Do you remember the old Napster debate of downloading music files and whether it should be allowed? Do you remember when Eminem first came out with his initial album and the whole debate started about freedom of speech within music lyrics? Well, welcome to the freedom of speech and Internet usage debate on the Internet – it’s called net neutrality.
In August, it drew up a set of four neutrality principles as it penalized Comcast Corp. (NASDAQ: CMCSA) for slowing the speed of broadband service to high-volume users. As with all rules, there will be people who have been greatly abusing the system for a while and the rules being instilled upon them are a huge wake-up call financially.
Internet service providers (ISPs) say traffic management is needed to balance soaring demand for bandwidth from video and popular sites. The wireless industry is also concerned that the rules are too broad and could stifle innovation on the web. The net neutrality principle states that if a given user pays for a certain level of Internet access, and another user pays for a given level of access, that the two users should be able to connect to each other at the subscribed level of access.
In essence, the FCC is trying to enforce no discrimination for Internet usage. Net neutrality protects each Internet user’s ability to view or download whatever they want online without interference from the phone or cable company. The definition of network neutrality is a principle proposed for access to networks participating in the Internet with no restrictions on content, sites, or platforms, on the kinds of equipment that may be attached, and on the modes of communication allowed, as well as communication that is not unreasonably degraded by other traffic. In layman’s terms, it means that all information flowing across the Internet should be treated equally – from the downloading of content-rich Web sites to the downloading of YouTube videos of grown men sliding down their lawn on giant slip-n-slides. The question arises – do we
need federal intervention to ensure fairness? The debate is over whether ISPs can give preferential treatment to content providers who pay for faster transmission or to their own content.
Neutrality proponents claim consumers have a choice of using a slower dial-up service or paying a premium price for faster speed over cable or DSL. Providers argue that if that two-tiered business model is applied to site owners as well as users, carriers will be able to offer more services like Internet-based cable TV programming and video at competitive rates. Many believe net neutrality to be primarily important as a preservation of current freedoms. Even the founders of the Internet and creator of the Web have spoken out in favor of network neutrality.
Critics of the two-tiered model fear that the extra costs incurred for premium service would be passed down to the consumer in fees for sites, applications and services. They point out that small, independent sites, such as personal blogs, are on an even playing field with large, corporate sites in a net-neutral environment but might be unable to compete in a tiered service model.
James Perly is the president of Perly Consulting Group. PCG makes claims for government tax credits, as well as grants for Canadian companies. He can be reached at jperly@perlyconsulting.com