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Broadband Competition Will Solve Net Neutrality Better than the FCC

Net Neutrality is commonly misunderstood. However, it could easily affect our society for generations to come considering the widespread use of the Internet and the innovations that it fosters. This article will briefly explain what Net Neutrality is, why the FCC is involved and better solutions for solving the problem.

Net Neutrality

The Internet has generally worked on a “First Come, First Serve” basis. Meaning, as information flows through the Internet, it is processed and forwarded in the order it was received. This gives every Internet user equal access to all applications and services on the Internet. For example, an Internet user may have a DSL Internet connection from AT&T and may use it to gain access to services from Vonage. Although Vonage is a competitor, AT&T’s network treats their packets of information just the same as they would treat packets from their own services.

The neutral Internet has provided opportunity for many innovative ideas and business models to grow and prosper. Equal access has allowed many of those ideas to begin with little or no funding. Facebook and Google are well-known examples. Facebook was started by Mark Zuckerman when he was a college student at Harvard and Google’s first servers were in a friend’s garage near Stanford.

Why the FCC is Involved

Some major Internet Service Providers (ISPs) have attempted to block or slow down traffic from web hosts the ISP did not want its customers to have access. Recent examples include Comcast requiring Level3 (host for Netflix) to pay for faster access to its customers and Metro PCS blocking traffic from Vonage and Skype. These practices have alarmed customers, industry professionals and web-based service providers especially when some ISPs have a monopoly or duopoly in certain areas that they serve. They may deny customers from accessing desired services, stifle ideas and prevent new and innovative business models from having a chance for success.

In an attempt to prevent these problems and keep the status quo of the Internet, the FCC passed a weak set of stipulations preventing land based ISPs from unnecessarily blocking or slowing down content and an even weaker set of stipulations for wireless ISPs. These actions are being challenged in court and Congress. The long term effects of the actions are in doubt especially with the government’s poor track record of solving problems with rules and regulations.

For the record, the FCC is not attempting to regulate the Internet. It is only attempting to limit ISPs from selectively blocking or slowing down access to legitimate web sites and services.

Competition Solves the Problem

The Net Neutrality debate exists because there is not enough competition in the broadband market. Corporations like Comcast and Verizon must maximize their profit and act in the best interest of their shareholders. Their list of priorities does not contain the idealistic goal of protecting an open Internet. This does not make them evil. It is just a fact. How can an open Internet be in sync with the responsibilities of Comcast and Verizon? That is simple. Competition.

Christopher Yoo, director of the University of Pennsylvania Law School Center for Technology, Innovation and Competition, agrees. He is quoted in PCWorld as saying the net neutrality debate is less important than spurring broadband competition and implementing the FCC’s national broadband plan, released last March. The net neutrality debates in recent years “probably generated much more attention than they deserved.” If broadband competition was “robust enough, all these issues would go away.”

Real time applications like Netflix, online gaming and VoIP (such as business Hosted PBX services) are rapidly becoming the most popular applications on the Internet. Could Verizon and Comcast block or slow down some of this content while going head-to-head against a competitor that does not? Not likely since losing revenue would not be maximizing their profit potential. And that would be far more effective than any regulation government could ever put in place.

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