FEDERAL COMMUNICATIONS COMMISSION CHAIRMAN JULIUS GENACHOWSKI STATEMENT ON PRESERVING INTERNET FREEDOM AND OPENNESS

WASHINGTON, DC

December 21, 2010

Let me start with a quote. “The Web as we know it [is] being threatened.” That’s Tim Berners-Lee, the inventor of the World Wide Web, in a recent article. He continued, “A neutral communications medium is the basis of a fair, competitive market economy, of democracy, and of science. Although the Internet and the Web generally thrive on lack of regulation, some basic values have to be legally preserved.”

Today, for the first time, the FCC is adopting rules to preserve basic Internet values. While the Commission had in the past pursued bipartisan enforcement of Open Internet principles, we have not had properly adopted rules. Now, for the first time, we’ll have enforceable, high-level rules of the road to preserve Internet freedom and openness.

As we stand here now, the freedom and openness of the Internet are unprotected. No rules on the books to protect basic Internet values. No process for monitoring Internet openness as technology and business models evolve. No recourse for innovators, consumers, or speakers harmed by improper practices. And no predictability for Internet service providers, so that they can effectively manage and invest in broadband networks.

That will change once we vote to approve this strong and balanced order. The vote on this order comes after many months of debate — which has often produced more heat than light. Almost everyone says that they agree that the openness of the Internet is essential — that openness has unleashed an enormous wave of innovation, economic growth, job creation, small business generation, and vibrant free expression.

But despite a shared allegiance to the Internet as an open platform, there has been intense disagreement about the role of government in preserving Internet freedom and openness. On one end of the spectrum, there are those who say government should do nothing at all on open Internet. On the other end are those who would adopt extensive, detailed and rigid regulations.

Both sides impose tests of ideological purity. To some, unless their test is met, open Internet rules are “fake net neutrality.” To others, unless their test is met, open internet rules are “a government takeover of the Internet.”2 For myself, I reject both extremes in favor of a strong and sensible, non-ideological framework – one that protects Internet freedom and openness and promotes robust innovation and investment throughout the broadband ecosystem.

Because none of these goals are abstractions. They live or die not in ideology or theory, but in practice — in the hard work of grappling with technology, business, and real-world consumer experiences. Now, in this issue we encounter familiar arguments – we’ve heard some today – the kind trotted out to oppose almost any government action. We are told by some, for example, not to try to fix what isn’t broken, and that rules of the road protecting Internet freedom would discourage innovation and investment. But countless innovators, investors and business executives say just the opposite, including many who generally oppose government action.

Over the course of this proceeding we have heard from so many entrepreneurs, engineers, venture capitalists, CEOs and others working daily to invent and distribute new Internet products and thereby maintain U.S. leadership in innovation. Their message has been clear: the next decade of innovation in this sector is at risk without sensible FCC rules of the road.

As one leading early stage investor put it, in thoughts echoed in a letter we receiving from 30 prominent venture capitalists: “the lack of basic ‘rules of the road’ for what network providers and others can and can’t do is starting to hamper innovation and growth.” And as we heard in a letter from more than two dozen leading technology CEOs: “Common sense baseline rules are critical to ensuring that the Internet remains a key engine of economic growth, innovation, and global competitiveness.” The innovators, entrepreneurs, and tech leaders recognize, as I do, the vital need for massive investment in broadband infrastructure.

Based on their in-market experience – they also tell us that broadband providers have natural business incentives to leverage their positions as gatekeepers of the Internet in ways that would stifle innovation and limit the benefits of the Internet. They point out that, even after the Commission on a bipartisan basis announced open Internet principles in 2005, we have seen clear and troubling deviations from open practices.

Given the importance of an open Internet to our economic future, given the potentially 3 irreversible nature of some harmful practices, and given the competition issues among broadband providers, it is essential that the FCC fulfill its historic role as a cop on the beat to ensure the vitality of our communications networks and to empower and protect consumers of those networks.

