Harvard Law Professor Jonathan Zittrain dissects the recent FCC net neutrality decision and asks whether it’s nearly as earth-shattering as many of us suppose. After all: The chairman of the FCC is a former head of the Cable Television Association and the Wireless Association, so it’s not all that likely that what was decided is really groundbreaking. The long-term question, says Zittrain, is to what extent internet service providers will seek out different revenue streams outside of cash-and-carry delivery.
Jonathan Zittrain: Recently the FCC took another swing at what's loosely called net neutrality. I guess I'd count myself among those who are not sure it's an earth-shattering deal. It shouldn't come as that much of a surprise that a chairman of the FCC who is a former head of the Cable Television Association and the Wireless Association is not done anything that's going to bring anything down. I guess what's most notable about the rules as they're coming down again is they're applying to wireless; that had been left off the table by rules that were in place from 2010 to 2014. But I suspect that most internet service providers can live within these rules. The long-term question is going to be to what extent internet service providers feel they need to earn money through something other than cash-and-carry delivery of what we think of as generic broadband. You know, "We're just going to give you good bandwidth; you're going to pay for it; have fun out there," is the internet service provider of the traditional vain.
If they're wanting to cut a bunch of what you might think of as more interesting deals, well wait a minute maybe we'll charge more for one particular provider, like Google, to have to reach our eyeballs of our subscribers and Google can pay for that. And maybe, this is the ideal case for this kind of argument that net neutrality doesn't allow, maybe it will even turn out that we can offer free internet access to people. They'll pay nothing per month because it will get paid for, subsidized, on the other side as the Google's of the world pay to beat a path to the door of our subscribers. That might be a good idea. The thing is that the number of outs that involve some form of differential pricing, of being very canny about whose bits are coming from where and going to where and whether those will be treated differently or charged differently, more frequently I think would not result in free internet for consumers, but in added revenue for the company that simply goes back to the shareholders and really is reflecting the fact that there isn't a lot of competition in America today for the provision of broadband.
If you live in a house and you want a fast internet connection, you don't have a ton of choices; in many places you only have one choice for who you're going to use. And at that point they don't have the same incentives that a competitive marketplace would give. And that's one reason why something like that net neutrality makes a lot of sense. It's been interesting to see that around the world there's been a laboratory for different regulatory and technical regimes for implementation of internet access. In a place like the United Kingdom they don't talk much about net neutrality because they have a regime where British Telecom, the legacy government-affiliated telephony provider is a wholesaler and then Virgin Broadband and others can resell it. And that means that if one started to get to canny, no Google for you because Google refused to pay us, their subscribers would leave and use a different ISP; even though it's all going over the same pipe, you might not need net neutrality the way that you see it shaping up in America where there isn't that open-access mandate. The third category to keep an eye out for over the years is municipal broadband. Should it be that just like governments provide roads and fill or don't fill potholes in them that municipalities might choose to offer fiber to each home? You'd pay them a flat fee and that's the end of the story.
One of the interesting artifacts of the recent FCC decision is actually overturning state-level legislative bans on municipal broadband provision that had been enacted in part at the behest of existing internet service providers that would prefer not to compete with the government to provide internet access. And we will see now maybe a couple cities in which the municipalities will have a chance to offer it as well. And I'm curious to see where that leads.