What’s the Big Deal About Google, Verizon, and Net Neutrality? We Explain.

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Tech news and forums this week have been overrun by chatter about the legislative proposal for net neutrality that Verizon and Google jointly released on Monday. The proposal, which both Google and Verizon posted to their blogs at 1:38 p.m. EST and 1:47 p.m. EST, respectively, was, they say, intended to spark discussion, and spark discussion it did. If your head is spinning with this week’s discussions of network neutrality, wireline, wireless, a private Internet, and “differentiated online services”, read on.

At its core, net neutrality, also known as ‘network neutrality’, is the concept that Internet service providers should be required to treat all types of Internet traffic as being equal, and not be allowed to place restrictions on some types of Internet traffic, or to show a preference for others.

Reasons that an Internet service provider might want to discriminate against Internet traffic might be because certain types of traffic (such as downloading a movie) are resource-intensive. Reasons that an Internet service provider might want to favour certain types of Internet traffic are because those generating that traffic are willing to pay the Internet service provider to let their traffic take priority.

One can’t fault Google and Verizon for wanting to get the discussion moving. The net neutrality debates have been going around in circles ever since the term first reared its divisive head several years ago, with no clear end or direction in sight.

So it isn’t so much what they did, as what they said, that has everyone up in arms.

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To cut to the chase – and mind you we are vastly oversimplifying this and omitting large swathes of related, but for the purpose of a general layperson’s discussion, tangential aspects – the proposed legislation defines three separate and distinct paths (or as some refer to them, “pipes”) for moving Internet network data around. It may help if you think of “network data” as something like, say, a piece of email. Those three defined Internet pathways are: the current wired portion of Internet (such as cable services and DSL), the current wireless portion of the Internet (including any Internet accessways offered by cellular carriers and accessed via cell phones and wireless modems, including 3G and 4G networks), and an as yet non-existent wired third channel on which businesses could “offer additional, differentiated online services” examples of which, say Google and Verizon, might include things such as health care monitoring, the smart grid, advanced educational services, or new entertainment and gaming options.”

For purposes of wrapping your head around this, you might analogize these three Internet data channels to three telephone communications channels: the regular wired telephone line in your house, the wireless cell phone in your pocket or purse, and a network of wired “hotlines” connecting all of the country’s CEOs and legislators to each other. (To be clear, this last telephone network does not exist – so far as we know – it’s just an example to help explain what this brouhaha is all about.)

What Google and Verizon have put forth in their proposed legislation is that principles of network neutrality be applied to wired (or as they refer to it, “wireline”) networks, but that the wireless portions of the Internet be essentially exempt from the requirements of network neutrality. And that the proposed third channel – the “private Internet” for “differentiated online services” – be exempt as well.

To use our telephone analogy, the basic premise of network neutrality is akin to saying that when confronted with a teen who is gabbing for hours on end about nothing in particular, and a CEO taking a 10-minute phone meeting to close a deal, generally the telephone companies should be prohibited from saying that one call takes priority over the other.

But in the Verizon and Google proposal, while that would be true for calls being made over landlines, the cell phone companies (wireless carriers) would be allowed to discriminate between the two calls, perhaps by taking money from the CEO to put his call through first, or by limiting the teen to 5 minute intervals of phone service at a time.

Then we come to this interesting third “private network” which, again, would not be subject to a neutrality requirement. Google and Verizon say that this would only be for those “differentiated online services”, and that “regular” Internet services that use wired paths would be required to adhere to the principles of neutrality.

The reason for not requiring neutrality for wireless networks is, said Verizon and Google in a joint statement this week, that “We both recognize that wireless broadband is different from the traditional wire-line world, in part because the mobile marketplace is more competitive and changing rapidly. In recognition of the still-nascent nature of the wireless-broadband marketplace, under this proposal we would not now apply most of the [Net Neutrality] wire-line principles to wireless, except for the transparency requirement.”

The Verizon – Google proposal also gives a nod to enforcement by the FCC, something which has been chipped away at in recent years.

The proposal has drawn sharp criticism from many different corners, including from the FCC itself. Said FCC commissioner Michael Copps, “Some will claim this announcement moves the discussion forward. That’s one of its many problems. It is time to move a decision forward – a decision to reassert FCC authority over broadband telecommunications, to guarantee an open internet now and forever, and to put the interests of consumers in front of the interests of giant corporations.”

