Congress silent on needed new Communications Act, choosing to keep an outdated law in a dynamic marketplace. (Opinion)
by Brian A. Rankin
In what seems to be news to legislators and regulators, the communications marketplace is innovative and dynamic. The platforms used to consume increasingly varied types of content are in flux, with old models fading and new ones growing.
Yet we continue to operate under the Communications Act of 1934, a law last updated in 1996. This Act and the underlying regulations are woefully out of date. The last major congressional action came 62 years after its predecessor. Technological innovations in that time included widespread adoption of television (now in living color!), cable technologies, and early uses of wireless voice communications. In about half as much time, 28 years, we’ve had a virtual explosion of communications technologies, services, and business models. But many of them are overseen by government regulators using a playbook designed for radio during the Great Depression.
Despite the obvious need, what we get from Congress is… crickets.
Silence from the people’s elected representatives when there is dramatic marketplace change. Streaming is now the most popular viewing platform as cord cutting leads to millions of cable television subscriber losses each year.
The broadband market is changing from competition too. Wireline ISPs experience broadband subscriber losses in the face of competition from fixed wireless offerings like T-Mobile’s 5G Home Internet.
But the old laws and regulations are still in place and are being used to further regulatory agendas. The FCC is proposing to apply utility-style common carrier regulation to broadband internet access service. Florida and Texas passed laws to regulate social media, taking inspiration from telephone and railroad regulation to argue that platforms such as Facebook and X must adhere to common carrier principles by transmitting information without discrimination among users (i.e., content moderation).
Local governments are eager to preserve threatened regulatory authority and revenue streams as old models fade away. In Maine, a new law will impose traditional cable television regulation on a streaming video provider that also has an affiliate with facilities in the public rights of way. This includes the payment of franchise fees under the federal Cable Act (five percent of gross revenues derived from the operation of a cable system) to the local franchising authority. Maine is attempting to shoehorn internet-delivered streaming services into the old cable regulatory regime and the driver is a five percent fee that is supposed to compensate for the “burden” imposed on the rights of way by a cable network.
These clumsy maneuvers assert power from old, unsuited legal and regulatory regimes onto a dynamic marketplace. Major market and economic restructurings are occurring and Congress must act to prevent outdated laws and regulations from skewing the natural progress of market forces and technological advancement.
In light of what federal, state, and local agencies are doing, consider the preamble to the 1996 Telecommunications Act:
An act to promote competition and reduce regulation in order to secure lower prices and higher quality services for American telecommunications consumers and encourage the rapid deployment of new telecommunications technologies.
Congress should write a communications act for the 21st Century. The US is ready to embrace sensible free market, pro-competition principles that support the growth and development of the communications marketplace. Old regulatory regimes and habitual thinking must be jettisoned and principles suited for an evolving and dynamic marketplace enacted.
In so doing, Congress must clearly authorize any regulatory agency power. That regulatory agency power should be limited and designed to prioritize market-based principles and reject prescriptive regulation. Innovation during this century will occur far too fast for anything else.
Next year, the House Commerce Committee—along with its Senate counterpart, one of the two primary committees to develop and move telecommunications legislation—will have a new chair and hopefully a fresh perspective.
No more crickets. It’s time to fill the halls of Congress with the buzz of hard work on a communications act for the 21st Century.
Originally published by the Competitive Enterprise Institute. Republished with permission.
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