A U.S. appeals court threw out rules from the Federal Communications Commission (FCC) net neutrality proposal requiring broadband providers to treat all Internet traffic equally. This means that websites like Netflix and Google’s YouTube, which account for approximately half the broad band data traffic in North America, might have to pay extra to ensure quality service for their users or internet service. Net neutrality appears to have broad support from consumers, but there are two sides to the argument.
Some feel that net neutrality has caused consumers to pay higher prices for unlimited data. Innovation, infrastructure investment, and broadband rollout have been reduced because broadband companies have been unsure of their return on investment. In some respects, these firms argue that net neutrality rules are like forcing a restaurant to charge the same price for all customers whether they order one item or consume all they can eat. Robert McDowell argues persuasively in a Wall Street Journal opinion that the nongovernmental net governance structure of engineers, academics, and users from all over the world working individually to keep the internet open and running has enabled it to grow faster than any technology in history. In addition, he argues that central top-down government control cannot keep up with the web’s rapid evolution.
Proponents of net neutrality argue that consumers will have to pay more to use many of their favorite websites. Small start-up companies that are unable to pay internet service providers to guarantee access to their websites could be crippled. It could lock in the positions of current market leaders that are able to afford fees or pass them on to consumers. In addition, cable providers could protect premium subscription fees by blocking consumers from accessing rival offerings from Netflix and other content providers that rely on internet streaming.
If the decision is not appealed and the FCC does not attempt to classify broadband as a telecom service that it can regulate, enterprises should consider how this will impact them. Enterprises that are not big consumers or suppliers of content may gain more reliable service for employees at lower cost from this. It may indirectly help with efforts to get employees to consume less mobile broadband as they become more aware of the costs.
In the meantime, enterprises should verify if they have adequate reporting to identify where they are spending money and ongoing validation of charges for broadband data usage. Most organizations are consuming more data as attachments in e-mails get larger and applications with more features require more bandwidth. Also, services and files that are stored remotely in the cloud, employees’ use of web conferencing, and the shift from traditional voice services to VoIP and other technologies require more data use. A flexible TEM program will enable you to prepare now by tracking data consumption and optimizing expenses before any changes result from this ruling.
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