Net Neutrality and Nincompoops

Reason’s Nick Gillespie gave a fawning interview to FCC Chairman Ajit Pai with the topic of net neutrality. Along the way, we learn just how little acquaintance with the issues either of them apparently has.

Here’s the softball on net neutrality per se:

Nick Gillespie: To get into it a little bit, there was a free and open internet in 2015, there’s kind of one now too or nothing much has changed. What was the pressing cause that people said, you know, “The internet is being shut down, it’s being taken over. It’s being warped in ways for particular business or political interest.” What was the proximate cause for pushing for this new type of regulation, which was much bigger and much broader than anything before?

Ajit Pai: There was none. We were not living in a digital dystopia in the years leading up to 2015. By contrast, actually, the commercialization of the internet in the 1990s up to 2015 represented I think the … one of the most incredible free market innovations in history. With light touch regulation, broadband providers spent 1.5 trillion dollars on infrastructure. Companies like Google and Facebook and Netflix became household names precisely because we didn’t have the government micromanaging how the internet would operate. That Clinton era framework is something I think served us well and going forward I hope it continues to serve us well.

Companies like Google, Facebook, and Netflix became household names, all right, but they didn’t get there by being internet service providers (ISPs), which is what net neutrality is about, so listing them off is irrelevant to the discussion. (Google has since then dabbled in ISP service, but that wasn’t their business at launch.)

Notice Pai’s assertion that net neutrality rules came about without cause. Did Gillespie take a moment to say, hey, wait, is that really true? Let’s look at the follow-up.

Nick Gillespie: So, what is something … Pulling back Title II, what is something that an ISP or an internet company can do that they wouldn’t be able to do as easily under Title II.

Ajit Pai: Well, nothing in my view because if you look at the record that the FCC had on the books in 2015, internet service providers were not willy nilly blocking traffic and throttling traffic. To the contrary, these were all phantoms that were conjured up by people who wanted the FCC for political reasons to over-regulate the internet. Going forward, if we go back to the rules as they were previously, we are not going to see this parade of horribles that we are sure to hear about in the next coming weeks.

That’s right, Gillespie totally gave Pai a pass. even after Pai cited Netflix as an example Internet company. Neither Pai nor Gillespie note the historical precedent Netflix’s interaction with Comcast gave for the FCC to adopt its net neutrality rules.

Go back to 2014, the very year prior to 2015 that Pai referenced, and one finds news items about Netflix agreeing to pay Comcast moeny in order to allow Comcast customers full access to Netflix. Places like the Wall Street Journal covered this story; why don’t Gillespie and Pai seem to have any recollection of it? Comcast is an ISP. They get paid by consumers to have access to things on the internet. Comcast, though, decided that getting paid by their users was not enough, and that they would shakedown a content provider, Netflix, for more money in order for Netflix to be able to provide content to Comcast’s large bloc of users. In my opinion, Comcast was able to hold their customers hostage for the purpose of extorting money out of Netflix. There is data to support that view. The FCC’s “common carrier” rules meant that such arrangements between ISPs and content providers were off the table. And that makes hash of some further exchanges between Gillespie and Pai.

Nick Gillespie: Well and let’s talk about that because this was always the example. When people talk about net neutrality or an open internet, you conjure up the idea of I have Time Warner, which is now Spectrum I guess, and I want to go to reason.com on Spectrum but it’s blocked or I can’t get there or it won’t load and it’s because the people there don’t like Reason, they don’t like our politics or maybe our competitors have bought some kind of thing to kind of block us. That’s, that’s what people worry about. That kind of stuff is not happening.

Ajit Pai: It does not happen now.

Gillespie, you ignorant blockhead, it was happening, we have the data, and you let your subject lie with impunity. But that assumes that Gillespie had at least some aspiration to journalism, which I suppose is an unfair assumption. As a Randian flak, it would make total sense for Gillespie to allow Pai to deny reality, so long as it resulted in fewer regulations on businesses.

There’s more stuff in the interview, which is considerably less interesting since we’ve apparently established that neither of the participants either knows squat about the topic or are willing to speak truthfully on related matters. Pai does bring up the example of T-Mobile trying to get around net neutrality common carrier rules by offering customers “free data” for particular uses, and declares that as an example of FCC regulations harming consumers. But the difference between an ISP presenting payment from a content provider as “cost of doing business” and “extra feature for our customers” is nil in principle. You end up with the ISP being able to monetize and prioritize what content they prefer, rather than serving the content that their customers prefer.

I don’t know why Reason hates the free market, but articles like this confirm that is precisely their position. They are willing to connive at depriving the customers who embody that market from making unconstrained choices that will determine the competitive outcomes of content providers.