Research Notes

Everything you need to know about net neutrality and internet regulation – Strand Consult‘s experience from 50 countries around the world

Net Neutrality in EU after 2 Years: Why operators keep losing the battle against Internet regulation

The EU’s net neutrality law has been in place for more than two years, and the European Commission has scheduled to review its implementation in 2019. Policymakers promised that the law would bring more innovation and protect end user rights, but it appears that the law is doing the opposite. The EU cannot point to new innovation as a result of the law, the law is being used by European regulators to restrict internet products and services that consumers want, and the dominant Silicon Valley platforms have increased their market share in EU. Moreover, the investment gap in EU has widened, and the region is 2 years behind the US and Asia on the rollout of 5G.

Strand Consult describes these and other developments in its report, Net Neutrality in EU after 2 Years: Why operators keep losing the battle against internet regulation. We has again collected, translated, and summarized 29 reports from the national telecom regulatory authorities into a single document. This new report has more than 150 pages of information. In early December 2018, the Body of European Regulators for Electronic Communications (BEREC) released its opinion on its implement of the EU net neutrality law. Unsurprisingly and uncritically, BEREC declared its implementation correct, but it failed to mention the many problems it created for operators, including more than half a dozen regulatory investigations attempting to create the appearance of violations of net neutrality, thereby justifying its heavy-handed approach.

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The net neutrality debate is absurd. What’s the real threat to Internet—governments surveilling citizens or telecom operators selling subscriptions?

The internet, some decades old now, was birthed in part as a research project of the American military which did not want to be reliant on the Ma Bell telephone network. The Internet has transformed our world, not to mention telecommunications, and its success has caught the attention of telecom regulators.  Given that so many subscribers have vacated the highly regulated public switched telephone network for mobile and internet communications, telecom regulators have scrambled to find something new to do. They promote concepts such as net neutrality and fake news to be relevant and to justify new authority to regulate new technologies. Meanwhile governments, which used to have a firm hand on communications, find themselves disrupted with the many ways that people communicate outside of their purview.

Policymakers invent problems, bogeymen, and villains to create a narrative which supports their desired regulation. Frequently the facts don’t match the reality.  For example telecom operators have sold subscriptions to the internet for some 30 years; the price per megabyte has fallen in about 90%; speeds have increased 3000 percent; and people consume increasingly larger amounts to data.  All the same, telecom operators are called “gatekeepers” and saddled with regulation designed to deprive them of shareholder value.

For example when making net neutrality regulation in 2015, the Federal Communication Commission could name only a handful of minor incidents from nearly a decade earlier which it found to be problematic. Notably all were resolved without the need of net neutrality regulation. Similarly in the EU, the European Parliament relied on a survey of contract disclosures some 5 years old to justify their rules. Note that the EU did not record a number of violations; instead it extrapolated a number based upon its interpretation of a survey. Those projections have never been tested.

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The press claims that the American telecom regulator FCC killed the free Internet. Is it true?

Many of the stories you read about net neutrality and internet regulation originate from the media in the USA and then are copy-pasted into Google Translate to make a story in a local language. Many journalists consider this “reporting” and don’t both to read the underlying source documents or understand the situation in the USA.

These articles cultivate myths, one of which is that removing rules imposed two years ago by the Obama Federal Communications Commission (FCC) will kill either the Internet, hurt consumers, or put the internet at the mercy of some telco “gatekeeper.” These journalists forget that the Internet was free and open before the Obama era rules were imposed in 2015, and it is free and open today under new rules. Indeed, all of the major internet companies we know today began before 2015 when the Obama-era rules were imposed. Moreover, both the FCC and the Federal Trade Commission (FTC) will police and deter abuse if it arises.

Strand Consult engages with many of these journalists to highlight their mistakes. In rare cases, they update their stories with corrections.  Mostly they ignore people who call attention to their bias. A key problem is that these journalists think internet policy begins and ends with net neutrality, so they cover very little of what actually goes on at the FCC.

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Follow the money – Net Neutrality Activism Around the Globe

Much has been said and written about network neutrality regulation around the world, but there is little transparency to the powerful and moneyed forces which fund net neutrality activism.

Many governments and telecom regulators have experienced how net neutrality activists disrupt political and regulatory systems. Consider how net neutrality activists influenced the European Union and the Body of European Regulators for Electronic Communications (BEREC) by launching a globally coordinated campaign to influence the democratic process. BEREC clocked a record of some 1 million comments in its consultation on net neutrality guidelines in 2016, with at least one-third of the comments coming from the US and a large part from non-EU citizens outside the EU. The regulatory process is purported to be expert and independent, but the manipulation by activists questions the credibility of rulemaking.

In June 2016 Strand Consult published four research notes on how net neutrality activists manipulated the EU process for Open Internet. We described in detail the lack of transparency in BEREC and our repeatedly denied requests to BEREC for openness on how the rules were made.

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