Which Way, FCC—Build or Stagnate?

Marc Andreessen’s 2020 treatise “It’s Time to Build” is one of the most influential pieces written about American dynamism. Published during the dark night of the COVID-19 pandemic, the venture capitalist articulates a hopeful future where Americans embrace optimism. He explains that there are two approaches we can take: One is a fixed mindset that continues our nation down the road of mediocrity and stagnation; the other is a growth mindset that embraces challenges and builds a better future through developing new innovations and launching emerging industries.

His essay predicted many current debates around emerging technologies like artificial intelligence (AI). In California, for example, we saw a concerted legislative effort to strangle open-source AI in its cradle, creating a regulatory framework that would drive leading AI companies to flee the Bear Republic. Andreessen’s essay has been a rallying cry for effective accelerationism and other free market advocates who want a light-touch approach that allows AI in the U.S. to flourish instead of legislating against hypothetical harms. 

As policy debates rage over AI, there are helpful lessons to learn from other ongoing technology policy debates, such as looking down the internet stack to the network and infrastructure level. These fights have raged on for nearly 30 years. Since the 1996 Telecommunications Act there have been similarly two mindsets at war over how policies should be implemented around internet providers.

Most of this ongoing debate has been centered at the Federal Communications Commission (FCC). We have had leaders at the FCC, like newly appointed Chairman Brendan Carr and Chairman Ajit Pai, who have embraced innovation and spurred on next-generation internet connectivity. We have also had FCC leaders such as current Chairwoman Jessica Rosenworcel and former Chairman Tom Wheeler who have implemented a “Mother, may I?” approach to internet connectivity. Their approach has created arbitrary barriers to entry for new internet providers or regulations to weed out hypothetical harms that only hurt tangible efforts to close the digital divide. 

Few issues in telecom regulation have sparked as much contention as net neutrality. This ongoing back-and-forth began in 2015 when then-FCC Chairman Wheeler pushed through Title II to extend utility-style regulations on internet providers. After it was clear this foolhardy approach was hindering broadband investment and doing nothing to address concerns about internet censorship, Wheeler’s successor, Ajit Pai, righted the ship, repealed the net neutrality rules, and applied a light-touch approach. As Europe struggled to handle the increased Internet traffic during the pandemic, the U.S. was better able to handle the surge of internet usage—not to mention the faster internet speeds available in the U.S. immediately after Pai’s intuitive actions.

Yet good things don’t last in D.C. The fixed mindset philosophy Andreessen warned about came flooding back as President Biden’s pick for the FCC, Jessica Rosenworcel, bulldozed Pai’s approach and brought back Title II. Now the courts appear to be stepping in to halt this gross example of government overreach.

It isn’t just net neutrality where this diverging approach is on display. In the fall of 2023, the FCC pushed through a partisan Digital Discrimination Order that implements fines and penalties on any entity involved in delivering broadband connectivity if they were deemed to be promulgating “disparate treatment and disparate impact” on consumers. This means that if the FCC thinks anyone is getting unfair treatment they can fine and punish any entity.

As Brendan Carr explained, this new regulatory approach “gives the FCC a nearly limitless power to veto private sector decisions” and, for the first time ever, gives “the federal government a roving mandate to micromanage nearly every aspect of how the internet functions.” The rule even applies to tower builders and climbers who are merely servicing infrastructure. If the FCC thinks they are perpetuating “disparate impact,” these construction crews will face stiff penalties even though they don’t pick the area they service.

Finally, we see these differing approaches in the way the Biden administration is implementing the $42 billion BEAD program. Three years after Congress authorized the program, not one dollar has been spent to connect Americans or build out broadband infrastructure. Uninterested in deploying access to unconnected communities now, the Biden administration has used the program to implement longstanding ideological priorities like DEI and climate goals that have dramatically slowed down efforts to close the digital divide. Instead of allocating the resources in a tech-neutral way, the administration is creating mandates on private companies in exchange for broadband funding that will only handcuff the entrepreneurs set to build out broadband.

This contrasts significantly with Carr and Pai’s approach, which would have leveraged market-based policies and guarded against overbuilding. These policies would have resulted in faster, more efficient build-out to the rural communities that most desperately need that connectivity.

As the political discourse in tech evolves to address emerging innovations, it is imperative to learn the right lessons from other industries. This is clearly displayed in the longstanding fights in telecommunications and other established industries. Instead of continuing the fixed mindset that permeates so many in Washington, it is time to build.

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