Netflix and YouTube Now Consume 50% Of The Internet As The Argument For Net Neutrality Weakens
(This post originally appeared on Forbes)
According to this definition from Oxford Dictionaries net neutrality is “…the principle that Internet service providers should enable access to all content and applications regardless of the source, and without favoring or blocking particular products or websites.”
Do you support this idea? We know the President does.
“Net neutrality,” President Obama said in a recent statement, “has been built into the fabric of the Internet since its creation — but it is also a principle that we cannot take for granted. We cannot allow Internet service providers (ISPs) to restrict the best access or to pick winners and losers in the online marketplace for services and ideas.” The President wants to eliminate paid prioritization of content providers on the Internet, stating that “…no service should be stuck in a “slow lane” because it does not pay a fee. That kind of gatekeeping would undermine the level playing field essential to the Internet’s growth. So, as I have before, I am asking for an explicit ban on paid prioritization and any other restriction that has a similar effect.”
Last week it was reported that Netflix consumed approximately 35% of all broadband traffic in the U.S. and Canada. In fact, both Netflix and YouTube combined take up half of the Internet’s bandwidth. Half! So wait…these companies shouldn’t pay more? In a world of net neutrality, this would all be OK. They would not be charged any more for faster lanes or special access. Our largest internet service providers, like Comcast and Verizon, would be required to let them consume as much as they want for the same price that you and I pay. And so the argument for net neutrality weakens. For two big reasons.
Net neutrality will curtail our Internet access, speed and performance. I love House of Cards, but what about my neighbor who’s not a Kevin Spacey fan or a Netflix subscriber? Should she be punished with slower Internet speeds caused by bottlenecks because she’s battling for half of what’s left? And just because those around her choose to subscribe to Netflix and stream movies and she did not? And who’s to say that in a few years other services like Netflix won’t appear (Facebook? Snapchat?) that will consume even more bandwidth. Or, let’s suppose you’re staying in a hotel (or you’re on a plane) where everyone pays the same for Internet access, except there’s one guy in room 805 who’s hogging up 50% of the bandwidth watching God knows what. With net neutrality, he would have the right to the same bandwidth as you do and would pay the same. Except he’s abusing his right. And you’re suffering with slower speeds and less productivity.
Net neutrality will increase our costs. The President wants to treat the Internet as a utility. Except that the Internet cannot yet be treated as a utility because it’s not billed as a utility. If it were billed as a utility, you and your business would be paying for usage/downloads/uploads instead of a flat monthly fee. Far richer companies like Netflix, YouTube and others on the horizon would be allowed to consume as much of it as they want and pay the same fees you and I are paying. This is not equal. This is not neutral. This is a bad idea. And a costly one for companies like mine.
Is this fair? Is this neutral? It’s really not. The world is not neutral. And it’s not equal. It’s competitive. And companies are competing everywhere where space, whether it’s real estate, market share or Internet bandwidth is valuable. This is why there are $8 million studio apartments in New York City and why a 30 second advertisement on the Super Bowl costs $4 million.
I don’t trust Comcast any more than you do so here’s a better idea than calling the Internet a utility: regulate them more. Let them run the Internet, let them keep investing and let them profit. Let them provide “fast lanes” for an extra fee to those data hungry companies that need it. Require them to provide a basic level of service to everyone else. Have a set of rules on what’s allowed or not allowed and let the FCC (along with regional “charter” boards similar to what we once had with cable systems) execute. Make sure there’s a process for consumers and small businesses to bring their complaints to the right authorities and give the FCC the power to enforce those rules.
Will the evil ISP’s strangle others’ content? Will they stop their “competitors” from using their Internet service? Not if they can make money at it, they won’t. Otherwise, why am I still able to watch the Big Bang Theory on my Comcast service – last time I checked Comcast doesn’t own CBS (at least, not yet). Let them charge Netflix, YouTube and any other companies using a significant amount of bandwidth more. Let the subscribers for these services, apps and sites pay more. Just like some hotels charge their guests a premium for faster Internet service if they so choose.
Netflix and YouTube love net neutrality. I’m not a fan.