Now at the same time, government must not overreach by imposing rules that are overly restrictive or that assume perfect knowledge about this dynamic and rapidly changing marketplace. We know that – to meet our broadband speed and deployment goals for the country – broadband providers must have the business incentives to invest many billions of dollars to build out their networks, the ability to run their networks effectively, and the flexibility to experiment with new business models to further drive private investment.

Today, we are adopting a set of high-level rules of the road that strikes the right balance between the imperatives. We’re adopting a framework that will increase certainty for businesses, investors, and entrepreneurs. In key respects, the interests of edge innovators – the entrepreneurs creating Internet content, services, and applications – broadband providers, and American consumers are aligned.

Innovation at the edge catalyzes consumer demand for broadband. Consumer demand spurs private investment in faster broadband networks. And faster networks spark even cooler innovation at the edge. I believe our action today will foster an ongoing cycle of massive investment, innovation and consumer demand both at the edge and in the core of our broadband networks.

Our action will strengthen the Internet job-creation engine. Our action will advance our goal of having America’s broadband networks be the freest and fastest in the world. Our action will ensure Internet freedom at home, a necessary foundation to fight for Internet freedom around the world. The crux of the order we are adopting – which is based on a strong and sound legal framework – is straightforward.

Here are the key principles it enshrines, and the key rules designed to preserve Internet freedom and openness:4

First, consumers and innovators have a right to know the basic performance characteristics of their Internet access and how their network is being managed. The transparency rule we adopt today will give consumers and innovators the clear and simple information they need to make informed choices in choosing networks or designing the next killer app. Shining a light on network management practices will also have an important deterrent effect on bad conduct.

Second, consumers and innovators have a right to send and receive lawful traffic – to go where they want, say what they want, experiment with ideas – commercial and social, and use the devices of their choice. The rules thus prohibit the blocking of lawful content, apps, services, and the connection of devices to the network.

Third, consumers and innovators have a right to a level playing field. No central authority, public or private, should have the power to pick winners and losers on the Internet; that’s the role of the commercial market and the marketplace of ideas. So we are adopting a ban on unreasonable discrimination. And we are making clear that we are not approving so-called “pay for priority” arrangements involving fast lanes for some companies but not others. The order states that as a general rule such arrangements won’t satisfy the nonreasonable-discrimination standard – because it simply isn’t consistent with an open Internet for broadband providers to skew the marketplace by favoring one idea or application or service over another by selectively prioritizing Internet traffic.

Fourth, the rules recognize that broadband providers need meaningful flexibility to manage their networks to deal with congestion, security, and other issues. And we also recognize the importance and value of business-model experimentation, such as tiered pricing. These are practical necessities, and will help promote investment in, and expansion of, high-speed broadband networks. So, for example, the order rules make clear that broadband providers can engage in “reasonable network management”.

Fifth, the principle of Internet openness applies to mobile broadband. There is one Internet, and it must remain an open platform, however consumers and innovators access it. And so today we are adopting, for the first time, broadly applicable rules requiring transparency for mobile broadband providers, and prohibiting them from blocking websites or blocking certain competitive applications. 5

As I have said for many months, as many innovators and entrepreneurs have told us, and as the facts and record bear out, there are differences between mobile and fixed broadband that are relevant in determining what action government should take for mobile at this time.Among the differences: unique technical issues involving spectrum and mobile networks, the stage and rate of innovation in mobile broadband; and market structure.

Also, one of the largest mobile broadband providers has just begun providing 4G service using wireless spectrum subject to openness conditions adopted in connection with the auction of that spectrum.

Importantly, our order makes clear that we are not endorsing or approving practices that the order doesn’t prohibit, particularly conduct that is barred for fixed broadband. And we affirm our commitment to an ongoing process to ensure the continued evolution of mobile broadband in a way that’s consistent with Internet freedom and openness. Any reduction in mobile Internet openness would be a cause for concern—as would any reduction in innovation and investment in mobile broadband applications, devices, or networks that depend on Internet openness.

