Control or Chaos? The Clash Over Broadband Power

Navigating the Net: The High Stakes of Internet Regulation

The Biden administration's recent push for broadband price controls through the Federal Communications Commission (FCC) and other agencies has sparked controversy, with critics arguing that such measures could undermine efforts to close the digital divide. FCC Chairwoman Jessica Rosenworcel has stated that the commission does not intend to regulate rates, yet the notice of proposed rulemaking for the Safeguarding and Securing an Open Internet order suggests otherwise, hinting at the possibility of ex post rate regulation.

This ambiguity is mirrored in the National Telecommunications and Information Administration (NTIA), where Administrator Alan Davidson and Department of Commerce Secretary Gina Raimondo have publicly disavowed rate regulation, despite NTIA's actions suggesting the opposite. Notably, NTIA's insistence on a "middle class affordability plan" from states for the Broadband Equity, Access, and Deployment (BEAD) Program, which was not authorized by Congress, has raised concerns. For instance, Virginia's request for pricing flexibility was denied by NTIA, which mandated adherence to specific affordability criteria.

Moreover, the Taxpayers Protection Alliance has criticized the administration for potentially deterring participation in the BEAD program by imposing unauthorized controls, especially given the more than $100 billion allocated for broadband expansion. These concerns are compounded by the broader economic challenges facing the broadband industry, such as inflation and worker shortages.

FCC Commissioner Brendan Carr has labeled the administration's "digital equity" plan as an "unlawful power grab," suggesting that it would grant the federal government unprecedented control over the internet. Carr warns that the plan, which includes a set of government controls not previously applied to any technology, would micromanage nearly every aspect of how the internet functions, from ISPs' capital allocation to consumer services and pricing.

The Biden administration's broadband policies have been criticized for their economic inefficiency and regulatory overreach, with Carr accusing the administration of blaming the private sector for policy failures.

The FCC's potential adoption of new rules under the Infrastructure Act could lead to extensive federal oversight of the internet sector, which Carr and others argue is incompatible with free market capitalism.