What do the iPhone, the “Internet of Things” and solar panels all have in common? They’re all fantastic technologies that make our lives better, and none of them were invented by utility companies.
They could have been. People consider phone companies to be utilities. Same with electric companies. But thanks to decades of heavy regulations, these sectors have had little to no incentive to innovate due to outdated laws and regulations that stifle rather than encourage investment and competition.
Those disrupters have been able to move quickly and build innovative new companies, thanks to the internet, which has arguably been the single largest engine for growth in this country since the auto industry.
It’s safe to say that the internet does not behave like a utility, but too often, it is treated as one. Until a few weeks ago, the same committee in the California Assembly that dealt with utilities also handled internet issues. The Utilities and Commerce Committee handled everything from ride-sharing issues to the transition to renewable energy. Last session it was overwhelmed by 140 bills.
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Kudos to Assembly Speaker Anthony Rendon for spearheading a new alignment for that committee. It is now two different groups: the Communications and Conveyance Committee and the Utility and Energy Committee.
This new division more closely reflects the reality of the internet. It’s not a utility – it’s a technology.
It’s an important distinction.
The internet is often lumped in with utilities when it really shouldn’t be. Take the California Public Utilities Commission, for example. The PUC has oversight of California’s utilities – including the internet. Four years ago the Legislature concluded that the PUC was holding back the development of internet phone service. It moved oversight of that industry to the Legislature, and since then it has flourished.
Last year we were supportive of Assemblyman Mike Gatto’s efforts to disband the PUC (though his bill might have been a step too far). That bill ultimately failed, but it had the right idea. There are utilities and then there is technology, and the two shouldn’t be regulated in the same way.
That’s not to say that the Legislature should take a completely hands-off approach to the internet. We need regulations, but they need to be smart regulations that promote innovation, investment and competition.
Regulations should suit the demands of our technology-reliant world. They should promote broader access to fast internet, help close the shrinking digital divide and make sure our emergency systems are operating at the highest level of security and reliability.
The more we think about the internet as a utility, the more we’ll slow progress. And that’s not what anyone wants.
Kish Rajan is chief evangelist at CALinnovates and former director of Gov. Jerry Brown’s GOBiz initiative. He can be contacted at kish@CALinnovates.org.