Sixth, and finally, today’s order recognizes the importance of vigilance—vigilance in promptly enforcing the rules we are adopting and vigilance in monitoring developments in areas such as mobile and the market for specialized services, which may affect Internet openness. That’s why I’m pleased that we’ve committed to create an Open Internet Advisory Committee that will assist the Commission in monitoring the state of Internet openness and the effects of our rules.

We’re also launching an Open Internet Apps Challenge on challenge.gov that will foster private-sector development of applications to empower consumers with information about their own broadband connections, which will also help protect Internet openness. The rules of the road we adopt today are rooted in ideas first articulated by Republican Chairmen Michael Powell and Kevin Martin, and endorsed in a unanimous FCC policy statement in 2005. And they are grounded in the record we have developed over the last 14 months, including more than 100,000 public comments, numerous public workshops, and hundreds of meetings with stakeholders ranging across the spectrum.

I am proud of this process, which has been one of the most transparent in FCC history. And I am proud of the result, which has already garnered broad support – from the 6 technology industry, including TechNet, the Information Technology Industry Council, the Internet Innovation Alliance and the hundreds of technology companies those groups represent, as well as many other technology companies; support from investors of all sizes, including some of the nation’s preeminent venture capitalists and angel investors.

Our framework has also drawn support from key consumer, labor, and civil rights groups, a list that includes the Consumer Federation of America, Consumers Union, the Center for Democracy and Technology, and the Communications Workers of America. I thank them and the other groups that have worked on this issue. And our framework has been supported by a number of broadband providers as well, who recognize the sensible balance of our action and the value of bringing a level of certainty to this fraught issue.

Our action today culminates recent efforts to find common ground on this challenging issue – here at the FCC, as well by private parties, and in Congress. I thank each of those who took their time over the last several months to take on these difficult issues, seeking to bridge gaps and find solutions, and who supported us in our efforts.

I want to praise and thank my colleagues Commissioners Copps and Clyburn particularly, for their vision and constancy in pushing this Commission to focus on the interest of consumers. Their work has certainly improved our rules and order. As Commissioner McDowell and Commissioner Baker pointed out, virtually all of our decisions are bipartisan or unanimous, and I look forward to working together on a series of items to serve the public and grow the economy. And I can’t express enough appreciation to the remarkable staff of the FCC, who have worked so hard – and so well – to wrestle with difficult issues and turn complex ideas into simple rules.

This includes many offices and bureaus at the FCC, including the Office of General Counsel, the Office of Strategic Planning, the Office Engineering and Technology, and the Wireline, Wireless, Media, Consumer, Enforcement, and International Bureaus.

Thank you all.

And thank you to all the staff on the 8th floor, and in particular to the extraordinary team

I’m lucky to have in the Chairman’s office. Eddie Lazarus, Zac Katz, Rick Kaplan, Josh Gottheimer, Jen Howard, Daniel Ornstein, and Maria Gaglio – you’ve each gone well above and beyond the call of duty. I apologize to your families. But I know they join me in honoring your service.

Thanks to the work of these incredible public servants, today a strengthened FCC is adopting rules to ensure that the Internet remains a powerful platform for innovation and job creation; to empower consumers and entrepreneurs; and protect free expression.7 These rules will increase certainty in the marketplace; spur investment both at the edge and in the core of our broadband networks, and contribute to a 21st century job-creation engine in the United States.

Finally, these rules fulfill many promises, including a promise to the future – a promise to the companies that don’t yet exist, and the entrepreneurs who haven’t yet started work in their dorm rooms or garages.

For all that, I am proud to cast my vote.

“President Obama is strongly committed to net neutrality in order to keep an open Internet that fosters investment, innovation, consumer choice, and free speech.  The announced action by FCC Chairman Genachowski, building on the work of Chairman Waxman’s collaborative effort to craft legislation in this area, advances this important policy priority.”

— Aneesh Chopra, CTO, White House, December 1, 2010
“The Communications Workers of America supports Chairman Genachowski’s initiative to sustain open Internet principles and create the stable conditions necessary for critical investment and quality job creation in broadband networks.”

