What's Going on with Net Neutrality?

Jim Machi : Industry Insight
Jim Machi

What's Going on with Net Neutrality?

Net Neutrality is a hot topic in the United States.  Essentially, it means “let the internet be open” and let whatever it’s used for, whatever is connected to it, etc. happen as long as it’s lawful.  The FCC has rules regarding the internet and they are designed to prevent content discrimination on the Internet.  These rules came into existence because advocates of Net Neutrality are worried that those who own the networks, who intstall the networks, will block competitor content, or throttle its use somehow.  The FCC also says the rules are there to provide some certainty about the internet so innovation can continue to occur, and thus job creation can occur. 

Let’s take a look at two aspects of this – use of the internet for “free” and also the wireless broadband internet.

One issue relates to those who own the transport mechanism paid for the transport mechanism to be installed. Think about AT&T for instance, or a cable company like Comcast.  But you can then use a free service like Google, or Skype, on top of this transport.  In this case, AT&T and Comcast put in the infrastructure and thus in some way could “control” what’s going on  their infrastructure if they wanted to.  And if Skype is going on top of an AT&T network, why is this good for AT&T?  It isn’t, right?  Well, clearly AT&T and Comcast in this case shouldn’t just put in the networks and let others make money from them.  That’s not right in my view.  They should be compensated for sure.  And you can argue that they are compensated since we pay “usage” fees for their use. 

I pay Comcast for TV services, and I also pay Comcast a monthly internet usage fee.  So they make money from my internet usage, even if I’m using it for voice, or for watching video that may take my time away from watching TV.  And someday, who knows, I may not pay for the TV at all, and just watch all my “TV” from the Internet.  So in this case, I’d just be paying them for internet access.

And I have choices on the internet usage pipe to my house, so it’s competitive and they’re making a market-based fee.  But what if, and this happens with cable, my experience isn’t great?  What if it’s slow, for instance? And rest assured, it is slow in my neighborhood when kids get home from school.  So I’m paying a fee, not being happy sometimes, and does Comcast have the right to throttle someone’s usage to make sure 99% of their customers are happy?  I would think so because they’re running a business. But in the Net Neutrality world, this wouldn’t be allowed.  So I’m not on-board with that.  They should be able to satisfy their customers in a way that maximizes their profit.

In next week’s blog I will take a look at the wireless aspects of the internet.

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