Net Neutrality – Is regulation really the answer to protect consumers and businesses from bandwidth throttling and broadband manipulation of internet protocols?

net neutrality ruling

An extract of this article is available from Gulf News online (at bottom of page) and was published in full in hard copy.

Back in 2003, Tim Wu coined a new phrase “net neutrality”, when he identified the discrimination by broadband and telecommunication companies who used to practice biased services to consumers and corporates based on the type of data being transferred from the host to the user.  Net neutrality is the unbiased delivery of packets of data over IPv4, being the main internet protocol (IP) for the transfer of information through the web. In 2015, the US Federal Communications Commission (FCC) was authorised by Congress to regulate internet rules to ensure that all web traffic and information transmitted by broadband providers is treated equally for all users, as per set policies. The FCC ruled in favour of the reclassification of broadband services in the same way utilities are regulated on a common carrier basis. Internet Service Providers are restricted in the practice of bandwidth throttling, being the limiting of user bandwidth for users for video streaming, peer to peer file sharing through Bit Torrents, FaceTime and VoIP (the transmission of voice and media over IP networks).

The new Chairman of the FCC, Ajit Pai, wants to roll back the internet rules of net neutrality, which are set out under Title II of the Communications Act of 1934 and Section 706 of the Telecommunications act of 1996. The FCC has put forward a proposal entitled “Restoring Internet Freedom” to remove the net neutrality regulations for the internet. You may ask yourself, ‘why is this important to me and how will such regulation affect you?’.  In short, there are mixed views on what the relaxing of such regulations may have on commerce, consumers and innovation of the broadband ecosystem.  If these regulations are relaxed or removed there could be restrictions levied on consumers through higher charges, to access social media, online services, independent news content and video streaming services. Some of the on-line companies such as Facebook, Netflix, eBay, Amazon, Twitter and Tumblr could be adversely affected under the new FCC proposal. Additional charges for quality services and high data transmissions, through premium pipelines for fast data transfer, would likely be passed on to businesses and consumers alike. This in turn may create a hierarchy of internet services and fees for corporates and consumers. The whole purpose of the internet was to provide everyone with unfettered access to online information and the transmission of information and data.  The Internet Association encourages innovation, economic growth and empowerment of people through the free and open internet. Any internet restrictions or controls of internet data package transmission speeds in the US would likely impact us all as many the social media, online or cloud services have their servers based there.

My view of the FCC’s proposal is mixed, on the one hand I see that they want broadband and telecommunication companies to self-regulate and on the other hand they want to encourage further investment and development of internet infrastructure, through the funding of premium internet services, which could provide a competitive edge and raise additional taxes for the US economy. Unfortunately the proposal could negatively affect the ability of low income families and students to access information and connect with others through free VoIP services, both in the US and globally.  I am for regulation, as long as it is in the best interest of society and economies. The FCC’s proposal for the reversal of the net neutrality is likely to be more advantageous to the larger corporates, whilst impacting smaller innovative web content producers and lower income consumers. A level playing field would allow an equal opportunity for businesses succeed or fail based on the quality of their websites and services.

My suggestion for small technology businesses and online retailers would be to try and mitigate their IT risk and stay abreast of the proposed US changes. The first round of public comments is now closed and the FCC will provide their formal response by August 16th. If you want to have your voice heard make your public comment on the FCC’s website where over 8.7 million comments have been left already.

Note on the author:

Robert Ford is currently the managing partner of Governance Gurus, which is a UAE entity providing Business and IT Consulting services and training masterclasses and workshops in corporate governance, director duties, the role of the company secretary, change management, corporate culture and leadership development. Robert is passionate about change management and the use of information technology for innovation and to protect the privacy of individuals, see out blog on GDPR and impact on GCC corporate governance practices. He holds a master’s degree in Leading Innovation and Change and whilst in the UAE he has helped an international law firm and big 4 consulting firm to use technology to improve efficiency and quality through cloud-based software for multi-jurisdictional and virtual team co-ordination and provision of services.