For the most part, Americans got all glassy-eyed when the tech types tried to whip up support for “net neutrality,” which treats everyone as equal on the Internet. Now, we’re about to pay the price — literally — for our indifference.
Netflix announced to investors this week that it will raise its monthly price, hardly surprising after the shakedown Comcast staged by throttling Netflix content, causing buffering and angry customers to the point where Netflix had no choice but to pay Comcast more money to clear the roadblock.
As we depend more and more on the Internet, expect more price increases now that the Federal Communications Commission has essentially determined who owns the Internet: Comcast and its colleagues, who just happen to be some of the most hated companies in America.
According to the New York Times and Wall St. Journal, the FCC is about to issue new rules in consideration of a court decision that said because the Internet is not considered a utility under federal law, it was not subject to regulation mandating equal access to the Internet.
For this one, you really can blame Obama. He put Tom Wheeler in charge of the FCC last year. Wheeler, a big contributor to the Obama campaign, is a former lobbyist for the cable and telecommunications industry. The former chairman of the FCC? Michael Powell is now a lobbyist for the cable and telecommunications industry. Cozy, eh? Welcome to Washington. It’s worse than it appears, Esquire notes. The FCC and the cable and telecommunications industry are practically the same thing.
After the new rules leaked to the Journal and Times, Wheeler issued a statement that they’re both wrong.
“There are reports that the FCC is gutting the Open Internet rule. They are flat out wrong. Tomorrow we will circulate to the Commission a new Open Internet proposal that will restore the concepts of net neutrality consistent with the court’s ruling in January. There is no ‘turnaround in policy.’ The same rules will apply to all Internet content. As with the original Open Internet rules, and consistent with the court’s decision, behavior that harms consumers or competition will not be permitted.”
Sean Hollister at The Verge parses the denial:
The problem, which Wheeler’s statement doesn’t refute, is that the FCC intends to say that it’s okay to discriminate against traffic if content providers don’t pay the ISPs a “commercially reasonable” fee. While the FCC chairman says that “behavior that harms consumers or competition will not be permitted,” any fee might risk harming both, even if it’s tiny. Today, when anyone can create software and internet services on their own personal computer, any additional barrier to entry can theoretically harm competition. What’s more, the mere existence of a standard that allows discrimination, by definition, violates the idea of net neutrality.
Wheeler, however, has endorsed the idea of a two-tiered Internet — a fast one you could buy into, and the slow one for the little people.
“I am a firm believer in the market,” he said in December. “I think we’re also going to see a two-sided market where Netflix might say, ‘well, I’ll pay in order to make sure that you might receive, my subscriber receives, the best possible transmission of this movie.’ I think we want to let those kinds of things evolve. We want to observe what happens from that, and we want to make decisions accordingly, but I go back to the fact that the marketplace is where these decisions ought to be made, and the functionality of a competitive marketplace dictates the degree of regulation.”
About that marketplace. Comcast is about to swallow up Time Warner, and will control over 60 percent of the broadband market. In most communities, the local provider is a monopoly.
In the case of Netflix, the Internet will be controlled by the companies who also happen to be its biggest competitor: cable TV companies.