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Why Canadians Should Celebrate FCC's Net Neutrality Regulation

03/17/2015 01:27 EDT | Updated 05/17/2015 05:12 EDT

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Net neutrality is a hotly-debated topic these days, and for a good reason -- it surrounds one of the most pivotal aspects of our daily lives: the Internet. On February 26, the U.S. Federal Communications Commission (FCC) voted to enforce Net neutrality after all, by classifying American Internet providers as "telecommunications services" instead of "information services" -- subject to Title II of the 1934 Communications Act.

However, the decision is not without its critics. Recently, former Florida governor Jeb Bush called it "one of the craziest ideas" ever, while Republican Rep. Marsha Blackburn of Tennessee said that "these overreaching rules will stifle innovation [and] restrict freedoms."

While some of these detractors may have a point, there are many good reasons to celebrate what happened on February 26 -- even here in Canada. Here's what they are:

Reason #1: Providers Can No Longer Manipulate Broadband Speeds

One of the reasons why Net neutrality needs to exist is to prevent American Internet providers like Comcast, Verizon, AT&T, Sprint and T-Mobile from charging businesses for making their websites load faster than others. Without Net neutrality, providers could essentially act like mercenaries by manipulating broadband speeds in favour of highest bidders, while offering virtually nothing to their subscribers or the companies that cannot afford such a "service."

If you want to know why this is ludicrous, just compare the Internet to roads. If big businesses were to own every road in the country, they wouldn't just be able to charge people for using them, but also alter them for the sake of profit. So, if Walmart were to pay one such company to obstruct every road that leads to Target, that company would be well within its rights to do so. Net neutrality is here to prevent such a blatant abuse of power from happening.

How does this affect Canada? Since the Internet in Canada is already regulated as a utility by the Canadian Radio-television Telecommunications Commission (CRTC), nothing will really change for us in terms of rules, which is a good thing. However, if the FCC ruling had failed, it could have reopened the debate in Canada and called into question the Net neutrality we already have.

The FCC ruling should also stop U.S. providers from potentially slowing down Canadian websites in favour of their American counterparts. For instance, Canadian automotive resource Unhaggle should in theory be as accessible in the U.S. as its American rival TrueCar to allow both businesses to compete equally.

Reason #2: Small Businesses Have a Chance to Compete

By providing equal opportunity for Internet speeds, Net neutrality gives small companies and entrepreneurs a fair chance to compete against their bigger counterparts.

Etsy CEO Chad Dickerson explains in his February 20 blog post that while a slower speed may not seem like a big deal, it can be absolutely devastating for Internet-based businesses. "Make no mistake, speed impacts the bottom line," he wrote.

According to research from Google, Bing and others, even a few milliseconds of delay can negatively impact a company's revenue, since nothing can stop a consumer from leaving a slow-loading website. If your company's revenue is already low, then the impact can easily send you out of business.

However, a Republican member of the FFC, Ajit Pai, believes that the new ruling won't help with this problem, stating that it "saddles small, independent businesses and entrepreneurs with heavy-handed regulations that will push them out of the market."

Yet a letter to the FCC from one hundred emerging companies, including Yelp, Etsy, Kickstarter, Tumblr and GitHub, openly disagrees with Pai's assertion, stating, "Any claim that a net neutrality plan based in Title II would somehow burden 'small, independent businesses and entrepreneurs with heavy-handed regulations that will push them out of the market' is simply not true."

Small businesses have plenty to gain from Net neutrality and they know it, which is why many of them seem to fully support the new ruling.

Reason #3: Online Companies are Free to Innovate

Whether they are American or Canadian, online businesses are at the forefront of innovation and progress. Just look at Google, Amazon and Skype to see what a successful online property can accomplish. Yet big Internet providers don't mind suppressing online businesses for their own benefit.

A few years ago, Google came into conflict with AT&T in Austin, Texas, where the Internet provider owns roughly 20 per cent of all the utility poles. Google asked the company if it could use them to build a high-speed fiber network, but AT&T refused, citing that only "a telecom or cable provider" can do so. If Google was classified as such, then AT&T would have been legally obligated to provide access to the poles at a fair market rate. The two have reached a deal eventually, but it wasn't an easy bargain.

Why was AT&T so adamant to keep Google away from their utility poles? Many existing providers believe that Google Fiber poses a serious threat to current Internet services, which has them very worried.

Before the new rules to protect companies like Google, American providers could unfairly squash unwanted competition without facing any legal consequences. Now Google and others can innovate with fewer restrictions, which should benefit everyone -- including Canadians.

It's Not Over Yet...

The FCC may have voted to adopt the new rules, but the fight is far from over since numerous lawsuits are yet to come. In fact, major providers, including AT&T, Verizon and several cable operators, have already stated that they will legally challenge the Title II proposal. In addition, several members of Congress have already created legislation that would strip the FCC of its power and render this vote useless.

Since Canadian Internet is passes through American servers and Bell has already launched a legal challenge to the CRTC ruling in Canada, we are certain that the issue of Net neutrality will be called into question once more.

Image courtesy of Pexels.