Monday 19 May 2014

Net neutrality: what is it and why does it matter?

The FCC meets Thursday to discuss new rules for regulating the web. James Ball explains the latest challenge to net neutrality
Ethernet cables

The new rules would introduce an effective competition test which sets a bar ISPs have to pass in order to prioritise particular traffic. Photo: Lukas Coh /AAP Image
The Federal Communications Commission (FCC) meets Thursday to discuss new rules for regulating the internet, bringing the debate about “net neutrality” back to the fore. The FCC was forced to rewrite the rules after its old ones were overturned in January following a court battle with Verizon. Protesters are camping out outside the FCC's offices and some of the world's biggest tech firms have written to the regulator expressing concern that the proposals leaked so far offer a “grave threat to the internet.”

As is common on the information superhighway, a debate on an issue like net neutrality tends to lead to a great deal of shouting but not much actually being said. So, ahead of the latest in what will be a long string of protests, decisions, rulings and challenges, it's worth taking a step back and looking at what we're debating and how we got here.

What is is net neutrality?

The core principle of net neutrality is a simple one: that all traffic (data) traveling across the internet should be treated the same at each stage of the process. 

That roughly means that whether a particular packet of data is video from Netflix, HTML from the Guardian, or a P2P file being sent across BitTorrent, it's given the same priority along the same routes. No-one has priority access, or a "fast lane".
This is one of the key principles around the governance and structure of the internet, and one the FCC and Obama administration have both said they support, though people have their doubts about the FCC's stance in particular.

Why it matters

The more lurid of the pro-net neutrality posters and articles get very dramatic about what an abandonment on net neutrality would mean. One particularly dramatic viral image shows an ISP bundle looking more like a cable subscription: charging additional sums each month for access to particular sites or services – $5 for online gaming sites, $5 for international, and so on.
It's certainly scary – no-one wants to be hit in the pocket – but isn't really the most realistic idea of what an abandonment of net neutrality would likely mean (though it could, in theory, happen down the line). ISPs actually blocking all but permitted content, or even just directly charging customers for particular access would be particularly easy for the FCC, even under its watered-down rules, to challenge. The courts would likely have a similarly easy time against such rulings.

What's more likely

Instead, the initial effects to consumers would likely be invisible. ISPs could rather offer prime deals to particular heavy users of bandwidth. The most obvious candidate is, of course, Netflix – a single site which often makes up as much as a third of all internet data usage. Where other video sites like YouTube try to optimise their content, Netflix will generally use as much of the pipe as it can: if there's lots of bandwidth going, it'll send UltraHD. Only if the pipe's slow will it compress and optimise.

It's no exaggeration to say a single stream of one Netflix program can use the same amount of data as a million straightforward web pages, and it's the ISPs that have to manage that traffic.

Why shouldn't they pay for that access, then?

On the surface, it seems reasonable, then, to charge Netflix for their relatively free (or at least cheap) ride: if they're using so much more bandwidth than anyone else, why not charge them for priority access? 

Here's the arguments why not. The first is one of competition: allowing companies to charge for a fast lane completely reshapes how the marketplace works. Let's say Netflix is willing to pay every US ISP for a special "fast lane" for its data (it has, after a fashion, already cut one such deal). 

Later, a better competitor comes along: easier to use and cheaper, with better shows, better tech etc, but its relatively slow net connection means it can't stream at the same quality – its streaming might even be bitty and interrupted. As a startup, it can't compete with what Netflix is (hypothetically) shelling out to ISPs. And so despite the better tech and content, the challenger fails. An internet without net neutrality moves huge market power to the gatekeepers and the incumbents (of course, you could argue in that example it's only shifting the monopoly away from rightsholders to pipeholders, but that's a different issue).

A second issue is merely one of fairness. In our homes, ovens use vastly more power each day than lightbulbs. Should, then, oven manufacturers pay electricity companies for all that burdensome work they have to do to keep ovens working – especially when lightbulbs are so low-strain? Generally, we'd see such a concept as ridiculous: the customer pays once, and that's enough.

What's the FCC doing?

So now we come to what the latest challenge – there've been many others – to net neutrality is. The agency had previously tried to come up with a fairly good guarantee of net neutrality, which most advocates were relatively happy with.

However, this was struck down in January by the appeals court as overly burdensome: the FCC, they said, should specify some circumstances in which it might allow ISPs to prioritise traffic. The agency has responded with a proposal that would use Section 706 of the Telecommunications Act that would assess attempts to prioritise traffic on a case-by-case basis. The proposal either protects or undermines net neutrality, depending on how much you trust the FCC.
The new rules would introduce an effective competition test which sets a bar ISPs have to pass in order to prioritise particular traffic. Senior FCC staff promise that bar will be set very high – any deal must prove itself “commercially reasonable”. The FCC is trying to reassure net neutrality advocates that neutrality is safe under such a regime. Critics seem unwilling to stake such a lynchpin of the open internet on assurances.
Wise as that seems, the alternative proposal carries heavy risk. What many open internet advocates are calling for is for the FCC to declare that the internet is a utility, like electricity. This would be done under Title II of the Communications Act, which already covers telecommunications services but since 2002 has not covered "information services" – data travelling over the internet. If the FCC reclassified information under Title II, as in the earlier analogy, the data must flow equally, just as power flows across the grid. Such an effort would do much to safeguard net neutrality. If it worked.
If it didn't – and opposition and lobbying against it from the powerful and connected cable companies is already fierce – the FCC has played its last card, its doomsday device. It would have nothing left in its hand: net neutrality in the US would likely be a lost cause.

The FCC seems keen to avoid rolling the dice. It wants net neutrality advocates to trust that it's trying to protect the principle while keeping something in reserve. Advocates fear it's merely trying to kill neutrality with a whimper, rather than a bang.

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