Net neutrality: pros and cons

09.02.2018

There has been a lot of talk about 'net neutrality' recently.  But what does this concept entail in fact? And what are the arguments for and against?

'All data are equal'

The Internet in and of itself, is an open network.  And in theory, all players in that network are neutral towards the data flow across the network. This applies to companies that manage the nodes of the network, Internet service providers, telecom operators, etc. All data should thus be treated in the same way.  Certain data, such as P2P traffic, should not be slowed down. And other data, as the proprietary services of an Internet service provider, should not be given any priority.

This is a fine principle, but things are not so simple in practice.  This situation is comparable to a family where each member has his or her Internet connection. The daughter is playing an online streaming game, the mother is watching women's cyclo-cross in streaming, and the father is listening to Spotify in streaming while doing a chore in the house. Together, they use a lot of bandwidth, while the son, who is a diligent student, is having difficulties searching for data for his homework. Isn't it therefore logical that the mother, who manages IT matters at home, should impose restrictions on the heavy users so that the student can also use the broadband without fits and starts?

The same applies on a large scale:  heavy users devour bandwidth, so that providers, who want to serve all users, might be tempted to curb services that use much bandwidth (Netflix or YouTube, for instance).

Most Internet providers in Belgium have fortunately not opted for this form of traffic shaping but have broached this problem in a fair way by working with data caps. You choose a certain subscription, whereby a certain downloading and uploading  speed is guaranteed, and a maximum of MB or GB that you can upload or download: the higher the number, the higher the price. A basic access to the Internet seems to be secured.

Arguments for net neutrality

With the advent of Netflix and on-demand content, the discussion about net neutrality  has really picked up steam. More and more "cord cutters" are figuratively cutting their TV cable and are watching films and all sorts of on-demand content on their computer, tablet or smartphone instead of the TV, and that leads to an enormous data consumption.  Providers are coming under pressure to take measures that go against net neutrality, such as asking for a contribution for high data consumption on the major Internet players such as  Google (YouTube), Netflix, Facebook (WhatsApp), Microsoft (Skype) - with or without the promise that their data would be given priority by the networks in return.

Proponents of an open Internet and the related net neutrality however think that the providers would engage in unfair competition by giving priority to their own services. WhatsApp and Skype (data-based  -- and therefore cheap -- messaging services) are thereby at a disadvantage compared to SMS and the telephone (per unit and per minute). Films that you view via Netflix and other on-demand services count towards your download limit, whereas films on your TV are part of your TV subscription (Proximus, Telenet) and can be viewed on demand as well.

This would moreover create a two-speed Internet, whereby the most bandwidth would go to the big payers, and the 'ordinary' services and websites, which do not pay extra for the transport of their data, would have to make do with snail pace.  This would in turn stifle all innovation, because new players, with their limited resources, would never be able to grow sufficiently in order to compete with the existing big players.

Another technique applied is zero rating. Here, an ISP  concludes an agreement with a service provider (Facebook, for instance), under the terms of which Facebook data are not counted towards your data limit. In Belgium Proximus has for some time now given you a choice between different online services  (Facebook, WhatsApp, Snapchat, Instagram, Twitter or Pokémon Go).  Following a positive BIPT report, this was opened up to other providers. Companies such as  Delhaize, BNP Paribas Fortis and ING all joined the system. The same objections can be raised against this technique as well.

Arguments against net neutrality

But are there no arguments that plead for the breach of net neutrality? Certainly, when a limited bandwidth has to be shared by many, for instance. Think of WiFi on the train, something that many commuters complain about. It is quite a feat to provide a stable Internet connection as the train races through the landscape - a connection that has to be shared by dozens of passengers via WiFi.  Isn't it then logical and social that streaming services should blocked, but e-mail and ordinary surfing allowed, so that the WiFi signal can be shared by as many users as possible?

Something can also be said about the argument of Internet service providers who want a contribution for bandwidth devouring services such as YouTube and Netflix. Now that more and more users are switching to these on-demand services, the providers are required to upgrade their networks in order to be able to satiate the hunger for broadband.  This is a good thing for the community, but the costs are borne fully by the providers, while the broadband services play fast and loose with the subscription fees of the users and need not even make any efforts to maintain or the expand the infrastructure.

There is a danger that local players such as Telenet and Belgacom will ultimately have to bear the charges, but receive no benefits. Up till now investments in infrastructure (cable, mobile phone pylons, G4 expansion, etc.) were offset by revenues from different sources.  But the income sources are slowly drying up. For instance, SMS has been supplanted by  WhatsApp (Facebook), telephony by Skype (Microsoft) and Facetime (Apple), and the cord cutters are cancelling their subscription with Telenet and Belgacom, to get content from Netflix, Google, Amazon and so on.

Bear in mind that part of the revenues from the TV offer from Belgacom and Telenet is passed on to the content makers (VRT, VTM, SBS and other production companies). When these revenues disappear for the infrastructure providers, the latter can invest less in local infrastructure, with lower employment,  less telecom innovation for the providers themselves as a result, but also less income for the local content makers. In short, net neutrality could be a threat for our local economy in the long run…

No legislation

As you can see, there are enough arguments for but also against net neutrality. There is no legislation on the matter in Belgium for the time being, only a European directive, which our country complies with.

Is legislation necessary, or should the market be given free rein to set the net neutrality rules de facto? This is an issue you are bound to hear a lot more about. We have simply apprised you of a few arguments here.

Internet business