A federal appeals court struck a crucial blow for the freedom of the internet with its 2-1 ruling in support of net neutrality, guaranteeing unfettered access to the web.
What a relief, not only for consumers but also for the future of Silicon Valley.
Massive broadband providers such as Verizon and AT&T had hoped to be able to maximize their profits by charging content providers for faster internet speeds and greater reliability, costs that would inevitably get passed along to consumers. But the U.S. Court of Appeals for the District of Columbia Circuit recognized the unacceptable consequences: It simply leads to a society of haves and have-nots for users and the next wave of entrepreneurs.
As President Barack Obama eloquently put it last November, the open internet “has been one of the most significant democratizing influences the world has ever known. We must not allow internet service providers to restrict the best access or to pick winners and losers in the online marketplace for services and ideas.”
The tech community must never lose sight of the fact that while companies such as Google and Apple are the envy of the world, it is the hundreds of entrepreneurs, startups and small businesses that are essential for the next wave of innovation. Somewhere out there in the Bay Area are a dozen or so startups that 10 years from now will be the hottest companies in the Valley—if and only if their products are available to the widest audience possible.
The appeals court ruling stems from the Federal Communications Commission’s 2015 decision that broadband access should be treated as a utility, such as telephone service, meaning it should be equally accessible by all. Broadband providers had hoped to create a Wild West industry with little or no government regulation and few protections for consumers.
If Netflix and its customers want access to the fastest, highest quality pipeline available, they argue, go for it, but be prepared to pay a big premium. That may be fine for an established company such as Netflix, but it isn’t for the hundreds of companies with quality new products trying to get their products before consumers.
The appeals court ruling also upholds a more obscure, but vital aspect of the FCC regulations. FCC Chairman Tom Wheeler inserted a regulation ensuring that the privacy of consumer data gathered by broadband companies would be honored. The FCC has yet to announce how that rule will be implemented. Consumers should keep a close watch on that process.
Expect broadband providers to challenge those rules and appeal the ruling to the U.S. Supreme Court for a final verdict.