The FCC voted today to designate the internet as a “telecommunications service,” an action that will establish the set of regulations that support what its backers call “Net Neutrality.”
What the FCC’s Net Neutrality Decision Means for Small Business
While the issue can sound complex and confusing, perhaps you can judge the impact of the Net Neutrality vote today by seeing who opposed it—the giant communications companies that provide us with access to the internet: Comcast, Verizon, AT&T, T-Mobile and Time Warner Cable.
These companies don’t want the internet to be considered a “telecommunications service” because that prevents them from creating special rates for services like Amazon and Netflix that use lots of bandwidth. These fees would be in addition to the fees paid to the carriers by subscribers (us) for internet access and use.
Another way to look at it is not about additional fee-based “fast lanes,” but recognizing that when Netflix can pay for faster speeds, the rest of us, in effect, are being throttled down.
As with most lobbying efforts, the big companies used “small business” to oppose Net Neutrality
Ajit Pai, a member of the FCC, voiced the argument last week that net neutrality, “saddles small, independent businesses and entrepreneurs with heavy-handed regulations that will push them out of the market.” Nearly immediately, a pro-Net Neutrality group of 100 companies (including Yelp, GitHub, Foursquare Labs, Etsy, Kickstarter and Tumblr) issued a letter to the FCC saying, “Any claim that a net neutrality plan based in Title II would somehow burden ‘small, independent businesses and entrepreneurs with heavy-handed regulations that will push them out of the market’ is simply not true.”
What to look for to predict the long term impact of today’s vote
While, no doubt, the carriers will continue efforts to overturn today’s action, they must also find Plan Bs to grow within the new reality. The most beneficial way would be for them to see the potential for growth in expanding access to higher speed networks for all of us.
For example, it will be interesting to watch AT&T’s future decisions related to the roll-out of its highspeed fiber service in new markets. As we reported last November, AT&T’s CEO halted the rollout, blaming Obama’s support for Net Neutrality as the reason. Many saw this as a ploy to gain the support of consumers for the company’s anti-Net Neutrality efforts.
With a pro-Net Neutrality company, Google, using that AT&T decision as an opportunity to expand its fiber service into AT&T strongholds, we’ll see if the November announcement was merely a lobbying tactic or a true business decision that AT&T can defend when shareholders challenge the strategy.