Definition of net neutrality
The principle that all traffic on the internet should be treated equally.
The internet is delivered by broadband providers who can use their infrastructure to set particular terms for access of internet applications and content (websites, services, protocols). These access terms are discussed under the heading of "net neutrality" (NN), generating a debate that has received a great deal of attention from all the stakeholders involved and which is likely to influence the development of the sector in the years to come.
On one side of this debate side stand the "openists”, who propose a regulation that bans discrimination of data packets (eg, Google’s content should be treated identically to that of any other content provider) and guarantees open and equal access to the net.
One of their main arguments is that net neutrality is needed to protect the innovation of small start up content providers: among those there may be tomorrow’s giants like Google, Facebook or Youtube. Innovation at the edge of the network is one of the defining features of the internet and discrimination constitutes a potential harm to it.
On the other side stand the “deregulationists”, who believe that the internet needs no regulation and will develop better by letting the market forces operate freely. Their main argument is based on the need of broadband providers to get an appropriate remuneration for the use of the infrastructure, which seems the best way to guarantee investment for maintenance and expansion of the capacity of the network (the “core” of the internet). The latter is a prominent concern in times where the popularity of bandwidth-intensive applications is rapidly increasing.
As consumers, we typically subscribe to a broadband provider (say, BT) in order to use the internet (say, search on Google).
The funding to BT’s infrastructure comes from us, not from Google. Yet Google gets its revenues from advertising. BT treats all content providers, such as Google, identically, so no one gets a faster priority lane to deliver their content - this is net neutrality.
Technology is now changing this picture, especially if NN is to be abandoned. Broadband allows BT to engage in web traffic management techniques that can potentially be used for discrimination of data packets (so, Google gets priority, but only if it pays for it), and several other practices that may raise competitive concerns (BT could promote its own content, and not that of rivals).
Current business models will change if one abandons NN: BT could charge Google directly, and perhaps end customers could pay less for their subscriptions (an example of a waterbed effect).