Higher Prices for Services Like Hulu Plus, Netflix, VUDU Most Likely Coming Due to FCC’s Net Neutrality Regulation


roku xds netflix graphic

Today the FCC voted 3-2 for “net neutrality” regulation that will allow broadband providers to charge alleged bandwidth hogging services a toll to run through their pipes. The neutrality bit comes from the fact that consumers won’t be forced into paying for a “faster, less congested highway” and won’t be blocked from accessing websites of their choosing (kind of like what we can already do today!). However, ZDNet predicts that this new regulation of the Internet is going to become a political hot potato in the new year — especially when the new Congress enters. FCC commissioner, Meredith Attwell Baker, who voted against the Internet regulation, explains that “consumers won’t see any benefit from regulators overreaching without evidence of wrongdoing.” What’s more, she can’t see how the FCC can be a successful referee of the Internet (and I’ll add: without picking winners and losers or being influenced by special interests). Interestingly, wireless data providers were left out of the regulation. In summary, the Internet is still open, but it now has a self-imposed bouncer at the door to make sure everyone behaves. FCC links: Chairman’s statementNews release.

Aside: the issue over net neutrality stems from the fear that broadband providers will at some point throttle or block users from accessing certain bandwidth intensive websites or services during busy times of the day. On a personal note, Comcast, without question, throttles BitTorrent use. I have experienced this on several occasions when trying to upgrade my Linux-based OS.

What do you think? Should content service providers be penalized by broadband companies and have the Internet supervised by the government, or should the government stay out of it and allow broadband companies to charge users a premium for heavy usage during peak times? Maybe something like what the electric company does? The other, more mainstream, option is to allow broadband subscribers to voluntarily upgrade to a plan with more bandwidth to leverage HD services on a continuous basis (i.e. those who want to cut the cable TV cord).

My 2-cents: the issue is not about speed, access, or really even HD video streaming, it’s about congestion. Everyone should have equal access to the Internet, but those whose bandwidth usage is disproportionately more aggressive should pay a premium. Regulating the Internet is not going to decrease congestion… it will most likely just enrich broadband providers by mandate as they make slight improvements to their infrastructure.

Steve Wozniak chimes in on the net neutrality debate:

I frequently speak to different types of audiences all over the country. When I’m asked my feeling on Net Neutrality I tell the open truth. When I was first asked to “sign on” with some good people interested in Net Neutrality my initial thought was that the economic system works better with tiered pricing for various customers. On the other hand, I’m a founder of the EFF and I care a lot about individuals and their own importance. Finally, the thought hit me that every time and in every way that the telecommunications careers have had power or control, we the people wind up getting screwed. Every audience that I speak this statement and phrase to bursts into applause.

[...]

The early Internet was so accidental, it also was free and open in this sense. The Internet has become as important as anything man has ever created. But those freedoms are being chipped away. Please, I beg you, open your senses to the will of the people to keep the Internet as free as possible. Local ISP’s should provide connection to the Internet but then it should be treated as though you own those wires and can choose what to do with them when and how you want to, as long as you don’t destruct them. I don’t want to feel that whichever content supplier had the best government connections or paid the most money determined what I can watch and for how much. This is the monopolistic approach and not representative of a truly free market in the case of today’s Internet.




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