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Study: New Network Compact Is Consumer-Driven

Regulations should serve consumer choice, not determine it 7/30/2014 01:43:00 PM Eastern

The Internet Innovation Alliance is suggesting that regulators take a fresh look at the so-called network compact and recognize that it should be competition and consumer-driven, with regulation only a targeted means of helping maintain that compact.

"The New Network Compact: Consumers Are in Charge," a new study from Anna-Maria Kovacs, visiting senior policy scholar at Georgetown University’s Center for Business and Public Policy, says that regulators, consumer advocates and network providers all agree that there are core values that should apply to communications "ecosystems" — public safety, universal access, consumer protection and competition.

FCC Chairman Tom Wheeler has invoked that compact in explaining the need  forregulatory intervention when those values appear to be threatened — from media ownership regs to network neutrality — but Kovacs' analysis suggests that the competition portion of that compact has now empowered consumers to set their own priorities, which may not match those of regulators.

She suggests that the old compact has been enforced in a top-down fashion from "inescapable regulators" to "monopoly providers" to "passive consumers" at the bottom.

Now, Kovacs argues, "empowered consumers" are at the top but part of a two-way flow chart including "competitive providers" and "strategic regulators."

But that provides a dilemma for regulators, she argues. "When consumers make choices that are not consistent with the core values, should regulators intervene--recognizing that they are limiting consumers’ choices by doing so? If they do intervene, how can they make their intervention effective given consumers’ power to evade regulatory choices that do not mesh with their own priorities?"

The answer, she says, is for regulators "to craft a new network compact based on respect for consumers and their choices."

“The 21st century challenge of regulators in preserving and advancing the core values must take into consideration new platforms and the plethora of consumer choices,” said Rick Boucher, IIA honorary chair and former chairman of the House Communications Subcommittee. “Policymakers should tailor the new Network Compact in a way that addresses specific consumer needs rather than making overly-broad attempts to regulate on a technology, platform, or service basis.

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