Who Needs Net Neutrality Anyway?

With widespread concern over government regulation permeating even the more liberal circles of the political dialogue, net neutrality is potentially a non-starter from a regulatory perspective. Long enforced by the FCC, the recent Verizon ruling upended the status quo and has left everyone unsure of exactly what’s going to happen next. This isn’t a political article, we’re here to talk about web technology, but every once in a while a public policy issue comes along that has such a potentially large impact on how we function as designers, entrepreneurs, and business professionals that it’s worth mentioning; even on a tech blog. To that end, we’d like to stand strong behind net neutrality; but first, it would help if everyone knows what that means.

Net?

In a nutshell, the internet isn’t a single network. Instead, it’s a collection of various networks owned, managed, and regulated by a diversity of corporate interests, governmental entities, and private initiatives; it’s a hodgepodge. No one owns or controls all of it, but some companies do control access to it. This can happen in one of two ways. The first, and simplest, is control over the access end users have to the rest of the web. Most private users access the internet through a local-monopoly service provider. Of these, there are just a handful (read three), included in which are Comcast, AT&T, and Verizon. These providers (along with a few smaller players) own the vast majority of so called “last mile” connections; the lines that run out to individual homes and businesses. The second control over web access comes from the much less well known Peering agreements and Exchange operators. Peering agreements are basically contractual arrangements under which multiple network operators share or distribute traffic amongst themselves. Exchanges refer to the physical capacity to operate peering agreements (servers and routers that actually share traffic along with the work of administering these assets).

Neutrality?

This ad-hoc system is what has made the internet possible, both financially and technically. It’s also part of what’s kept the internet relatively unregulated by the government; which thus far, has been healthy for the system. One area, however, that has been fairly strongly regulated was the balance between these various operators. In short, each was required to treat all traffic on their respective networks equally. This means that, until the recent Verizon decision, no network operator could give preferential treatment (meaning speed or data caps) to traffic coming from another operator. Under this system, everyone had equal access to the internet, so long as they paid for a connection.

Growing Monopolies

Behind this functional front, the various internet providers have been, for years, scrambling for market position. Traditional media companies, such as Comcast, have also been struggling against recent upstarts such as Amazon or Netflix in the media market. These business realities have led to some interesting results; and some interesting conflicts. It would take a whole article to cover all of these machinations in any kind of reasonable detail, but suffice it to say that Comcast and other TV providers are hesitant to work with companies who are creating “new media”( like Netflix) because it undermines their traditional business models. On the other side, companies like Netflix don’t want to pay extra for fair access, need the big providers to work with them, and would love to put the big providers right out of business all at one time.

Where do we go from here?

What comes next is an open question. Netflix recently agreed to pay Comcast an extra fee for better network speeds after Comcast allegedly degraded access to Netflix for all Comcast internet clients. Comcast denies this charge saying that the Netflix fee deal has more to do with peering charges than anything else. Comcast also promises not to favor traffic; at least for now. But this arrangement is tenuous at best. Comcast is losing subscribers to Netflix (in droves), but ironically controls how those subscribers access Netflix products (access over which Comcast holds a monopoly for many of its customers). This is not a long term solution. Ultimately one party or another is going to lose the balance, and eventually the entire war. Companies like Netflix would not even exist without open access to the internet, but neither would the internet exist without companies like Comcast investing billions in last-mile cabling (investments that aren’t easy for smaller operations).

It might be that the market will sort itself out. Google (arguably a content company, mostly) is busily laying its own fiber lines and some of the larger internet providers are getting into the online content game. Unfortunately, most content and ecommerce companies just don’t have the muscle to bid competitively against Companies like AT&T or Comcast. Consumers are no solution either. For most US residents, internet access is not a matter of choice. Only one company offers high-speed connections in most geographic locations meaning that even the most dissatisfied customers can do little more than disconnect themselves; a move that arguably hurts them more than the provider.

In the long run, it seems likely that some form of government regulation will be necessary. Just as the big Bells were busted up under antitrust laws in years past in order to maintain a functioning telephone system, so too will the modern conglomerates need some oversight in order to maintain the internet as we have known it thus far. Exactly what kind of regulation will make this possible without becoming an evil itself, however, is debatable. 

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Kjeld Lindsted Kjeld Lindsted
Content Architecture, Copywriting, and Editing
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