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  December 20th, 2017 | Written by

Net Neutrality: What it Means for Businesses

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  • The FCC undoing of net neutrality is not yet the law of the land.
  • Several lawsuits seeking to block the FCC’s net neutrality order have been announced.
  • Net neutrality means ISPs should deliver web traffic, applications, and content equally.
  • Opinions differ as to the effect of the FCC’s action on net neutrality.

The first thing to know about last week’s Federal Communications Commission undoing of net neutrality is that it is not yet the law of the land. The FCC must surmount several procedural hurdles before htat happens, including finalizing the text and subjecting the order to review by Office of Management and Budget and the Government Accountability Office. After OMB approves the order, the FCC will publish it in the Federal Register, and it will take effect 60 days after that. Congress also a chance to override the action under the Congressional Review Act.

Opponents of the FCC’s action will no doubt mount challenges in Congress and the courts. Several lawsuits seeking to block the order have already been announced.

Net neutrality encompasses the idea that internet service providers (ISPs) should treat the delivery of web traffic, applications, and content equally. In 2015, the FCC, with the support of the Obama administration, classified the internet as a common carrier under Title II of the Communications Act, subjecting ISPs to a new set of rules. The FCC action undid that designation, allowing broadband internet services to revert to their previous categorization as an information service subject to much lighter regulation.

Opinions differ as to the effect of the FCC’s action.

The 2015 rules prevented ISPs from: exempting their own video services from caps on mobile data; throttling the speed of sites and apps for competitors; and creating contracts that connect networks in exchange for telecommunications traffic.

Detractors say ISPs are now in a position engage in these practices, which could put businesses, and especially small ones, in a difficult spot. ISPs could slow broadband connections to rival companies and increase speeds for content providers who pay and they would have to pay all ISPs if they wanted to maintain speed across the board.  Site speed is important to Google’s search rankings.

Business may have to pay extra to get access to certain consumers, which would raise their costs. The loss of net neutrality could also impact companies involved in the internet-of-things (IoT) phenomenon.

Supporters of the FCC move say it will not end the internet as we know it. Users won’t see any difference in the internet’s performance. The major providers have committed to no blocking and throttling practices, the same as before the 2015 rules came into effect.

Meanwhile Free Press, an activist group, and the attorneys general of Washington and New York states have said they would sue to block the FCC’s order. According to Washington Attorney General Bob Ferguson, the FCC’s action violated the Administrative Procedure Act.

All of which brings up a larger issue. Should these internet policies be left in the hands of executive agencies? Perhaps it is time Congress took a stand on how ISPs should be regulated.