Net Neutrality Rollback: What It Means for Small Businesses

Net Neutrality Rollback: What It Means for Small Businesses

Unless you’ve been avoiding the news and social media over the last several weeks, you’ve probably heard about the Federal Communications Commission’s Dec. 14 decision to repeal internet rules known as Net Neutrality.

Chances are you’ve also seen opinions ranging from “it’s the end of the internet as we know it” to “it will be just the same as it was before the FCC rules were put in place in 2015.” While neither of these statements are really accurate, they represent the confusion surrounding the changes the FCC voted to make.

What Exactly Is ‘Net Neutrality?’

If you aren’t familiar, net neutrality is simply another way of saying open internet. It means that ISPs (internet service providers – the folks who provide your connection) treat all content equally, regardless of what it is, and don’t give preference to some digital content providers over others. So, for example, if you own a small hardware store, your ISP can’t give faster speeds to Home Depot just because they can pay more for it.

The FCC’s decision earlier this month to repeal those rules, however, means that that could change and the internet could become “pay for play” when the rules change goes into effect Jan. 1.

Now, some proponents of the changes say the result of the FCC’s decision will be nothing – that the internet will be exactly as it was prior to the net neutrality rules went into effect in 2015. But, as Jessica Rosenworcel, a commissioner of the U.S. Federal Communications Commission, wrote in a Dec. 12 piece for the Harvard Business Review, “Since its inception, the growth of the internet has been guided by a foundational principle: your broadband provider should not get to pick winners and losers in terms of how quickly or easily you can access things online. Instead, you should control what you see and what you do, and everyone should have an equal opportunity to get their content or service to their intended audience, without interference. This principle has led to a virtuous cycle of innovation that has driven our economy in previously unimaginable directions. For the first time, small business could think big and consumers could shop small, from anywhere in the world.”

She goes on to explain that the policies that have guided the internet since its inception were a byproduct of regulations established by the FCC decades ago. The Communications Act of 1934 sets forth that networks operate in a nondiscriminatory fashion. That applied to telephony and extended to the internet at its inception. The FCC’s recent decision stands to upend all of that, meaning your ISP could potentially charge more for “premium” service. If your small business can’t afford it, your potential customers could experience slower load times for your site as well as delayed transaction times.

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What the Net Neutrality Repeal Means for Your Small Business

Not only could you as a small business owner be asked to pay more for the services you currently receive, you could potentially be asked to pony up more just to have an internet presence at all.

Broadband providers now could potentially block websites that refuse to pay, censor certain content and, as we mentioned before, create tiered services that result in paid prioritization.

As Rosenworcel wrote, the net neutrality rules prevented “broadband providers from getting in between a business and its customers online.”

Here’s what the change could mean for your business.

1. Your ISP May Want to Promote Their ‘Partner’

One of the beauties of the internet age has been the ease with which small businesses and entrepreneurs can compete with larger companies. But, should ISPs be partnered with competitors to your business, the loss of net neutrality means they may provide that partner with preferential treatment, including priority speeds. So, NBC’s Hulu (a subsidiary of Comcast) could get priority over Netflix when it comes to video download speeds for Comcast customers, for example.

2. You Could Lose Your Google Ranking

Many small business owners rely on organic traffic from search engines as part of their marketing plan. Part of Google’s secret sauce when it comes to search rankings is site speed. If your ISP starts throttling your speed because you can’t afford the premium package, it’s possible your company site could slip off the first page of search results. That could be a killer for a lot of businesses.

3. Your Small ISP Could Be a Loser

Like small businesses, smaller ISPs could also take a hit from the removal of net neutrality because they won’t be able to compete against the larger broadband providers. Smaller ISPs simply won’t be able to offer some of the loss-leader packages that larger providers may. Some proponents of the rules change contend that it will allow smaller providers to be more innovative.

4. You Can’t Afford Premium Services

If you’re just starting out or your business is just branching out into e-commerce, it’s possible you could be priced out of the market all together. It could require cuts in other areas of your business in order to maintain your internet visibility.

Is Net Neutrality Rollback a Done Deal?

It’s possible the FCC’s decision could be reversed, but probably not before the decision takes effect Jan. 1. New York Attorney General Eric Schneiderman is leading a multi-state lawsuit against the rollback. There have also been rumblings that Congressional Democrats may try to override the FCC decision.

For now, though, it’s a wait-and-watch scenario for small businesses and consumers alike to see just how ISPs will respond to the removal of net neutrality.

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