The Pros and Cons of Net Neutrality

At the end of February, 2015, The Federal Communications Commission (FCC) voted that broadband Internet service would be regulated as a public utility, a move closer to what is commonly called “net neutrality.”  While Tom Wheeler, the commission chairman, said that the move was designed “to protect innovators and consumers” and to preserve the Internet’s role as a “core of free expression and democratic principles,” many on the other side of the political aisle disagreed, claiming that the F.C.C. decision would unfairly restrict free-market competition and ultimately stifle innovation.  Understanding the significance of this decision, as well as delving into both sides of this controversial issue, is vital to successfully navigating the world of internet advertising.

Think of broadband internet access like the water that is piped into your home.  An internet service provider (ISP), for a fee, provides the means by which this resource reaches you, just like water companies charge for access to their pipes.  Those opposed to net neutrality, particularly the major internet service providers like AT&T® and Comcast®, argue that they have poured significant amounts of money into expanding their networks, effectively providing more “pipes” to bring their service to more people, but that the amount of bandwidth (or water that can flow through those pipes at any one time) is limited, so they should be allowed to charge whatever the market will bear.  In particular, these internet service providers sought to establish special “premium service packages” where those who paid higher rates could enjoy faster and more reliable service.

Proponents of net neutrality, however, argued that this would give internet service providers the power to discriminate between the different information that flows through their system, effectively censoring what their customers were allowed to see.  They could block or favor specific websites, so that some would simply be impossible to view while others would load faster because they had paid for premium service or made an exclusive deal.  In particular, this would be unfairly burdensome to smaller companies writing web content, who would not be able to pay the amounts that established, multi-national corporations could pay and so would simply become inaccessible to their customers.  It would allow, for example, an ISP to broker an exclusive contract with a single news channel, and then make it impossible to view any other news channel over their network.

The new rules, which re-classify internet access as a public utility, are specifically intended to ensure that no content is blocked and that the Internet is not divided into pay-to-play fast lanes for Internet and media companies that can afford it and slow lanes for everyone else. Those prohibitions are hallmarks of the net neutrality concept.  Supporters of net neutrality claim that the decision will maintain a level playing field for the literally thousands of new start-ups, online stores, and simple ecommerce sites that start every day while encouraging creative free expression by ensuring that content providers don’t need corporate sponsorship in order to have their ideas heard.  Internet service providers, however, argue that being able to charge higher rates would give them the ability to pay for more sophisticated infrastructure, which would benefit all the users of that network.  They point out that, under the new regulations, they are only allowed to charge higher rates when demand overwhelms their capacity and so they have little incentive to try to improve the service they provide.

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