Top Cable Lobbyist: Don't Make the Internet a Utility

The former FCC chairman battles a new push for regulation.

President and CEO of National Cable & Telecommunications Association Michael Powell speaks at the 30th Annual Walter Kaitz Foundation Fundraising Dinner at The New York Marriott Marquis on October 9, 2013 in New York City. (National Journal)

Treating high-speed Internet networks as utilities would strangle their growth, the top lobbyist for the cable industry warned Tuesday.

Michael Powell, the head of the National Cable and Telecommunications Association, acknowledged the "intuitive appeal" of applying utility-style regulations to Internet service providers. In many ways, the Internet has become as central to our lives as roads and electricity, he said.

But he argued that government intervention has degraded other services and would only dampen investment in broadband networks, leading to slower speeds and less access.

"The potholes visible through your windshield, the shiver you feel in a cold house after a snowstorm knocks out the power, and the water main breaks along your commute should restrain one from embracing the illusory virtues of public-utility regulation," Powell, a former chairman of the Federal Communications Commission during the Bush administration, said in his speech at NCTA's annual show in Los Angeles.

He cited statistics showing that large portions of U.S. roads and bridges are in poor condition. The water infrastructure needs $1 trillion in improvements, and the electric grid needs $768 billion, Powell said.

"Because the Internet is not regulated as a public utility, it grows and thrives, watered by private capital and a light regulatory touch," he said. His group lobbies for Comcast, Time Warner Cable, Charter, Cox, and other cable TV and broadband Internet providers.

Powell's comments come as an array of liberal advocacy groups are lobbying the FCC to treat broadband providers the same way it treats telephone utilities.

In 2002, as FCC chairman, Powell classified cable-modem Internet access as an "information service" instead of a "telecommunications service." The move dramatically handicapped the FCC's ability to regulate high-speed Internet access.

In January, the D.C. Circuit Court of Appeals struck down the FCC's controversial net-neutrality rules. The regulations, first adopted in 2010, prohibited Internet service providers from blocking websites or any "unreasonable" discrimination of Internet traffic. The rules were intended to ensure that Internet providers can't act as "gatekeepers" and control what information people access online.

The court said the FCC was essentially trying to apply a utility-style regulation to the Internet. To adopt those regulations, the FCC would have to first reverse Powell's 2002 decision and classify broadband as a "telecommunications service."

Instead of reclassifying, current FCC Chairman Tom Wheeler (who headed NCTA from 1976 to 1984) is trying to rework the rules under the current authority. To comply with the court ruling, the new rules will have to be looser.

Under Wheeler's new proposal, ISPs would still be barred from blocking websites, but they could charge websites for faster service as long as the arrangements are "commercially reasonable."

Matt Wood, the policy director for advocacy group Free Press, argued that the FCC should reclassify broadband as a "telecommunications service" and enact tough net-neutrality rules.

"It would put us back on solid footing where we're not pretending that broadband communications networks are somehow not communications networks," Wood said.

"Broadband is essential. It's the opening price for participating today in our economy and our democracy."

In a blog post on Tuesday, Wheeler emphasized that reclassifying broadband as a Title II "telecommunications service" remains on the table.

"If the proposal before us now turns out to be insufficient, or if we observe anyone taking advantage of the rule, I won't hesitate to use Title II," Wheeler wrote.