  Resources that would normally be spent on building and improving infrastructure would instead be spent complying with burdensome regulatory obligations, and uncertainty regarding future profitability would deter additional private investments.  If investment in broadband services declines, it will set off a domino effect of decreased investment and innovation.”

The letter also says that if the FCC goes forward with new regulations, it should exercise legal authority under Section 706 rather than Title II.

The FCC “has previously declined past invitations to regulate broadband Internet service as a Title II service, wisely recognizing the essential role that flexibility and innovation would play in the success of the Internet economy,” the companies say.

Signatories of the letter are all members of either the Telecommunications Industry Association (TIA), the National Cable and Telecommunications Association (NCTA), or both.

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