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Boston Tech Community Worries About Plans To Chip Away At Net Neutrality Regulations04:02Download

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The new FCC chair insists his plans will spur economic growth and innovation, but some Boston tech executives say it will do the exact opposite. (Andrew Harnik/AP File)MoreCloseclosemore
The new FCC chair insists his plans will spur economic growth and innovation, but some Boston tech executives say it will do the exact opposite. (Andrew Harnik/AP File)

The head of the Federal Communications Commission has begun a campaign to curb government regulation of the internet and roll back net neutrality rules — the Obama-era policy that essentially requires internet service providers to treat all online data equally.

FCC Chairman Ajit Pai insists that his plans will spur economic growth and innovation, but some Boston tech executives say it will do the exact opposite.

Same Objective, Different Paths

In a speech at the Newseum in Washington, D.C., Wednesday afternoon, Pai described the internet as "the greatest free-market success story in history," but he added that "heavy-handed" regulation in recent years has hurt innovation.

"Going forward we cannot stick with regulations from the Great Depression that were meant to micromanage Ma Bell," Pai said.

In 2015, the FCC classified the internet as a Title II telecommunications service instead of a Title I information service. A Title II classification subjects internet service providers to stricter, utility-like regulations — it was a legal framework initially designed to control the Bell telephone monopoly in the 1930s. Pai wants to revert to the previous, less stringent classification and has said he'll release documents detailing his full plans on Thursday.

But the idea of de-regulation concerns Rory Cowan, CEO of Lionbridge, a software company based in Waltham.

"We've seen this before from railroads, we've seen it with utilities, we've seen it with telephone companies. And I think there's a point where some sort of regulation has to be imposed or maintained on these natural monopolies," Cowan said.

Cowan has operations in 35 countries and says he relies on the internet heavily for his business, so he's worried about any efforts that might affect internet access for his employees. Whereas Pai sees government regulation as the obstacle to more widespread high speed internet, Cowan insists that other countries — such as Finland and South Korea — have better internet access precisely because of government rules.

"I do so much work around the world, probably 50 percent of our revenue is outside of the U.S.," Cowan explained. "And I see ... people behave differently when internet access is like air. You're a more competitive society."

So the local tech community and the FCC chairman both say publicly they want to achieve same goal: innovation, job growth and more widespread high speed internet access. But they seem to fundamentally disagree on whether the internet can achieve that goal on its own through the goodwill of a handful of internet service providers, or whether the internet inherently needs more robust government regulation.

'Hysterical Prophecies Of Doom' Or A Real Threat?

Speaking Wednesday, Pai said the idea of a discriminatory internet with fast and slow lanes was complete conjecture, nothing more than "hysterical prophecies of doom."

"We were warned that [without more regulation] the internet would suddenly devolve into a digital dystopia of fast lanes and slow lanes," Pai said Wednesday. "Did these fast lanes and slow lanes even exist? No."

But for Carbonite CEO Mohamad Ali, it's not a far-fetched idea. His company provides cloud backup and data protection services. He says internet service providers have similar cloud systems that they could boost as direct, unfair competition to Carbonite if no one's watching.

"One example is Verizon. They have a cloud backup offering also," Ali said. "It's an inferior product. But think about, they could effectively subsidize the bandwidth of their offering and make their offering faster than ours."

Ali said even though Carbonite may be paying for "equal access," if an internet service provider is in direct competition with his cloud backup services, the service provider will have an edge and could hurt Carbonite's business.

But beyond Carbonite's direct business impact, Ali, like Cowan, wants to ensure the internet, which he describes as the modern "railroad," remains free and open. And Mike O'Hanlon, the VP of government and industry relations for Boston-based e-commerce site Wayfair, agrees.

"We very much still consider ourselves to be a startup and a source of a lot of innovation," he said. "And we think an open internet is key for the next generation of innovators to be able to come down the pipe."

O'Hanlon isn't particularly concerned about what changes in internet regulation could mean for Wayfair directly — he's more concerned about the broad Boston startup ecosystem that he says needs easy and equitable internet access.

Untangling Title II And 'Net Neutrality'

Boston College law professor Daniel Lyons, who specializes in telecommunications law, agrees with the FCC's new chair that Title II isn't the right regulatory structure for internet service providers, but he believes there are other ways to achieve "net neutrality" if that's what people want — though he's not personally sure it's necessary.

"One of the key things that I think that's gonna have to come out in the next few days is distinguishing between the Title II classification of broadband providers and the net neutrality issue as a policy issue," Lyons said. "One of my primary concerns has been ... the unintended consequence of using Title II to accomplish net neutrality."

Lyons believes a new regulatory framework should come from Congress.

"The real problem is we have an act that originally was written in the 1930s," he said. "We're long overdue for Congress to step in and make clear what the agency's power should and shouldn't be."

But so long as Title II and net neutrality are interwoven, some tech executives in Boston are willing to put up a fight. Last week, more than a dozen local tech leaders met with Sen. Ed Markey to voice their concerns, and Markey has vowed to fight any legislative or regulatory efforts to kill net neutrality.

This segment aired on April 27, 2017.

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