Bay Area Job Growth Slows as Net Neutrality Bites

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As the effects of Net Neutrality have begun to appear in the tech industry, California’s Employment Development Department reports that the government created more jobs than the private sector did in the Bay Area in August.

The San Jose Mercury News notes that analysts are cautious about drawing conclusions about the overall economic picture of the region. Still, the controversial new Internet regulations are already having an impact on investment.

Net Neutrality aims to ensure all had equal access to the Internet by preventing Internet service providers (ISPs) from charging different rates for different volumes of traffic, or blocking low-paying customers to serve high-paying ones.

After the government’s initial attempts at regulation, which lacked legal basis, were blocked in court, the Obama administration pressed the FCC to regulate Internet companies like telephone utilities under a 1934 law.

Left-wing tech activists celebrated, mostly. They were happy that the new world they had helped to create would be run by socialist rules–though a few wondered what the Internet had in common with industrial-era public utilities.

Few, it seems, had stopped to think about what would happen to investment in the physical infrastructure of the Internet once companies could no longer expect to earn a return. Major Internet companies are already finding ways around it. And the court challenges are already under way.

Now, new data show that “major ISPs reduced capital expenditure by an average of 12%, while the overall industry average dropped 8%,” the Wall Street Journal reports. And as Journal columnist Holman Jenkins points out, the new rules have strengthened the cable oligopoly.

Ted Cruz once called Net Neutrality the “Obamacare” of the Internet. Like Obamacare, it is helping a few but hurting the industry overall.

Where are its cheerleaders now?


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