Regulatory and Legal Reform

The Federal Communications Commission voted Thursday to restore Obama-era broadband regulations—a move that is outside the agency’s remit and will erode investment in telecom infrastructure, the NAM said.

What’s going on: “The commission voted along party lines to finalize a proposal first advanced in October to reinstate open internet rules adopted in 2015 and reestablish the commission’s broadband authority” (Reuters, subscription).

• The rules, repealed by the Trump administration in 2017, will reclassify broadband as a telecom service under a law originally passed in 1934. This change will subject 21st century high-speed internet to regulations designed for the era of the rotary phone.
• The Biden administration has been seeking a return to the 2015 regulations since 2021, when the president signed an executive order urging the FCC to reinstate them.

Why it’s important: The resuscitated regulations will have a significant and negative impact on the U.S. economy, as historical evidence shows.

• From 2011 to 2022, attempts to impose so-called “net neutrality” restrictions depressed telecom infrastructure investment by $8.1 billion each year, decreased employment by approximately 195,600 jobs and reduced gross domestic product by $145 billion annually (Phoenix Center).

Our view: “Ultimately, [the FCC]’s broadband regulations are a solution in search of a problem,” the NAM wrote in a social post. “The U.S. already has an open and fair internet. This is just the latest in a long line of decisions adding to the regulatory onslaught facing manufacturers in America.”