Senators Divided Over Title II Economic Impact

The impact of Title II on broadband investment was a hot topic of conversation, and dispute, at the Senate Commerce Committee nomination hearing for FCC chairman Ajit Pai and commission seats for Jessica Rosenworcel and Brendan Carr. 

Sen. Mike Lee (R-Utah) cited stats, which have been proffered by ISPs, that investment has gone down. He also took issue with a New York Times story that investment had gone up since the 2015 Open Internet order reclassified ISPs under common carrier regs. He said that increase included foreign investment, some of which he said was spurred by the Title II disincentive to invest in the U.S., and that there was evidence that U.S. infrastructure investment had declined precipitously.

On the other side was Sen. Ed Markey (D-Mass.) who said that almost half of the venture capital funds, or about $25 billion, invested since 2015 was in internet-related businesses, with broadband providers investing $87 billion, the highest Capex rate in a decade.

Markey said investment and job creation are high, so there is no problem that rolling back Title II or reviewing net neutrality rules would fix. 

Both asked Pai for his take on their respective views, but the chairman's answer was cautious given that he has an open proceeding before him and comments on his proposal to roll back Title II and review the rules are still coming in. The chairman has long said he would not prejudge items still before him. 

He said that evidence of decreased investment was one of his concerns, but that the FCC was testing that theory, as well as the opposite, as part of its due diligence. 

Pai also pointed out that the FCC could have simply declared that the old rules were harmful but opened the proposed rulemaking instead to vet and address such issues.

John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.