FCC Chairman Defends Net Neutrality Decision

BARCELONA, Spain—On Monday, Federal Communications Commission Chairman Ajit Pai defended his decision to end net neutrality in the United States, claiming the regulation is needed to build out the nation's next-generation wireless infrastructure. On the first day of the Mobile World Congress technology trade show, Pai said rolling back Obama-era rules that could let telecom companies change how they throttle the internet was the right decision. Pai’s remarks came during a broader talk on the future of 5G internet—a technology that could pave the way for faster video speeds, self-driving cars and a broader Internet of Things ecosystem. “A third pillar of our strategy is closely related to infrastructure challenges. And that is market-based network regulation," he said, adding that the "most important" move was to "reverse the previous administration’s decision to subject our 21st-century networks to 20th-century-style utility regulation." Pai pushed back on widespread criticism that he might negatively impact the open web. (It should be noted that Pai was supposed to speak at January's Consumer Electronics Show in Las Vegas, but canceled after death threats.) “The United States is simply making a shift from preemptive regulation—which foolishly presumes that every last wireless company is a competitive monopolist—to targeted enforcement based on actual market failure for any competitive content,” he said. The timing of Pai’s speech is notable for a few reasons. Monday was the three-year anniversary of the implementation of the net neutrality, also coinciding with a major ruling by an appeals court over an ongoing lawsuit between the Federal Trade Commission and AT&T. The lawsuit—in which the FTC charged AT&T with illegally throttling internet usage from 2011 to 2014—is the first major test as to whether the FTC will honor its task of monitoring telecoms that try to be heavy handed with what users can or can’t view with their network. In its ruling, the court reaffirmed the FTC’s ability to have jurisdiction over ISP activity, explaining that allowing the FTC to oversee “unfair and deceptive non-common-carriage practices” has “practical ramifications.” "New technologies have spawned new regulatory challenges," the ruling states. "A phone company is no longer just a phone company. The transformation of information services and the ubiquity of digital technology mean that telecommunications operators have expanded into website operation, video distribution, news and entertainment production, interactive entertainment services and devices, home security and more. Reaffirming FTC jurisdiction over activities that fall outside of common-carrier services avoids regulatory gaps and provides consistency and predictability in regulatory enforcement.” Other panelists on stage—including Sprint CEO Marcelo Claure—were slow to disagree with Pai. Some audience members visibly bristled when one official from the European Union said it’s up to U.S. residents to decide the fate of the internet in their country; that remark caused one audience member to stand up and yell at the official during the discussion before a security guard intervened and asked the man to quiet down. “The U.S. is not going to be the leader in 5G unless we can change that specific piece,” Claure said. “We’re talking about a massive investment."