Why Smart Organizational Leaders Care about Net Neutrality

Posted by Matthew Thomas

matthew-thomas-2Is access to broadband internet more like access to cable TV or more like access to electricity, telephones, or running water? 

Two decades ago, this wouldn't have even been a question. First of all, in 1994, people still weren't sure what the Internet even was, or if they knew about it, they didn't know why it would be interesting to anyone other than academics. The World Wide Web was still in its infancy, and programmers and other computer science types were just starting to create their first web pages, hand-coded with the first edition of HTML. 

Over those two decades, though, the web has moved from a curiosity, to a disruptor, to a social and media and social media platform, to a means of connecting bi-directional data from all sorts of smart devices. Now, the once-assumed neutrality of internet data is being challenged, primarily by the cable and cable-media companies that control the monopoly on service in local markets. 

Net neutrality is the idea that the wire doesn't care what kind of data travels down it, and that all data, regardless of content, should have equal opportunity to travel on that wire. The implication, of course, is that infrastructures will then have to respond to the level of traffic that they must sustain to maintain quality of service. Smart organizational leaders care about net neutrality because it affects their business. Nonprofit leaders care about net neutrality because it affects their cause. People care about it at home, because it affects how they see the world.

Let's take a look at how the current discussion about net neutrality breaks down, through a couple of examples.

Example 1:

If we assume that access to broadband internet is like cable TV, then these local monopolies can charge more for varying levels of service and access - much like basic vs. premium channels. The monopolies argue that different content creators should have to pay more for faster access. (Of course, their own content doesn't have to pay a premium for access, increasing the likelihood their content will be seen and used.) Moreover, when services are interrupted, the assumption is that since this is media or entertainment, the disruption is at most annoying, but not breaking down essential activities. Comparing this to phone service, this would be like saying that a call to your grandmother and a call to your 401(k) advisor should be charged at different rates, and with different call quality, based on whether your grandmother wants to pay a premium to hear you better than the two tin cans and a bit of string, or whether your 401(k) advisor wants you to be able to call him during regular business hours or only at off-peak times. Comparing this to electrical service, this would be like paying to make sure brownouts didn't damage your appliances and a premium for every amp and volt that went to running your air conditioner. 

However, if we assume that access to broadband internet is like a utility, (as the original design of the Internet was), then customers would pay based on rates of consumption, no matter what data was travelling over the lines. Outages would be matters of public interest, much like electricity and standard telecommunications outages. In this scenario, data would be data, and the infrastructure would be designed to carry the load of data as needed for usage, rather than on a pay-more-get-more-bandwidth scenario. No longer could data be throttled, and the telecommunications utilities would have to build infrastructure into their pricing such that everyone could have standard high-speed access, at speeds that could be measured as easily as the kilowatt-hours coming in to one's building or home, with construction standards comparable to the National Electrical Code. 

Vision makes all the difference when a disruptor enters the marketplace.

Example 2:

In the summer of 2010, our neighborhood was hit by a heat wave, accompanied by two power outages. The first was caused by the transformer in my backyard exploding from the sheer amount of power running through it due to too many air conditioners running simultaneously. The second came a few days later, as the new transformer, with a higher rating, allowed the power lines themselves to heat to the point of ignition when the air conditioners kicked in late in the afternoon. In both cases, the power company came out and replaced the faulty parts and restored power, and in the second case, actually upgraded the power infrastructure to respond to the load. 

If this had been a broadband internet outage, it would have taken multiple calls from multiple customers in the neighborhood for the cable monopoly to come out and even look at it, and then it would have just said, "well, you just need to try to run your air conditioner at off-peak times, like, say, January, and then you won't have this problem." And it would have taken days to get the service restored. 

So why should we care about net neutrality?

Net_NeutralityFive reasons.

1. Internet services have become a standard utility for many people. While running water, electricity, and telephones were once considered luxuries, they have become standard utilities in most places in the developed world. Broadband internet services have become so in a very short period of time. 

2. The current business model puts entrepreneurs, small businesses and disruptors at a disadvantage. Pay-to-play increases the cost of doing business. If the cable monopolies get to control who gets pay-to-play deals, they won't be too inclined to write favorable deals with those who could disrupt their own monopoly or control of content. Moreover, it disadvantages the poor, for whom in this generation internet access is like access to telephones a generation or more ago. 

3. Pay-to-play and the so-called "fast lanes" concentrate power in the hands of a few players in a monopoly business with a downright lousy reputation for customer service, with little expression of public responsibility. The cable monopolies see themselves as content providers (with the infrastructure as the means to that end) rather than as infrastructure providers (with the content as a bonus). Since they are founded on a luxury goods model, they are unlikely to change that attitude as they become something everyone not only wants, but needs. When one company controls that much media, it can begin to control how people think, what people say, and to whom, and how they say it. That doesn't sound much like a free society. 

4. Net Neutrality means that what your data's content is doesn't matter, it has the same capacity to reach its destination no matter who you are. If you are in the business of doing something outside of the mega-enterntainment industry, you have a level playing field with the major media companies. Remember how many of the current industry giants were started in dorm rooms and garages - net neutrality allows for that to happen again. 

5. Net neutrality will give room for the next utility battle in telecommunications - mobile broadband - to fall more favorably on the side of the customers and end-users. Mobile broadband is currently the most expensive data that traverses the Internet. And despite popular perception, in most cases, the only part of that data that travels wirelessly is between your mobile device and the cell tower. The rest is over wire, cable, or fiber. (Seriously.) As data needs increase, and as the world becomes more mobile-device dependent, this is probably actually the more significant long-term issue for businesses and personal users of mobile data. Net neutrality will allow the disruptors into the market that will provide the options that drive prices down and quality up. 

So now what?

Even up through a couple of hundred years ago, individuals and companies built roads and bridges, and retained the rights to those roads and bridges, exacting a toll on all who wanted to use them. Eventually, this was seen to stifle commerce, economic development, and the overall movement of goods and services throughout countries. As that happened, governments began assuming the responsibility for roads and bridges. This allowed a lane to be a lane, and for infrastructure to serve everyone, not just those who could afford to pay the tolls. No one is currently suggesting that anyone nationalize the cable and internet infrastructure, but that could be the result if cable monopolies overplay their hand. Selecting a data-neutral option would take a middle path.

Smart organizational leaders care about net neutrality because it affects them and their businesses directly as they attempt to operate in the current marketplace. Whether for-profit or non-profit, entrepreneurial disruptor or longstanding institution, net neutrality will affect how all of us do business now and into the future.


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Topics: Matthew Thomas, Organizational Leadership, current events, net neutrality, disruptor