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Net Neutrality – a Canadian Perspective

What is Net Neutrality?

When it comes to Internet access, Canadian consumers connect via an Internet Service Provider (ISP) such as Rogers, Bell, Telus, Shaw, TekSavvy etc. ISPs deliver our means to access online content and services (resources) and do not influence us by restricting or enhancing our access to these resources. The term “net neutrality” is borne of this idea; that governments and ISPs should refrain from influencing our use of the Internet by restricting or enhancing access to any online resource.

Why Net Neutrality is important?

To compare the Internet to the bricks and mortar physical world we live in; content and service providers like Google.ca, Amazon.com, or even little guys like FoundationBTS.com are like retail shops which are accessible to consumers via the Internet which in this analogy is the road. ISPs are the vehicle that consumers use to access the road. The ISPs offer service plans which vary in performance (speed) and capacity (bandwidth); some consumers will purchase an Audi to get to the shops faster, while others will elect to take the bus, and still others might require a tractor trailer.

This analogy clearly shows the relationship between content and service providers, the Internet, ISP’s and you the consumer. If the ISP only provides the vehicle, why should they want to influence you to visit Hulu.com vs. Netflix or Amazon vs. Etsy? The answer is simple, they can generate more revenue by directing you, the consumer to content and services that they own.

Real World Examples

In the United States, companies like Comcast and TimeWarner both operate as an ISP and as a content and service provider. Hulu.com for example is owned by Comcast which is a direct competitor of television streaming service company, Netflix.

Netflix and other providers like them, increasingly find themselves at a disadvantage as ISPs use their size, influence and self interest to manipulate consumers. Recently, the position of the FCC in the United States as well allowed these media giants to offer services that give them a distinct advantage over content providers.

Zero-Rating Plans

While under the Obama administration several regulations were put into place to regulate ISPs to ensure a level playing field for content and service providers, but most recently a Republican backed FCC officially endorsed something called Zero-Rating Plans, which allows an ISP to provide certain free content to subscribers while requiring other content to be paid for as part of a data plan.

According to an article in Wired Magazine https://www.wired.com/2017/02/fcc-oks-streaming-free-net-neutrality-will-pay/ companies like Verizon and AT&T are allowing some apps “squeak past” their data caps while still charging customers for the use of others. For example, you can stream all the Spotify, Apple Music, and Pandora you want under certain T-Mobile programs without using any of your data.

Potential Consequence

In cases like these, major content providers like Apple, Pandora or Spotify might pay the ISP to get preferential treatment, and to the consumer this can initially look like it benefits them. The problem is that for any start-up company trying to break into the market with a new innovation they now face not only competition from existing major providers, but also from the ISPs who put them at a disadvantage. In the long term, competition suffers and the consumer loses out.

Canadian Solution

While we are witnessing the gradual deterioration of net neutrality in the US, Canada has a distinctly different perspective on the Internet as a basic human need, and the role of the ISP. Over the last ten years, the CRTC has created laws that prevent ISPs from managing traffic to limit Internet speed for some applications or zero-rate certain content. The end result is that content creators and consumers, not ISPs are in control when it comes to the delivery and consumption of Internet content. For more reading; the Globe and Mail has an excellent article on the Canada’s policies on net neutrality: https://www.theglobeandmail.com/report-on-business/rob-commentary/why-canadas-net-neutrality-stance-places-consumers-in-control/article34867805/

Summary

US policies on net neutrality will negatively impact content creators not only in the US, but around the world. The ability for start-ups and innovators to bring new products to the consumer will be more difficult when ISPs dictate what content gets consumer attention. Thankfully, Canada, Europe and much of the world have an opposite view on this important matter and do support the principals of a neutral Internet.

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