Net Neutrality: What it Means and Why It’s Significant

Net Neutrality: What it Means and Why It’s Significant

On December 14, 2017, the U.S. Federal Communications Commission (FCC) removed Net Neutrality, the legal framework that governs Internet access and control. The repeal has incited an uproar among consumer advocates and companies alike that are concerned about the new possibility for service providers to manipulate Internet traffic. So what is Net Neutrality and what are the pros and cons? Here’s what you need to know.

What is Net Neutrality?

Net Neutrality is the governing principle that Internet providers treat all web traffic equally, giving equal status to all network packets with no favorites or prioritized traffic flow (so-called "neutrality"). These rules ensure Internet service providers (ISPs) don’t manipulate traffic, so providers such as Comcast can’t charge Netflix for a faster path and can’t block or slow apps that rival their own services.

This net-neutral approach is more or less how the Internet has worked since its creation. From the start, it was designed as a best effort platform--all packets are created equal. Proponents of Net Neutrality rules claim it codifies this status.

In 2015, the inception of Net Neutrality by the FCC granted the agency new powers to regulate the Internet. At the core of the debate is Title II of the Communications Act of 1934, which allows the FCC to govern public utilities and their service providers. In 2015, the FCC deemed ISPs “common carriers,” making them subject to the same legal rules as other public utilities. However, in December 2017, Net Neutrality was repealed, removing the 2015 rules for ISPs and creating concerns among advocates on both sides of the issue.

What are the Pros and Cons of Net Neutrality?

Some say that Net Neutrality rules are good because:

  • They level the Internet playing field and keep prices low. The rules create equal access and prohibit ISPs from creating Internet “fast lanes” with premium service at higher prices.
  • There’s a whip to crack. Without the rules it is harder for the government to crack down on ISPs that act against consumer interests.
  • The rules allow a more open market. Without them a few powerful cable and phone companies are able to “pick winners and losers” instead of consumers.
  • They protect against censorship and content regulation. Without the rules ISPs are free to block content they don’t want you to see.

Others argue Net Neutrality rules are bad because:

  • They spurred monopolization. Between 2015 and 2017, ISPs largely consolidated, and consumers saw little change in prices and Internet service levels. Without strict regulations, ISPs can lower their total cost of ownership, which could spur competition in ISPs at the local level for "last mile" coverage, potentially giving rural areas more Internet service options.
  • The rules limit innovation. Removing the rules on bandwidth and packets is good for investment in broadband networks and services. Deregulation gives ISPs greater freedom over how they organize and charge for their services, giving consumers more content service options.
  • They enable censorship and content regulation. While ISPs are unable to block content because “all packets are neutral,” loopholes and vague rules enable content providers and social networks to block content they deem hurtful to their business when posted on their sites (e.g. a bad product review).

What Do the Consumer Advocates and Business Communities Say?

There are many concerns, viewpoints, and power plays in the mix.

Consumer Concerns
  • Price Increases: ISPs will likely charge consumers more for bandwidth-heavy content services (Netflix)
  • ISP Monopolies: “My town only has one ISP!”
  • Censorship and content regulation
Business Concerns
  • Price Increases: Companies that leverage public Internet service for network connectivity could potentially face higher prices for faster Internet service lanes.
  • Monopolies with Mergers between ISPs and Content Providers: Large ISPs are merging with content providers (e.g. AT&T + Time Warner Cable). Will the Federal Trade Commission (FTC) enforce Department of Justice antitrust rules and break them up?
  • Passing the Bandwidth Buck - ISPs vs. Content Providers: ISPs like the repeal because they can now charge content providers for excessive bandwidth usage (e.g. Netflix). Meanwhile, content providers (e.g. Netflix) want to maintain neutrality rules so they can pass the bandwidth cost back to ISPs and say, “You must treat the packets equally.”
Power Grabs and Political Concerns
  • Will the FCC ruling to repeal Net Neutrality be overturned? Lawsuits are being filed and protests are raging...
  • Who should govern the Internet--entrepreneurs, consumers, and the market or the government and the FCC? Who should govern ISP monopolies--the FCC under Net Neutrality or the FTC under antitrust laws? Does Net Neutrality give the FCC too much power in terms of both regulating the Internet and in managing ISP monopolies?

What is the Impact of Net Neutrality on Enterprise IT Network Management?

Get the answers in our other blog post, Net Neutrality Repeal: The Impact on Your IT Network

About Paul Ruelas

Director, Product Management, Masergy
Paul Ruelas is Director of Network Products at Masergy. He brings over 26 years of expertise in telecommunications, IP Networks, complex solution design, and product development. Paul has developed many Ethernet and optical products that enabled numerous global enterprises to transform their data communication infrastructures to improve business outcomes. Paul is an industry thought leader in communication transformation and on topics such as hybrid networking, SDN, NFV, and cloud connectivity.