What is the possible benefit to removing net neutrality?

Net neutrality rules were put in place after, among other things, T-Mobile, Verizon, and AT&T began policies that reduced the quality of legal video playback on their networks. This is called “throttling”, and T-Mobile introduced plans that cost more to access the un-throttled data. This is different from your usual data plan allotment that you buy each month. Their continued use of the word “unlimited” in relation to a very limited data plan is still contentious.

Their action impacted the ability for YouTube, Hulu, Netflix, etc. to play at their full, intended, high-quality nature unless they were on a list of “approved” or “known” sources from the carrier. T-Mobile was upfront in saying anyone can get on the list, they just needed help making the list. I don’t begrudge them for this, because cell providers are fighting a hard physics problem. It’s a big country, mobile internet demand is skyrocketing, and each tower is expensive to build and maintain and can only handle so many connections at once. Placing pricing tiers and giving options is exactly what they should do because their problem is a supply-and-demand problem.

Most Americans have a marketplace to shop from in cell providers among the Big Four (AT&T, Verizon, T-Mobile, and Sprint). That’s what makes that market (mostly) work and it’s led to an ever-decreasing cost-per-gigabyte in data over the last 15 years. Your plan may not feel cheaper than 15 years ago, but you get a lot more from it now.

The rules also place limits on Internet Service Providers (ISPs) from accepting payments to prioritize data transfer speeds. Comcast and Verizon were fined for limiting Netflix download speeds in favor of their own services. AT&T did similar throttling of competitor services in favor of their DISH Satellite services. Comcast has also started limiting data usage on their network to 300 GB a month in many US markets, including Indianapolis. Unlike the cellular carriers which are fighting against physics to provide their service, broadband internet is just a dumb wire in the ground. Once you lay it (and there is a cost to that), it’s just there. Limiting data access to 300 GB a month is like limiting the number of breaths you can take in a month. The air, like data over a wire, is virtually limitless. It serves no purpose to limit wired, broadband data except to slowly raise revenue without most people noticing.

The fear has always been a loss of what is a genuinely neutral Internet. Disney, Amazon, Netflix, Wal-Mart, Saks, Apple, Facebook, and every other company on the planet has the same access to the Internet as you do. Proponents of net neutrality want to keep it that way. Without it, Amazon could pay Comcast to let Comcast customers load Amazon.com at broadband-speeds whereas a small retailer selling boutique items may take 2-3x longer to load a page. We know from a long list of studies that every second of additional page load time reduces site usage. Google even considers page load-time in its ranking algorithm. The goal is to ensure ISPs don’t burden start-ups and small entrepreneurs with undue influence.

On the other side, telecom companies and ISPs argue we’ve had the Internet for 30 years and it’s always operated openly and neutrally. FCC Chairman Ajit Pai voted against the FCC rules during the Obama years, but is now Chairman under the Trump administration, and the political tilt of the body has shifted. He calls the rules “an intrusive example of government overreach”. The rules are considered regulatory and burdensome to ISPs. The rules also mean the government can regulate ISPs as if they are “common carriers”, much like America’s traditional landline phone system.

My take: the US Government is woefully inadequate at understanding this issue. Congress still considers dial-up internet access “an option” compared to Comcast or Time Warner. Thus, they view the marketplace as being competitive when almost every American broadband customer has only one choice for true broadband speeds. Broadband, to the government, starts at DSL, the same technology that falls apart when it’s slightly moist or a cloud moves by. In almost every market true broadband is limited to either Comcast or Time Warner Cable. Even today, Pai and others in the FCC are saying “consumers should be able to buy the service plan that’s best for them.” I agree! We should be able to buy from a robust market of ISPs. But we don’t have that. Even AT&T’s U-Verse and Verizon FIOS are much slower than most Comcast services in download output.

Comcast and others have always lamented the “dumb pipe” issue. Their shareholders want more value from the company. They don’t want to be a “dumb pipe” into your house like your electrical box or water or sewer pipe. They do that currently, but to add value they need to provide TV packages and DVRs and produce original TV shows and compete with HBO. I don’t fault them for trying to find new sources of revenue and service. But just as I don’t want my water company flavoring the water for various fees, I don’t want Comcast noodling with Internet packages. Because they’re really bad at it and they’re a monopoly with little incentive to do much but shove services and costs on to consumers.

I view Comcast as a utility, not a “feature” or “nice to have” service. It’s integral to the nation’s economy. Other companies are far better at making TV shows and movies than Comcast or Verizon. Netflix doesn’t make me buy their service. Neither does Hulu or Amazon. No one makes me watch and pay for ABC’s sitcoms, either.

The Internet is neutral because it always made sense to be, and the net neutrality rules put a stamp on top that says, “Keep it that way”. If we wanted to open the marketplace and get unregulated, we need to lift restrictions on new construction of broadband service, free up leasing rights to existing wired infrastructure, and remove protectionist policies that help telecom companies stay the monopoly or duopoly that they are. That, like having open pricing of healthcare services, doesn’t seem to get much attention.

The FCC’s vote today starts the ball rolling that would lead to a December vote to entirely approve the rule removal. The FCC is expected to pass their removal on party lines. Their open-comment period has been woefully ignored despite overwhelming comments in favor of maintaining net neutrality. Congress or the Supreme Court will likely have to take up this issue at some point in the future. Congress, at least more than the FCC, still has to listen to the public.

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Justin Harter

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  • […] and to block content sponsored by other companies. Such blocked content according to the article “What is the Possible Benefit to Removing Net Neutrality?” could include websites such as Disney, Amazon, Netflix, Wal-Mart, Saks, Apple, and Facebook. […]