➤ Former FCC Chairman Ajit Pai said time has shown the repeal of net neutrality has not harmed the vibrancy and health of the internet.
➤ Title II classification under the Communications Act is a "sledgehammer" from a regulatory perspective.
➤ Pai believes that net neutrality is best handled at the Congressional level.
U.S. President Joe Biden made the reinstatement of net neutrality protections a key agenda item for his administration. But not everyone wants a return of the regulatory regime that made those rules possible.
Former FCC Chairman Ajit Pai led the agency in its repeal of a 2015 order that classified broadband as a Title II telecommunications service, a classification that gave the agency more regulatory authority over broadband service providers, such as Comcast Corp., Charter Communications Inc., AT&T Inc. and Verizon Communications Inc. The 2015 order also established three net neutrality rules that prohibited broadband service providers from blocking or throttling legal internet traffic or prioritizing certain traffic for payment.
The subsequent repeal under Pai classified broadband as a Title I information service and eliminated the FCC's authority to enforce net neutrality protections.
S&P Global Market Intelligence recently spoke with Pai, now a nonresident fellow at the American Enterprise Institute, about the impact of the repeal and the future of net neutrality. What follows is an interview that has been edited for length and clarity.
Ajit Pai served as FCC chairman from 2017 to 2021.
S&P Global Market Intelligence: Starting with net neutrality matters — the FCC under your leadership famously revoked those protections in 2017 and set transparency rules in place where internet service providers must disclose instances of blocking or throttling. Net neutrality has now resurfaced as a policy priority for the Biden administration. Do you think those protections are important, or do you think the transparency rules set under your leadership are sufficient safeguards for consumers?
Ajit Pai: We now have four years of concrete experience following the decision we made in December 2017. And that experience has shown that our approach — the light touch, market-based approach — has clearly been to the benefit of consumers. The average fixed broadband speeds in the United States are up 172%. On the mobile side, we're up over 300%, and millions more American consumers have access to the internet today than they had in 2017. This is according to Ookla LLC, an independent third party.
From a network perspective, the networks remain open. You don't see ISPs blocking content, throttling content and the like. In fact, to the extent that happens, that's actually from the content companies that were pushing net neutrality to begin with.
I think our approach is clearly the right one, and you see now a growing recognition among those who initially were critics that it's been a positive decision, or at the very least, that the hyperbolic fears that were raised by politicians and activists here in Washington were completely overblown.
Do you think net neutrality provisions should be separated from Title II classification?
Everything flows from that classification. Because Title II is such a sledgehammer from a regulatory perspective, it gives the agency the ability to do a lot of different regulations under that rubric. All of the basic neutrality rules flowed from the Title II classification as well. That also includes some of the things that the FCC in 2015 decided to forbear from, in particular, price regulation. And so Title II opens up the toolbox, so to speak, for a wide variety of regulatory tools that I think a lot of people on the other side of the aisle would very much like to consider.
Do you think the FCC under Chairwoman Rosenworcel will move to pursue broadband price regulation under that Title II regime?
I think it depends, in part, on the personnel at the agency. The agency is constituted with a 2-2 split, so the third Democratic commissioner on the commission will make a big difference because this most likely will be a 3-2 party line vote, as it's typically been. And so the extent to which the new FCC decides to forbear or not from price regulation would depend on what that particular majority decides to do.
I will say, more generally speaking, outside of the FCC, there are a lot of calls for explicit price regulation. And those political pressures are going to be brought to bear on the agency in a way that hasn't been the case in previous iterations, most recently in 2015.
When we examine net neutrality, we've heard arguments from both sides of the aisle that it'd be better for Congress to decide instead of the FCC handling on its own. Do you think we're better off having Congress act on a formal net neutrality law, similar to efforts that we're seeing to get a comprehensive privacy law passed?
Absolutely. I've been on the record since 2014 following the D.C. Circuit's decision that I thought that the best approach would be for Congress to act in a bipartisan way to set in the pages of the United States code the basic principles of an open internet that everybody agrees on.
Nobody wants ISPs to block access to lawful content. Nobody wants them to throttle content — outside the context of network management tools that everybody agrees upon — and nobody wants to see any competitive paid prioritization. Everybody wants transparency.
Those are the basic principles that I would think could pass very quickly through Congress if people were able to put some of the political differences aside. And I think that would just take a lot of the sting out of this issue and allow the FCC to focus on what its core mission really is, which is promoting what I call digital opportunity: making sure that every American can have access to the internet and advanced technologies. That is what the agency is best suited for.
READ MORE: This is the second part of a two-part Q&A with Ajit Pai. To read the first part, click here.