Net neutrality has been a heated topic of discussion for many years, and the election of a new president has done nothing but dial up the temperature. Debates arguably boiled over in May 2017, when Ajit Varadaraj Pai, the newly appointed chairman of the Federal Communications Commission (FCC), moved to start rolling back established net neutrality regulations. The move, driven by the “Restoring Internet Freedom” Notice of Proposed Rulemaking (NPRM), has set in motion a chain of events that could culminate in what many circles believe as the end of net neutrality.

While the “end of net neutrality” may sound like a foreboding if ambiguous concept for many, it presents some very real consequences for ground-level businesses and everyday Internet users. To comprehend the gravity of these consequences, it’s important to first understand how the proposed net neutrality legislation fell into place and how the specific principles of this NPRM may impact the future for businesses and consumers.

The Evolution of Net Neutrality

FCC Open Internet Order 2010

Prior to Pai’s proposed roll-back plan, net neutrality was regulated according to President Barack Obama’s plan for a free and open internet. The FCC Open Internet Order of 2010 stated that “an entrepreneur’s fledgling company should have the same chance to succeed as established corporations,” and that “access to a high school student’s blog shouldn’t be unfairly slowed down to make way for advertisers with more money.” In the simplest terms, President Obama’s plan said that Internet service providers were to treat Internet traffic equally.

The FCC Open Internet Order of 2010 was focused around three key principles:

  • That broadband providers couldn’t throttle Internet traffic for users or content providers
  • That network management practices, network performance and commercial terms of broadband Internet access service would operate with greater transparency
  • That broadband Internet access service would be reclassified as a “telecommunications service”

Perhaps most importantly, this order created a framework that supported both Internet regulation and broadband innovation. Consumers would get access to the content they wanted, and carriers would be able to improve the ways they delivered that content.

“Restoring Internet Freedom” Notice of Proposed Rulemaking

Pai’s new NPRM moves to repeal many of the statutes of Obama’s Open Internet Order in favor of implementing a light-touch regulatory framework enforced by voluntary commitments among Internet service providers (ISPs) and content providers. The NPRM cites declining investments in new broadband infrastructure and a subsequent loss of jobs as reasons for the overhaul.

Less infrastructure investment and more employment losses highlight potential benefits of Pai’s roll-back plan. By operating under less regulation, ISPs will be able to deploy new broadband investments more quickly and by suffering fewer compliance costs. This could be especially beneficial for smaller municipal ISPs, where delays to new build-outs or innovations can greatly impact Internet access for their rural customers.

How “Restoring Internet Freedom” is Rolling Back Net Neutrality:

  • Reclassifying broadband Internet access service as an “information service”
  • Eliminating the Internet conduct standard

What This Means for Net Neutrality

Like with any new legislation, there are pros and cons to be considered on both sides of the net neutrality debate. It’s true, Pai’s proposed “light-touch regulatory framework” may enable greater and easier innovation to broadband infrastructure. But does this innovation come at a price?

For many, “Restoring Internet Freedom” arguably threatens the most important principle of net neutrality: that all users have equal access to Internet content. By reclassifying Internet access service as an “information service” and eliminating the Internet conduct standard, the notice enables ISPs to take an active role in filtering web traffic through practices like zero-rating.

Zero-rating is when ISPs allow users to access content from certain platforms without it taxing their data plan. Proponents of net neutrality are staunchly against zero-rating, but increased FCC deregulation may make the practice more widespread. And many fear massive deals between ISPs and content providers, like the impending merger between AT&T and Time Warner, are the first dominoes to fall in a line that ends with ISPs having free rein to give preferential treatment to certain providers’ content. Naturally, this will present substantial challenges for many businesses and end-users.

Challenges for Businesses

Eliminating Internet regulation gives ISPs the power to charge organizations more to push their content to customers on the web. While higher Internet fees may not pose a threat to large, cash-rich enterprises, smaller companies may not be able to afford the raised prices. As a result, their content will load more slowly, user audiences may diminish and opportunities for growth and revenue generation may dry up.

Challenges for Consumers

Consumers may ultimately bear the brunt of Internet deregulation because they will be hit on two different levels. Not only will they continue to be charged higher fees for content access, but depending on which provider they use and how deep that provider’s pockets are, that content may also be marred by slower load times and poorer quality.

A Future Without Net Neutrality

The end of net neutrality may paint a dim future for many businesses and consumers. But “Restoring Internet Freedom” has yet to be passed and discussions are still ongoing. This means businesses and consumers alike have a tremendous opportunity to understand the potential ramifications of the NPRM and start evaluating options.

NEF is leading the way to ensure businesses have the insight they need to make smart, holistic decisions in the face of Internet deregulation, no matter what the future brings. If you have questions about how the “Restoring Internet Freedom” plan may impact your business, contact the team at NEF today.

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