Net Neutrality - Yet Another Risk on the Horizon - The Impact To Digital Marketers
Published in Marketing Quarterly - March 2018
By Craig Spiezle, AgeLight, Managing Director
The demise of net neutrality continues to make headlines, while the rest of the world questions the United States' commitment to consumers' digital rights. Last year as tens of millions of citizens voiced their opposition, trade groups representing ISPs and carriers mobilized support of the Federal Communications Commission, (FCC) repeal. In the end, the FCC sided with the trade groups and voted along party lines to abolish net neutrality protections.
In the aftermath, there has been a resounding effort by net neutrality supporters to regroup and counter the repeal. At the state level, the State of Washginton in early March pased landmark regulation effectively enacting a state Net Neutrality law focused on protecting an open internet. Others States including California, Montana, New York, Oregon and others, are seeking pass laws to trump the effects of the FCC's repeal. These efforts seek to make it illegal for state agencies to contract with a carrier who unfairly prices or limits access to content based on tiered levels of services. At the same time a coalition of over twenty State Attorney Generals have filed suit. At the Federal level, the US Senate is working on what is likely a "Hail Mary" invoking provisions of the Congressional Review Act (CRA) to overturn the FCC's vote and forcing the FCC to maintain prior rules effectively regulating ISPs as common carriers or utilities. As of today just one more Senator is needed to sign-on to move this forward!
If these efforts fail and the roll back of net neutrality survives, one should not be surprised if the pendulum swings the next time the Democrats win control of Congress. The risk of seesawing regulation introduces a unique set of challenges and uncertainty that could have long-term ramifications to our economy, business models and the free flow of information.
The Impact Beyond Consumer
Digital Marketers should be concerned about the FCC's repeal on multiple fronts. Foremost is that carriers are now integrated media conglomerates. For example, Comcast includes Universal Studies and NBC while Verizon includes AOL, Yahoo and a diverse portfolio of programming networks and ATT includes wireless and DirecTV one of the largest providers of pay TV in the world. The repeal of net neutrality risks placing them in control allowing them to gain competitive advantages by pricing and tiering offerings that benefit their services and drive consumers from competition.
Reaching the Inbox
On the customer engagement front the ability to deliver mail in high volumes in a narrow window of time could be at risk. Today ISPs protect user inboxes by legitimately throttling email traffic for anti-spam and security protections. There are also tactics to help ensure inbox placement including positive reputation signals from third parties, including opensource whitelists and commercial certification programs. In a world without net neutrality, such decisions could easily advance beyond security and user preferences. Imagine a world where high-volume mailers must pay their recipients ISPs for "high-volume burst bandwidth" or risk losing inbox placement or prompt delivery. Can you imagine the impact of surcharges being placed on online florists in advance of Valentine's Day or online merchants leading up to Cyber Monday?
While ISPs may deny these scenarios will occur, a similar pay structure was attempted in the past. Goodmail Systems CertifiedEmail, was pitched as "the standard for trusted email" an email certification program in which digital marketers would pay for preferential inbox treatment and revenue would be shared with participating ISPs. Many ISPs jumped at the opportunity including AOL, Yahoo, Comcast, Cox and others. While this business model failed for a variety of reasons, it remains to be seen if the repeal of net neutrality will open the pay-to-play door once again.
The potential impact of the repeal goes beyond email delivery, also putting at risk the ability for online service providers to deliver a compelling user experience. For example, if the call to action is to attend a webinar, what is to stop an ISP from throttling connections or a user's ability to watch a high definition video hosted on an organization's site?
On the surface it might be easy to dismiss the negative impact and feel only industry titans such as Amazon, Netflix, Facebook and others will be targeted to pay. In reality we need to think about the impact more broadly. Providers and consumers of any size that rely on bandwidth may be at risk. Services such as music streaming, storage providers, VPN users, online education and training, hosting providers and more ubiquitously the email and interactive marketing channels we use and rely on daily can be impacted.
To this point last month, Burger King released an ad explaining the concept of net neutrality. In the ad, actors playing Burger King employees taunt customers by making them wait for absurd amounts of time to receive their order - unless they pay to get their food quickly.
Take Action and Help Control Your Destiny & The Future of the Internet
Collectively we must continue to advocate for an open internet where all trusted traffic is treated equally. The United States' public policy needs to be aligned to the rest of the world which promotes an open internet and respects consumer choice and freedom. In the absence of action, we risk disenfranchising business innovation, marginalizing access and ultimately increasing cost to consumers.
Do not risk being caught flat footed. Plan for the potential impact and recognize the power is in your voice. Use it today or risk your business being marginalized tomorrow. Contact your Senators today and urge them to support the pending CRA!