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Right Hooks

Net Neutrality a Year Later

Obama's legacy is to chill growth of the Internet.

Dan Gilmore · Mar. 3, 2016

This is a legacy of the Obama administration: The growth and innovation that came with a free Internet ceased after the government decided it would treat the net like a utility, regulating it like landline phones. It’s been a year since the Federal Communications Commission, at the behest of Barack Obama, instituted net neutrality, declaring that Internet providers needed to treat equally every packet of information zipping through the fiber optic, whether it’s Netflix streaming thousands of shows a minute or someone casually browsing Facebook.

The result, The Wall Street Journal explains, is that Internet companies are investing less into building up infrastructure. In 2013, the industry increased capital expenditures by 8.7%; last year, those investments shrank by 0.4%. FCC Commissioner Ajit Pai told The Daily Signal, “I think what you are seeing is companies less willing to spend money building broadband that is faster and better and cheaper to your homes and businesses. This is the first time that year-over-year investment in broadband has gone down, outside the tech bubble bursting in 2001 and the Great Recession of 2008. The fact it coincides with the FCC adopting these heavy-handed regulations, I think, is directly related. And that’s unfortunate for American consumers, especially in rural areas where the business case for building our broadband is already tough as it is.”

The FCC’s newfound powers are being challenged in the courts — and it might go to the Supreme Court. But if the FCC prevails, then it will have the power to tax the Internet, further freezing the innovation and creativity that the Internet fostered.

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