'I don't think consumers are going to see any change at all,' FCC Chairman Pai says of net neutrality repeal

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FCC Chairman Ajit Pai speaks during a Senate Appropriations subcommittee hearing in Washington on May 17, 2018.

WASHINGTON — The U.S. government’s net neutrality protections may have been wiped from federal rule books on Monday, but the battle is only just beginning. The architect of that repeal, Federal Communications Commission chairman Ajit Pai, must still contend with a challenge to his efforts in federal court, a campaign on Capitol Hill to roll back his changes, and a slew of states that are looking to regulate in the FCC’s place.

In an interview Friday at the chairman’s eighth-floor FCC office, Pai stressed that much of the blowback he’s received is due to “misinformation.” He said consumers would be just fine under the new regime, which hands off enforcement of net neutrality violations to the U.S. government’s competition regulator. And he signaled potential legal action to come against states enacting their own net neutrality laws.

Here’s our edited conversation.

What does the end of net neutrality rules mean for consumers today?

In the short term, I don’t think consumers are going to see any change at all from the internet experience they’ve come to cherish. And in the medium- to long-term, I think we’re going to see more investment in high-speed networks particularly in rural areas that are difficult to serve. … We were hopeful that that type of the light regulatory approach we’re taking will lead to … better, faster, cheaper internet access for consumers and more competition particularly.

Even in the months after the order, consumers have expressed more and more opposition to your repeal. Why?

I’m not sure if it’s gotten angrier or less, but I do think that there is a fair amount of misinformation out there that has led some consumers to think that this is indeed, as some mistakenly pronounced on Dec. 14, the end of the internet as we know it. The misinformation, for example, the sort of stuff like we’re going to have to pay five dollars to be able to put a tweet on Twitter, or it’s going to be impossible to access Instagram. … Starting on June 11 and going forward, people are going to recognize that they have been misinformed about what exactly the effect our decision is.

What’s the source of that misinformation?

I’m not sure who was putting that out, but it was false. … The other thing is that some of the politicians who’ve been grandstanding on this issue have been misinforming the public. For example, the Senate Democrats from their official accounts, said in tweets, one word per line: This is how your internet experience is going to be. The Washington Post … the fact checker put out an analysis of that claim and found that it was false. He rated it three Pinocchio.

We all agree on the core values of a free and open internet. We simply may disagree on the appropriate regulatory framework for securing those values. And I would much rather have an open and honest debate about the appropriate regulatory framework as opposed to throwing misinformation out there to achieve political ends.

The FTC is now the lead enforcer for net neutrality. Some critics say the agency lacks the staff and experience for the job. Why are you confident that they can do it?

I think that concern is misplaced. I think that chairman [Joseph] Simons, the new chairman of the Federal Trade Commission, has said on the record that the FTC is going to be a vigorous cop on the beat. They are determined to exercise their authority … to police any unfair or deceptive trade practices or any unfair methods of competition that might exist in the internet economy. … They’ve taken numerous actions over the years to protect consumers when it came to privacy, and probably in other cases, and under his leadership they are going to do that going forward.

Are you fearful telecom companies may sue and try to chip away at the FTC’s authority?

I don’t believe so. I think the FTC’s authority here is very broad in terms of unfair and deceptive trade practices. … And given the resources they have both in the Bureau of Competition and Bureau of Consumer Protection, I think consumers can rest assured that they will have a much more competitive marketplace.

Many states are looking to pass their own net neutrality regulations in reaction to the federal repeal, though the FCC’s repeal order attempts to prohibit this. How do you respond to that reaction?

Broadband internet access service is inherently an interstate service, and that is not a determination that just the FCC has made. … It sort of follows from that the federal government is responsible for determining what regulatory approach to apply. We made the determination in December 2017 that a light-touch market-based approach was the right one. And it follows from that then that any state that is adopting or issuing rules that are in conflict with the deregulatory approach would be preempted, because we don’t want to have a patchwork of state laws and federal laws that are in conflict. Now, I can’t opine about any particular state’s approach, whether it will be consistent or inconsistent with the preemption framework I just described. It’s a case-by-case analysis that has to happen.

But there are a lot of them, including California. Are you encouraging lawsuits or working with telecom providers on them?

We’re keeping all options on the table, and we will certainly see how the issues progress, whether through litigation or otherwise.

But there is a world in which the FCC is an intervening party in these cases?

Right.

From a public opinion standpoint, why do you think there are so many states that are rushing to regulate — and in some cases even Republicans have supported new rules?

I understand the political salience of the issue in some quarters, but I think at the end of the day we have to keep our eyes focused on what is genuinely in the public interest. And again, what is in the public interest is a free and open internet that is improving over time for everybody, especially in parts of the country where the digital divide is most keenly felt. I’m confident that our decision is the one that best vindicates consumers’ concerns going forward, and protects them in the internet economy that we have, and promotes a stronger economy for them going forward.

In speaking with lawmakers in states like Washington, they think they should have the final say because they’re elected and the commission is not. How do you respond?

I mean the reason why Congress created us in 1934 was to regulate radio and wire communications across state lines. And the 21st century analogue to that is the internet.

There’s been renewed interest recently in two incidents, in 2014 and 2017, in which the agency’s system for accepting public comments went down — incidents that the FCC’s top tech officer initially attributed to a cyber attack. But agency emails unearthed by Gizmodo have cast significant doubt on those explanations. It seems the FCC in 2014 never experienced such an attack, and the agency in 2017 has furnished no evidence suggesting another had occurred. Walk us through what happened.

This seems to be a disagreement between some of the staffers of the Wheeler administration, including former chairman [Tom] Wheeler himself. For my part, I have consciously deferred to the career IT experts here on this issue.

But there’s been no evidence furnished. Does it exist?

I defer to the career experts at the agency. I’m not a I.T. expert myself.

The other big thing happening next week is the AT&T decision. But I do wonder if you are sensing a growing opposition in the public toward bigness particularly in the telecom and the tech space. Do you feel that way? Do you hear these concerns about consolidation?

I think I read about it at least in some of the press coverage that I’ve seen but I think it’s dangerous to try to come up with impressionistic views of things and then apply that policy. For our part, we are simply focused on the facts and the law. [We] take a look at the papers that are presented to us in the context of any transaction, and figure out whether the consummation of that transaction will be in the public interest. We try to make it as sober an analysis as possible because, at the end of the day, our test is not putting a finger in the wind but putting a finger on the need for a competitive marketplace.

So you don’t feel this pressure from the public to take a harder edge against something like Sprint T-Mobile merging?

I think it’s dangerous to make a decision based on where one thinks the public may or may not be. Aside from the fact that that’s not what the law prescribes, it’s also, I think, not what reasoned decision making is all about. … You always try to look at the facts and apply the law faithfully.