Listening to Monday’s net neutrality arguments in the U.S. Court of Appeals-District of Columbia left me with the impression that the Federal Communications Commission does not have a clue as to how to distinguish between the Internet and broadband access services. This failure to properly distinguish the two, no doubt exacerbated by the arguments of grassroots open Internet proponents, may continue to make any degree of regulation in this space increasingly uncertain no matter the outcome of the net neutrality issue before the court.
I’m not going to sit here and tell you how the court is going to rule. My crystal ball is too cloudy and trying to determine where the court is coming from just based on the questions from the bench and the tone behind their questions is dangerous (just ask people trying to gauge the U.S. Supreme Court during oral arguments on Obamacare). What I can say is that the court was not very impressed with the FCC continually failing to focus on the question at hand: does the FCC have jurisdiction to regulate broadband access.
Instead, the FCC spent a lot of time talking about “the open Internet” (which they never defined); Internet traffic (having never defined that during the oral arguments); and voice or telephony over the Internet (which the judges were not interested in hearing about). The FCC’s failure to define the market it wants to regulate with a net neutrality policy should make uneasy minority entrepreneurs who are developing services on the edge of the Internet or large players that provide backbone services for companies sending traffic over the Internet.
As Larry Downes recently pointed out in an op-ed, neutrality is an engineering term. Neutrality or the openness of the Internet means that an entrepreneur could interconnect her servers at some network access point and make available her content for access by anyone with a computer and her IP address. It’s a given that consumers will have access to the entrepreneur’s data (assuming the entrepreneur properly makes the world aware that they exist). It goes back partially to Moore’s law. The network is going to grow in value as more computing capacity is demanded and which broadband provider is going to accept no increase in their network’s value by blocking content from edge providers.
Frankly that’s how I always viewed neutrality until the more progressively inclined added a three-letter word and politicized the term in order to get consumers riled up into believing that broadband providers intended to manipulate traffic so that grandma would have a hard time sharing her thoughts on YouTube with the rest of her neighbors or using Skype to talk to her choir director about next Sunday’s performance at the go-to-meeting.
So what would be the impact on the entrepreneur should the court of appeals uphold the FCC’s net neutrality rules? Confusion. The current rules would stay in place accompanied by a few new cans of worms. Would an agreement between your edge service and Verizon to send your traffic at a faster rate violate the anti-discrimination portion of net neutrality rules? Should Verizon even be hit with accusations of net neutrality violation if it enters an arrangement with an edge provider just to move data traffic between a couple offices versus someone trying to access Internet content?
And what about transparency rules? If Comcast is required to share with a broadband access service consumer accurate information regarding network management, as an edge services provider would you want Comcast put in a position where it incidentally shares your information with a consumer simply because your data is part of a broadband access providers management practice?
On the other hand, what if all or even some of the FCC’s net neutrality rules were vacated? Would the sky start to fall? Probably not. Vacating the anti-discrimination rule for example would not result in your Internet service provider favoring its own news content for transmission to you versus content from The New York Times. Again, meeting the consumer’s choice for their news is better for business and for expanding a networks value.
In addition, before these net neutrality rules came into being, all major Internet service providers shunned the practice of blocking content, so in the face of net neutrality advocates crying foul should the courts strike down some or all of the net neutrality rules, broadband access consumers and content providers will see no throttling of their services. Consumers will still have multiple choices for broadband access and innovative services, especially from edge providers will continually develop.