Watching TV Online is About to Get More Difficult

Two years ago this week, the Stop Online Piracy Act (SOPA) was shelved after millions petitioned their representatives to preserve their internet access rights. However, after a decision by a federal appeals court last week, those rights could be in jeopardy once again.

At the center of this issue is the concept of net neutrality - the principle that Internet service providers (ISPs) should enable access to all content and applications regardless of the source and without favoring or blocking particular products or websites. Up until last week, the Federal Communications Commission (FCC) had rules in place to protect net neutrality and keep the Internet a level playing field where ISPs must provide transparency, allow access to lawful content and not discriminate against broadband traffic.

However, the U.S. Court of Appeals for the District of Columbia, in the case of Verizon v. FCC, struck down these rules on the grounds that the FCC can not regulate ISPs because they are not designated as telecommunications services.

Consumer advocacy groups say that this ruling could lead to business models in which internet service providers could charge content providers for access to usual high speed broadband networks and “throttle” or slow down access for all other users.

Percentage of population using the internet by country in 2007. Image via Lobizón/Wikimedia Commons.

Percentage of population using the internet by country in 2007.
Image via Lobizón/Wikimedia Commons.

“I would not be surprised if business development folks in ISPs around the country were now looking for ways to partner with content creators,” said Michael Weinberg, acting co-president of Public Knowledge, a consumer advocacy group. The company’s goal is “to make sure their unpartnered service is bad enough that a paid partnership is attractive.”

Stacey Higginbotham, writing at GigaOM, argued that the rights of Internet users would certainly be subject to change, and not for the better.  “Instead of treating all traffic flowing over their broadband pipes equally, Internet service providers can now start making deals that could prioritize some content over other traffic," she said.

This could have a substantial impact on video streaming services such as Netflix, Hulu Plus, Amazon Instant Video and YouTube. Because the new ruling allows for ISPs to begin discriminating between consumers, companies such as Comcast and Verizon can now charge fees to these sites or threaten to slow access to their content.

Image courtesy of Wesley Fryer/Flickr.

Image courtesy of Wesley Fryer/Flickr.

Alternatively, these video streaming companies are rich targets for ISPs that want to sell their own video services to their own subscribers and therefore have an incentive to slow down access to these sites to gain a competitive edge.

George Askew, an analyst at Stifel Nicolaus, estimated that Netflix alone may be subject to fees in the range of 75 to 100 million dollars a year, a cost that is sure to be passed down to its subscribers. Netflix shares fell 2.3% the day the ruling was announced.

Reed Hastings, CEO of Netflix, has responded to the ruling by warning all internet service providers that his company would call for more regulation if it caught ISPs discriminating. Hastings said that if ISPs breached the "strong network neutrality across all networks, including wireless ... we would vigorously protest and encourage our members [33 million strong] to demand the open Internet they are paying their ISP to deliver."

The WiFi we all know and love may be at stake. Image via Wifi Alliance/Wikimedia Commons.

The WiFi we all know and love may be at stake.
Image via Wifi Alliance/Wikimedia Commons.

For now, Tom Wheeler, chairman of the FCC, said he was “committed to maintaining our networks as engines for economic growth, test beds for innovative services and products, and channels for all forms of speech protected by the First Amendment.”

“We will consider all available options,” he added, “including those for appeal, to ensure that these networks on which the Internet depends continue to provide a free and open platform for innovation and expression, and operate in the interest of all Americans.”

In the meantime, it appears that the rights of Americans to freely access any site on the internet is in jeopardy.

Featured image courtesy of spike55151/Flickr.

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