Briefly, net neutrality rules were put in place so that cable companies and other internet service providers (ISPs) couldn’t adjust speeds or charge customers more than their monthly bill to access certain sites or content. Those rules are not gone yet, because the ruling must be voted upon by Congress before being enacted, but many people are anxiously waiting to see what is going to happen.
The regulations that were just potentially tossed out the window were first put in place two years ago. Companies like Amazon and Google are advocates for net neutrality, saying that it preserves free speech. Companies like Verizon and AT&T oppose net neutrality, saying that it doesn’t allow for free-market commerce. Just before the vote, the cable giant Comcast released a statement from its chief executive, stating, in part, that the company “does not and will not block, throttle, or discriminate against lawful content.” Statements like these are not doing much to alleviate fears amid the general public.
How This Affect Small Business Owners
Small business owners, in particular, are concerned that the cost of doing business online may soon go up. Companies that provide Internet service will now have free reign to charge customers as they wish and, while there are no publicized plans to do so, it is a very real possibility. The owners of these small businesses fear that they may no longer be able to compete with giants like Amazon who have the capital to pay whatever a provider chooses to charge.
If your business revolves around the Internet, you need to pay attention. For example, if you sell a product and take orders online, send those orders to a fulfillment company and then have those orders shipped, you could see your costs rise significantly. If this happens, will you be able to stay in business? According to one small business owner, things are already difficult. That business owner told the New York Times, “You’re busy enough just keeping your company running, trying to grow and succeed or just stay alive, that you don’t have the resources or the time to contemplate how to prepare for something like this.”
According to statistics, more than 99 percent of small business employ fewer than 500 people. Close to 80 percent are owned and operated by a single person. Over a quarter of small businesses said that they had planned to expand e-commerce platforms this year. Whether that happens now remains to be seen.
The American Sustainable Business Council and small business groups sent an open letter to the Federal Communications Commission supporting more than 500 small businesses throughout the country. They said that rolling back net neutrality regulations could be disastrous for American businesses. “The open internet has made it possible for us to rely on a free market where each of us has the chance to bring our best business ideas to the world without interference or seeking permission from any gatekeeper first,” the letter said.
The End of Net Neutrality Could Damage the Economy
Small business owners are concerned that if providers begin to wield more power, their sites will be negatively impacted. For instance, a study has shown that if a consumer has to wait more than three seconds for a site to load, they are likely to abandon the site in favor of one that is faster. If a provider throttles Internet traffic in favor of a larger company, a small business could suffer. Those who own the smallest companies are worried that having to pay extra to be put in the fast lane could be detrimental to their operations.
Freelancers may also take a hit. In today’s gig economy, millions are doing piece work online in order to make ends meet or even to support themselves entirely. If Internet prices change in such a way that people are expected to pay more for higher speeds, to access certain sites or apps, or to be given priority, freelancers may be looking for other work.
A final concern is that people who are considering going into work for themselves may choose to opt out of the small business world in favor of brick and mortar work. Imagine having the idea to start a small business only to know that you will be nickel-and-dimed in order to keep that business running. In a world where we are used to paying a single price for our Internet service and being able to do anything we wish, knowing that you would have to essentially pay to play could very well have people changing their minds about going into business for themselves.
What exactly will be happening in the near future is anyone’s guess. None of the major cable providers have publicly announced plans to change their fee structures. We have not yet seen a change in Internet speeds or been blocked from certain sites and applications. That isn’t to say, however, that it couldn’t happen in the very near future. As we move closer to the end of one year and the start of another, the deregulation of net neutrality could turn into bigger news than it already is.
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