The issue of net neutrality has been brewing for a few years, and the final ruling has been anticipated by internet providers, companies providing services over the internet, and internet users alike. Net neutrality is the uninhibited service of providing as much bandwidth as requested to different sites online. In essence, it states that internet providers should not limit access to certain sites because they might be bandwidth-intensive, creating an issue for internet freedom. The issue of throttling bandwidth to certain sites has angered internet users, and internet companies like Netflix. However, the FCC came out with their ruling and made a decision on the matter that didn't seem to favor popular opinion. Watch today's Daily Brown Bag to learn about the FCC's ruling on net neutrality, why they made the decision they did, and what it could mean for companies that depend on the internet for their services.
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Hello, and welcome to The Daily Brown Bag. Today we’re going to be talking about net neutrality. I’m Chad Hill, and I’m joined by Adam Stetzer.
Good morning, Chad. Welcome to our Brown Bag! Net neutrality is an interesting topic. If you’re not familiar with it, it’s this idea that there is open access for everyone on the internet and that everyone can have equal access. The FCC has been pushing an agenda and even legal rules to force ISPs to play fairly among both the big and little players who all want access to people on the internet. But, this breaking news (and I’m looking here, Chad, at Gizmodo, and you also looked at CNN.com) is that the U.S. Appeals Court just invalidated some very important FCC neutrality rules which were geared at not playing favorites. So basically what I think has happened here, Chad, and I want to discuss the implications for internet marketing and the internet at large, is that the rules they put in place were seen as an overreach, and the FCC really doesn’t have the jurisdiction is what this court’s saying. So, let’s talk about the implications and what that means for the little guy on the internet.
Right, and the specific thing about that was that the court said that the internet is not a crucial utility as defined by current law. I think that’s really interesting, Adam, because when you look at the internet and the damage it can do to a business by just having your internet connection down for a day, it’s hard to believe that it isn’t, in 2014, a crucial utility. But, I think the most important thing here is that what this means is that if this doesn’t change and we don’t have net neutrality, the big guys like Verizon and Comcast who control that wire into the business or into the home can start asking some of these bigger players like Netflix and Amazon, even, “If you want to have guaranteed, high-speed, unfettered access to the home that doesn’t end up in the slow lane, you’re going to need to pay to play.” So, we think that the big guys, sure, could pay something, because clearly it’s a service that these guys would be willing to pay for. For something like Netflix, it’s a very important part of their business. But, I think we also have to think about what this means for the small business. What this probably means for the small business is that there’s not going to be $6.95 hosting anymore, because nobody in their right mind is going to be investing in marketing a website that isn’t on the fast lane. That means that those hosting companies that currently host websites for $6.95 are going to have to increase their fees, so it will impact a lot of people, I think, maybe directly or indirectly, but this is a pretty important change and ruling that the courts have made here.
Wow, Chad, there’s a whole ball of wax here, so let’s pick this apart. Net neutrality doesn’t sound like it’s that big of an issue, but the first point I want to get your feedback on is that it seems like the government is saying, “This is not critical, so we can’t overregulate it,” but if you look at the defense industry and everything you hear about cyber-terrorism and the money that’s being spent on cyber-attacks, and the stuff you hear on the news about putting viruses into nuclear power plants in Iran, the other side of the government is saying that the biggest threat of the next decade is online. So, I guess my first question, Chad, is this: doesn’t that seem like a bit of hypocrisy, when one side of the government is focused on commerce and businesses say, “No-no, hands off! This isn’t even that important of a utility,” and the other is saying, “Hands on! We need tons of money from Congress, because the biggest threat we face in warfare defense is actually on the internet.
It does seems so, but there’s actually a three-branch government, right? We’ve got one group that’s interpreting current law, another group trying to administer those laws, and what it sounds like is that there’s some grey area about what the law really says. So, I agree, Adam, it seems like that’s clearly got to be something that we address here.
And the other issue you brought up that I think is fascinating is this idea that the internet is not seen as a utility, which sounds like the sort of fine print and the leverage they use to say that this is out of scope for what the FCC can do. Then you start talking about services like Netflix, Hulu,and online banking and start to really wonder how this can not be a utility. Really, it makes me want to see who the lobbyists are behind this. My guess is that they are people who have a vested interest in saying that utilities are things like electricity, water, and cable, and they want to keep your subscription dollars over on those utilities and keep their monopolies nicely locked up. These are kind of threatening technologies if other people can have access to people to deliver, for example, a movie through the internet at the same speed at which they can do it through cable or drone delivery, it just seems that they’re trying to make the playing field unlevel and let the big guys win here. I don’t know if that’s jaded or a conspiracy theory, but do you see that coming through in this ruling?
Yeah, absolutely, and I think most people who were in favor of net neutrality said, “I’m already paying that company to get this service, so why should they get to decide for my $70 a month, or whatever, for high-speed access in a business or home that they can restrict how much bandwidth a certain player gets to my house?” I think that that’s really what this side of it is. If I’m paying the utility for the service and they need to charge more, let the markets decide what they charge to get access to my home, but don’t let them decide who gets in my house and who doesn’t. I want that as part of the utility I’m paying for.
A final point on this is that when we start talking about net neutrality and utilities, of course, Chad, even in this conversation we’ve gravitated toward Verizon, Comcast, Cox, and Time Warner Cable as the natural bad guys, but the corporation I’d really like to hear from is Google. I know I’ve read that they’ve brokered quite a few deals before some of these rules were in place to make sure that their search engine results were much faster than other people’s. In other words, they’re exploiting net non-neutrality, using their economic might to edge out other folks. So, I wonder if the definition of utility should be expanded to include search engines. I’m sure Google would fight that very much, because they very much want to remain in a very unregulated space. You don’t see them front and center in this discussion, but I have to wonder if they will be edged into this as it progresses. Well, that’s our Brown Bag today on net neutrality. We certainly want to hear your comments. Put in your comments, let us know how you’re feeling about this, and we hope you’ll subscribe to our YouTube channel so we can see you back tomorrow at another Brown Bag.