Access to the internet is access to opportunity. But for a lot of Montanans, the wait for quality, high-speed internet access just got a little longer because of Gov. Steve Bullock’s recent executive order on so-called net neutrality.
Earlier this month, with the stroke of pen, the governor required internet service providers that have contracts with the state government to adhere to the same net neutrality rules that the Federal Communications Commission recently voted to repeal. According to the governor’s order, ISPs that fail to do so will lose lucrative state contracts.
It’s certainly within the governor’s power to do this. But the question Montanans should be asking is, why would he want to?
The net neutrality rules, which the Obama administration imposed in 2015, were an ill-fitting approach and represented a massive government overreach that threatened to stifle the rapid technological innovation that until then had characterized the internet.
After the rules were imposed, investment in broadband networks dropped by more than 5 percent, something that had never happened before outside of a recession. Small fixed-wireless companies that largely serve rural communities reported “delayed or reduced network expansion” and “incurred additional expenses,” according to the Wireless Service Providers Association, which represents them. FCC Chairman Ajit Pai said that if the rules were left in place, “millions of Americans who are on the wrong side of the digital divide would have to wait years to get more broadband.”
Many of those Americans live in rural communities right here in Montana that still don’t have reliable, high-speed internet.
But instead of cheering the repeal of burdensome federal regulations that hampered broadband network development, Gov. Bullock is imposing those bad ideas on internet service providers and consumers in our state.
The governor claims that after federal repeal of net neutrality “a free and open internet is no longer guaranteed.” He’s wrong.
For decades prior to 2015, the year net neutrality was imposed, the internet was open and free from censorship. And innovation flourished.
What’s more, the internet isn’t without oversight. Service providers are required by federal law to be transparent if they throttle, speed up or slow content.
And the Federal Trade Commission now has jurisdiction and the authority to go after service providers that engage in questionable or abusive tactics.
“The FTC … is an experienced cop on the beat in this area,” said Jon Leibowitz, a former Democratic commissioner at the FTC, in the Wall Street Journal. “It protected internet users from unfair, deceptive and anticompetitive practices for the two decades before the FCC’s 2015 rule.”
So, Gov. Bullock hasn’t made the internet safer or freer in Montana. But he has likely made it harder for thousands of Montanans to get broadband internet access altogether.
“Following patchwork of legislation or regulation is costly and makes it even harder to invest in networks,” says the president of the American Cable Association, which represents small and mid-size broadband providers.
This means fewer broadband companies are likely to invest and compete in our state and rural communities will have to rely more heavily on the Universal Service Fund for network expansion.
But that program, which is intended to boost rural telecom development and is managed by the FCC, has been a corporate welfare boondoggle. From 2002 to 2008, just 17 of the more than 1,400 participating carriers were audited. And since 2011, nearly 59 cents of every dollar spent went to personnel, administrative, and general expenses rather than building and improving infrastructure. This doesn’t bode well for Montana.
Montanans deserve the same broadband connectivity that so many Americans already enjoy if they want to pay for it and someone is willing to build the network to service them. The best way to make that happen is by enabling internet service providers in our state to compete and innovate, not to tie their hands.
Gov. Bullock’s net neutrality grandstanding might get his name in the New York Times, but how does it to help rural Montanans?
David Herbst is the Montana state director of Americans for Prosperity.