Ask FERF about ... net neutrality.

• Author: Sinnett, William M.
• Position: Resources - Financial Executives Research Foundation

Net neutrality" is a hot topic in the news and is the subject of potential legislation that could affect the way you use the Internet and how much you pay to use it. Should you be concerned? In a July 19 Web article, Computerworld.com states: "Any business that relies on a public Web site for taking orders from the public or communicating with customers may be affected because, depending on the outcome of the debate, the business may want to pay extra for additional services and bandwidth."

So what is "net neutrality?" In "Broadband Regulation: Will Congress Neuter the Net?" published by The Heritage Foundation, James L Gattuso defines net neutrality as "any policy of managing content without differentiation, although in the current debate it more often refers to regulation to achieve that end. The concept is therefore more accurately termed 'neutrality regulation.'"

The current debate is about whether broadband network owners, such as telephone and cable TV companies, should be required by law to treat everything sent on the Internet equally, or "neutrally."

First Amendment of the Internet

Gattuso provides some history to put the current debate in context. "The basic idea of net neutrality was formulated in the early days of the Internet as an engineering concept often called the 'end-to-end' principle." This principle holds that the functionality of the Internet should be at the ends of the network, with only "dumb pipes" in between to transmit data without modification. This concept is the "First Amendment of the Internet," and is more elaborately discussed under "f.a.q." on the Savethelnternet.com website.

The current debate over neutrality regulation began some years ago, when several cable companies began imposing restrictions on subscribers, such as limiting how much a customer could download per day. They argued that these restrictions were necessary because cable broadband service operates on a shared basis--the more bandwidth each subscriber uses, the less is available for others.

The Four Freedoms of the Internet

In August 2005, the Federal Communications Commission (FCC) responded to these restrictions, declaring in a policy statement that consumers are entitled to:

* access the lawful Internet content of their choice;

* run applications and use services of their choice, subject to the needs of law enforcement;

* connect their choice of legal devises that do not harm the network; and

* competition among network providers...