The biggest impact on Silicon Valley tech companies from Donald Trump’s election as the 45th President will be the killing off of what Breitbart News called the “Best Net Neutrality Silicon Valley Money Can Buy.”
President-elect Trump has promised “a temporary moratorium on new agency regulations.” For Silicon Valley tech firms, his biggest target will overturning the “Net Neutrality” regulation passed on a straight-line party vote by the three Democrat members of the Federal Communications Commission on February 26, 2015.
The Obama administration claimed the new FCC regulation would enhance consumer welfare and protect the public interest by requiring Internet service to enable access to all content and applications regardless of the source, and without favoring or blocking particular products or websites.
Although that sounded noble, the real objective of “net neutrality” was to force Internet service providers to be regulated as “utilities” and be forced to provide free search engine access. And with Google accounting for 64 percent of all Internet searches, net neutrality was essentially a huge transfer of wealth to Google.
The FCC is directed by five commissioners appointed by the president and confirmed by the United States Senate for five-year terms, but no political party is allowed to hold more than 3 seats. In 2002, FCC Chair Michael Powell, son of former Secretary of State Colin Powell, and the four other Commissioners chose to regulate the Internet loosely as an “information service,” rather than a highly regulated utility “telecommunications service.”
The move was cheered at the time for preventing the doubling of the billions in taxes on dial-up Internet access charged each month to consumers’ landline phones.
But the left’s consumer media reform groups — including Consumers Union, Color of Change, Demand Progress, CREDO Action, the Future of Music Coalition and Free Press, among others — spent years advocating for regulating high-speed Internet service as the “the First Amendment of the Internet.”
With Democrats controlling the Presidency and Senate in 2009, the Obama Administration named a third Democrat FCC Commissioner and appointed Democrat Tom Wheeler as chairman. Less than a week after Democrats were crushed in the 2014 elections, Obama endorsed a utility-style regulation he termed “Net Neutrality.”
President Obama said, “An open Internet is essential to the American economy, and increasingly to our very way of life. By lowering the cost of launching a new idea, igniting new political movements, and bringing communities closer together, it has been one of the most significant democratizing influences the world has ever known.”
But perhaps the biggest “democratizing influence” that the President was referring to was the spectacular increase in lobbying by “Silicon Valley firms”. By 2014, computer and Internet industry lobbying expenditures hit $139.5 million to fund 1,094 registered lobbyists. A quarter of all industry lobbying came from three tech firms: Google spent $16,830,000; Facebook spent $9,340,000; and Microsoft spent $8,330,000.
Breitbart News reported, in “Net Neutrality Passes: Everybody Equal, But Google Much More Equal,” that Google executives were given a proposed 322-page “Net Neutrality” draft of the regulations just before the FCC vote. The company also had the opportunity to make edits.
Trump’s coat-tails included Republicans winning control of the House of Representatives, 239-192; the Senate, 51-47, and at least 33 governorships. The last time Republicans held the White House, Senate and House of Representatives was in 1928.
With Democrat FCC Commissioner Jessica Rosenworcel’s term expiring on June 30, 2017, President Trump and the Republicans will be able to flip the seat to a third Republican, and then quickly kill President Obama’s “Net Neutrality.”