What the FCC Net Neutrality Rollback Could Mean for Your Business
February 20, 2018
Under net neutrality rules, internet service providers (ISPs) were required to display all online content equally. If the internet were a road, all traffic would essentially be traveling along the last mile to the customer’s computer using the same lane.
But with the net neutrality rollback announced in December, the FCC made it possible for ISPs to create fast and slow lanes for internet traffic — and to block off some travelers altogether.
The decision is part of the Restoring Internet Freedom Order. Opponents worry it could make content from some businesses arrive more slowly than content from other companies.
Small- to medium-sized businesses (SMBs) could find it too expensive to get their content into the fast lane.
What are the order’s potential risks, and what can SMBs do to mitigate them?
Fast and Slow Lanes
The order, created by Ajit Pai after his appointment as FCC chair, eliminates prohibitions on blocking, throttling and paid prioritization of traffic. This net neutrality rollback means the internet will no longer be a level playing field.
Under the new rules, ISPs can treat traffic differently to support their own policies. They can put some traffic in a “fast lane,” relegating other traffic to a slower one. This would make it harder to offer a strong connection.
Traffic throttling or blocking decisions can be based on an ISP’s own policies. Many ISPs are also content providers, such as Comcast, AT&T and Verizon, and some small businesses say this is a conflict of interest.
A group called Startups for Net Neutrality outlined this in a letter to Pai: “Without net neutrality, the incumbents who provide access to the internet would be able to pick winners or losers in the market. They could impede traffic from our services to favor their own services or established competitors.”
Net neutrality rollback doesn’t affect just U.S. companies.
For example, Canadian startup Bootkik provides video training courses for entrepreneurs. It worries its traffic will be throttled in the States, choking off a potentially lucrative market. The company is rethinking its expansion as it factors in the new risks.
Barriers to Marketing and E-Commerce
Putting some traffic in the “slow lane” could hurt companies trying to sell products and services, through lower customer awareness and search engine rankings.
A company selling goods via its own e-commerce site already faces the likes of Amazon. Now the new rules could help its rivals who can afford “fast lane” service, leaving its own e-commerce site performing far more slowly.
Companies might be able to pay for faster speeds. If so, that cost would be passed to customers, potentially crippling it in a competitive market.
Affecting Internet Consumption
Even if content providers find a way to avoid passing on costs, ISPs could charge users more to see information of certain types or from chosen sources.
This has the American Sustainable Business Council worried. It told Pai that “Internet access providers could also charge our customers new fees for access to our websites and services.”
Small businesses that rely on specific data for their business, such as real-time financial market statistics, could find themselves paying ISPs more just to get access to that information – on top of any existing subscription fees they may already pay to the company publishing it.
How to Fight Back
Small businesses might be able to offset some of these problems in several ways:
- Lobby lawmakers: Various states and advocacy groups are likely to challenge the new rules in court. Contacting congressional representatives directly is the best way to make your opinions known. Joining others, perhaps in your local chamber of commerce or through an advocacy group, can amplify your voice.
- Follow the news: The FCC must finalize the text and then submit it to the Office of Management and Budget (OMB). After OMB approval, the FCC must submit it to the Federal Register. The order must come into force 60 days after publication.
- Watch your ISP: ISPs have committed to avoid throttling or blocking traffic for their broadband customers in their terms and conditions in the past. Keep a close eye on those terms and conditions, watching for any sudden, subtle changes. Create a plan to change providers if an existing one alters policy.
- Watch content providers: If ISPs begin throttling and prioritizing different traffic en masse, businesses should be prepared to respond with a content strategy that ensures their content still performs. Large video and audio distributors and web hosts are unlikely to stand still and may cut deals with the ISPs to sustain the speedy delivery of their own content. SMBs wanting to give their customers the best experience could host their content with these services.
Businesses thrive on certainty, and the FCC just made the internet a less certain place for small- and medium-sized businesses.
But this doesn’t necessarily signal an internet apocalypse. It simply means companies must factor a less certain online future into their risk analyses.
Evaluating risk and developing steps to mitigate it is a healthy, sensible approach for any business in any climate. Consult a CPA-based advisory firm for more information. As those around you wring their hands about the net neutrality rollback, it will pay to keep a level head.