What the net neutrality battle is really about

Vschlichting | Getty Images

Vschlichting | Getty Images

The FCC’s proposed net neutrality regulations are widely expected to be approved Thursday by a three-to-two vote along partisan lines. The battle between Internet companies and Internet service providers has heated up ahead of the vote, with CEOs on both sides weighing in—including Netflix’s Reed Hastings, for one, in favor, and Comcast’sBrian Roberts, for the other, against it.

But the two sides aren’t really disagreeing over net neutrality itself: There’s general consensus about the basic tenets of no blocking or throttling of basic Internet service.

Read More Father of net neutrality: Rules won’t kill spending

So what are people really fighting over? The controversy comes down to the fact that the FCC’s new net neutrality rules reclassify broadband as a public utility—just as telecom companies are considered a public utility—under what’s called Title II regulation.

Proponents of the new rules say regulating the Internet as a utility protects consumers and innovation. Opponents say it stifles innovation and restricts capitalism. Essentially, the debate has become ideological and partisan.

“On the one hand you have the Internet companies like Netflix and Facebook who are trying to ensure they have unfettered access to the consumer and that the consumer has unfettered access to them,” said analyst Craig Moffett at Moffett Research. “And on the other hand you have companies like Verizon, AT&T and Comcast who are saying they don’t oppose any of the net neutrality-related rules, but the legal framework in order to get there imposes all these burdensome regulations and the risk of government overreach.”

The concern, Moffett said, is the risk that Title II regulation—even with all sorts of carve-outs, or “forbearance” on certain more onerous parts of Title II—will lead toward the government regulating prices.

“Is this really a foot in the door towards price regulation of the broadband market?” said Moffett. “The Internet service providers, the cable companies, the phone companies would argue, yes, that this really is a step in the direction of price regulation because the statues that are being imposed do include requirements around- quote un-quote, just and reasonable pricing.”

The FCC has said very clearly that it does not plan to regulate pricing. But the concern among opponents of the new regulation is that this could be a slippery slope.

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