Good Afternoon. Ladies and gentlemen, tomorrow we will have the first significant vote on the future of the Internet. At stake, is the fate of the Internet as we know it.
Tens of millions of Americans and hundreds of thousands of American businesses use and rely upon the Internet every day. In addition to its vital economic role, the Internet is also an unparalleled vehicle for open communications by non-commercial users, for religious speech, for civic involvement, and our First Amendment freedoms.
The reason why the Internet is so revered as a medium and prized as an engine for innovation and entrepreneurial entry is that it is open to all comers. It is this very openness that allows Americans to access the content and services they want, and not just the content and services that some broadband baron has chosen for them. The fundamental truth about the Internet is that no one owns it. The Internet is the type of disruptive technology that Josef Schumpeter talked about as being indispensable to our capitalist system. Schumpeter said that “without innovation, no entrepreneurs, without entrepreneurial achievement, no capitalist returns.”
Yet the Internet is at endangered because of the misguided provisions of the bill before us, which put at grave risk the Internet as an engine of innovation, job creation, and economic growth. The bill permits the imposition of new fees, or “broadband bottleneck taxes” for Internet sites to access high-bandwidth consumers. This will stifle openness, endanger our global competitiveness, and warp the web into a tiered Internet of bandwidth haves and have-nots. It is the introduction of creeping Internet protectionism into the free and open World Wide Web.
Tomorrow we will have the first legislative showdown over two visions. It is a choice between favoring the broadband designs of a small handful of very large companies and safeguarding the dreams of thousands of inventors, entrepreneurs, and small businesses. Tomorrow we will either vote to preserve the Internet as we know it, or instead, vote to fundamentally and detrimentally alter it.
I also want to briefly touch on non-discrimination and competition in the context of national cable franchises. The proposed bill permits a national franchise for cable service, grants multi-billion dollar companies access to public rights-of-way, yet has no service area requirement for providing cable service. By failing to include a build-out provision to ensure service area parity between a Bell company entering a franchise area and the incumbent cable operator, it allows a national franchisee to use public rights-of-way in a community but serve only select neighborhoods within the community.
Now, getting access to a community’s public rights-of-way without any obligation to serve the whole community is a sweetheart deal for phone companies. But it is a raw deal for the neighborhoods that will be skipped over or ignored. Relying upon a complaint process where the onus is upon the aggrieved neighbors to prove outright economic discrimination is a weak remedy for a principle of fairness that has been so essential for our country for years. This bill needs a plan to ensure real fairness, not a plan to bury discrimination complaints in a bureaucratic nightmare proceeding years down the road.
Moreover, the bill compounds the consumer risk when the omission of a service area requirement is considered in the context of an incumbent cable operator qualifying for a national franchise. Under the Barton bill, an incumbent cable operator may seek a national franchise after the phone company arrives in a franchise area, even if the phone company is serving just one household in the franchise area. The lack of a service area requirement at the national level then means that the incumbent cable operator no longer has to serve the entire franchise either. In other words, the operator is free to skimp on service upgrades or withdraw service from any part of their historic service area within the affected community. The incumbent may also raise rates in areas of the community the phone company is not serving in order to cross-subsidize its offering in the part of town the phone company has chosen to serve. This represents a serious consumer protection flaw in the bill and only a provision ensuring service area parity can effectively remedy this flaw.
Thank you and I look forward to the debate and the votes tomorrow.