Business Advice

is your arsenal for developing and maintaining sound financial plans and business strategy.

Inside: Budgeting | Compensation | Valuation

Free Trial: Intuit QuickBooks

Simple Start Free Edition 2009 for Windows

Departments

Fresh Inc.

Inc.com Featured Blogs

May 17, 2006

Today's news

Debating Net Neutrality

Posted by Mike Hofman at 11:22 AM

Network neutrality is a hot topic these days, with some Congressional action on Internet regulation likely in the next few weeks. The question is, should companies that provide the infrastructure for the Internet--the Verizons and AT&Ts of the world--be able to charge their customers an extra fee to download certain kinds of Web content, such as video programming.

Supporters of net neutrality argue that the net should remain as free as possible, and that big telecom companies should not be able to charge you a different fee for one set of bits over another.

In an "Opinion" column in the May issue of Inc., Ethan Zuckerman makes the case in favor of network neutrality. "BellSouth and AT&T have announced plans to sell 'premium' network services that deliver video from some providers more quickly that others... Soon, it may no longer be sufficient to know that you're connected to 'the Internet'--businesses will need to know where the bits and they want are, and whether the provider they're using for Internet service considers them premium or substandard." (Here's the link.)

Another supporter of net neutrality is Robert Reich, the former Labor secretary, who delivered this commentary on the radio program Marketplace.

Meanwhile, Bob Litan, a contributing editor at Inc., has taken the opposite point of view. In the Washington Post a few weeks ago, he writes:

"Until recently, traffic congestion on the Net was not a problem... But that blissful world is gone now. The existing networks are rapidly running out of excess capacity. We need new cyber-highways if the brave new world of movies, fast Google searches, and telemedicine-- to take a few examples-- is to become at all viable.

The question, then is: who should pay for these much higher speed networks? Asking all users to pay the same amount, regardless of how much they data they download, hardly seems fair.

... If, instead, telecoms companies are required by law to charge everyone the same amount for the next upgrade, there is a real risk that the charge will be so high that only a few data heavy sites will be able to pay. But because they, in effect, will have been subsidized, there will not be enough revenue collected to pay for the new networks. And they won't get built." (Here's the link.)

For yet more debate, check out this conversation on the Legal Affairs site.

What do you think? Is net neutrality necessary to ensure the future viability of the Internet, or is the network's viability only certain if the companies that build and maintain it are able to charge a premium to customers that use their networks most heavily?

2 Comments

Posted by: Bobbie Gossage at May 18, 2006 2:13 PM: I agree with Bob Litan. If there's a limited capacity and sites with a lot of video content are hogging up the resources, why not make them shoulder more of the burden for that expense?
Posted by: Steve Baty at May 21, 2006 3:01 AM: This is the clearest piece I have ever seen on this issue. Heavy users should pay more. Its like a large fleet of trucks pays more gas tax than a soccer mom. Its their taxes that pay to upkeep the highway.

Post Your Own Comments

Try a RISK-FREE Issue of Inc. Today!

Renew | Contact Us | Current Issue