— Larry Cohen, President, CWA, December 1, 2010
“We commend Chairman Genachowski for recognizing that the time to act is now. The Internet is and should remain a medium that is open to innovation, not one where big network operators get to pick winners and losers.  This rulemaking is about preserving the characteristics that have made the Internet such an overwhelming success.”

— Leslie Harris, President, Center for Democracy & Technology (CDT), December 1, 2010. CDT is a non-profit public interest organization working to keep the Internet open, innovative, and free

“Maintaining an Open Internet is critical to our economy’s growth and Chairman Genachowski and his team deserve kudos for their thoughtful leadership. This effort is a pragmatic balance of innovation, economic growth and crucial investment in the Internet. We look forward to working with FCC to protect these principles so the Internet grows and thrives for generations to come.”

— John Doerr, Partner at Kleiner Perkins Caufield & Byers. Kleiner Perkins Caufield & Byers is a venture capital firm that has backed entrepreneurs in over 500 ventures, including AOL, Amazon, Citrix, Compaq, Electronic Arts, Genentech, Google, Intuit, Juniper Networks, Netscape, Sun, Symantec, Verisign and Zynga.

“As the founder of Craigslist and a passionate believer in the economic and social benefits of an open and free Internet, I proudly endorse the Chairman’s historic efforts to protect these important principles in our society. Common-sense rules of the road will help ensure certainty in markets while also preserving the openness and freedom of the Internet that has helped generate millions of jobs and share billions of ideas around the world.

— Craig Newmark, Founder, Craigslist, December 1, 2010.

“I am proud to join a diverse coalition in support of the Chairman’s proposed rules of the road. This light-touch, common-sense framework will help protect investment and innovation throughout the ecosystem and will ensure certainty in markets for years to come.”

— Ron Conway, Founder, SV Angel, December 1, 2010.  SV Angel is a Silicon Valley technology angel venture fund.

“We applaud the work of the Chairman Genachowski and FCC on this draft Open Internet framework.  Chairman Genachowski has offered a quality framework that hits the right balance between encouraging investments, fostering innovation and protecting consumers in a manner that is both transparent and enforceable.”

— Rey Ramsey, President and CEO of TechNet.  TechNet is the national, bipartisan network of more than four hundred CEOs. Its members represent more than one million employees in the fields of information technology, biotechnology, e-commerce and finance.

“Today ADE commends the FCC for embracing this spirit, rejecting partisan bickering and choosing mainstream compromise over extreme action in the debate over net neutrality. Today’s announcement shows that thoughtful debate on policy can lead to solutions that uphold our commitment to preserving the open Internet while maintaining a focus on the priorities of the American people:  restoration of our economy and a solution to creating jobs.”

— Shirley Franklin, Senior Advisor, Alliance for Digital Equality (ADE), December 1, 2010.  The Alliance for Digital Equality (ADE) is a non-profit consumer advocacy organization that serves to facilitate and ensure equal access to technology in underserved communities.

“We believe that today’s net neutrality proposal from the FCC represents an important step forward.  It’s vital for net neutrality regulations to promote new investments by network operators to increase broadband speeds, while also ensuring that consumers easily can access content and services from both start-up and established companies with the necessary quality of service and at the highest speeds available.”

— Statement by Fred Humphries, Microsoft, December 1, 2010.

“We applaud Chairman Genachowski for his leadership in moving forward with a balanced approach in the face of the heightened polemics on this issue…[t]he FCC’s policy position represents a fair middle ground that will provide regulatory certainty to an issue that has been lacking it since the Comcast decision last spring.”

— Dean Garfield, CEO, Information Technology Industry Council (ITI), December 1, 2010.  ITI is an advocacy group representing global leaders in innovation–from all areas of the ICT sector including hardware, services, and software.

“We … urge you to bring the Open Internet rulemaking to conclusion …the Commission can provide the certainty necessary for policymakers, consumers, investors, and innovators that the Internet will remain an open network, under the watchful eye of the Federal Communications Commission, and that the service will be delivered and managed with full and complete transparency.  Combined, that will make it possible for the agency, advocates, engineers, and the media to police practices that could threaten innovation at the edge of the network. … We understand that there are some who would have you go further and some that would have you do nothing.  But we believe you are headed toward a principled center and we support that effort.”

