Ajit Pai says net neutrality was the top threat to broadband deployment

Enlarge/ Federal Communications Commission Chairman Ajit Pai arrives for his confirmation hearing with the Senate Commerce Committee on July 19, 2017 in Washington, DC.Getty Images | Chip Somodevilla

Net neutrality is the number-one reason many rural Americans still lack broadband access—at least, that's what Federal Communications Commission Chairman Ajit Pai says.

In a speech to the American Cable Association (ACA) today, Pai said that "closing the digital divide is the FCC's top policy priority" and that nothing impeded that goal more than net neutrality rules.

The ACA is a lobby group for small- and medium-sized cable companies and was one of Pai's major supporters in the December 2017 vote to repeal net neutrality rules.

Pai's speech to the ACA described the FCC's 2015 Title II order that imposed net neutrality rules on ISPs as a "regulatory misadventure" and a "regulatory onslaught." It was, he said, "the largest deterrent to network investment." Pai noted that 30 percent of rural Americans lack access to high-speed broadband at home.

"I'm proud to say that last year, we reversed the Title II Order," Pai said. "We restored the light-touch approach to network regulation that served us well for almost 20 years, paving the way for over $1.5 trillion in private investment to build out wired and wireless networks."

The so-called "light-touch approach" of the previous 20 years actually consisted of much heavier regulation than exists today, as we've previously explained.

Pai's speech also offered no new proof for his claim that net neutrality rules were "the largest deterrent to network investment."

Today isn't the first time Pai has struggled to justify his grand pronouncements about the harmful effects of net neutrality rules. In December, Pai issued a press release about five small ISPs that he says were harmed by the rules. But Pai's announcement offered no data to support that assertion.

When advocacy group Free Press looked at the FCC's broadband deployment data for those five companies, it found that four of them had expanded into new territory after the FCC imposed its rules. The fifth didn't expand into new areas, but it did start offering gigabit Internet service.

Last month, Pai's FCC issued a report saying that broadband deployment across the US is finally on the right track and that it's improving because of the repeal of net neutrality rules.

That's impossible, because the net neutrality repeal still hasn't taken effect. Besides that, the FCC's data on broadband deployment only covers the period through December 2016, one year before the repeal vote.

To "prove" that the net neutrality repeal is spurring new broadband deployment, Pai pointed to deployments by AT&T, Verizon, Frontier, and Alaska Communications. But as we explained in this article, three of these four deployments were planned during the Obama administration, and two were funded directly by the FCC before Pai was the chair. All four came from ISPs that had announced broadband expansions before Pai took over, with the net neutrality rules in place.

Internet blocking not a problem, Pai says

In today's speech, Pai scoffed at the idea that ISPs will behave badly after the net neutrality rules are gone:

When you get outside the Beltway and talk to Americans about Internet access, as I've done regularly since joining the FCC in 2012, one thing becomes clear. Contrary to what some Beltway politicians and special interests assert, consumers' top complaint about the Internet is not and has never been that their ISP is doing things like blocking content. It's that they don't have sufficient access and competition. Well, greater access and competition requires private investment.

It isn't surprising that Pai didn't hear complaints about blocking, because it was outlawed by the FCC's net neutrality rules between 2011 and 2014 and then again starting in 2015 when the rules were put back into place. (A court decision set the first version of the rules aside throughout most of 2014 and the beginning of 2015; the same court later upheld the new version of the rules.)

The FCC's first net neutrality rules were enacted partly as a response to Comcast interfering with BitTorrent downloads. Pai's FCC has argued that Comcast's throttling of BitTorrent was no big deal and that net neutrality is a "solution in search of a problem."

Pai promises to cut more regulations

Pai's repeal of net neutrality rules will let ISPs block, throttle, or prioritize Internet content in exchange for payment as long as they publicly disclose their network practices.

The cost of net neutrality rules was too high, Pai said. Because of net neutrality rules, "money that could have expanded networks was now being siphoned off to pay lawyers and consultants to make sense of the new rules," he told the ACA.

The net neutrality order also threatened ISPs with "the possibility of after-the-fact rate regulation that could reduce returns on investments and prevent you from raising further capital," Pai said.

In fact, the FCC never imposed any price limits on broadband service as a result of the net neutrality order. Consumers were allowed to file complaints if ISPs charged prices that were "unjust" or "unreasonable," but the complaint process never led to any orders to cut prices.

Pai promised the cable companies that he will continue to help them as FCC chair by "remov[ing] regulatory barriers to buildout." Among other things, the FCC will try to combat "the fees and delays associated with accessing utility poles," he said.

"To me, it's pretty simple: with rules that make it easier to deploy broadband, we will see more broadband deployed," Pai said. "We'll extend that ethos throughout 2018."

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