By Quandary Peak Research
The FCC’s recent repeal of net neutrality regulations has provoked strong reactions from free speech advocates, corporations, politicians, and everyday internet users alike, making it difficult to separate the facts from the bluster. We’ve outlined the case for net neutrality before, so in this piece we’ll examine the legal elements of the repeal, review the arguments for and against net neutrality, and examine what lies ahead.
What, Exactly, Does the Repeal Cover?
The net neutrality repeal rolls back Obama administration-era rules from 2015, which allowed the FCC to treat broadband as a utility under Title II of the Communications Act. This characterization enabled the FCC to prohibit the following actions, which it deemed harmful to the open internet:
• Blocking – discriminating against lawful content by blocking websites or apps
• Throttling – slowing data transmission for legal content based on the nature of said content
• Paid Prioritization – no fast lanes for customers who pay a premium, and no slow lanes for those who don’t
The argument for net neutrality (defined in basic terms as the open and indiscriminate movement of content over a network) revolves around equality—giving Americans equal access to content and equal ability to pursue their objectives online. One of the key concerns of net neutrality supporters is that Internet Service Providers (ISPs) like Comcast and AT&T will become, in the words of the New York Times’ Cecilia Kang, “gatekeepers to information and entertainment”. Major technology companies like Google, Facebook, and Amazon are among the biggest supporters of net neutrality. They argue the repeal will give ISPs the ability to block services, prioritize content, and create ‘slow and fast lanes,’ ultimately undermining the capacity for innovation that drives so much of the internet.
On the other side of the argument, the repeal supporters—most prominently large telecom companies like AT&T, Verizon, Comcast, as well as FCC chairman Ajit Pai (a Trump administration appointee)—believe that FCC regulations were hindering the ability of telecom companies to offer customers a wider selection of services at a variety of price points. In a statement, Mr. Pai described the repeal as an effort to stop the federal government from “micromanaging the internet”. Instead, “the F.C.C. would simply require internet service providers to be transparent about their practices so that consumers can buy the service plan that’s best for them”.
What Does the Net Neutrality Repeal Mean Right Now?
Not much. The concrete effects of the repeal are up-in-the-air beyond the pure policy changes. Prominent broadband companies, like AT&T and Comcast, have each promised customers that their experiences will not change. Because of these promises, and prevailing public sentiment from consumers about net neutrality rules, experts predict that large companies will have to tread very carefully to implement any future changes.
Can Consumers Expect Any Benefits?
Yes and no. Broadband service is dominated by a small handful of companies where the barriers to entry are high, so the notion of increased competition resulting in lower prices seems somewhat far-fetched. Innovation is a constant in the industry, however, so it also seems likely that consumers will not end up any worse off.
The practice of “zero-rating” is also seen as a positive for some consumers. Zero rating refers to when a service provider gives access to content from specific programs or sites without counting it towards a user’s data plan. T-Mobile, for example, allows its subscribers to stream Netflix and YouTube without using any of their data allotment. Zero-rating was previously under investigation by the FCC for potentially violating net neutrality rules, but the investigation was dropped in February 2017.
How Will Net Neutrality’s Repeal Change the Internet Landscape Going Forward?
Future effects are still based on conjecture. Net neutrality supporters are concerned that broadband companies will begin offering the internet in bundles, much like is done currently with cable television. A Portuguese company is already experimenting with bundled internet packages, which offer different services for different prices. There is significant concern about the creation of “fast lanes”, where customers would pay for prioritized speed and access, and small business owners are worried they won’t be able to compete with large companies in this environment. Mr. Pai has championed transparency and choice as protections for consumers, stating that broadband providers will need to disclose if they are creating fast lanes or choking traffic. If consumers do not like the practices after being notified, they can switch providers. The FCC also transferred oversight duties to the Federal Trade Commission (FTC), stating that the FTC’s antitrust and consumer protection laws are best for preventing harm to consumers.
The repeal’s consequences are far from set in stone, but two outcomes seem highly likely. First is that there will almost certainly be legal challenges to the FCC’s decision. Several state attorney generals, as well as numerous public interest groups, have stated they will be filing lawsuits once the rules become official. The second is that net neutrality rules have tended to shift depending upon which political party is in power, so election results in 2018 and 2020 will likely have an outsized effect on maintaining the status quo or reimplementing regulations. Unless legislation replaces FCC rules, the fate of net neutrality stands to change depending upon which party occupies the Oval Office (and thusly, which president appoints the FCC chairman).