Presidential Hopeful Carly Fiorina Displays Astounding Ignorance In Slamming Net ...

[Mike]

Carly Fiorina, whose claim to fame was basically presiding over HP while the company's value dropped in half, has made it clear that she's planning to run for President, despite her sole political experience being losing a Senate race in California against Barbara Boxer. To get ready, Fiorina has been ramping up her public opinion-spewing. She's gotten plenty of attention for blaming environmentalists for California's current water problems and accusing Apple's CEO Tim Cook of hypocrisy in his response to Indiana's controversial Religious Freedom Restoration Act. Feel free to debate those claims all you want. The one that interests me is Fiorina's confused and ignorant take on net neutrality -- which seems to involve making a bunch of claims that are flat out false. I recognize that, as a Republican candidate, she apparently is duty-bound to hate on net neutrality (despite the fact that Republican and Democratic voters alike both overwhelmingly support net neutrality -- and Republicans who actually understand technology support it as well). It still remains a mystery to me why this is even a partisan issue, but it is. Still, if you're going to attack net neutrality, you should at least do so on a factual basis. Fiorina can't even muster up the effort to do that.

Crony capitalism is alive and well. If you need proof, look no further than the Federal Communication Commission's new Title II regulations imposed in the name of "net neutrality" under pressure from President Barack Obama, and the big businesses that benefit.

Um, no. The crony capitalism was on the other side, as nearly all of the pressure against net neutrality came from the giant broadband players, Comcast, AT&T, Time Warner Cable and Verizon. There was almost no actual public support. Meanwhile, the push for Title II was driven heavily by public interest groups and the public itself. While there were some companies that got involved, most of the "big" businesses seemed to sit things out until late in the process and it was clear which way the wind was blowing. The companies that actually made a big difference were the startups (mainly in New York and San Francisco) that mobilized to talk about the harm that the FCC would do to the open internet if it didn't stop the broadband companies from messing things up. Kickstarter, Etsy, Tumblr and others played a really big role. Those companies are growing, but they're nothing like the big broadband companies.

Net neutrality proponents did a masterful job of marketing it with the help of late-night hosts and political spin, arguing that it would level the Internet playing field. The truth, however, is that it will insert Washington bureaucracy and control into the 21st century's greatest success story. The Internet, which has empowered hundreds of millions of Americans in so many aspects of life, will now be subject to the same types of regulations that governed telephone service in the 20th century.

This is a massive exaggeration and is incredibly misleading. First of all, the rules are not the "same regulations," but rather they're just built off the same authority (Title II), but with clear forbearance on the parts of Title II that everyone agrees are problematic. The rules are not about treating the internet as a utility, but in preventing duopolists and monopolists from abusing their position. On top of that, if you talk to a lot of people, they actually remember when telephone service was super reliable, unlike broadband service today.

As someone who led a $87 billion company for six years, I know this: Only big companies can deal with vast, sweeping regulation like the 313 pages imposed by the FCC. This administration has had a habit of identifying a particular problem and then convincing the voters that we require enormous new swaths of government control to fix it.

Almost everything in this paragraph is misleading. First of all, "leading" an "$87 billion company" -- well, here's the chart of HP's stock price during Fiorina's tenure:

As you can see, the valuation fluctuated a bit during Fiorina's "leadership," but it seemed to go mostly downward...

Second, the rules are not "313 pages." They are 8 pages. You can see just those 8 pages right here. The rest of the document (which is actually 400 pages) consists of legally required supplemental material and the dissents.

Next, remember, that it was mostly small companies pushing for these rules and big companies fighting against them. As small ISP Sonic made clear, the rules are only a problem if you're trying to do something bad. So if the small companies are clamoring for this, and the big companies are against it, it defies basic common sense to argue that the new rules are good for big companies and bad for small companies. You either have to be woefully misinformed, or blatantly lying. I'm not sure which is the situation here, but neither looks for for Fiorina.

Title II regulation gives the Federal Communications Commission nearly unlimited authority to micromanage how, when and where Internet companies innovate.

This isn't even close to true. It only gives limited authority in how it makes sure that internet access providers handle their traffic. That's it. Not "internet companies." It's a cheap trick to conflate internet access providers and the internet companies that rely on an open internet, but that's the best Fiorina can do. And then she takes it to another level of ridiculousness:

Whereas the old Internet was "permissionless," the new Internet will require bureaucratic approval for the most mind-numbing minutiae and create huge areas of uncertainty . Major companies such as Google, Facebook, Amazon, eBay and Netflix now have a government-conferred advantage over start-ups because they can afford the lobbyists and lawyers necessary to navigate the new Title II landscape. When influence trumps innovation, big entrenched companies benefit.

This isn't true. The new rules do not require anything of internet companies. They don't need lobbyists or lawyers to navigate anything. The rules are directed at internet access providers, and startups offering services on the internet do not have to deal with the rules -- only those offering internet access.

And, really, let's just repeat this line for its sheer insanity:

When influence trumps innovation, big entrenched companies benefit.

Yes, that line is true, but if you look at the past two decades, you'd see that the companies with the most powerful influence have been AT&T, Comcast and Verizon which have some of the most powerful lobbying operations in the world, and have driven broadband policy almost entirely on their own whims for the past two decades. This has resulted in less competition, terrible service and a variety of bad policies.

Who does Fiorina think she's fooling?

One, the Internet economy will no longer benefit from the competition that has steadily driven prices down over the past two decades.

What? Has Fiorina looked at internet bills lately? They have not been going down. It's true that the prices of other things on the internet have gone down, but she is once again conflating internet services with internet access. And, in fact, under the new rules it looks like there may be more competition because it will make it easier to get pole attachments. Furthermore, because of the FCC's other big ruling we may finally see some real municipal competition. And, as AT&T has made clear, when there is real competition, then its prices go down. But it has spent years actively blocking competition, using its political influence.

Two, companies will devote more of their resources to lobbying and regulatory compliance, passing the costs of these activities directly on to consumers.

Again, the rules only impact internet access providers and only if they're doing bad stuff to consumers. If they treat traffic neutrally, there are no compliance issues to worry about.

Ah, wait. It appears we left out a bit of Fiorina's bio. Before she took the helm at HP... she spent her career at AT&T and AT&T spinoff Lucent. Perhaps that has more to do with her position than anything. But if she thinks she's going to court the tech vote, directly misleading the public about an important issue like net neutrality isn't going to do her any favors.

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Originally Published: Fri, 17 Apr 2015 13:30:44 GMT
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