Silicon Valley Is Laying Low on Net Neutrality

Silicon Valley Is Laying Low on Net Neutrality

Original Article on TheStreet

To sustain net neutrality rules designed to check the power of the country’s largest internet providers, Craig Aaron of Free Press will need all the help he can get.

But the president and CEO of the Washington public interest policy group isn’t expecting an outpouring of activism from Silicon Valley.

“It wouldn’t hurt,” Aaron said. “Anybody who can bring political clout and political power to these debates is welcome, but Silicon Valley has always been followers on this side of the fight rather than taking the lead and saying these are our policy priorities.”

Federal Communications Commission Chairman Ajit Pai on Tuesday, Nov. 21, announced plans to undo rules passed by the agency less than three years ago aimed at ensuring that all internet traffic be treated equally. Known as net neutrality, the regulations limit the ability of an internet provider to block or slow traffic and, most importantly, prevent favoring its own content through so-called fast lanes.

Free Press and other consumer advocacy groups led crowds of boisterous internet advocates in a series of colorful protests held in front of the FCC, urging Tom Wheeler, an Obama appointee, to pass the regulations formally known as the Open Internet Order in February 2015. The Democrat-led commission passed the order in a 3-2 party line vote.

As it did in the run-up to that vote, AT&T Inc. (T – Get Report)   last week used Pai’s proposal to denounce Wheeler for an “ill-conceived experiment with heavy-handed regulation of the internet.” AT&T along with Comcast Corp. (CMCSA – Get Report) and Verizon Communications Inc. (VZ – Get Report) , Pai’s former employer, have been clamoring for net neutrality’s repeal ever since Donald Trump’s election handed Republicans majority control of the five-member FCC.

But if telecom’s firepower on Capitol Hill is to be met with equal force, it’s unclear whether top executives at Facebook Inc. (FB – Get Report) , Alphabet Inc. (GOOGL – Get Report) , Netflix Inc. (NFLX – Get Report) , Inc. (AMZN – Get Report) and Apple Inc. (AAPL – Get Report) will lead that charge.

Netflix CEO Reed Hastings admitted as much in May in an interview with Recode when he said that net neutrality is “not our primary battle at this point,” adding that the Trump administration will find a way “to unwind the rules no matter what anybody says.”

Not exactly fighting words.

In July, Facebook CEO Mark Zuckerberg encouraged his many users to get involved on the issue, stating in a post that net neutrality was essential to guarantee that service providers can’t “block you from seeing certain content or can make you pay extra for it.”

Zuckerberg said Facebook plans to work with members of congress to support the rules. He also added a link to the Internet Association, Silicon’s Valley’s Washington lobbying group, which has done most of the heavy-lifting in D.C. on behalf of the country’s tech companies. Amazon also linked its call to action to the association’s website.

Indeed, the Internet Association has met with Pai and made a series of filings arguing, as it did last Tuesday, that  Pai’s “proposal undoes nearly two decades of bipartisan agreement on baseline net neutrality principles that protect Americans’ ability to access the entire internet.”

The association declined further comment.

Some of the association’s smaller members — Etsy Inc. (ETSY – Get Report) , Pinterest Inc., Kickstarter PBC, Dropbox Inc. — have taken a higher profile to argue that as internet providers such as AT&T, Comcast and Verizon own more content — AT&T may still buy Time Warner Inc. (TWX)  while Comcast already owns NBCUniversal — it’s only natural that they’ll play favorites. 

Aaron, meanwhile, doesn’t downplay the importance of Facebook, Amazon or Google publicizing the fight to safeguard net neutrality rules. By comparison, the telecom lobby, he says, has flooded Capitol Hill, aggressively pushing its agenda.

Already this year, the FCC under Pai, a former associate counsel at Verizon, has hammered through a series of rule changes that will allow TV station operators such as Sinclair Broadcast Group Inc. (SBGI – Get Report) to own more stations as well as newspapers or radio outlets in a single market. Still more could be on the way.

Silicon Valley is laying low, playing the proverbial both sides-of-the-aisle as they lick wounds sustained by criticism that it hasn’t done enough to protect users’ privacy while guarding against the sort of hacking perpetuated by Russian operatives leading up to the 2016 elections. When Google, Twitter Inc. (TWTR – Get Report) and Facebook executives were asked to appear before Congress last month to talk about those issues, they didn’t send their CEOs.

It may just be that when it comes to net neutrality, Silicon Valley’s largest companies may not need the protections as much as smaller technology players. The same goes for start-up companies angling to become the next Facebook or Netflix — provided their services aren’t blocked or throttled.  

“When it comes to advocating, most of these companies support the right policy and their trade associations put out the right kinds of letters,” Aaron said. “But are they going all out for this? Not all of them, and that’s partly because they are big companies now, and they have a lot of different interests.”