By Tim Fernholz
April 24, 2014
It’s the end of net neutrality—at least, as we know it today.
The US Federal Communications Commission is proposing new rules on internet access today, after its last effort was thrown out in January in a court challenge from US telecom Verizon. The mooted new rules, which will be opened for public comment and finalized by the end of 2014, are similar to the old ones: They demand transparency from internet service providers (ISPs) and institute a “no blocking” rule to prevent them from discriminating against content—e.g., making traffic flow more slowly from some websites than others. However, in what to many seems like a nit-picking distinction, the new rules will allow ISPs to discriminate in favor of content—i.e., ISPs will be able to charge content providers extra for faster access to their customers.
Net neutrality advocates say that this is really bad news for internet users. And one reason they think that is that the FCC itself said so just a few years ago, in its 2011 open internet order (pdf) (emphasis ours):
[I]f broadband providers can profitably charge edge providers for prioritized access to end users, they will have an incentive to degrade or decline to increase the quality of the service they provide to non-prioritized traffic. This would increase the gap in quality (such as latency in transmission) between prioritized access and non-prioritized access, induce more edge providers to pay for prioritized access, and allow broadband providers to charge higher prices for prioritized access. Even more damaging, broadband providers might withhold or decline to expand capacity in order to ‘‘squeeze’’ non-prioritized traffic, a strategy that would increase the likelihood of network congestion and confront edge providers with a choice between accepting low-quality transmission or paying fees for prioritized access to end users.
If you read our explainer about how the internet works, you can see where this dynamic might lead: Already, big ISPs like Comcast are demanding extra payments from large traffic providers like Netflix to ensure that their data reaches its network as fast as possible. While that relationship has made Netflix faster for viewers who use Comcast, the FCC says it’s still outside the jurisdiction of its open internet order—which governs only the “last mile,” the relationship between consumers and ISPs, not content providers and ISPs. Netflix and open internet advocates think that’s a myopic view.
But codifying this kind of behavior in the “last mile” rather than the more nebulous zone of interconnection between ISPs, content providers and backhaul networks will only give ISPs even more leverage. And, if the Time Warner-Comcast merger goes through, the new company will have nearly 40% of the broadband users in the US. That’s not ideal either for content providers who might need to pay extra to reach those users, or for consumers to whom the content providers may pass on those higher costs.
ISPs say they need rules like these so they can finance investments in improving their networks, and the FCC says that it will monitor these agreements to make sure they are not “commercially unreasonable,” adjudicating complaints on a case-by-case basis. Net neutrality activists are skeptical that the FCC will be able to do this effectively, however. They want broader rules guaranteeing neutrality—or, in some cases, that the FCC simply reclassify the broadband companies as common carriers who must treat everyone the same.
By Tim Fernholz
April 24, 2014