The Lowdown on Net Neutrality

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The current state of the Internet in America is one of “Net Neutrality.” It means that all traffic is treated the same regardless of what data is being sent – emails, web searches, VOIP calls, streaming videos, etc.. – all traffic has to share space along the conduit. Internet Service Providers (ISPs) can’t block traffic to certain sites in order to allow traffic to others to get through, although they do currently “throttle” certain high-demand users (meaning they slow their service, making it more difficult to stream content).

As more and more Americans stream movies, TV, music and more over the Internet, ISPs are struggling to manage the traffic. According to an annual report by Sandvine, a Canadian Internet monitoring firm, Netflix and YouTube account for over half of the Internet traffic in North America, with Netflix comprising the lion’s share. During the peak hours of 7pm to 9pm in North America, AKA “Internet Rush Hour,” the deluge of users online at the same time leads to slowed or lost connection for users stuck in the “traffic jam.”

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The major ISPs in North America – namely Comcast, Time Warner, Verizon and AT&T – claim that the traffic caused by certain activities (streaming video content) and a few select sites (Netflix and its competitors) are causing everyone to suffer. In order to support the increased demand, they will need to upgrade their networks. The cost to do so will have to be borne by either: the ISP (don’t hold your breath), the end user (you and me), or websites that are generating the most traffic.

While there is no law currently forbidding ISPs from charging more to certain users or throttling traffic in order to demand more money from certain sites, the primary ISPs in North America have banded together to petition the FCC to allow them to offload the cost of upgrading their networks to support the increased traffic. Undoubtedly, the ISPs are hoping that a decision in their favor by the FCC would mitigate a lawsuit being filed against them by Netflix, Amazon, Google, etc. in the event that they took action without getting approval by some sort of governing agency.

The current proposal that the FCC is considering involves the creation of a two-tier internet system. While George Foote, a telecommunications lawyer, would like us to think of it as “a fast lane and a hyper-speed lane,” it seems relatively clear that traffic to those sites able to pay a premium (such as the major content providers like Netflix, Google and Amazon) it would be sent over a faster, more reliable network while traffic to websites unable or unwilling to afford the high cost of entry to the premium network would be directed over the standard (i.e., slower, less reliable) network.

This proposal spawns several concerns from those who support Net Neutrality:

High Barrier to Entry: Several industry professionals have pointed out that new start-up websites will likely be unable to afford the “premium” network, giving established sites a distinct advantage and potentially squashing innovation. If someone devises a great new way to share videos over the internet, for example, but their traffic is throttled in the early stages of their attempts to get a foothold online, no one is likely to give their service a try.

Monopolies Should go to Jail: There is also a potential conflict of interest in that many of the major ISPs are themselves looking to carve out a piece of the streaming content distribution market. If they can charge a premium to competitors while giving preferential treatment to traffic to their own sites and subsidiaries, the ISPs will stand to gain market share and even greater profits over time. While the FCC insists that any sort of tiered system would require that ISPs disclose the rates they charge, it’s hard to imagine that a report will garner much interest after the heat of the debate has died down.

Big Brother is a Bully: Others point out that if ISPs are given free rein to charge a premium to some sites that they deem “bandwidth hogs,” it gives them the ability to control what you and I can freely access online. If an ISP gets in a contract dispute with Google, should it be able to simply turn off access to Google sites until the dispute is resolved?

In a letter to the FCC sent in early May, major technology companies such as Google, Microsoft, Amazon, Yahoo, Facebook and more asked the FCC to uphold Net Neutrality ( The letter includes the following plea: “Instead of permitting individualized bargaining and discrimination, the Commission’s rules should protect users and Internet companies … against blocking, discrimination, and paid prioritization…”

The FCC is currently accepting comments from the public while it considers its ruling on the ISP’s proposal. As of this writing, over 73,525 comments have been posted with regards to proceeding 14-28, “Protecting and Promoting the Open Internet.” Make your voice heard by posting a comment at
