In the first part of this two-part series, we described what is meant by "net neutrality" and why it’s important. Let’s review the definition with an excerpt from that column:
"Net neutrality means that the network owners who are moving our stuff around don’t play favorites. Nobody gets blocked or slowed down, and nobody gets special favors. Nobody pays more money or less depending on what they’re sending, where it comes from, where it’s going, what kind of equipment they’re using or who the sender or receiver is."
The timing of the piece was driven by a pending vote in Washington, D.C., one that would have allowed providers of Internet business data services to charge customers varying prices. This was seen by many as an ominous first step toward abandonment of a commitment to net neutrality.
Had the measure failed to pass, Part two of this series would have been unnecessary. But (predictably) it did. So here we go.
Proponents of net neutrality and the more vigorous subset known as "open Internet activists" decry any attempt at violating that principle for fear that it would precipitate the fall of western civilization. Those who want to move away from it believe that pure net neutrality is a romantic impracticality that will stifle competition and drastically limit consumer options.
As if so often the case these days (think ballot propositions, political elections, and homeowners associations meetings), the controversy has devolved into contentious and mean-spirited left-right polarization being played out with bumper-sticker sloganeering intended to obscure rather than illuminate. The other side isn’t just wrong, it’s evil and will kill your pets if left unchecked.
The basic, somewhat simplified arguments are these:
- Open Internet activists believe that net neutrality preserves everyone’s right to communicate online without interference, in the same way that the phone company lets us make calls without regard to the content of those calls.
- They also believe that manipulating the speed with which that content is passed around – in other words, giving higher speeds to preferred or higher-paying customers and slowing down others – would destroy the open Internet.
- They believe that Internet access, like electricity and water, is a necessity of modern life, not a luxury, and should be regulated as a utility rather than as an optional service. Compromising net neutrality would deprive minorities of the unfettered right to be heard, and would also make it difficult for small businesses to compete against larger players, stifling innovation and retarding the growth of jobs.
At least for the present, net neutrality as defined above is the law of the land (sort of; see below). It was challenged in 2014 after the D.C. District Court struck down existing law as flawed and left it to the FCC to fix. Following a public outcry when an FCC proposal to erode net neutrality was leaked, the Obama administration and FCC chairman Tom Wheeler fought back industry objections and reaffirmed net neutrality as federal policy.
So who’s got a problem with this? Not surprisingly, it’s broadband Internet providers like AT&T, Comcast, Verizon, and Charter Communications, who believe that being regulated like a utility is unfair. It’s easy to dismiss those objections as transparently self-serving, but the same could be said of open Internet activists, and just because they’re self-serving doesn’t necessarily make them wrong.
The argument from industry is that utility-style regulations will stifle innovation and competition, ultimately hurting consumers. (Sound familiar?) President Trump’s new FCC chairman Ajit Pai concurs, saying that the previous commission’s vote on net neutrality was a "mistake," one that would be the "enemy of growth."
It’s not an irrational point of view. AT&T fought for decades against deregulating the telephone system (how’s that for irony?), claiming that allowing third parties to connect equipment to its system could ultimately damage it beyond repair.
But the Carterfone decision in 1968 that went against the phone company led to an explosion in telephony advances of which consumers were the beneficiaries. That it also opened the way for theretofore unimagined new revenue streams for industry didn’t negate that clear public benefit.
It’s also interesting to note that companies coming out in vociferous defense of net neutrality included Netflix, Amazon.com, Facebook and Google. While their spirited and ultimately successful lobbying seemed high-minded and virtuous, it didn’t go unnoticed among industry cynics that these deep-pocket titans would have been among the prime candidates to pay through the nose for fast-lane service and might have been using their campaign to avoid those expenses.
Speaking of cynical, is there a case to be made that open Internet activists are deliberately conflating two issues — fast-lane service and site blocking — in order to obscure the fact that those are two different issues, and that allowing fast versus slow lanes isn’t a necessary precursor to censorship or content discrimination?
