The Editorial Board
When consumers began embracing the Internet in the 1980s and ’90s, they got a lesson in the joys of competition. While they had to use a monopoly — generally a phone company — to dial in, that monopoly had no say in what content they accessed.
Much has changed since then. Broadband has brought far greater speeds and uses. But with it has come a persistent effort by the Internet Service Providers (ISPs) such as the phone and cable companies to turn the medium into their proprietary domain.
This week’s ruling by a three-judge panel, striking down the Federal Communications Commission’s “net neutrality” policies, was a big win for the ISPs. Unless the FCC or Congress acts, they will be free to cut deals with some content providers for faster access while forcing others into the slow lane.
To be sure, the changes are likely to be gradual. Companies such as Verizon and Comcast don’t want to cause an instant uproar. But make no mistake about it. If nothing is done, the Internet of the future will be much less appealing than today’s.
Consumers would pay more for certain content while finding fewer choices. And start-up content providers would face more obstacles in bringing their products to market.
One immediate impact could be felt in movie and TV streaming. Wall Street analyst Michael Pachter said Thursday that Netflix could face $75 million to $100 million per year in additional content delivery costs, much of which would presumably be passed along to subscribers. But he added that Netflix might actually use the ruling to its advantage by cutting deals that shut out competitors.
That’s a pretty telling example of what should not be allowed to happen. It’s OK if providers want to charge the heaviest consumers based on the amount of data they stream. That, in fact, might be necessary to keep the Internet from getting overloaded, and it’s already happening.
But this is something different. This is entrenched providers cherry-picking the parts of the Internet that generate large amounts of revenue and imposing themselves as toll collectors on the information superhighway.
By forcing content providers into bidding wars for preferred access on limited pipelines, they would drive up costs to consumers while turning the Internet into something more like cable television and less like the ingenious open platform that it has been. Fights like the one that has prompted DirecTV to dump The Weather Channel could become more commonplace.
There is a simple way to prevent this. The court clearly stated that the FCC could continue its net-neutrality policies if it reverses its decision from the 1990s to not treat broadband as a common carrier, as it had with traditional telephone service.
That decision, which looks hopelessly naive in retrospect, was based on a belief that the broadband industry would be much more competitive than it has turned out. In large swaths of the country, consumers have no more than one viable option.
In the past decade and a half, the Internet has gotten much faster and in many ways better. But if significant amounts of control are handed over to entrenched cable and telephone companies, the next 15 years will be considerably less appealing.