Facebook too was quick to comment, saying through spokesperson Andrew Noyes that “Facebook continues to support principles of net neutrality for both landline and wireless networks. Preserving an open Internet that is accessible to innovators – regardless of their size or wealth – will promote a vibrant and competitive marketplace where consumers have ultimate control over the content and services delivered through their Internet connections.”

So that’s it in a (very simplified) nutshell.

Here’s the text of the proposal:

Verizon-Google Legislative Framework Proposal

Google and Verizon have been working together to find ways to preserve the open Internet and the vibrant and innovative markets it supports, to protect consumers, and to promote continued investment in broadband access. With these goals in mind, together we offer a proposed open Internet framework for the consideration of policymakers and the public.

We believe such a framework should include the following key elements:

Consumer Protections: A broadband Internet access service provider would be prohibited from preventing users of its broadband Internet access service from –

(1) sending and receiving lawful content of their choice;
(2) running lawful applications and using lawful services of their choice; and
(3) connecting their choice of legal devices that do not harm the network or service, facilitate theft of service, or harm other users of the service.

Non-Discrimination Requirement: In providing broadband Internet access service, a provider would be prohibited from engaging in undue discrimination against any lawful Internet content, application, or service in a manner that causes meaningful harm to competition or to users. Prioritization of Internet traffic would be presumed inconsistent with the non-discrimination standard, but the presumption could be rebutted.

Transparency: Providers of broadband Internet access service would be required to disclose accurate and relevant information in plain language about the characteristics and capabilities of their offerings, their broadband network management, and other practices necessary for consumers and other users to make informed choices.

Network Management: Broadband Internet access service providers are permitted to engage in reasonable network management. Reasonable network management includes any technically sound practice: to reduce or mitigate the effects of congestion on its network; to ensure network security or integrity; to address traffic that is unwanted by or harmful to users, the provider’s network, or the Internet; to ensure service quality to a subscriber; to provide services or capabilities consistent with a consumer’s choices; that is consistent with the technical requirements, standards, or best practices adopted by an independent, widely-recognized Internet community governance initiative or standard-setting organization; to prioritize general classes or types of Internet traffic, based on latency; or otherwise to manage the daily operation of its network.

Additional Online Services: A provider that offers a broadband Internet access service complying with the above principles could offer any other additional or differentiated services. Such other services would have to be distinguishable in scope and purpose from broadband Internet access service, but could make use of or access Internet content, applications or services and could include traffic prioritization. The FCC would publish an annual report on the effect on these additional services, and immediately report if it finds at any time that these services threaten the meaningful availability of broadband Internet access services or have been devised or promoted in a manner designed to evade these consumer protections.

Wireless Broadband: Because of the unique technical and operational characteristics of wireless networks, and the competitive and still-developing nature of wireless broadband services, only the transparency principle would apply to wireless broadband at this time. The U.S. Government Accountability Office would report to Congress annually on the continued development and robustness of wireless broadband Internet access services.

Case-By-Case Enforcement: The FCC would enforce the consumer protection and nondiscrimination requirements through case-by-case adjudication, but would have no rulemaking authority with respect to those provisions. Parties would be encouraged to use non-governmental dispute resolution processes established by independent, widely-recognized Internet community governance initiatives, and the FCC would be directed to give appropriate deference to decisions or advisory opinions of such groups. The FCC could grant injunctive relief for violations of the consumer protection and non-discrimination provisions. The FCC could impose a forfeiture of up to $2,000,000 for knowing violations of the consumer-protection or non-discrimination provisions. The proposed framework would not affect rights or obligations under existing Federal or State laws that generally apply to businesses, and would not
create any new private right of action.

Regulatory Authority: The FCC would have exclusive authority to oversee broadband Internet access service, but would not have any authority over Internet software applications, content or services. Regulatory authorities would not be permitted to regulate broadband Internet access service. Broadband Access for Americans: Broadband Internet access would be eligible for Federal universal service fund support to spur deployment in unserved areas and to support programs to encourage broadband adoption by low-income populations. In addition, the FCC would be required to complete intercarrier compensation reform within 12 months. Broadband Internet access service and traffic or services using Internet protocol would be considered exclusively interstate in nature. In general, broadband Internet access service providers would ensure that the service is accessible to and usable by individuals with disabilities.

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