It’s a reality. Regulations on internet service providers, known as net neutrality rules, began to roll back April 23, although the controversial action by the Federal Communications Commission faces court challenges and a recently passed Senate bill that would reimpose net neutrality will soon go to the House of Representatives for a vote.
While the intense debate surrounding the rollback continues, the fact remains that the changes from net neutrality, if passed, will be gradual, and consumers will not likely see an immediate impact. Indeed, many scenarios painted by critics — such as paying a la carte for popular Netflix and Hulu services and a general increase in fees — are worst-case scenarios, contends CNET’s 359.
The rollback of net neutrality does allow internet service providers, or ISPs, the opportunity to provide fast lanes and set priorities for access to a variety of bandwidth-intensive video websites, such as Netflix, YouTube, and Facebook. Investment in the communications infrastructure is anticipated to be centered around delivering higher internet speed and improved network functionality that will likely appeal to higher-paying subscribers.
Think of our broadband infrastructure as the highways for transportation and video-intensive website users as vehicles traversing the highways. Today, these bandwidth-intensive users occupy many “lanes” of the broadband infrastructure resulting in the degradation of performance for all users. At day’s end, the carriers and ISPs are the companies paying to build additional infrastructure or highway lanes, the spectrum, fiber and other dedicated resources necessary to give users the performance they have come to rely upon in their work and personal lives. What eventually occurs is gridlock of broadband access.
Ultimately, consumers do not want this “traffic jam” affecting their data use. Rolling back net neutrality allows internet service providers to problem-solve for three major issues preventing the unblocking of this traffic jam:
- More traffic requires more infrastructure
Higher bandwidth applications, smarter devices and an increase in the number of devices accessing the infrastructure are creating the “traffic” situation that must be solved to meet the current and future demands of the explosion in bandwidth demand. Industry research firm iGR predicts that the average monthly broadband usage in 2018 will be 5.8 gigabytes a month per each connected device. iGR also predicts that usage will soar another 84 percent by 2020. Ericsson AB, the telecommunication equipment maker, forecasts connected devices will number over 30 billion by 2023, of which roughly 20 billion will relate to the Internet of Things (IoT), and 1.8 billion of these IoT connections will be via cellular networks including 5G. These will continue to generate more traffic-straining existing infrastructure.
- Connected devices, tech advances demand more data traffic lanes
Consider the current speed demands to receive the best video experience, and it becomes clear why the rollback can spell vast improvements. For Netflix, the minimum speed recommended for the best experience is five megabits a second; streaming 1080p HD content on Hulu requires six megabits/second, and streaming HD content on Amazon video takes 3.5 megabits/second, reports Lifewire. Optimal user experience today requires 15-25 megabits/second, irrespective of tethered or non-tethered connections.A big focus today is on building Smart Cities. ReadWrite, a tech media information company, has outlined ten key elements for a city to be a smart city, including ubiquitous connectivity through 5G, or fifth-generation networks that will make downloads significantly faster on phones and, for some, even replace home broadband. Rollback of net neutrality should catalyze targeted network investments to deliver the foundation for a connected smart city.
- Government investment waning; U.S. lags other nations
This data explosion will require huge broadband infrastructure investment, which net neutrality rules have stunted. In 2014, before the net neutrality rules went into effect, spending for annual broadband infrastructure was $78.4 billion, and while the spending continued, the absolute numbers dipped to $76 billion in 2016, according to US Telecom, a trade group representing U.S. carriers. In addition, the U.S. has fallen behind other major countries in broadband rollout and speeds. Statista researchers reports that the United States ranks No. 10 among countries as measured by internet connection speed, with South Korea outpacing the U.S. by 52 percent.
The benefits of the rollback
So, what does the eventual rollback of all net neutrality rules suggest? It likely will give carriers more reasons to increase funding toward maximizing their network infrastructure spending with a major focus on network functionality. While carriers for many years have been investing in networks to enable high-speed 4G LTE, the immediate opportunity arises to invest smartly and enable the fifth-generation applications that require network functionality. As a result, mobile broadband promises to be faster and more reliable.
Consumers will benefit from a faster and more reliable internet, especially low-income families, maintains economist Michael Katz. In an interview with Quartz, Katz predicted that the most basic internet packages “would likely become more affordable as some of the money that internet providers, like Comcast and AT&T, receive from content companies like Netflix and YouTube would be passed on to consumers. The basic low-cost internet option would entice more households to sign up and, in turn, would be a win for both internet and content providers.”
Clearly, change will trigger uncertainty. Media coverage of the rollback has brought up many pertinent points that raise alarm bells in the minds of consumers. However, the end of net neutrality should impact consumers positively by delivering a faster internet and overall better service. Companies in the communications infrastructure ecosystem will be able to focus on innovation — and the United States should reposition itself as the key player in the global internet space.
