The debate over network neutrality is an incredibly emotional one. It seems people want to tear at their hair, sob, and raise their fists for FREEDOM. What about the little guy? And is this the end of the Net as we know it? After all, eBay's (NASDAQ:EBAY) Meg Whitman recently sent a scary email to customers, suggesting that if telecom and cable companies have their way, some parts of the Internet could become a dirt road. Other tech giants have echoed similar sentiments.
The debate is also devolving into theater of the absurd. R.E.M's Michael Stipe and Moby have spoken in favor of net neutrality, and some female songwriters formed The Broadband to record a song called "God Save the Internet." Alyssa Milano supports net neutrality (nope, don't know why she'd have any clout here). Moveon.org and the Christian Coalition -- two polar opposite organizations, save perhaps for sheer political extremism -- are among the far-flung organizations that make strange bedfellows in condoning regulation.
That's my first point: This issue has become a circus. Net neutrality is a complicated and tricky issue, it's made more so by some of the hype. What may sound fair and good for "everybody" certainly may not be if net neutrality evangelists have their way.
Somebody's got to pay
Telecom and cable companies (obviously) provide the infrastructure through which all Internet traffic travels. Until now, Internet traffic has been "neutral" -- data travel is the same for everyone. Net neutrality proponents -- companies like Google (NASDAQ:GOOG), Amazon (NASDAQ:AMZN), and Yahoo! (NASDAQ:YHOO) -- fear that telecom and cable companies might begin to offer a two-tier Internet, in which entities that consume more bandwidth for their services might be required to pay extra to ensure fast service. Does a toll for bandwidth hogs sound too terribly illogical once you think about it?
High-bandwidth content like video and voice-over Internet Protocol (VoIP) are picking up steam. Think of the multimedia inherent in News Corp.'s (NYSE:NWS) MySpace, the digital pictures you increasingly receive via email, the multitudes of downloaded albums from Apple's (NASDAQ:AAPL) iTunes, the popularity of user-generated video on YouTube, the nascent beginnings of full-length movie downloading.
And some telecom companies have implied that giant companies like Google are, in a sense, freeloaders, since they use the infrastructure but don't foot the bill to build it out, maintain it, or improve it. Such companies do apparently pay some fees in order to use ISP's bandwidth, but with video and other chunky content increasing at an astronomical pace, it's an important point that it could choke the pipes and eventually slow everyone to a crawl.
The end of innovation?
Although the net neutrality advocates holler that a two-tiered Internet would stifle innovation and creativity, undue regulation often achieves exactly that end. Furthermore, it's not in ISPs' best interest to make their end users -- people like you and me -- unhappy with a slow and crawling Internet. Why would they jeopardize the culture that made the Internet a success? It is, however, in their best interest to keep the infrastructure strong, fast, cutting-edge, and capable of handling all that high-bandwidth data -- which, of course, requires cash.
Net neutrality legislation might not only dry up ISPs' cash for development, but could also cripple them with governmental or legal wranglings over any alleged discrimination of Web traffic. (The Wall Street Journal underlined a recent uproar when Cox Communications' users couldn't access Craigslist -- the crowd cried foul, but the glitch was merely due to a bug in the security software that Cox had installed to protect its users, not some kind of discrimination. The WSJ pointed out that situations like this provide an ominous example of the types of distractions that could loom if stringent net neutrality regulations are adopted.)
The road to hell is paved with good intentions, and that idea is often borne out by overzealous regulation, which often has entirely unexpected side effects. Despite net neutrality's proponents' claims, such regulation might actually mean that somewhere down the line, all of us will be stuck on a dirt road instead of an information superhighway.
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Alyce Lomax does not own shares of any of the companies mentioned
