The Internet’s success lies in its design, which is based on the principle of net neutrality. From the outset, the flow of all the content on the Internet was treated without discrimination. New entrepreneurs did not need permission or market power to innovate on the Internet. With the development of new digital services, especially the ones consuming high bandwidth such as high-quality video streaming, some Internet operators (telecom companies and ISPs) started prioritising certain traffic – such as their own services or the services of their business partners – based on business needs and plans, justifying such an approach with a need to raise funds to further invest in the network. Net neutrality proponents strongly fight back such plans arguing this could limit open access to information and online freedoms, and stifle online innovation.
The current situation
The first discord in the interpretation of the principle of net neutrality focused on network traffic management practices. Since the early days of dial-up modem connection to the Internet, traffic management has been used to deal with a gap between available bandwidth and the users’ bandwidth needs. In order to address this challenge and provide quality service, Internet operators have used various traffic management techniques to prioritise certain traffic. For example, Internet traffic carrying Voice over Internet Protocol (VoIP) services (e.g. Skype) should have priority over traffic carrying a simple e-mail: while we can hear delays in Skype voice chat, we won’t notice minor delays in an e-mail exchange. With the continuously increasing demand for high bandwidth (prompted by over-the-top (OTT) services such as Skype, Google Hangout, Hulu, or Netflix), traffic management is becoming increasingly sophisticated in routing Internet traffic in the most optimal way for providing quality service, preventing congestion, and eliminating latency and jitter.
In the debate over traffic management practices, net neutrality purists argued that ‘all bits are created equal’ and that all Internet traffic must be treated equally. Telecoms and ISPs challenged this view arguing that users should have equal access to Internet services and if this is to happen, Internet traffic cannot be treated equally. For example, if both video and e-mail traffic are treated equally, users won’t have good video-stream reception. Even net neutrality purists ceased to question this rationale.
Economic aspects in the network neutrality debate
During the past few decades, network operators have started to change their business models: in addition to providing Internet access, they have introduced their own VoIP or IPTV (television via Internet) services, video-on-demand, music or video download portals, etc. They are now competing not only with their counterparts for providing cheaper, faster, and better quality connections, but also with OTT service providers. In this new competitive environment, traffic management may be used for prioritising packages according to business-driven preferences. For instance, an operator may decide to slow down or fully ban the flow of data packages from a competing company to end-users through its network, while giving priority to data packages of its own in-house service .
Operators also argue that the demand for more bandwidth - spurred mostly by OTT services - require them to invest more in the basic infrastructure. In their view, since OTT service providers are the ones benefiting the most from the improved infrastructure, a multi-tiered network policy model requiring providers to contribute financially would guarantee the required quality of service for OTT consumers.
In an attempt to increase revenues, the industry has designed new business models.
Zero-rating services, offered to customers by mobile telecom providers, allow unlimited (free) use of specific applications or services. In some cases, access to such services does not count towards a subscriber’s data threshold, while in other arrangements, users are allowed access even without a data plan.
Although it is is increasingly present throughout the world, zero-rating has become a controversial subject. One of the main arguments in favour of zero-rating is that it lowers the cost of access to online information (when offered as part of a data plan), and gives access to (some) online information to users who cannot afford a data plan (when access is free of charge). Supporters consider that access to some information is preferable to no access at all. Opponents argue that zero-rating prioritises certain services over others, and, as such, challenges the net neutrality principle while harming market competition and innovation. Some also express concern over the implications that zero-rating could have on users’ human rights, in that such services can conflict with a user’s right to information.
Debates on zero-rating have become more intensive following the introduction of the Free Basics service in 2014. Offered by Facebook in several developing and less developed countries; the service allow users of mobile communications to access applications such as Wikipedia and AccuWeather (in addition to Facebook) without incurring data charges. These debates have led to the service being suspended in some of the countries where it had been previously introduced (India and Egypt). This map shows the current situation of Free Basics around the world: where the service was introduced and how countries are reacting to it.
Besides zero-rating services, telecoms also refer to ‘specialised services’ – such as HD video streaming that require higher bandwidths, or future e-health solutions – that may need to be offered and would require high quality and therefore special treatments.
In the meantime, the market has brought changes in the way the Internet works: in order to reduce transit costs and time, content providers have come closer to users by setting up Content Delivery Networks (CDNs) – caching servers placed close to regional Internet Exchange Point (IXP) hubs or within big regional telecoms. This has improved network performance and costs.
Network neutrality and human rights issues
The consequences of violating net neutrality principles are not only economic. The Internet has become one of the key pillars of modern society linked to basic human rights, including access to information,, health, and education, and freedom of expression. Endangering Internet openness could thereby impact fundamental rights.
In addition, the ability to manage network traffic based on origin or destination, on service or content, could give authorities the opportunity to filter Internet traffic with objectionable or sensitive content in relation to the country’s political, ideological, religious, cultural, or other values. This opens possibilities for political censorship through Internet traffic management.
Policy approaches of net neutrality
With the network neutrality debate, one of the major challenges regulators face is whether to act preemptively (ex-ante), in order to prevent possible breaches of the network neutrality principle, or to respond based on precedents (ex-post) once (and if ) the breach occurs. Another challenge that legislators and policymakers face is whether the problem should be dealt with, with ‘hard law’ – encoding the principles into legislation – or if ‘soft law’ (guidelines and policies) would be sufficient.
In the USA, the Federal Communications Commission (FCC) adopted, in 2015, a set of rules in favour of net neutrality. Entered into force in June 2015, the rules ban three practices seen as harming the open Internet: blocking of lawful content, applications, services or devices; impairing or degrading lawful internet traffic on the basis of content, application, or service (throttling), and paid prioritisation of certain content, applications or services. Starting January 2017, when a new FCC chairman was appointed, there have been concerns that the net neutrality rules would undergo serious review.
At EU level, Regulation 2015/2120 sets out the obligation for providers of Internet access services to treat all traffic equally, when providing Internet access services, without discrimination, restriction or interference, and irrespective of the sender and receiver, the content accessed or distributed, the applications or services used or provided, or the terminal equipment used. The regulation also deals with the concept of ‘specialised services’, allowing operators to offer ‘services other than internet access services which are optimised for specific content, applications or services, or a combination thereof, where the optimisation is necessary in order to meet requirements of the content, applications or services for a specific level of quality’. The regulation was followed by a set of implementation guidelines, issued by the Body of European Regulators for Electronic Communications (BEREC).
Brazil, Chile, Slovenia, and the Netherlands protect net neutrality by national legislation. Norway, on the other hand, has chosen a soft-law approach, with the national regulatory authority issuing a set of guidelines for network neutrality (drafted in collaboration with various industry players and consumer protection agencies).