Network Neutrality is an issue that will affect everyone who uses the Internet, both consumers and web content producers. It is a complicated issue that involves billions of dollars and lots of politics. The US Department of Justice (DoJ) issued a statement to the Federal Communications Commission (FCC) arguing against Net Neutrality. It said in part "
The Department said in its filing that it may make economic sense for content providers who want a higher quality of service to pay for the Internet upgrades necessary to provide such service, arguing that “any regulation that prohibits this type of pricing may leave broadband providers unable to raise the capital necessary to fund these investments.”
“Consumers and the economy are benefitting from the innovative and dynamic nature of the Internet,”said Thomas O. Barnett, Assistant Attorney General in charge of the Department’s Antitrust Division. “Regulators should be careful not to impose regulations that could limit consumer choice and investment in broadband facilities.”
What is Net Neutrality? It means that all web sites and services are equal and get the same rights to bandwidth from the carriers. So, email, web site content, music files, video, VoIP, IPTV, etc., all get equal access to bandwidth without any additional charge.
Who pays for Internet bandwidth? The telecom "carriers" get paid on both ends by consumers, and by web content producers. Consumers can pay $10 a month for dial up service or $50 a month for broadband service. Consumers usually have two choices for broadband service; your cable TV provider, or your telephone service DSL.
Web sites and content owners also pay for Internet bandwidth. Web sites pay their ISP (Internet Service Provider) for the bandwidth they use to push their content to users. The charges are based on how much bandwidth they use. The ISPs then pay the big telecom "carriers" who own the infrastructure.
What do the telecom carriers want? They want the right to charge extra for certain applications at their discretion. The carriers are rethinking "unlimited usage" in cases where applications consume huge amounts of bandwidth. Things like video, IPTV, and VoIP could be the target of extra charges from the carriers. Companies like YouTube, BrightCove , Skype, and Vonage might be asked to pay surcharges for bandwidth.
What is the problem? What happens if Verizon decided to charge Skype and Vonage extra for VoIP but allows its own VoIP service to go over its network for free? What happens if Comcast decides to charge BrightCove and other IPTV companies extra and has its own competing IPTV service? What happens if Comcast and Verizon coincidentally decide to add a surcharge YouTube traffic?
What if they decide to charge Google a surcharge for traffic? The telecom carriers are very jealous Google's revenue stream...and they want a piece of it. Executives at AT&T and Verizon have publicly said they think Google, Yahoo, and Microsoft should pay a percentage of their revenues to them for use of the network.
Will competition prevent surcharges? How many broadband Internet carriers are there? Most consumers only have two choices. If one adds a surcharge and the other does not, consumers might switch over to the other one. But, if they both add surcharges...what is likely to happen?
We haven't heard the last of Net Neutrality. Expect the truth to get twisted in bizarre ways by both sides of the argument.