And while we’re on the topic of censorship: While I deplore it as a general rule, I’m also not nuts about the fact that Internet service in some neighborhoods slows to a crawl after 3:00 pm because of all the high school kids rushing home to download porn in volumes that would dwarf the Library of Congress. Would I object to an ISP throttling the bandwidth of nookie.com, not because of the nature of the content but because it’s unfairly bogarting a precious resource? Hard to say.
One more curmudgeonly bit of iconoclasm: The whole notion of opposing fast lanes belies the current reality of the Internet. Google and Netflix don’t connect to the Internet the same way you and I do. Because of the enormous amount of traffic they generate, a handful of companies like these have direct peering connections to the big Internet service providers (ISPs), placing their own routers inside those ISPs that allow them to move data straight from the ISPs to consumers. They can even put their own servers inside, creating "content delivery networks" (CDNs) to get the data out even faster.
An advantage over their competitors? Of course. But a benefit to us consumers, too. This "fast lane" lets us do searches faster and watch flicker-free movies in HD (high definition).
However, it’s worth noting that the ISPs don’t charge extra for this, because it’s to their advantage as well. They might in the future, though, if the federal government allows it (and they probably will, as the new president and his new FCC chief seem to indicate). So the issue isn’t going to be whether there are paid-for fast lanes, just whether they’re administered fairly and in the public interest.
Open Internet supporters make the case that there is a very real possibility of abuse here. ISPs have traditionally delivered content from unrelated third parties. For the past few years, though, they’ve been investing heavily in content providers. Comcast owns NBCUniversal, AT&T owns DirectTV, etc. If left unchecked, will they favor delivery of their own content versus that of others? Probably. The previous commission criticized AT&T and Verizon for allowing its customers to stream content from their subsidiaries without counting it against their data plans, a huge advantage over the competition.
The new commission, under Chairman Pai, dropped its objection to these "zero-rating" plans altogether, in the belief that the market will sort it out. Again, not an irrational expectation. If you objected to your cell provider throttling your Internet access once you exceeded your data limit on your no data limit plan, you only had to wait a month or two until the competition sniffed the air and started offering no-throttle plans.
Those are just some of the highlights. As I hope you noticed, I’ve tried to remain neutral in outlining the basic issues, and I don’t want to muddy things up by discussing which way I lean. All I’m trying to say is that there are strong arguments on both sides.
That net neutrality rules are going to get rolled back by the Trump administration is a near certainty. What the net effect of those rollbacks will be is by no means certain, so it’s important to bear in mind that each side’s positions are predicated on what they believe is likely to happen, but they don’t know for sure.
However it turns out, blind and party-line-toeing demonization of one side or the other is the dead wrong approach to dealing with a complex topic that demands nuanced consideration.
Open Internet activists are not wild-eyed Marxists and FCC Chairman Ajit Pai is not an agent of evil bent on destroying our freedoms. The activists have legitimate concerns and a solidly grounded foundational ethos, and Pai is actually a proponent of an open Internet who happens to believe in "light-touch regulation" and letting competitive market forces get us to faster, cheaper Internet access.
The last thing we want is one side winning and the other losing, because then we’ll all lose. And, unlike starting a war or dropping a nuke, the unintended consequences of a net neutrality policy threatening to go off the rails can be fixed.
So let’s quit tearing each other’s heads off and just figure this out.
Lee Gruenfeld is a Principal with the TechPar Group in New York, a boutique consulting firm consisting exclusively of former C-level executives and "Big Four" partners. He was Vice President of Strategic Initiatives for Support.com, Senior Vice President and General Manager of a SaaS division he created for a technology company in Las Vegas, national head of professional services for computing pioneer Tymshare, and a Partner in the management consulting practice of Deloitte in New York and Los Angeles. Lee is also the award-winning author of fourteen critically-acclaimed, best-selling works of fiction and non-fiction. For more of his reports — Click Here Now.
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