On December 14th, 2017, the Federal Communications Commission, or FCC, voted on whether or not to preserve Internet neutrality. The 3-2 FCC vote went along partisan lines in favor of eliminating existing rules for broadband Internet service providers. With that vote, net neutrality was relinquished. What once ensured open access to Internet content and parity in quality connections was no longer guaranteed. But the final word on Internet parity matters has yet to be made. Opposition to the FCC vote continues, and the ultimate outcome may be determined in a court of law. The following provides an overview of current net neutrality issues as well as a statement about why they matter.
Defining Net Neutrality Issues
Prior FCC oversight required that Internet service providers supply comparable Internet services to all consumers. This meant individuals and businesses alike had access to equally fast Internet speeds, bandwidths, and content. In other words, Internet parity among users existed, and this came to be known as net neutrality. But with the removal of these FCC oversights, these safeguards are no longer in place. Broadband Internet service providers can preferentially provide some clients with faster services than others. Based on their own discretion, they can also determine if some content might be censored, blocked, or limited. With greater control in the hands of the large ISP corporations, net neutrality is no longer guaranteed.
Why Regulations Are Needed
In many instances, regulations and oversight can hinder markets and competition. But when it comes to Internet neutrality, this is not the case. The main issue stems from the fact that only a few telecommunications giants run the show. Corporations like Verizon, AT&T, Cox, and Comcast are often the only game in town for many wanting broadband Internet. Thus, the ability for competition to self-regulate Internet quality and services are limited. Likewise, knowing when services are being limited or censored is not always easy to tell. As a result, companies can get away with censorship or discriminatory practices without consumer awareness. Both of these issues concerning net neutrality require oversight and consumer protections.
Incentives to Undermine Net Neutrality
According to the FCC majority vote, the absence of oversight would not change anything. But this is highly unlikely. Major ISP corporations have tremendous incentives to undermine net neutrality. Certainly, profit motives exist where higher quality Internet services are provided to clients who will pay more for better services. This results in larger businesses with deeper pockets being able to take advantage of smaller businesses in their marketplaces. In addition, ISP corporations may choose to undermine net neutrality for their own advantage. Blocking damaging content, suppressing competitive offers, and hindering labor union communications are a few examples where net neutrality has been violated previously. Without regulations in place, these incentives go unchecked.
Opposition at Federal and State Levels
While the FCC is a federal agency with powers to regulate net neutrality issues, they are not completely without Congressional oversight. As part of the Congressional Review Act, Congress has the capacity to reverse agency regulation determinations. In May, the Senate voted to keep net neutrality, thus opposing the recent vote by the FCC. However, the chance that the House will support the Senate’s action is less likely. Hope still remains in this regard, however, as one way that Internet neutrality regulations could be reinstated.
The other federal level action, which is more likely, exists at the judicial level. In fact, twenty-two states and the District of Columbia have filed suit against the FCC vote. This decision remains at the level of the U.S. Appeals Court presently. Likewise, many states are actively pursuing state legislation to reintroduce net neutrality laws. Of course, major ISP corporations oppose this and are lobbying for the FCC’s capacity to preempt such state actions. But history is on the states’ side based on past judicial rulings. In fact, California will likely have such laws in place in the very near future.
Internet Neutrality and Business
Without question, a lack of oversight ensuring Internet neutrality poses threats to free speech and access to information. Likewise, the failure to regulate parity to information access invites discriminations and an uneven playing field in the market. These developments negatively affect consumers. But at the same time, they also have tremendous impacts on many businesses. Without equal access to information and Internet services, fair competition and organic market growth are handcuffed. In turn, this hinders creativity, innovation, and social advancement. For these reasons, net neutrality is essential for the health of the market and society. Ensuring its presence is one area where regulatory oversight is clearly needed to protect the common interests of all.
John R. Miles
EVP & Associate Publisher
John R. Miles is Executive Vice President of Business Development and Associate Publisher of Bold Business. He is a sought-after motivational speaker and writer. He brings visionary leadership style and talent as a Navy Veteran and an internationally experienced CEO, COO, and Fortune 50 CIO across a multitude of industries. Miles is also an operating partner at the Virgo Investment Group where he is responsible for identifying and pursuing new investments while supporting existing portfolio companies with operational expertise. He is active on Linkedin and Twitter and published in a variety of media. Miles graduated with honors from the U.S. Naval Academy where he was a varsity athlete.