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Network neutrality

Updates

14 Jan 2017

In a public speech made less that one week before his planned resignation as chairman of the US Federal Communications Commission (FCC), Tom Wheeler called for further protection of net neutrality, saying that ‘the open Internet is the law of the land’. In the context of announced intentions of FCC members to reverse the commission’s net neutrality order, Wheeler noted that ‘tampering with the rules means taking away protections consumers and the online work enjoy today’, and ‘threatens any innovation that requires connectedness and with it the productivity gains, job creation, and international competitiveness required for America’s economic growth’.

11 Jan 2017

The US Federal Communications Commission (FCC) released a report outlining the result of a policy review it conducted over the course of 2016, and which was focused on the zero-rating (called ‘sponsored data’) plans offered by T-Mobile, AT&T, and Verizon. These plans were reviewed against the net neutrality rules adopted by the FCC in 2015. In the case of T-Mobile, the FCC finds it ‘unlikely that the offering violates’ the applicable regulations, while, for Verizon, the report notes that there is ‘potential for discriminatory conduct in favor of affiliate services’. With regard to AT&T’s Sponsored Data plan (enabling third party edge providers to deliver streaming edge content on a zero-rated basis to AT&T’s mobile broadband subscribers), the FCC finds that it presents competitive problems, and that there is ‘a substantial possibility that some of AT&T’s practices may violate’ the applicable regulations. The Commission’s chair also sent a letter to US senators on the same subject, outlining that AT&T’s and Verizon’s zero-rating services ‘present significant risks to consumers and competition’.

4 Jan 2017

The Telecom Regulatory Authority in India (TRAI) released a Consultation Paper on Net Neutrality, asking for input from stakeholders on questions such as: what could be the principles for ensuring nondiscriminatory access to content on the Internet, in the Indian context? and how should ‘Internet traffic’ and providers of ‘Internet services’ be understood in the net neutrality context? The aim of the consultation is to ‘proceed towards final views on policy or regulatory interventions, where required, on the issue of net neutrality’. This is part of a two-stage consultation process on net neutrality, initiated by TRAI in May 2016.

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The Internet’s success lies in its design, which is based on the principle of network neutrality. From the outset, the flow of all the content on the Internet, whether coming from start-ups or big companies, was treated without discrimination. New companies and innovators did not need permission or market power to innovate on the Internet. With the growth of the use and the development of new services, especially the one consuming high bandwidth such as the high-quality video streaming, some Internet operators (telecom companies and ISPs) started prioritising certain traffic – such as their own services or services of their business partners – based on business needs and plans, justifying such approach with a need to raise funds to further invest in the network. Net neutrality proponents, on the other hand, strongly fight back such plans arguing this could limit the open access to information and online freedoms, and stifle online innovations.


The importance of network neutrality to the success of the Internet is key. The debate has attracted a wide range of actors: everyone from the President of the United States to human rights grassroots activists. The way in which network neutrality is treated can influence the future development of the Internet.

Network neutrality: The current situation

Paradoxically, network traffic management has always been in place. Since the early days of dial-up modem connection to the Internet, there has been a gap between available bandwidth and the users’ bandwidth needs. In order to address this challenge and provide quality service, Internet operators – also commonly referred to as carriers – have used various traffic management techniques to prioritise certain traffic. For example, Internet traffic carrying voice conversation over 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 email exchange. The need for traffic management is especially important today with the extended demands for high bandwidth: a growing number of users regularly use Internet voice and video calls (Skype, Google Hangout, teleconferencing), play online games, or watch TV shows and movies in high definition (HD) quality (e.g. services like Hulu or Netflix). Traffic management is important for wireless communication due to, on one hand, expansion of use of mobile devices and, on the other hand, the technical limits of the wireless spectrum. Cisco predicts that, by 2020, some 50 billion devices will be connected to the Internet within the expanding concept of the Internet of Things.

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. The first discord in the interpretation of the principle of network neutrality focused on whether any traffic management at all should be allowed. Network 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 it is users who should have equal access to Internet services and if this is to happen, Internet traffic cannot be treated equally. If both video and e-mail traffic are treated equally, users would not enjoy good video-stream reception, yet they would not notice a few seconds delay in receiving an e-mail. Even network neutrality purists ceased to question this rationale.

The issues

In the network neutrality debate, there is emerging consensus around the need for appropriate traffic management. The main question is how to determine what is ‘appropriate’. Apart from technical concerns, there are two areas where the debate on traffic management and network neutrality is particularly heated: the economic aspect, and human rights issues.

The economic aspect

During the past few decades, network operators – including telecoms and ISPs – have started to change their business models: in addition to providing Internet access, they have introduced their own VoIP (telephony via Internet) 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 the over-the-top (OTT) service providers, that is, content and service providers such as Google, Facebook, Netflix, and Skype.

