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The importance of net neutrality

On Tuesday, the Federal Communications Commission (FCC) adopted new rules on net neutrality. The guidelines, which were approved by a narrow party-line vote, drew immediate criticism from both Internet access providers and consumer interest groups.

But first, what is net neutrality and why does it matter?

In simple terms, net neutrality means that the people who provide you with Internet access – the telecom giants, the cable companies, the satellite providers – must do so without favoring one particular web site or company over another. Everything should be accessible in the same way and at the same speed.

Let’s look at an example to see why this matters. Say you’ve just launched a web site, ABC.com, which offers reviews of tech products and services. You are very successful and your web site starts to draw lots of visitors. Another established tech review web site notices the increased competition and goes to Verizon and Comcast with a proposal: if the Internet providers will speed up access to the established site and slow down or block access to ABC.com, then the established web site will pay them a fat monthly fee.

But it may not just be a case of favoring one third party over another. What if Verizon or Comcast started a tech review site of their own? Again, they control the speeds and feeds and could seriously hurt the competition by establishing a fast lane for their own service and a slow lane for everyone else.

What’s at stake is nothing less than digital freedom of speech: everyone should enjoy the ability to deliver and access content without interruption or discrimination. 

The FCC guidelines, which are not legally binding, concentrate on three broad principles: transparency, no blocking, and no unreasonable discrimination.

The transparency rule applies to fixed and wireless networks. Providers must disclose their network management practices, network performance and characteristics, and the commercial terms of their broadband services. This, the FCC hopes, will ensure that consumers have the information they need to understand the services that are being offered.

As far as the no-blocking rule is concerned, fixed network providers may not block lawful content, services, and applications, and they cannot charge providers of these services simply for delivering traffic to and from the network. There is an exemption for wireless carriers, in that they are able to discriminate in favor of their own applications. (Think V CAST Apps, etc.)

Finally, fixed broadband providers cannot unreasonably discriminate against lawful network traffic.

The FCC guidelines are just the first baby steps on a road that is sure to be long and tortuous. The rules, which were a clear attempt at compromise between the carriers and content providers, predictably satisfied no-one. They were also met with derision by the free-market law-makers that are set to dominate the next session of Congress.

But net neutrality is an important debate that we can’t shy away from. The future of the Internet depends on it.

What’s your opinion on net neutrality? Do the rules go too far or not far enough?

Comment by Andy Anderson, posted 12/23/2010, 11:29 AM:

I hope your analysis of the new rules is correct - I've heard more than one interpretation, but I've not read them so I can't comment on that. If you're correct, then the new rules are a good thing. To my mind, the root of the problem is that the ISPs are all de facto monopolies; the barrier to entry into the market is very high, and the time to make a profit can be long. This also seems to me to be a good example of an economic "neighborhood effect" where regulation is prudent.
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