All bits are created equal…or are they?
On January 14, 2014, a federal court ruled against Federal Communications Commission regulations protecting net neutrality. You’re probably asking yourself two questions at this point: “What does that mean?” and “Why should I care?”
I’ll answer the second question first, to peak your interest: Netflix could be in jeopardy. More on this later.
Net neutrality is a highly disputed principle that internet service providers should not discriminate against or give preferential treatment to different web content or data. In 2010, the FCC established regulations in the Open Internet Order to make progress on net neutrality, and to protect basic rights of the “open internet” that were created in 2005.
US Federal Court ends net neutrality regulations…for now
With this recent ruling, internet service providers can make deals with internet companies to discriminate against different internet services. NPR’s digital culture correspondent Laura Sydell explains this more clearly:
So, say, your ISP strikes a deal with Amazon Prime for its video streaming service, but you subscribe to Netflix. Your ISP could put Amazon on a high-speed lane on its network and relegate Netflix to a slower lane, making it less appealing. Now, Netflix might offer to pay Verizon more to get in the fast lane, and they may pass that cost onto you. So no more 7.99 a month for all you want to watch.
Netflix video streaming services could be in peril
See what I mean about Netflix’s peril? Michael Pachter, Wall Street analyst, claims that Netflix could face between $75 million and $100 million in additional content costs as a result of the court’s decision. These extra charges would be passed onto consumers.
For more information, check out Three Dangers of Losing Net Neutrality That Nobody’s Talking About and this great infographic.
