Net Neutrality Rules: Good, Bad or Just Political?
Jan. 14, 2011 (Vol. 32, No. 2)
The latest development in the net neutrality saga is a U.S. Federal Communications Commission order vague enough to leave most pundits guessing as to its impact on enterprises and expecting a string of subsequent lawsuits.
The FCC voted late last month to turn what had been recommended Internet guidelines into three formal rules aimed at preserving an open, equal-access Internet. The agency’s order calls for the following:
- Full transparency by all broadband network operators about their network management practices
- No blocking of lawful Web sites and applications by fixed broadband operators
- No unreasonable discrimination by fixed operators as to how they treat content from various sources
The blocking and discrimination rules are subject to an overarching exception for reasonable network management by the carriers.
Whether the FCC even has the authority to make and enforce Internet rules is an overriding question that already has been challenged successfully in court once and is likely to be again. In the meantime, perhaps the biggest outstanding issues for enterprises are two areas with particularly ambiguous wording in the FCC order:
• Pay for priority. This practice is discouraged in the FCC order but not expressly prohibited. If the world’s most deep-pocketed companies can pay a premium to ISPs for “fast-lane” Internet access privileges to their Web content, does this leave your Internet-facing business at a potential disadvantage? And could it affect your strategy to use cloud services, such as software as a service (SaaS), in which reliable Internet transport plays a fundamental role?
• Wireless access. Because of its newness, the wireless access network was left fairly unprotected. What does this mean for your users and customers as wireless Internet access increasingly becomes the de facto access method?
The order “leaves what’s ‘unreasonable’ up to the FCC and enforcement to be determined on a case-by-case basis,” notes Andy Regitsky, president of Regitsky and Associates, a policy and regulatory consulting firm in Reston, Va.
Let’s examine what’s at stake.
Pay for Priority
In a pay-for-priority situation, a content, application or service provider pays a premium to a network operator above and beyond its monthly network capacity fees to have its content treated preferentially across the Internet. The payoff ensures a better user experience with that entity’s traffic compared to content delivered by others that do not pay a premium.
The order doesn’t explicitly ban this activity, though it does state that “pay for priority will be unlikely to satisfy the no unreasonable discrimination” rule.
So ... which is it? Leaving the question up in the air implies that each priority agreement might have to be scrutinized by the FCC or other enforcement body. Or it might mean that the question was too weighty to be answered now, and that the FCC wanted to get something on paper, in part to help President Obama fulfill his net neutrality campaign promise.
Net neutrality advocates tend to dislike the pay-for-priority concept.
“Enterprises don’t pick their customers’ ISPs,” points out Colleen Boothby, partner at Levine, Blaszak, Block & Boothby, LLP, a law firm specializing in telecom regulatory and policy matters in Washington, D.C. The firm works frequently with the Ad Hoc Telecommunications Users Community, she says, a group of rotating Fortune 500 companies that support net neutrality regulation.
But those ISPs stand between the enterprise and its customers. “Enterprises don’t want to pay twice to get to their customers,” in that they are already paying for broadband access to their Web sites. “That’s a transfer of resources away from their enterprise to a service provider’s bottom line,” she says.
“Everyone is already paying,” asserts Chris Hazelton, a research director at The 451 Group, an enterprise technology analysis company based in New York. Internet-facing businesses are already shelling out money for domain names, to register their services, for supporting data infrastructure and for Internet access, he says.
“It could be argued that with users paying per megabyte for access and [Internet-facing] business also paying per megabyte on the outgoing side, that there’s already a double billing situation,” he adds.
On the other hand, who’s to say that paying for prioritization is illegal?
It’s a slippery slope. Application traffic of all shapes and sizes has been shoehorned onto multiservice IP networks, yet different application types have different latency, packet loss and jitter requirements. Plain old data is fairly forgiving on all counts, where voice over IP, for example, is not.
As Boothby points out, “enterprises live in a class-of-service world,” in which they manage their own networks to optimize user experiences with each type of application. ISPs need to do that, too. But where does necessary network management leave off and unfair leverage of the power they have over Internet pipes begin?
Some, such as Regitsky, argue that the FCC is attempting to prevent future bad behavior that hasn’t yet occurred, which they find unreasonable. Others contend it’s unreasonable to wait for abuses and create policy to deal with them after the fact.
What’s Up with Wireless?
The wireless portion of the order is equally murky. Only the first of the primary tenets of the FCC’s net neutrality order – network management transparency – firmly applies to wireless networks.
Because of this, “there’s an overall sense that wireless was not well protected,” says Andrew Brown, another partner at Levine, Blaszak, Block & Boothby.
The FCC order does preclude mobile operators from blocking voice and video applications and services that compete with their own. For example, Skype is an alternative to wireless voice services available from the mobile network operators, so it must be allowed.
“The FCC [advocates] one, open Internet, but then includes a whole section on mobile that chips away at the no-blocking rule,” Brown says.
For example, it’s unclear whether mobile operators can disallow applications that don’t directly compete with their core services. Mobile operators retain control over what goes into their own app stores. However, it’s not expressly stated whether they could block apps available elsewhere that compete with those in their app stores.
“And operators can always claim that downloading and running a particular application presents management issues for their networks,” Brown says.
In Violent Agreement?
Perhaps the most fascinating aspect of net neutrality is that people on both sides of the issue portend to have the same end goal: an open Internet in which innovation is able to flourish.
Pro net neutrality folks believe that advances in network management technology such as deep packet inspection (DPI) could squelch innovation if abused. DPI enables network operators to identify types of traffic and treat it appropriately for its requirements on bandwidth, latency, loss and jitter.
However, armed with such a capability, broadband operators could degrade or block competing services, giving their own services an unfair advantage, which is what the rules aim to prevent.
Anti-net neutrality folks believe the Internet can’t remain innovative if subject to rules and regulation, period – even if those rules and regulation are intended to retain equal access to the Internet.
“People pushing for strong Internet rules are unhappy because the FCC didn’t reclassify [the Internet] from an information to a telecommunications service,” which would ensure that regulation would fall under the agency’s control, Regitsky explains.
But the ISPs are unhappy, because “they don’t believe there should be any rules. There will be years of uncertainty as [the order] goes to the courts, and uncertainty leads to lack of investment” in network applications and services, he adds.
The FCC was “under political pressure and needed to get something done,” Boothby notes. The rules “will almost certainly be challenged in court.”
Meantime, the rules could go into effect early in 2011, barring someone filing a request for injunction that a judge grants. Once the rules are in effect, complainants could contest them.
Joanie Wexler has spent 20 years analyzing trends and news in the computer networking industry. Currently an independent editor and analyst, she covers the gamut of IT hot topics, including voice and data network services and equipment, convergence, wireless communications and data center trends. Contact Joanie at email@example.com.