(Editor’s note: Opinion pieces are published for discussions purposes only.)
By Nick Labadie Rose Law Group Senior Planner/Project Manager, involved in start-up business ventures
The repeal of Net Neutrality is terrible but the real reason why it isn’t what’s getting discussed. Obviously, free speech and the public’s equal access to information and the microphone of the internet are worth keeping it by themselves, but the huge issue that is not being discussed is the devastating blow to economic development that could result from internet service providers (ISPs) creating fast and slow lanes on the internet. Creating a slow lane will effectively block access to websites whose traffic is slowed down by the user’s ISP. That will mean that small online businesses from web stores of brick and mortar companies, innovative new startups, local news outlets, and even bloggers will be essentially cut off from the internet. Most popular mobile applications rely on an internet connection to operate as well.
Who cares about these little businesses in the larger picture of the local, state, and national economies? We all should because we are a nation of bootstrapping business building entrepreneurial go-getters who shouldn’t stand for a few ISPs trying to shut us up, but it’s bigger even than that. At some point, most of the biggest websites and mobile apps today were tiny startups. Companies we take for granted as foundational to the business community would never get off the ground in the world of fast and slow internet lanes. Google was started in a garage. Facebook was started in a dorm. Do you think either of those companies could have afforded the fast lane? eBay was founded in a living room. PayPal was a similar startup that launched, among others, who have had an undeniable impact on our society today. New companies are launching every day that have the potential to become the next big thing. The impact of these companies goes beyond their direct financial contribution to our economy. Their indirect contributions are massive.
There is a large consulting industry built around Google’s Adwords platform and search algorithm. There is an equally large industry built around retail sales on platforms like Etsy, Facebook, and others. The ridesharing industry led by Uber and Lyft wouldn’t exist because small apps would never get the early reach and adoption necessary to spread the word. That new industry has breathed new life into the hospitality and nightlife industries. It’s not all luxury and convenience companies that we wouldn’t have. Companies such as Lifelock, SiteLock, Infusionsoft, and WebPT to mention just a couple with significant Arizona presence, provide critical services that help other businesses grow. The Arizona startup community is turning out some incredible companies that are saving and improving lives in many ways. The incredible success and growth of Phoenix Startup Week and #yesphx are indicative of that. Talk to anyone at GPEC or the Arizona Commerce Authority to hear how important this industry is.
It is important to note that the telecommunications industry that stands to be the sole beneficiaries of a lack of net neutrality aren’t limited to the cable company sending the internet to your house. Our smartphones, which are arguably more important to us than our cars and most possessions (would you rather lose your wallet or your phone?), are given access to the internet through companies like Verizon who can limit your access to apps and web browsing from your phone. Mobile access to the internet surpassed desktop for the first time last year and is trending up. Now more than ever, your cell service provider is in control of what you can do with your phone. Need to check a stock or read up on that small but awesome market blog? Good luck.
It’s no secret that the technology sector is one of the most coveted for high paying high-quality jobs. Economic Development offices and agencies all over Arizona and the country fight to attract these companies because they know how beneficial they are to our economy. Even in the healthcare industry, access to the smallest sites on the internet allows research and development departments to find and share the information they need to move their work along exponentially faster than they could before the open and free internet held the information it does today.
Now, will these fast and slow lanes be implemented right away? Of course not. There will likely be litigation over the FCC’s repeal of net neutrality. For at least that long, the ISPs will lie low. Inevitably, however, they will make those moves. They didn’t spend so many millions of dollars on principle for regulations that stopped them from doing something they weren’t doing yet. Will that end free speech? Most likely not. Other companies, who understand that the market will win, will provide the service the public wants and will pay for. Companies like Google will take the opportunity to expand their Google Fiber product with assurances they will never have fast and slow lanes. Then, like the cable companies, the ISPs will realize that people don’t want their access to information, entertainment, and free speech to be limited.
Even in the worst case scenario, I see us getting a free internet back at some point. What should worry us is how long that will take and what the cost will be to our economy while it gets worked out. How much will the tech startup industry be shuttered? How many local businesses and national headquarters will be closed or moved because other states like Washington have enacted their own Net Neutrality laws? Can we afford to wait and see? Or, should we take steps now to ensure that Arizona gets a leg up on the rest of the Country and protects our businesses? It is in the best interest of our economy and public to make sure that, at least in Arizona, net neutrality is enforced. If our ISPs say they won’t limit access, then they should support any efforts to maintain net neutrality.
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