It’s finally happened. On Monday, U.S. net neutrality—the rule that says telecommunications network operators must treat the traffic they carry in a neutral way—died at the hands of the current Federal Communications Commission (FCC), led by Ajit Pai.
But what will that actually mean in practice?
The unravelling of the net neutrality rule—which was introduced under President Obama’s FCC—theoretically means companies such as Comcast, AT&T (T) and Verizon (VZ) can block certain content on their networks, or slow it down if the companies behind that content don’t pay for it to be delivered quickly and at good quality.
The companies say they won’t do that, although throttling (the slowing-down practice) has taken place before. Comcast (CMCSA) notoriously did it to peer-to-peer (P2P) file-sharing traffic a decade ago, leading to a reprimand by the FCC.
Comcast’s decision to throttle P2P traffic was quite likely motivated by competitive fears—file-sharing was a threat to cable TV, and P2P voice services threatened traditional telephony revenue. Under the new rules, if an operator tries to worsen users’ experiences in an anti-competitive way, people won’t get to complain to the FCC, though.
Instead, they’ll have to go to the Federal Trade Commission (FTC,) which already has enough on its plate dealing with the rest of industry. FTC investigations are also slow, and are limited to antitrust violations—which depend on companies having clearly dominant positions in their markets—and the breaking of public commitments.
So, if your cable company does start slowing down Netflix in order to give a boost to its own services, relief could be a long way away.
On the other hand, operators are at least still required to be transparent about how they’re managing their networks, so if you notice Netflix’s quality is lower than it used to be, you should know whether or not your internet service provider is to blame.
Either way, it’s not so likely that operators will specifically try to downgrade the speed and quality of certain services. What’s more likely is that they would promote their own services, leaving others to make do with whatever capacity is left. Different technique; arguably the same result.
The best-case scenario, given the circumstances, is that network operators make good on their promises and invest more in their networks, making sure that there’s enough capacity in there for everyone. This is after all the reason why the FCC ostensibly rolled back net neutrality—to let operators make more money, in order to stimulate investment.
The worst-case scenario is that startups trying to provide new online services—ones that challenge the services provided by network operators—will find themselves unable to build a new user base unless they strike deals with those operators. Indeed, the practice of “zero-rating”—a net neutrality abuse where only certain services don’t count against the customer’s data limit—is already here.
All this is at the federal level, though. Many states have been pushing to introduce net neutrality at the state level—Washington and Oregon led the charge, while state government agencies in Montana and Hawaii can now only take Internet-related services from providers with net neutrality principles in their contracts.
Meanwhile, the attorneys general of more than 20 states have sued to undo the FCC’s net neutrality decision, arguing that it was “arbitrary, capricious and an abuse of discretion.”