The FCC and the Internet’s challenges to traditional regulatory policy

The United States Federal Communications Commission has taken action or is considering taking action on several controversial issues that arise from the growth of the Internet. In analyzing these issues, the Commission is applying a voice‐centric circuit‐switched telecommunications model that is based on an outdated view of the world and is attempting to protect a regulatorily created system of artificial prices and subsidies. The Commission has failed to come to grips with a new state of the world, characterized by packet networks and data traffic. This has led to a series of decisions that are ill‐suited to the new environment.