What you likely don’t know about Net Neutrality

January 2nd, 2011 by Tim Leave a reply »

Budding Web Surfer

Net Neutrality: keeping the web free for the next generation (Photo by Ilya Haykinson on Flickr)

A recent Rasmussen poll showed that a mere 20% of us are following the debate on Net Neutrality.  Meanwhile 54% are opposed to the FCC making any Net Neutrality regulations, while 21% were in favor.  A likely explanation is that most Americans don’t really understand what Net Neutrality is.

The FCC recently approved a new slate of so-called Net Neutrality rules.  The new rules ensconced a few tenets of Net Neutrality, but also propped open the door for companies to engage in some very non net neutral business models.  The result being that almost everyone wound up unsatisfied by the result.  Still, the vote came down strictly along party lines which bolstered the perception that Net Neutrality is a liberal vs. conservative issue.  Net Neutrality is often positioned as a government takeover or government regulation of the Internet.  It’s not either of those things, nor is it particularly political in a left vs. right sense.  But those perceptions are driving public opinion nonetheless.

The question is, what is Net Neutrality, independent of any specific proposed policy or rules?  At its core, Net Neutrality is simply freedom of the Internet.  It is a belief that Internet network access is a public resource that should not favor any content over any other.  That as a user of the Internet, you should be entitled to access any site or service with the same pricing and speed from the provider of that connection.

This means that your Internet Service Provider (ISP) cannot charge you more for using Yahoo! than Google.  It cannot provide speedy access to Netflix while throttling Hulu.  It cannot make it prohibitively expensive to do online banking with Citibank, while providing bargains for banking with Chase.  It cannot prohibit you from accessing The Drudge Report because it doesn’t like its political views.  As far as the network is concerned, traffic is traffic, and no preferential treatment shall be given.

The talk of government regulation of the Internet is not really accurate.  It sounds as if the government would be regulating content.  Instead, Net Neutrality proposes that the government regulate ISPs to insure they do not regulate the content of the Internet.  Net Neutrality is about insuring freedom for consumers and making sure ISPs don’t take that away.

Analogies have been made to the power company charging you more to run a TV than a washing machine, or giving you a discount for running Maytag appliances.  Rather, you pay for the kWHs you use, rather than whether you burn them using your PS/3 or your dishwasher.   Net Neutrality is simply ensuring that same agnosticism applies to your ISP.

In fairness, most ISPs have not yet tried to implement service structures that would not be net neutral.  However, there have been a few trial balloons floated, so there is justifiable reason for consumers to be concerned.  This is the primary motivation for trying to get Net Neutrality rules into effect now, before ISPs change to content biased business models.  It wil be much more difficult and much more disruptive to companies to force them to change after the fact rather than putting rules in place up front.

Viewed another way, Net Neutrality is like the Second Amendment, albeit for Internet rights rather than gun rights.  Your right to access the Internet content of your choice shall not be infringed.  This sort of basic freedom should appeal to card-carrying ACLU members as much as Tea Partiers.

So why does anyone oppose Net Neutrality?  Profit.  Being an ISP is a profitable business.  Demand is increasing while costs are decreasing, meaning that profit margins continue to rise.  A fast Internet connection is becoming a near must-have for households.  It’s like a car or a TV.  Most families would not chose to live without it.  So while ISPs are making good money with today’s net neutral business models, they fully recognize there are opportunities to make even more money by shifting to less content neutral pricing.

But wait, shouldn’t the free market sort all this out?  As a consumer, why would you opt for a restrictive ISP over a more open one?  The reason being that the vast majority of America lacks any serious market competition in the ISP space.  Only 4% of the market is served by 3 or more ISPs, while 78% is served by 2 ISPs.  If free markets were operating in the ISP space, you would not expect America to rank 28th in global speed of Internet connections while having comparatively more expensive ISP service.   The markets should have sorted that out by now as well.

The bottom line being that government rules enforcing that ISPs honor Net Neutrality wouldn’t be required if instead government required that ISPs unbundle their services and sell wholesale network access to small ISPs such that true competition existed in the market.  Either method works, and many other countries have successfully implemented the unbundling regulations.  However, American ISPs are understandably opposed to either option, and both options require some level of government intervention.  The alternative is that we simply have to trust that ISPs will be good citizens and not place profit motives over the interests of their customers—and history suggests that the customers rarely end up on the good end of that bargain.

Net Neutrality is not about restricting the Internet or your ability to post or access content on it.  On the contrary, its only goal is to ensure your continued ability to surf without restrictions or penalties.  While some government rules do impose constraints, Net Neutrality is one of those that promotes and ensures freedom.  What could be more American than that?

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