Net Neutrality and small businesses

We were contacted by Kristi Heim, Business and Technology reporter for the Seattle Times, this morning to discuss our stance on net neutrality.  [Update 6/22: her article Plan for two-tiered Internet puts higher price on speed quotes us at length in the last section]

While there is ample news on the positions taken by large companies on this issue (Amazon, Google, Microsoft vs. AT&T and Verizon), the views of small technology businesses like ours are often overlooked. We were happy to discuss our thoughts with Kristi, and wanted to share them with you too.

Should broadband providers providing "last mile" Internet connections to customers be allowed to provide improved quality of service for a particular company?

We say "no." We advocate laws that protect an unbiased Internet. As a small business, we believe that having to pay a myriad of broadband providers fees to guarantee higher-quality service would hurt us (and our users) significantly because it would:

  • Raise costs. We're on a shoestring budget.
  • Waste a lot of our time trying to contact and form agreements with several different broadband providers.
  • Enable unfair competition. A large company could oust BillMonk from the market simply by purchasing a much faster connection to the end-user. A small business like ours would not be able to compete solely on the basis of delivering a better product. (E.g. Would YouTube be able to afford fast enough network speeds to compete with Google Video and be as successful as it is today?)

More broadly, we believe that unless such laws to preserve net neutrality are enacted, broadband Internet service providers will come to exert significant control over the end-user Internet experience. In time, this will favor bigger established businesses over small entrepreneurs (like us), and would stifle innovation. Since most web-application innovation happens in the Seattle, San Francisco, and Boston areas, there are regional implications to this debate too.

Granted, the entire topic of net neutrality is fairly abstract. The big broadband providers have said that they would like to have to ability to charge companies for tiered levels of end-user service, e.g. Comcast could ask Skype to pay extra for so its customers have have low-latency guarantees within the Comcast network. But a specific price has yet to be decided, as do ground rules of how to deal with services that do not wish to pay.

We're not unsympathetic to the argument that the broadband infrastructure costs a lot of money, and telcos need to fund such a build-out. We believe they should pass along costs to customers and let fair market competition determine the price that balances people's need for broadband with the costs of providing these services. Econ 101, eh? We're not philosophically opposed to allowing for categories of different types of internet traffic (web, voice, movies) and allowing customers to pick a pricing plan (e.g. I'll pay $5/mo more for low-latency VoIP guarantees), as long as these categories are divided by type and not by company. It's precisely these kinds of rules about what broadband provider may and may not do that deserve to be codified into regulations.

This is a very timely issue. After the June 9th defeat of a US House bill that would have protected net neutrality, the issue has moved to the Senate Commerce Committee. Lots of action; the most recently proposed compromise would guarantee safeguards against blocking sites and services while allowing tiered service levels. There's a vote on this committee compromise this Thursday, and there will be a Senate vote in July.

If you would like to make your voice heard, write to your senator or representitve and let them know where you stand. (In Washington state? Get Maria Cantwell off the fence!) Tell them that small companies like us need net neutrality to innovate, and that deregulation puts too much power in the hands of what are rapidly becoming monopolies on everyday Internet access.

The Wikipedia article on Net Neutrality offers a good starting place to learn more.

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