— Senators John F. Kerry, Byron Dorgan and Ron Wyden, November 30, 2010.

“As an early-stage investor with deep ties to the technology community, I applaud Chairman Genachowski’s proposed framework to protect a free and open Internet. Nothing is more important to America’s economic future than the protection of a free and open Internet, and I am confident that Chairman Genachowski’s proposed framework will achieve just that.”

— Ram Shiram, Founder, Sherpalo Ventures, December 1, 2010. Sherpalo is a venture capital firm that supports the development and commercialization of technology companies.

“If you believe in the need to protect the open Internet, this is the realistic way forward, and it could lay the groundwork for other steps if necessary in the future.”
— Kevin Werbach, Professor, Wharton School of The University Of Pennsylvania, December 1, 2010.

“We commend the Federal Communications Commission for tentatively putting open Internet rules on the agenda for the Dec. 21 Commission meeting and for, we expect, circulating a draft order.  As Comcast’s recent actions have shown, such rules are urgently needed.”

— Gigi B. Sohn, President and Co-founder Public Knowledge, December 1, 2010

“We are pleased that the FCC appears to be embracing a compromise solution that is sensitive to the dynamics of investment in a difficult economy and appears to avoid over-regulation. … Such an approach would reduce regulatory uncertainty, and should encourage investment and innovation in next generation broadband services and technologies.  In that regard, we remain committed to working with the FCC to bring the benefits of broadband to all Americans.”

— Jim Cicconi, AT&T, December 1, 2010.

“As a technology venture capitalist representing hundreds of millions of dollars in investment, I strongly support your proposed rules to protect an open and free Internet….your proposal will help incubate growth for decades to come and should be adopted without further delay.”

— Jed Katz, Managing Director, Javelin Venture Partners, December 1, 2010.  Javelin Venture Partners is an early stage venture capital firm specializing in technology based start-ups.

“DISH Network applauds Chairman Genachowski for moving forward on critically important net neutrality rules.  His proposal is a solid framework for protecting the open Internet”.
— Charles Ergen, Chairman, President and CEO, Dish Network, December 1, 2010.

“Today’s announcement by the FCC represents a prudent and balanced approach to managing the growing volume of traffic on the Internet.  IBM will continue to work with others in the IT industry as this process moves forward to support fair and reasonable rules that will encourage continued investment in smarter systems in the United States.”

— Christopher Padilla, Vice President, Government Programs, IBM, December 1, 2010.

“FCC Chairman Julius Genachowski deserves a lot of credit for proceeding so thoughtfully and choosing a commonsense compromise in the face of hyper-partisan brinksmanship.”

— David Sutphen, Co-Chair, Internet Innovation Alliance (IIA), December 1, 2010. The Internet Innovation Alliance is coalition of business and non-profit organizations that aim to ensure every American has access to broadband Internet.
“Today’s proposal seems to be the most effective option for reducing regulatory uncertainty in the broadband marketplace, enabling more widespread investment and deployment that will ultimately benefit consumers and our economy.”

— Bruce Mehlman, Co-Chair Internet Innovation Alliance (IIA), December 1, 2010. The Internet Innovation Alliance is coalition of business and non-profit organizations that aim to ensure every American has access to broadband Internet.

We understand and are pleased that the proposed rules have moved away from broad Title II regulation and toward a more tailored approach that recognizes the unique nature of wireless services. … We believe significant input from a bipartisan majority of Congress and others, and the willingness of the Chairman to seek a workable solution, have contributed toward making the proposed rules less onerous. … [W]e appreciate the Chairman’s attempt to find a way forward on this issue that recognizes the need to create certainty in the market and facilitate investment.”

