10 Reasons Web Giants Want the FCC to Enforce Net Neutrality

by Don Reisinger

Any erosion of the net neutrality policies that have been in place by default since the early days of the Web is virtually guaranteed to raise the price of providing services to customers. If major Web companies are delivering high-end services that take up a lot of bandwidth (for instance, Netflix, YouTube and other video-streaming companies), ISPs would naturally be encouraged to charge them more in a world without net neutrality. That’s a major problem for online giants.

Right now, all the power on the Web is in the hands of Internet giants. They’re allowed to provide as much content as they want, and the ISPs need to deal with the bandwidth fallout. If net neutrality is officially struck down, the ISPs will hold all the power and Internet companies will have to play nice. That’s a dangerous prospect.

If net neutrality is struck down, there’s a good chance that users will be hurt. Net neutrality in many ways protects users from higher costs since companies would not carry the costs of major changes in pricing.

Startup development is a huge concern in the net neutrality space. If companies need to pay for the ability to deliver their service to customers around the globe or if the users themselves need to pay more just to have access to those services, startups will never be able to grow. And since big companies like to acquire small startups, it’s no surprise firms like Google and Facebook might take issue.

The Internet is a huge economic engine. If not for major Web companies, the U.S. would not be nearly as big or economically powerful as it is today. Net neutrality threatens all that by throttling Web companies and limiting their growth opportunities. The economy should be the FCC’s chief concern going forward.

It’s one thing to kill net neutrality in the U.S., but in many competing countries around the world, there are no such limits on traffic. That would give other countries the upper hand and potentially put the U.S. in an even worse position on the Web. International competition simply cannot be ignored when evaluating net neutrality.

Before becoming FCC chairman, Wheeler spent a long time as a lobbyist working on behalf of the wireless industry, which includes some of the biggest ISPs in the business. Wheeler was sworn in as FCC chairman in November 2013. He hasn’t had enough time to establish a track record as a rule-maker. So it’s natural that many of the Web companies would question whether he will fairly balance the interests of ISPs, Web application companies and users.

Although many of the largest Web companies signed the letter, there’s a real fear among smaller firms that they would be squeezed out from a net-neutrality-less world in which the big companies such as Google, Amazon and Facebook would be able to absorb the higher costs. Competition is a real concern.

As the companies note in the letter, an end to net neutrality could create a scenario in which “bargaining” for bandwidth and service access becomes commonplace in the industry. Companies would need to strike deals with ISPs, and in some cases, there would be significant differences in what end users are paying to access similar services. Net neutrality is supposed to reduce the chances of creating broad classes of disadvantaged users based on what they can afford to pay for Web access.

If costs are passed on to companies for delivering so much data, there’s a real possibility that the Web’s business model will change. Major Web companies might need to start charging for access to services that are currently free or charge more than they already do. Users will have to decide to pay the additional charges or drop the service. The Internet’s success has relied heavily on free or low-cost access to services. If ISPs make those firms pay, that business model might be toppled. And the Web might just change for the worse.