Net Neutrality Passes – Here’s What It Means

The FCC just passed rules that are supposed to insure that all Internet traffic receives the same priority. Some say it represents a victory for consumers over big Internet Service Providers. Others say the new rules don't go nearly far enough.

Net Neutrality Passes – Here’s What It Means Photo (cc) by photosteve101

If you’re a huge Internet service provider like Comcast or AT&T, you’re called a “gatekeeper” because, before any Internet traffic reaches your subscribers, it has to first travel through your network. And since you control the network, it’s tempting to slow down – even block – the content of your competitors, or make extra money by collecting a fee from content providers willing to pay for faster downloads.

In other words, even though you’re already charging people for access to the Internet, if the content they want to see doesn’t make you money, you’d like the option of making it harder for them to see it. For example, if you’re Comcast, you might make it faster to stream your pay-per-view movies rather than those of your competitors, like Netflix.

That’s the essence of net neutrality. The companies that own Internet infrastructure want to be able to decide how fast different types of traffic travels through their networks. On the other side of the issue, consumer advocates and content providers (like us, for example) say the net should be “neutral” – gatekeepers shouldn’t be allowed to favor certain types of content over others.

The FCC has been studying the issue off and on since 2005 and has finally issued a Draft Order that some consider a victory for consumers and others consider not nearly strong enough. The new rules will require broadband providers (like Comcast and AT&T) to let subscribers see all legal online content at the same speed, even if that content competes with their own. However, the rules will apply to wired networks only (think cable companies) as opposed to wireless networks (phone companies).

The issue was decided along straight party lines. The FCC’s five members consist of three Democrats and two Republicans. Both Republican members of the commission voted against the new rules, essentially saying that additional regulation was unnecessary and would lead to higher costs for broadband companies and, ultimately, consumers. Said Republican Commissioner Robert M. McDowell in a recent Wall Street Journal editorial

“Analysts and broadband companies of all sizes have told the FCC that new rules are likely to have the perverse effect of inhibiting capital investment, deterring innovation, raising operating costs and ultimately increasing consumer prices.”

But Consumers Union (publisher of Consumer Reports) applauded the new rules. From their press release

“The FCC is moving the ball forward to protect consumers who access the Internet through wireline connections, such as cables that connect PCs to Internet services. For a long time consumers have been left in limbo amid mounting concerns about the potential for Internet providers to show preferential treatment to certain content providers, and these new rules represent a positive step forward. As the FCC implements the rules, we look forward to working with the Commission to ensure consumers get the protections they need.”

Another consumer advocacy group, the Consumer Federation of America, agreed. From the same press release…

Mark Cooper, director of research at the Consumer Federation of America (CFA), said, “The network neutrality order could be an important milestone in ensuring that the Internet remains an open, consumer- and citizen-friendly place for communications and commerce. There are areas where stronger consumer protections are needed. CFA views the order as the platform on which those consumer protections can be built and we will work to ensure that consumers get those protections in the arenas where Internet policy is set.”

Then there are those who say that the new rules fall far short of providing the type of net neutrality that consumers deserve, for reasons including the fact that they don’t address wireless carriers. From a recent Huffington Post editorial by Senator Al Franken called The Most Important Free Speech Issue of Our Time

For many Americans – particularly those who live in rural areas – the future of the Internet lies in mobile services. But the draft Order would effectively permit Internet providers to block lawful content, applications, and devices on mobile Internet connections.

Mobile networks like AT&T and Verizon Wireless would be able to shut off your access to content or applications for any reason. For instance, Verizon could prevent you from accessing Google Maps on your phone, forcing you to use their own mapping program, Verizon Navigator, even if it costs money to use and isn’t nearly as good. Or a mobile provider with a political agenda could prevent you from downloading an app that connects you with the Obama campaign (or, for that matter, a Tea Party group in your area).

Bottom line? While the term “net neutrality” may sound boring, this is an important topic. And the fight’s far from over: Some in Congress are already talking about legislation that would effectively repeal the new rules.

Whichever side you’re on, the battle over net neutrality matters. If you’re a consumer advocate, it’s about whether the Internet belongs to media conglomerates or to the public. If you’re a supporter of less regulation, it’s about whether the government should interfere in private enterprise.

Whichever side you’re on, when you see articles pertaining to this issue, don’t skip over them: Check them out. Take a stand and make your voice heard.

Stacy Johnson
Stacy Johnson @moneytalksnews
I'm the founder of Money Talks News and have spent the last 40+ years in the personal finance trenches. I'm a CPA, author of a few books and multiple Emmy recipient. I'm ... More


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