The End of Net Neutrality Isn’t Good for Small Business

The End of Net Neutrality Isn’t Good for Small Business

The Federal Communications Commissions has revealed its plan to reverse net neutrality rules, drawing a large backlash as millions of people are sharing their concern over the possible repeal online.

So, what exactly is everyone afraid of? Without net neutrality, the state of the internet as we currently know it will end. Internet service providers (i.e. Comcast, Verizon, AT&T, etc.) will be able to block content, slow video-streaming services from rival companies and offer faster site loading speeds to companies willing to pay.

What’s most concerning is this unanswered question: what happens to smaller companies who can’t afford to pay internet providers to maintain the current quality of their websites?

What is Net Neutrality?

Before we delve into how small businesses will be affected by the repeal of net neutrality, it’s important to understand how the rules currently in place work. Essentially, net neutrality ensures that all web traffic sources are treated equally. This equality prevents internet service providers from intentionally blocking or slowing down content or creating "fast lanes" for companies willing to pay extra to deliver their content more quickly.

Alyson Shontell of Business Insider sums it up:

“In short, net neutrality creates an even playing field among content providers — both large and small — to the web. And it's great for consumers because they can access everything they want online for no extra charge. Right now, consumers control what they see online — not Internet access providers — and that's thanks in large part to net neutrality.”

While ISPs like Comcast have stated that they would not throttle internet speeds to the benefit of their own content and services, that doesn’t mean they won’t backtrack on their word should net neutrality be repealed.

How Small Business will be Affected

The biggest concern among net neutrality advocates is how a repeal would impact the way we receive content.

For example, Comcast will likely give streaming speed preference to its own Xfinity services than other websites that stream content. Large companies like Netflix will combat this by paying Comcast for their normal speeds. Smaller companies, that lack the funds to pay ISPs, will be unable to compete. 

This video does a good job of explaining how the internet might change without net neutrality and the concerns of small business owners:


Without net neutrality, there will be a barrier to entry for small businesses and startups who rely on the internet which didn’t exist before. For example, a small business that relies heavily on e-commerce may be forced to pony up to keep your web experience quick and seamless. 

While it’s important to note that the specific outcomes will vary based on ISPs, it’s hard to imagine they will ignore a new, lucrative revenue stream. 

The Portugal Example

To get a better idea of what the internet might look like in a few years without net neutrality, Portugal presents a clear example. Loopholes in the European Union’s network neutrality rules give provisions to national regulators, as the LA Times explains, that permit ISPs to exclude certain services from data caps. Data caps restrict the amount of data you consume to a certain amount before your internet connection is slowed down.

Wireless carrier MEO is one of the ISPs to take advantage of this loophole. They offer packages of applications that can be bought on top of the “traditional data” offering. The packages are grouped by app type: social (Facebook, Instagram, etc.), Video (Netflix, YouTube, etc.), Messaging (Skype, Facetime, etc.), Music (Sound Cloud, Spotify, etc.) and Email & Cloud (Gmail, Yahoo Mail, Google Drive, etc.). Each package costs $5 per month. These packages add more data to your plan that’s earmarked specifically for the package you select. If you pay for the video package, for example, you’ll be less likely to use a streaming app that’s not included in the package. As a result, most people will avoid using apps outside of their package for fear of running out of data, making it tough for newer companies to gain market share.

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Image Source: MEO

Rep. Ro Khanna of California shared his thoughts on how the system used in Portugal hurts small businesses:

"In Portugal, with no net neutrality, internet providers are starting to split the net into packages. A huge advantage for entrenched companies, but it totally ices out startups trying to get in front of people which stifles innovation. This is what's at stake, and that's why we have to save net neutrality."

How You Can Help Save the Internet

There’s still time to stop the repeal of net neutrality if enough people are willing to make their voices heard. Call your Congressperson and let them know your concerns. Battleforthenet.com makes it quick and painless by connecting you to your Congressperson and providing you with a suggested script of what to say. 

The FCC’s vote to end net neutrality happens on December 14th – so if this matters to you, be sure to take action sooner than later!

Written by Nik Vargas