The US net neutrality fight affects the whole world

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The United States is a nation quarreling with itself right now. Most of the country’s population wants to keep the internet an equitable and free place, embracing net neutrality rules as a necessary guardian against corporate overreach. But the current political administration seems hellbent on dismantling net neutrality and handing internet service providers the freedom to mold, shape, manipulate, and price internet access in whatever fashion they like. The downsides to this regulatory repeal are too numerous and appalling to list, but you don’t have to agree that it’s a bad idea to see something else important about it: whatever the American authorities do with respect to the internet will have major repercussions for the rest of the world as well.

This seemingly internal fight overflows US borders in a number of important ways. Here are the two key aspects that trouble me, as someone who doesn’t reside in the US but interacts with a panoply of its internet services as a matter of daily and professional routine:

The rest of the world looks to America to set the example

You might think that, under the Trump administration, the United States has done a lot less leading than in generations past. Certainly, withdrawing from the Paris climate accord, shunning Cuba after Obama had normalized relations, and looking to rescind the Iran nuclear deal are all signs of a country looking inward. But just because the US isn’t leading doesn’t mean that others aren’t following. A butterfly flapping its wings in the US tends to cause a rippling of effects in the countries looking to the States for guidance.

I’m not talking about France or the Netherlands here. Countries with a modern, well developed, and functioning jurisprudence can navigate their own way through the challenges of regulating internet access. They’re far less likely (though not immune) to be swayed by events and decisions taking place in the United States. Especially under Emmanuel Macron’s leadership, France wants to be seen as a more enlightened, more welcoming alternative to a United States that seems to be losing its religious and cultural tolerance. But France is part of a very small exception.

The countries most susceptible to being misled by the United States’ bad example in terms of internet regulation are those who treat American culture as a guiding light, as something superior to their own. I come from Bulgaria, and that’s exactly the phenomenon that’s been at play there for most of my lifetime: when the communist regime was removed in 1989, its place was taken up by a corruption-riddled economic liberalism and a deluge of American cultural exports. The first time a McDonald’s outlet opened in my nearest city, it was treated like the opening of a Michelin-starred restaurant. And yes, we have Black Friday deals even without the Thanksgiving tradition, just like most of the rest of the world.

Bulgaria is only one example of dozens of countries that are broadly grouped together in the “developing” category. We look for external examples, for best practices when handling complex matters like the internet, and the US is the obvious first port of call. It’s where Google, Apple, Amazon, Microsoft, Facebook, and most of the other tech companies we admire hail from. We may not follow the US example with things like health care and capital punishment — because we also have millennia of experience with both — but given how the US practically invented the internet we know now, it seems reasonable to expect that its regulatory system must be operating in the most efficient manner possible. Right?

Among the budding nations looking for a role model is India, which is still formulating its approach to net neutrality. Facebook has already trampled over net neutrality principles in the country with its zero-rated Free Basics, though the Indian authorities effectively banned the practice with a ruling last year. Where India goes from here will be of major significance for the future, given the country’s huge population and rapid growth in the number of people getting online. Could Indian net neutrality rules survive in the context of a US stripped of all net neutrality protections?

Online services may become more expensive outside the US if they are more expensive to provide in the US

A big problem with internet infrastructure within the US is a lack of competition between providers. It’s true that no ISP owns the entire US market, but the way they’ve arranged their services is such that de facto monopolies exist in various municipalities. Recode’s Albert Wenger, for instance, has only one provider choice in Manhattan (also known as: no choice at all!), whereas a Londoner like me could pick from BT, Virgin, Sky, TalkTalk, Plusnet, mobile companies dabbling in home broadband like EE and Vodafone, and a smattering of smaller providers.

The aberrantly uncompetitive US ISP market leads to situations where someone like Comcast or Spectrum can effectively dictate whatever terms it likes to its customers. The only protection against that is government regulation, installing rules of conduct for these providers to follow. Without net neutrality, an unshackled Comcast can start putting together nightmarish (by which I mean “just like cable TV”) tiers or bundles of internet access that will be good for Comcast’s bottom line, but bad for consumers and bad for online services.

If Netflix and Amazon are forced to pay additional fees to have their streaming services included in Comcast’s “good” bundles, the end result is that we, the consumers, will bear that cost. And since Netflix and Amazon Prime Video are international services, those costs are likely to trickle down to unsuspecting customers beyond the US as well.

Another, more ephemeral, issue that arises from the absence of net neutrality is that companies like Netflix need to develop the necessary skill and tool set to navigate an internet that doesn’t guarantee a level playing field. That means hiring people adept at negotiating deals with internet providers, and it means figuring out ways to leverage and exploit the lack of neutrality. Netflix has already been dabbling with that, flip-flopping on whether it supports net neutrality or not. Developing the requisite expertise to compete on an unequal footing costs time and money, but once Netflix has it for the US market, it’s going to be much more likely to seek to export it overseas and make the most of it. In this way, an unregulated US internet would feed directly into a push to instill the same legal environment elsewhere.

Is this really what we want the internet to become? A place full of ignoble economic incentives driving companies to engage in ethically dubious anticompetitive behavior? Internet service providers are doing pretty well in the US even with the currently extant net neutrality laws, which exist mostly to curb those companies’ worst impulses.

Why should we distort and disfigure the economics of internet access — something so essential to modern life that countries now treat it as a legal right — just to appease companies that face no threat of going out of business? The global influence of the United States, and of American online companies, also means that repealing net neutrality within the country’s borders would pose an existential threat to net neutrality around the world.

Disclosure: Comcast Ventures is an investor in Vox Media, The Verge’s parent company.



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