Terry H. Schwadron
Nov. 22, 2017
Not only is the Trump administration about to make another really bad policy decision, but by my lights, they have officially contradicted themselves among the very kinds of businesses that they say they want to encourage.
The decision of the day involved “net neutrality,” that is the policy of maintaining a fair use of the internet for all of us, whether big company or single individual, content provider or distributor, big internet user like Google or a small blogger like me. To be clear, it means that I have as much right to post online as does Microsoft.
The Federal Communications Commission chairman Ajit Pai, Trump’s appointee for this critical area, said that neutrality will no longer be the rule of the day.
Or as he put it, “Under my proposal, the federal government will stop micromanaging the internet. Instead, the F.C.C. would simply require internet service providers to be transparent about their practices so that consumers can buy the service plan that’s best for them and entrepreneurs and other small businesses can have the technical information they need to innovate.”
Free translation: high-speed internet service providers can now charge for their piece of the information highway, or block those who don’t pony up with extra fees to them. It is a sweeping victory for the AT&T’s of the world. And it clears the way for companies to charge more and or to block access to some websites.
Almost without having to go there, this is another direct repeal of something done for openness and fair play by the Obama administration, and therefore good material for rejection. Technically, all this is yet to be voted on by the 3–2 Republican majority FCC on Dec. 14. More on this in a moment.
But first, this decision was announced on the same day that the federal Department of Justice filed suit under anti-trust rules against AT&T for trying to buy out TimeWarner for $85 billion. The nub of that federal argument is that while a “vertical merger,” that is a proposed merger between a distribution company and a content company, the business deal would edge toward monopolistic practices, raise prices and lower choice for consumers, all triggers in the anti-trust laws.
While I’m happy to wish a pox on all the houses named here as being too big and too influential over my choices, I must note that this federal position seems directly at odds with that announced over ending net neutrality.
The AT&T deal is exactly the kind of effect that should follow an end to internet neutrality. Or if you accept the Justice Department argument, you should be for more openness on the internet.
Which Donald Trump is in charge here anyway?
And with all the “business” guys in the White House now, the same people who want to raise my taxes so that they can give permanent tax breaks to every big company in the country, is the message supposed to be about anti-trust consumer protection or a more libertarian let-them-do-what-they-want attitude about businesses operating without federal regulation.
None of these events have been presented as if they belong together, but somehow decimation of environmental and financial regulations, promotion of permanent tax breaks, elimination of consumer protections do not seem to fit with a suddenly aggressive anti-trust action. That’s what persuaded me, again, to conclude that this is really Justice action meant to smack CNN around, by insisting that CNN and parent Turner Broadcasting be separated from TimeWarner if the AT&T deal goes through.
Of course, you can expect that the FCC announcement will ignite a a loud and furious fight over free speech and the control of the internet, with telecoms like AT&T squaring off against Google and Amazon, who warn against powerful telecom gatekeepers so that they can be content gatekeepers. The big winners again will be lobbyists and lawyers.
For the moment, the internet service providers will be the biggest winners because they would be able to control access, remake internet economics and decide who gets access to what, either through tolls or by slowing or speeding varying access routes.
Losers would be consumers, smaller internet players and, of course, the Googles and Amazons, who would like to be kingmakers themselves.
On the anti-trust front, other businesses who want to merge are watching what Justice does here. Having announced a war on AT&T, Justice can’t easily back down now.
All I can tell you is that no one is thinking about the whole, and no one in these stories are looking out for us.