Wednesday, January 15, 2014

What Is Net Neutrality and Why Should You Care?

On Tuesday, January 14, 2013 the U.S. Court of Appeals in the District of Columbia Circuit said, "No, no, no," to the FCC's Net neutrality rules passed in late 2010. The story managed to give Gov. Christy and his bridge a bit of a nudge out of the limelight but I found most of the coverage to be inadequate at clearly defining the issues and what is at stake. 

First, it's important to know who the players are. There are (1) Internet broadband providers such as Verizon and (2) content providers such as Netflix and Facebook, and (3) consumers (those of us who use the Internet). The court's decision impacts content providers directly, not consumers, but the impact of the court's ruling is likely to ultimately affect consumers.

Second, it's useful to understand that prior to this federal appeals court decision, the Federal Communications Commission's (FCC) Net neutrality rules required Internet service providers [aka broadband providers] to provide consumers with equal access to all lawful content without restrictions or tiered charges, treating all web traffic equally.

Verizon Communications, Inc., a broadband provider challenged the FCC's rules asserting that the FCC had no authority to impose anti-discrimination rules  (Net neutrality rules) on broadband providers. This is a victory for Verizon and other broadband providers. (Think of who you purchase Internet service from like Verizon, Time Warner Cable, Comcast, AT&T etc., these are all Internet service providers/ broadband providers).

Internet content providers are all of the websites that we visit or join like Netflix, Facebook, Blogger, Word Press, state, federal, and local government sites, etc. This ruling has the potential to interfere with the ability of content providers to provide their content at higher speeds unless they pay a higher cost for access to the Net to the broadband providers.

The FCC continues to have authority to regulate broadband access which means that if can regulate content providers but under this ruling, the FCC cannot regulate broadband providers. The concern is that the broadband providers, which are much larger than content providers, will levy higher costs on the content providers for providing higher speed Internet connections. 

Increases in costs for higher speed Internet connections would likely put some content providers out of business, and prevent smaller content providers from ever setting up their Internet site. Content providers who can pay increased fees for higher connection speeds will have an unfair advantage over sites with slower connection speeds and Net neutrality will be a thing of the past.

The court's decision is unlikely to result in any costs for use to be passed along to the consumer as the FCC continues, under this ruling, to have authority to regulate broadband access. However, this ruling, if it stands on appeal, will impact consumer access to a broad variety of content providers and have a chilling effect on the development of new content on the Internet.

This is purely speculation on my part, but I do think that if this decision survives appeal, it's reasonable to believe that content providers will be chomping at the bit to get the FCC to lessen its control of content providers and allow them to pass on some of their increased cost for high speed access to consumers.

In addition, the only guarantee that we have that Internet broadband providers will provide equal access to all consumers is their pledge to do so. The lawyers for the broadband providers insist that nothing will change for consumers and we will continue to be able to roam merrily about the Internet. However, consumer advocacy groups fear that the broadband providers will begin charging content providers for higher Internet speeds, causing some sites to shut down and others to curtail their offerings or restrict access to some areas of their sites to fee paying consumers. In other words, no one is clear as to exactly what repercussions there will be as a result of this ruling.

The President sums up the administration's position in support of continued Net neutrality. According to the administration, "The President remains committed to an open Internet, where consumers are free to choose the websites they want to visit and the online services they want to use, and where online innovators are allowed to compete on a level playing field based on the quality of their products."

The simplest solution would be for Congress to redefine the FCC's authority to make it clear that it includes setting rules that govern the broadband providers, a step which the Democrats have offered to take. However, the Republicans are advocating a hands off position, agreeing with the Internet providers that the FCC rules "inhibit investments and are not necessary to ensure unrestricted access to Internet content."

This is the short version of a somewhat complex decision. There's a decent article on the federal court's decision here.

The U.S. Court of Appeals for the District of Columbus Circuit is also available online.

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