Does the End of Net Neutrality Threaten Your Business

Net neutrality has been one of the original and enshrining tenets of the Internet: All content is created equal. But a US federal appeals court has struck down a Federal Communications Commission (FCC) ruling meant to prevent ISPs from prioritizing some website traffic over others.

The US Court of Appeals for the District of Columbia ruled today that the FCC cannot mandate net neutrality on the likes of Verizon and other broadband providers. This opens the way for multiple tiers of Internet access, with preferred content services potentially getting faster service, depending on the Internet provider.

We take a look at reaction to the news and what it could mean for businesses and users.

Rewriting the Rules

When the Internet was mostly a dial-up business, it was easy for the FCC to apply rules designed for phone companies to the web. With the arrival of broadband and mobile Internet, however, that approach was always on shaky ground. Today, long-time adversary Verizon Communications finally won a multi-year battle after a four-month appeal. The FCC said it's considering "all available options," including appeal, following the decision. So the issue is not settled yet. But it does raise significant questions.

Today's ruling states that the FCC cannot tell US wired broadband providers to follow the rules of net neutrality. The ruling does not apply to mobile broadband (which has different roles) or specifically web content, only to provisioning and priority of service. However, it may not be long before content is used as leverage by providers. To rein them in again, the FCC would require Congress to pass new laws, which would send lobbyists on both sides into pitched battles.

Many technology and web companies publicly supported net neutrality, at least initially. Google was, at first, pro-net neutrality.  Then it tried to create a compromise with Verizon, Microsoft also shifted positions over the years.

The reality may be that the rise of mobile has forced all these companies to partner with mobile giants (who happen to be key broadband players) — at the expense of all other considerations. 

The Affect on Business

If Verizon (and other broadband players) have their way, it puts a whole new spin on the future of the Internet. While many of us have a wide choice of mobile providers, few users have the luxury of the same range of broadband providers. And while users already have to select their broadband speeds, it is entirely possible that they may also have to select "content consumption" packages. 

For businesses and content creators, there are potentially chilling questions — as yet unanswered. Do broadband providers' changes affect your data and your access to users? 

While the major content providers will be able to pay their way, startups (likely in video, VoIP or other services that threaten the majors) and smaller competitors could have a harder time getting their data onto the Internet in a smooth fashion. That could have a daunting threat on innovation.

In addition, if the Internet of Things (IoT) takes off, broadband providers could start charging extra fees for machine-to-machine (M2M) data. That could affect many businesses, although few end users would notice. 

From the ashes of the FCC's plans, different legal frameworks may yet emerge. Net neutrality is enshrined in some countries (Japan and the Netherlands), and others may now follow to avoid following in America's convoluted footsteps. 

Views from the Web

Verizon claims it "remains committed to the open Internet," meaning businesses should have nothing to fear. But then you have to ask: Why would it also try to kill the notification element of the FCC's rules? If it didn't have to tell customers what it was throttling, cutting out or blocking, then how would we know if it was being open or not? 

Craig Aaron, president and CEO of Save the Internet, issued the following statement:

We're disappointed that the court came to this conclusion. Its ruling means that Internet users will be pitted against the biggest phone and cable companies -- and in the absence of any oversight, these companies can now block and discriminate against their customers’ communications at will."

Gartner analyst Akshay Sharma put it a little more bluntly:

Net neutrality has been effectively neutered. Essentially all packets are not created equally. This shifts the power back to providers like AT&T and Verizon, away from the over-the-top content (OTT) players like Google and others. It will now allow a Comcast to sell prioritized services to consumers of its owned content like NBC or it can now auction off priority traffic rights to one site over another, or impose tolls for high-bandwidth sites such as video streamers Netflix. Beneficiaries of this ruling will include the incumbent carriers, as well as the equipment vendors to the incumbent carriers (e.g. Alcatel Lucent, NSN, Ericsson, Ciena, etc.), who provide carrier-grade solutions that support policy-based controls."

Social media echoed those sentiments, somewhat more vociferously.

But the reality is Verizon and others will have to make their next move very carefully to avoid becoming Internet pariahs no matter how many subscribers they claim.

Staff reporter Dom Nicastro contributed to this story.

Title image by mindscanner (Shutterstock).