Net Neutrality: Good for Google, Not Consumers

[Commentary] When I began my career as an engineer at Bell Telephone Labs in the 1970s, regulators had a guiding principle: Businesses should subsidize consumers to promote the public good and ensure universal service.

It was common to charge businesses twice as much as consumers for basic phone service, and for additional features such as call waiting. Businesses accepted the policy because they recognized the value of services that helped customers reach them. When toll-free, 1-800 service was introduced, it proved popular with both businesses and consumers, even though businesses paid the entire cost of communicating with their customers.

Forty years later, public policy has taken a sharp turn. The "net neutrality" Internet-regulation rules -- the latest iteration of which Federal Communications Commission Chairman Tom Wheeler previewed -- would force consumers to subsidize communication businesses by driving up prices for cable services. The rules would prevent broadband carriers such as AT&T and Comcast from charging market prices to content providers who use more bandwidth, such as Netflix and Google. But the bandwidth cost would just be passed on to consumers, who would have to pay more for cable and DSL. Self-appointed consumer advocates are in an uproar over the idea that businesses that benefit from broadband transport should bear part of the cost along with the companies that provide the bandwidth. Meanwhile, consumers are unhappy that carriers now often charge for broadband based on usage, particularly on smartphones and tablets.

If Google and Netflix are really champions of a free Internet -- not companies serving their own interests -- there is another solution. They can send monthly checks to their subscribers to defray the cost of additional bandwidth charges. They collect a good deal of information about their users and could roll out such a service swiftly. I'll await my first installment.

[Cambron is the former president and CEO of AT&T Labs]