Net Neutrality Debate

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ExitEvent has looked at the issue of net neutrality in context to local startups and small business, but as FCC Chairman Tom Wheeler’s new plan moves toward a vote this month, let’s look at how some of the details might affect web users around the Triangle, both in their offices and homes, as some of these ideas and talking points actually become law. 

What exactly will the FCC be voting or ruling on? 

Net neutrality is a catch-all term that refers to an open web, so it would be an oversimplification to reduce the FCC’s decision to ”voting on net neutrality.” But Wheeler’s plan is considered a giant step in this direction—and he has the support of net neutrality advocates—because it would reclassify Internet service providers (ISPs) like Comcast, Verizon and Time Warner Cable as ‘common carriers’ under Title II of the Communications Act, allowing the FCC to begin to carry out regulations that would look a lot like net neutrality. 
The majority of web traffic will largely remain unaffected (though the door is now open for that to begin to change), as most web data in terms of mileage is handled by third party content delivery networks or CDNs (Level 3, Cogent and Akamai, to name a few). When users send a Gmail or upload a YouTube video, most of those packets of information will still be optimized, prioritized and repackaged by companies like these, outside the gaze of the FCC. 
But, always, at the end points of those emails and video uploads are the big boys like Comcast or Verizon in what is referred to in the industry as the “last mile”—the actual copper and glass tediously buried throughout thousands of neighborhoods across the U.S.—and that’s what Mr. Wheeler, and President Obama, would like the FCC to being to keep their eye on. This is the “reclassification” debate that has dominated much of the policy discussion this past year. 

What regulations would be placed on ISPs? 

Under the proposed rules, basically any home internet service (or broadband network which connects smartphones) will be prohibited from blocking, throttling or prioritizing certain content over others. ISPs will have the same obligations as common carriers to home users as they will to Netflix or Amazon or your garage startup; as long as content is lawful, ISPs cannot degrade speeds or block access. 
Data caps would not be outright banned, but the FCC will begin to look into consumers or competitors being harmed in terms of net neutrality. “Harm" isn’t well defined. But even if it were, like most items here, it’s still yet to be seen how the FCC will enforce all of this. 

How does this affect individual web users and local business? 

Providers like Comcast and Time Warner Cable say prices will undoubtedly rise if Wheeler’s plan passes, but the FCC says there will be no new taxes or fees, no utility-like pricing regulations, and that state and local moratoriums on Internet taxation will continue. There’s an open door now for a small Universal Service Fund charge, such as what is already on telephone bills, but that would likely rival any typical increase by home service companies (something their customers can attest to). 
Opponents of the plan also point out that treating all content the same could degrade traffic that probably does need preference, such as game streaming or video, and regulations could stifle broadband innovation if ISPs are forced to pay for “unbundling” their final mile of cables. There might be some theoretical truth to the former complaint, but for the latter, to the contrary, Google has actually championed net neutrality as an avenue to utility-level services or “pole access” in its quest for Google Fiber. 

Net Neutrality Save the Internet
Most all independent internet organizations support Wheeler’s proposal, and the FCC taking responsibility for protecting the proverbial “little guy’s” access to the web is certainly a good thing for smaller or new companies. But truth to be told, the average joe or web app startup likely won’t feel the effects for some time, if at all; these initial steps are more of a preventive action for consumer protection down the road than a curtailing of any current illicit activity. 

So why are we hearing about this now? 

Enter Netflix. The video service accounts for nearly a third of all Internet traffic nowadays (even more during primetime) and for all intents and purposes binge watching Breaking Bad contributed to breaking the Internet this past year when Comcast and Verizon successfully forced Netflix to pay for connecting to their networks. It remains disputed whether or not Comcast was slowing speeds on purpose, or whether the enormous load of traffic was simply degrading the networks, but the end result was a nationwide debate on net neutrality laws. 

So net neutrality brought back Netflix, that has to be good, right? 

It depends. Naturally, we have no idea how the FCC will actually enforce these rules in practice. 
For instance (and somewhat ironically), the Netflix/Comcast dispute looks to fall outside of Wheeler’s new measures. Technically, Comcast and Verizon aren’t charging the video streaming giant for a “fast lane” (which would now be illegal), but to connect to their last mile of infrastructure to user’s homes. (Comcast and Verizon argued that while networks have historically allowed free connections, Netflix was abusing this relationship by overloading their networks; Netflix argued that companies like Comcast and Verizon had a public duty to carry out this transaction of information without interference since they control ultimate web access.) 
The point however — and it’s a big one — is that while the FCC has not officially banned this practice, it has officially thrown its hat into the ring to investigate claims like these, albeit on a case-by-case basis. The FCC will now be monitoring these issues, and that’s a monumental shift regardless of how this plays out. 

Should everyone panic? 

Probably not. The federal government and FCC have generally treated the web and broadband industry well and the success of the Internet itself is a testament to that (the proliferation of wireless cellular being another great example). The U.S. has a relatively good record here historically. 
That said, some neutrality purists are wary of a “reasonable network management” clause in the Wheeler proposal that might allow for who-knows-what; but as we’ve seen, such is the nature of regulation in general and what kind of leeway ISPs will be afforded is a work-in-progress. 

What should we really expect? 

Net neutrality is a complex idea, and pigeon-holing or simplifying its principles in practice to any particular point of view or rhetoric is dangerous. Equal treatment sounds great, but certain elements of the public web will always need preferential speeds in order for the system to run as smoothly (and quickly) as possible. And while regulation tends to have negative connotations, the Internet is without question in need of more enforcement, not only of new crimes but of old crimes who’ve found new homes. 
Mr. Wheeler’s job will not be easy, but it’s nice to see someone in Washington getting to work.