Schumer: Broadband is a Utility That May Require Price Caps Senate Democratic leader Chuck Schumer uttered some words this week that likely terrified lobbyists and executives for AT&T, Verizon and Comcast. During his floor argument for a Congressional Review Act resolution that would restore net neutrality, Schumer stated that he believes that broadband should be viewed as an essential utility, and that we may need to eventually explore price caps to prevent monopolies from over-charging for services thanks to limited competition.

Democrats and Republicans alike have traditionally avoided price caps on broadband service, in large part because deep-pocketed campaign contributors in the telecom sector have viciously opposed the idea for obvious reasons. Even when former FCC boss Tom Wheeler reclassified ISPs as common carriers under Title II of the Telecom act he was careful to "forbear" from applying rate regulation onto ISPs. But Schumer appeared to re-open the conversation of price caps on an uncompetitive broadband market during discussions about net neutrality, even though the likelihood of him actually following through with that isn't particularly likely given historical precedent. "You know, people say, well, let a private company do whatever it wants, let them charge whatever they want," Schumer argued. "But in certain goods which are essential we don't do that. Utilities, highways. The same thing now applies to the internet. It's a necessity and we have to have protections for average folks, for small businesses, for working families." Instead of price caps, regulators traditionally say they prefer government policy that encourages additional competition, since that ideally would address high prices at the source. But follow through on that front tends to be inconsistent. As a result, as Comcast is cementing a growing monopoly over fixed-line broadband thanks to telcos refusing to upgrade aging DSL networks at scale, and the hunt for a solution to the broken U.S. broadband market is only going to grow. The lobbyist attacks on net neutrality and privacy protections are only fueling calls for greater action beyond the failed efforts of years' past. Again, the idea of Schumer actually standing up to Comcast, AT&T or Verizon anytime soon to impose price caps is arguably laughable if you've watched both parties avoid such action like the plague for fear of upsetting deep-pocketed campaign contributors. That said, Schumer did take sharp aim at the broadband industry's recent attempts to legalize "paid prioritization," which would let a deep-pocketed company like Disney buy a speed and latency advantage over smaller competitors that may not be able to afford it. "It's not that you don't pay, it's that if you're a little guy or gal you shouldn't pay a lot more than the big shots," Schumer argued. "We don't do that on highways, we don't do that with utilities and we shouldn't do it with the internet, another modern 21st century highway that is a necessity." Schumer advised the public to contact lawmakers to support the CRA reversal of the FCC's attack on net neutrality. "Your wallets and well-being, in ways far more significant than most things we do here, depend on it," Schumer argued. "Your wallets and well-being, in ways far more significant than most things we do here, depend on it," Schumer argued.







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Most recommended from 73 comments



ieolus

Support The Clecs

join:2001-06-19

Danbury, CT 9 recommendations ieolus Member It doesn't matter how big or small your local cable company is ... as long as they have no real* competition, they are a monopoly and their customers are subject to any and all forms of monopoly-powered abuse.



* The local telco providing a 1.5M/384k connection to the internet is not competition.

jmn1207

Premium Member

join:2000-07-19

Sterling, VA 5 recommendations jmn1207 Premium Member Already Capped It seems like the industry has already applied a cap, but it is for the low end.

pclover

join:2008-08-02

Santa Cruz, CA 2 recommendations pclover Member No Look at how utility companies are regulated and how much crap they are allowed to pull. Would be more of the same here. For example PG&E in California killed people in San Bruno due to negligence and they got a slap on the wrist from the CPUC.



If you start adding price caps to internet services you can say bye bye to any new development and competition. Also the dominating monopoly providers would never improve services.



Beyond all that it would have so many strings attached as we've previously seen. Lazlow

join:2006-08-07

Saint Louis, MO 2 recommendations Lazlow Member Geograpic coverage Why not simply require them to use 20% of their profits to expand coverage, until they reach 97% geographic coverage? Assuming the 25Mpbs minimum broadband definition, this would greatly reduce the lack of broadband in rural areas. Any area that is covered by electricity/pots should have broadband.