— Steve Largent, President and CEO, CTIA-The Wireless Association, December 1, 2010
“We applaud Chairman Genachowski for supporting a measured, forward-looking policy framework that recognizes the dynamic nature of the telecom ecosystem and the importance of continued investment, job creation and innovation in the vibrant communications sector. We appreciate Chairman Genachowski’s leadership, commitment and support for continued growth and opportunity for consumers, technology innovators and workers, and investors in the communications sector and throughout the U.S. economy.”

— Jonathan Spalter, Chairman, Mobile Future Coalition, December 1, 2010.  The Mobile Future Coalition is coalition of businesses, non-profit organizations and individuals advocating for an environment in which innovations in wireless technology and services are enabled.

“We believe that it is a fair resolution of this set of issues and that it is proposed in a way that achieves our essential and shared objectives:  preserving the openness of the Internet and the incentives to invest and innovate for the benefit of consumers.  And I want to thank and applaud Chairman Genachowski, his Chief of Staff, Eddie Lazarus, and their staff for listening, for their hard work on incredibly complex business and technology issues, and for their leadership in seeking a fair resolution of a difficult and controversial set of policy goals.”

— NCTA President & CEO Kyle McSlarrow, President and CEO, NCTA, December 1, 2010.  NCTA is the principal trade association for the U.S. cable industry, representing cable operators serving more than 90 percent of the nation’s cable television households.

“We are happy to see that the Chairman appears to have…[struck] a balance between supporting growth in the tech sector and consumer protection. On behalf of our membership of hundreds of California innovators, we are happy to support the Chairman.”

— Erin Lehane, Executive Director, CALinnovates, December 1, 2010.  CALinnovates represents 150 technology companies and is focused on championing the conversation about the future of California’s critical technology sector.

For Immediate Release:
December 1, 2010

Contact:
Erin Lehane
(415) 494-8626 x102
erin@calinnovates.org

San Francisco, CA — CALinnovates, a California technology coalition, announced its support of FCC Chairman Julius Genachowski’s new approach towards the divisive issue of net neutrality.

“The issue of net neutrality had turned into an argument of extremes, this made our membership very nervous. Any regulation of the Internet is ‘make it or break it’ and during these tough economic times, we needed any proposed regulation to definitely not break it” stated Erin Lehane, Executive Director of CALinnovates.

“Innovation requires an environment that is supportive and not restrictive in order to grow as it has” said Lehane. “Extremist reactionary politics are not good for this growth-not in California nor around the country. We are happy to see that the Chairman appears to have chosen the high road, which also happens to be the middle of the road, and strike a balance between supporting growth in the tech sector and consumer protection. On behalf of our membership of hundreds of California innovators, we are happy to support the Chairman and his now proven ability to move past the extreme politics which have dogged this issue.”

For more information on CALinnovates please go to www.calinnovates.org; http://www.facebook.com/#!/CALinnovates and http://twitter.com/CALinnovates.

CALinnovates is a statewide coalition focused on championing the conversation about the future of California’s critical technology sector. CALinnovates brings together industry experts, thought leaders, tech innovators, policy makers and consumers in a nonpartisan mission to promote innovation, create new jobs, spur investment and support tech-friendly policies.

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Previous Press Releases

• November 23, 2010 – CALinnovates Launches “Grateful Tech” Holiday Content
• October 5, 2010 – How You Phone Is How You Think: iPhone Users More Apt to Believe In GOP Takeover of Congress, Be Influenced by Tea Party, New Poll Find
• February 3, 2010 – New Statewide Poll Shows Voters Believe Technology Industry is at Core of California’s Recovery

There’s no question that the tech companies in California are the leaders in innovation – almost all of the great technologies that touch your daily life began in California, and before you have your morning coffee, you probably interact with a dozen of them.  That’s why it’s so disconcerting that here’s a controversy playing out far from the sunny shores of the Golden State that could threaten California’s leadership in innovation.  The threat stems from the FCC and the debate over “Net Neutrailty” – a philosophy in the tech world that means information on the internet should be treated equally.  But like most things in politics, it’s more complicated than it sounds:

As part of its attempt to shape the concept of net neutrality, the FCC has begun proceedings to redefine a small piece of law written over a decade ago.  Title II of the 1996 Telecommunications act (great grandson of the 1934 Communications act which created the FCC) enforces specific regulations against telecommunications carriers but not against carriers providing information services – this is what the FCC wants to change – they want the authority to regulate information services.