Traffic management may be an important tool when competing in service and content provision by 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 (such as Skype or Google Voice) to end-users through its network, while giving priority to data packages of its own in-house service (such as the IP telephony or Internet television it offers to its customers).

At the same time, operators believe that the demand for more bandwidth - spurred mostly by OTT services - requires them to invest more in the basic infrastructure. They argue that 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. Once again, such cases demonstrate how traffic management is used for economic rather than technical reasons.

In an attempt to increase revenues, the industry has designed new business models or arrangements.

Zero-rating services, offered to customers by mobile telecom providers, allow unlimited (free) use of specific applications or Internet services. In some cases, access to such applications or 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. On one hand, it is seen by some as particularly important in developing and least developed countries, where access to mobile data services is more expensive than the average income. 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 argue that access to some information is preferable to no access at all; in addition, offering users free access to certain types of applications could generate demand for general Internet access, thus encouraging operators to invest in building and deploying infrastructures.

On the other hand, 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 (seen as part of the broader right to freedom of expression).

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.

Proposals for a multi-tiered Internet have been at the heart of net neutrality discussions for years. One such proposal was the Legislative Framework Proposal for an Open Internet, put forward by Verizon and Google in 2010, in which the business tier was proposed in the form of ‘additional online services’. Proponents of such models argue that this would bring more choice of services for users and would encourage more investment in the infrastructure; opponents fear that this would be detrimental to the best-effort network, since both economic and business tiers would effectively use the same ‘pipes’ (i.e., wireless spectrum and cables).

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, freedom of expression, health, and education. Entirely profit-led models (even if clearly leading to more innovation and investment) may increase the divide between the haves and the have nots: while the rich would be using unlimited online services with full quality, the poor might ultimately end up with useless, best-effort services or only prioritised services – a choice of which would be made by the telecom providers based on their economic interests. Endangering Internet openness could thereby impact fundamental rights.

Besides, 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. A 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 considered by FCC to harm 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.

At EU level, Regulation 2015/2120 adopted in November 2015 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’.

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, such as internet service providers, industry organisations, content providers and consumer protection agencies).

Events

Resources

Publications

Internet Governance Acronym Glossary (2015)
The Economics of Zero Rating (2015)
An Introduction to Internet Governance (2014)

Papers

Zero-Rating: Kick-Starting Internet Ecosystems in Developing Countries (2015)

Reports

One Internet (2016)

Other resources

Zero-rated Internet Services: What is to be Done? (2015)
Policy Brief: Access’ position on zero rating schemes (2015)
The Real Threat to the Open Internet is Zero-Rated Content (2014)

Processes

As often happens at the IGF, an issue emerged as the hot topic of the week. A couple of years ago, in Bali, it was online surveillance. This year, it was zero rating. Zero rating is the practice of not charging customers for specific applications or services they use. The most famous example is Facebook’s internet.org, now rebranded ‘Free Basics’. The Free Basics service provides free access to content and applications to populations in a number of developing countries, with the aim of providing some level of Internet service to people who otherwise would have no service at all.

 

However, for critics of zero rating, this ‘walled garden’ approach conflicts with any rational policy of social development through innovation, as panellists from Can Internet Rights and Access Goals be Reconciled? (WS 126) said.

While zero rating in developed markets may have stronger implications for competition and unfettered access to information, in an undeveloped market, where there is otherwise very limited or no access to the Internet, does the provision of some services through zero rating actually empower, rather than disempower, users?

One idea discussed during the Dynamic Coalition for Net Neutrality’s meeting is the existence of alternatives to zero rating that may be more sustainable in fostering Internet access and interconnectivity, among which are community networks that provide a decentralised alternative.

Some have asked whether we are witnessing a new ‘cyber’ imperialism, where the well-resourced tell the non-resourced that it is better for them to remain non-resourced until they have full resources rather than enjoy partial resources. On one hand, as speakers in Zero-rating and Neutrality Policies in Developing Countries (WS 156) said, users in least developed countries might prefer some access over no access. But as another speaker said (in WS 126), ‘If you want to give us access, don’t give us these tricks, give us real access. Don’t give us condescending statements like you’re too poor. Just deal with it. Give us real access.’

As with the two previous IGF hot topics, it may be that this IGF is the initial brainstorming phase of the zero rating discussion, with all parties passionately telling each other what they think without listening quite as intensely to each other’s viewpoints. As with online surveillance and human rights, perhaps IGF2016 will see a more focused and mature discussion on zero rating – possibly as part of the wider discussion on how to bring access to all.

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