Forget the Trendy Rants, Net Neutrality Shortchanges Consumers

Americans now depend on the Internet as an essential tool in their workday, their social interactions, their purchasing of goods and services, and their entertainment. And as the Internet evolves, so too does our ability to utilize faster connection speeds to access better quality applications and websites.

Where do these faster connections and tools come from? The answer is pretty simple: investments.

As we look into the future, we expect investments to foster even greater speeds and the accompanying historic innovations, such as 5G wireless which will support the Internet-of-Things and an upgraded Wi-Fi network. However, disruptions that impair Internet service operations and infrastructure investments will slow this progress toward ever higher speeds – affecting consumer satisfaction and online services – which brings us to Title II and net neutrality.

Title II and net neutrality regulations, created in 2015 by the Obama Administration to address problems in our Internet marketplace that didn’t exist, are sometimes summarized as rules designed to treat consumers equally by preventing Internet Service Providers (ISPs) from blocking consumer access to websites and charging consumers and businesses more for faster broadband services. Looked at from a pedestal of ignorance on how the Internet actually works, this could sound benign. In reality, it acts as an impediment to delivering what consumers and most website operators want.

Net neutrality’s insistence that everyone be treated identically is out of sync with consumers’ real interests. Many consumers place a high value on speed in the services they use. For example, Yahoo charges extra for professional quality email (Yahoo Mail Pro). The Mail-Pro service allows faster and less cluttered access to the emails because it removes adverts from the email page, minimizing unwanted interruptions and delays from adverts being shuffled onto and off the email page. The Pro service allows consumers to quickly focus their attention on the email, not the unwanted distractions. Pro-email is worth the $35 per year premium to consumers who value their time. There is no justification for preventing some customers from choosing Mail Pro just because others are using free email.

Amazon is successful in large part because it understands that many consumers value fast delivery of physical packages. It acts on this understanding by providing a choice of delivery speeds for each purchase. In some locations and for some purchases, next day delivery is available. More often express shipping (2-3 days) is available for a small fee or it is free as a privilege of Prime membership ($99 per year). Some items are available at a low shipping cost and longer shipping delay, but the 65 million Prime subscribers value fast delivery. There is no justification for regulation that would force everyone to endure the same delay in shipping.

The fact is that it is a common and pervasive practice for services to differentiate by speed, market, quality and price. Amazon does it, Yahoo does it, airlines do it and the US Post Office does it, but, under Title II and net neutrality regulations, ISPs can’t do it. Moreover, net neutrality regulations also prevent network ISPs from prioritizing some services, such as delivering emergency information and health monitoring data between patients and doctors, over downloading pirated HD videos.

Late Professor Frank Bowe, a major advocate for consumers with disabilities, concluded that net neutrality would inhibit supportive technologies that can help millions of Americans with special needs. One NAACP official also once stated that net neutrality regulations were about shifting Internet costs from large web companies to consumers, thereby adversely affecting lower income consumers. In fact, a host of academic studies found that these regulations reduce consumer welfare. Moreover, ISP investments have declined since net neutrality rules took effect in 2015.

Title II net neutrality regulations also do not benefit most small businesses. Large web operators offer upstream Internet infrastructure for themselves and for larger businesses — called content delivery networks (CDNs). For smaller companies, paying for faster services can provide them the ability to compete against these larger rivals, but net neutrality can restrict these options. While CDNs are not subject to net neutrality restrictions, ISP services are. This means that net neutrality limits options for many small businesses and startups and it favors big web companies.

Title II pretends to deliver fairness for all, but instead it forces consumers and many small businesses to settle for slower Internet services, discourages investment and innovation, and it prevents the prioritization of services, including lifesaving applications. Consumers deserve better.