The biggest takeaway for me from today’s New Economy New Rules panel discussion about Net Neutrality wasn’t clarity on which camp’s regulation demands are better. What I walked away with was a question about whether or not government intervention would untangle the complexity, make it worse, or create a new universe of unintended consequences.

Our featured panelists for this discussion sponsored by Barnes & Thornburg and LightBound included:

  • Bret Swanson, President, Entropy Economics
  • Darby McCarty, President, Smithville Communications
  • and Barry Umansky, Telecommunications Professor, Ball State University (and formerly with both the Federal Communications Commission and the National Association of Broadcasters in Washington).
 BretSwanson    DarbyMcCarty      Barry_Umansky
Bret Swanson
Darby McCarty
Barry Umansky
Ball State University 

At the top of the discussion, Professor Umansky nicely laid out a bit of background on the issue of Net Neutrality.

  • 98% of Americans have access to broadband speeds of 10 megabits per second or faster.
  • 85% of households in this country have access to speed of 100 Mbps or faster.
  • This availability is due to private industry investment.
  • In 2012 alone private industry invested $50 billion.
  • All of the above was achieved during a time of “light touch” from the federal government.

In 2004, the FCC chairman Michael Powell ran the FCC and did not impose regulations on the Internet because he wanted it to grow, become robust, spur innovation and not have the burden of heavy federal constraints.

That plan survived for a while but as more and more services switched over to Internet protocol technology — voice data and video — there were some in Washington who said “maybe we should get a handle on this stuff and have some kind of regulation of the web.”

“The FCC knows what they are doing on certain days,” said Darby McCarty. The day the chairman decided it was a good idea to allow open use of phone of airplanes without checking with the FAA or anyone else, however, wasn’t one of those days. Darby believes the FCC is good at enforcement, but she thinks that rule making requires a soft hand because the Internet is NOT the same as a Title II common carrier like phones and TV.

“It needs some regulation with a soft hand and whether it’s congress or the FCC, there has to be some protection so that major carriers don’t dial up or down, and so it remains free,” Darby said.

Bret Swanson (who identified himself as NOT in favor of broad new rule making) laid out the arguments of both sides of the Net Neutrality issue by first demonstrating what they have in common.

The idea of Net Neutralty is that of an open Internet where all data is treated equally. The idea came about 10-12 years ago is a very rough baseline, a laudable idea and a “first principle” of the Internet and it largely functions that way today.

“By and large everybody agrees with those ends, with those basic principles. And in fact, in 2005, I think it was, the FCC under a Republican administration established the open Internet principles — no blocking, no unreasonable discrimination, transparency, etc. — and essentially every single company across the Internet ecosystem, whether they are a network carrier, a network provider, a content provider, equipment providers, mobile companies, everybody across the spectrum signed on to those principles, everybody’s for an open Internet everybody’s for basic non-discrimination so the argument really is over means and not ends. And there is where you have very, very deep divide over the best way to maintain an open, robust, vibrant Internet.”

Advocates of Net Neutrality regulation seek a more robust regulatory function to try and maintain the principles that everybody agrees upon and that we have today, while those on the other side say it’s because of the hands-off approach that we have what we have today and that it would be dangerous to change the current regulatory model.


Watch the video of the entire discussion and share your thoughts and comments below.