Net Neutrality Ruling May Impede LatAm Startups Gabrielle Meyer - VOXXI
go to original February 10, 2014

Net neutrality establishes a level playing field for the Internet. (Shutterstock)

The Internet as we know it may change drastically in the next few years.

Last month a three-judge panel of the U.S. District Court of Appeals for the D.C. Circuit decided “net neutrality” is unconstitutional, and that Internet service providers (ISP) have the right to manage online traffic.

What exactly is net neutrality?

Net neutrality is a movement that aims to keep the Internet open and neutral to all consumers, application providers, and network carriers. The Federal Communications Commission approved a set of “open Internet” rules in 2010 to prevent ISPs from discriminating against or blocking online content of their choosing. Essentially, this means that ISPs cannot give preferential treatment to one user or the other, or to one application or the other.

Net neutrality establishes a level playing field for the Internet; every site has the same quality and speed and every consumer has access to the same sites.

What does the recent court decision mean for you?

Because of the recent net neutrality decision, ISPs can now manage traffic, but do have to disclose how they are doing so. This means that major ISPs like Verizon, Comcast, Cox, etc., can charge hefty fees to major sites, such as Netflix or Amazon, so that they can have access to an Internet “fast lane”, while other sites that cannot pay these fees will be saddled with slow speeds.

This means that you may be affected, depending on your ISP. Many Americans have only one or two choices of ISPs, and without the net neutrality regulations keeping the Internet playing field level, you may not have great access to certain sites. For instance, Comcast, which is owned by NBC, may favor streaming capabilities for NBC over other news sites like CBS, ABC, and Fox.

Advocates of net neutrality fear that abolishing net neutrality will not only give consumers limited access to websites, but that it will also impede creation, and thus will give major companies a monopoly in their fields.

According to TIME Magazine, Craig Aaron, president and CEO of Free Press, believes that the court’s decision means that, “the biggest broadband providers will race to turn the open and vibrant Web into something that looks like cable TV. They’ll establish fast lanes for the few giant companies that can afford to pay exorbitant tolls and reserve the slow lanes for everyone else.”

What does the loss of net neutrality mean to Latin American entrepreneurs?

The loss of net neutrality might have a devastating impact on startups. Open access to the Internet is what allowed startups like Twitter, Facebook, and Google to flourish in the first place, and now many people fear that inventive thinkers will be at a disadvantage without net neutrality.

Latin American startups, such as Ideame (Latin America’s kickstarer), Workana (an online marketplace for freelancers), Wormhole IT (a web conference platform), and many more may find it harder to get a foothold on the Internet without the help of net neutrality. Most startup companies cannot afford to pay ISPs for faster broadband or better quality, and therefore the already established companies will have an unfair advantage. For instance, if a Latin American entrepreneur wants to create a startup that would rival Netflix, he might find it nearly impossible to do so since Netflix will already have too much of a monopoly in that online field.

However, the future ramifications of the recent court decision are elusive.

We will not know exactly how the loss of net neutrality affects consumers and businesses until further down the road. And since the debate over net neutrality is far from over, we can assume that this recent court decision will not be the last we hear about net neutrality in America.

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