In technical terms, Title II is basically the argument about how to regulate data and bits (data rides on the bits) – either together or separately. Today, data and bits are treated the same under decades of FCC regulation – the idea being that not regulating transmission will spur investment and innovation. The new FCC believes there is a difference though between data and bits.  They would like to separate the two, and turn any information provider into a common carrier.  For example – under Title II, Apple would have to contribute 15% of their iTunes income into the Universal Service Fund.

Now for the easier way to understand Title II:  Think about it in terms of your local pizza place.  When you order a pizza, you pay one price for the pizza and the delivery.  That’s how the internet works – when you buy a song on iTunes, you pay not only for the song, but for the delivery of that song to your computer.  When the internet was first debated by the federal government nearly 40 years ago, they decided that to spur investment and innovation in the tech sector they should not regulate the transmission of data – the delivery of an iTunes song to your computer.  That’s the crux of the Title II issue:  the FCC wants the power to regulate not just the pizza, but also the delivery of that pizza.

If something touches the internet today it’s generally unregulated, meaning there are few if any government regulations driving costs or governing innovation.  If Title II is changed, the FCC will have the power to determine what it regulates.  The result could be increased costs for technology companies, passed on to consumers and taken out of our economy in the form of lost jobs and investment in innovation.

CALinnovates is dedicated to supporting innovation and technology throughout California.  We are concerned that the adoption of the proposed changes to Title II will undermine the very innovation that the FCC should be protecting.  Two years ago eBooks were unheard of, today Amazon sells more digital books than paper books – this same scenario is playing out across the tech sector – there’s no problem with the internet and innovation, so why is the FCC trying to fix it?  We’re not convinced they should be.

Just a few years ago California communities were bombarded with advertisements from dozens of VOIP telephone companies springing up across the country with the promise of cheap hassle-free telephone and conference calls – then the FCC regulated them – and all but a few disappeared.  The FCC’s solution in search of a problem put companies out of business and Californians out of jobs.

The slippery slope doesn’t just end with our economy – tinkering with Title II could lead to problems with data transmission as large companies and start-ups alike try to cut costs; we could face several presidential election cycles of policy gridlock resulting in a chilling effect in angel and venture capital; innovation in the cloud, which today has seen unprecedented growth, could slow, or worse, stop.

Consider Netflix for a moment.  Just today they announced that more than 60% of their users are streaming movies.  Without even realizing it, Netflix customers now expect the company to provide data storage, fiber optic transmission capabilities and signal quality all for $8.99 a month – but if the FCC subjected Netflix to the common carrier requirements of Title II those low monthly fees would be history.

Even Google has entered the fray.  Yesterday they fired off a policy missive to the Federal Trade Commission saying that new regulatory proposals could undermine the functioning of a healthy marketplace and stall the pace of change.

The current framework governing the tech industry has worked well for 40 years. For most of that time the California tech industry has felt almost immune to actions in D.C. – but we can’t afford to keep our heads in the Cloud any longer.  CALinnovates is concerned about Title II and it’s potential impact – and we want to hear from you.  Through blogs and emails, phone calls and status updates, we want to hear your thoughts and opinions on Title II.

As a tech community, we should be concerned about the federal government tinkering with the laws that could impact our industry.  We should require them to use the same scrutiny and diligence to change laws that we use before releasing a product or investing in an idea.  In order to stay on the forefront of the global marketplace and make certain that California stays competitive, we need to continue to find ways to work with policy makers to foster growth, innovation, and economic activity in order for us to continue to be the tech global leader.

CALinnovates is a statewide coalition focused on championing the conversation about the future of California’s critical technology sector. With over 150 member companies, CALinnovates brings together industry experts, thought leaders, tech innovators, policy makers and consumers in a non-partisan mission to promote innovation, create new jobs, spur investment and support tech-friendly policies.