Antitrust Rules or Net Neutrality: Which Should Rule the Web?

Congress examines whether the FTC and antitrust law are enough to protect Internet competition.

Rep. Bob Goodlatte, R-Va., gestures as he speaks during a gala before the start of the Virginia GOP convention in Roanoke, Va., Friday, June 6, 2014.

House Judiciary Committee Chairman Bob Goodlatte, R-Va., is not in favor of the net neutrality rules proposed by the FCC.

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House lawmakers and experts Friday debated whether antitrust law is enough to protect competition on the Internet instead of proposed net neutrality rules, as the Federal Communications Commission considers how best to rewrite those digital regulations.

The Obama administration is a staunch proponent of net neutrality, which is the philosophy of ensuring that all online content has a right to equal treatment by Internet service providers and that rival business interests do not disrupt that balance. But most, if not all, Republicans oppose net neutrality rules for fear that adding regulation to the Internet would jeopardize its growth as a free space and prevent free market investment in the sector.

New rules proposed at the FCC to replace those struck down by a federal appeals court have been criticized by Republicans who oppose the concept, but also by Democrats who fear they are written in a way that could allow companies to charge for priority content speeds, thus stifling competition and potentially adding new costs for consumers.

[READ: FCC Reveals Inconsistent Internet Speeds]

House Judiciary Committee Chairman Bob Goodlatte, R-Va., is among those who oppose the FCC's proposed rules.

“Vigorous application of the antitrust laws can prevent dominant Internet service providers from discriminating against competitors’ content or engaging in anticompetitive pricing practices,” Goodlatte said during a Friday hearing before a House Judiciary subcommittee.

The Department of Justice and the Federal Trade Commission enforce antitrust tests on business deals, but the FCC also applies a test of whether deals are in the “public interest.”

Those at Friday's hearing who favored existing antitrust rules instead of FCC regulation also included former FCC Commissioner Robert McDowell, a Republican who voted against net neutrality rules three times while on the commission. McDowell said there have been no large-scale attempts to thwart consumer access to content on the Internet, so there is no need for net neutrality rules to fix the Internet, which he called “the greatest deregulatory success story of all time.”

[ALSO: Democrats Push Bill Opposing Internet Fast Lanes]

The FTC’s mandate to preserve consumer welfare also makes it a good venue to preserve Internet competition, said FTC Commissioner Joshua Wright, a Republican. Digital privacy is already becoming a larger focus of the trade commission under FTC Chairwoman Edith Ramirez.

But making the FTC the preferred venue to regulate Internet competition “would be very controversial” among lawmakers, said Michigan Rep. John Conyers, the House Judiciary Committee's ranking Democrat. Instead, Conyers said, the FCC's net neutrality rules would be a pre-emptive approach to protecting competition online, instead of waiting for the “piecemeal approach of antitrust enforcement.”

Having best practices for Internet business codified at the FCC also would “provide certainty for the industry,” Conyers added.

“Moreover, antitrust law is not sufficiently broad in scope as it does not address the non-economic goals of net neutrality, including the protection of free speech and political debate,” he said.

[MORE: Amid Concerns Over Netflix, FCC to Examine Peering Deals]

Making the FTC the venue to preserve Internet innovation and competition likely would require “the agency equivalent of a brain transplant,” said Tim Wu, a Columbia Law School professor who served as a senior adviser to the FTC from 2011 to 2012. The FTC’s economic analysis might overlook the anti-competitive potential of certain actions, such as a company stifling a rival’s content-sharing, since sharing on social networks cannot be easily measured for monetary value, Wu said.

“For the [FTC] to safeguard the open Internet would be to make it an agency dedicated to the protection of speech, innovation and noneconomic values,” said Wu, who coined the term "net neutrality" and is running for lieutenant governor of New York.