The EU Legislation Proposal On Net Neutrality: Implications And Consequences

Information Infrastructure: The Magic of the Revolutionized Platform of the World Wide Web

Question-Differentiated services which allow for different consumer experiences of network delivery based upon paid access or similar access control provisions pose a threat to the future of internet communications.Critically evaluate this statement in the context of the EU legislative proposal on net neutrality?

With regard to information infrastructure, internet can be given the title of the most successful experiments and an integrated effort of constant research and development into the information infrastructure segment (Leiner, Cerf, Kahn, Kleinrock, Lynch, Postel, Roberts and Wolff 2015). At the click of a button, information can be disseminated to millions and billions of people across the world, irrespective of their demographic conditions. That is the magic of the revolutionised platform of the World Wide Web, whom we popularly call the internet (Weitzner, 2006). If statistics were to be taken into account, almost 20% of the global internet users were said to be from Europe, according to a survey taken on June 30, 2014 by Internet World Stats. Below is the represented pie-chart of the same statistics:

                                                 Figure 1: Global internet user’s statistics in percentage (Miniwatts Marketing Group, 2014)

According to Kramer, Wiewiorra and Weinhardt (2012), with the sudden surge of the internet as the obvious platform for the broadcast of information, there has been a sudden interest of the private market players with regard to the monetization of the services of internet service providers in the near future. The right kind of legislations and action steps must be in place, in order to ensure that decisions are taken in the general interest of the public (Kramer et al, 2012).

As obvious as the world around us seems, without the internet, no single business or academic or entertainment activities seem possible. As a matter of fact, the article has been written primarily with the dynamic facility of the internet as a search-tool medium. This present employment of internet in our daily to daily, and in fact hourly to hourly activities of mankind, has led the internet service providers to rampantly monetize the entire internet service providing activity among the masses of the European population and worldwide as such (Kramer et al, 2012). Such exponential focus on the healthy supply of internet from ISPs to the public aroused a concept called net neutrality debate, which takes into consideration the status of the internet in the coming future.

The EU Legislative proposal on net neutrality was a key decision taken in, across and for the entire European countries in the late 2013 in the months of September (Meyer, 2013). The entire purpose of creating a new framework for internet service takers across the European Union was to scrape out the fragment network of internet providers which were disrupting the unified approach to taking and using internet connections. With the advent of the EU legislative proposal on net neutrality, the roaming charges were aimed to be cut down as well as to create an authentic market for telecommunications for internet users in the EU region. However, the prior requirement of being converted into a law would relate to the passing of the proposal by the European Parliament.

Monetization of Internet Service Providers' Services: A Cause for Concern

In the context with the European Union’s legislate proposal on net neutrality, the European Parliament has taken into consideration to impose restrictive barriers on the internet service providers (ISPs) to offer differentiated products of internet services, with the aim of targeting data-hungry consumers for generating higher revenue (BBC, 2014). The proposed legislation has still not been passed by the European Union’s Council of Ministers, and comes into contradiction with other countries like USA and India which offers customers a variety of broadband and wireless data packages, therefore targeting to the individual needs of the customers and bridging up the connection between demand and supply for generating higher revenues presently and in the coming future. For instance, a company like Netflix in the USA was the highest tax paying company for offering preferential internet services to the customers of the States.

The principle behind such a proposal is to ensure that all the service providers are in the practice of offering a similar product to customers, which will result in the generation of equal internet traffic. Although the net neutrality proposal would prove to be a boon for the general public otherwise, it might just as well prove to be a bane for the entertainment industries which promise the download and viewing capacity of films at a 4k super-qualitative speed, for a higher sum of revenue (BBC, 2014).

With response to the suggested legislative proposal of net neutrality, a combined statement by four trade bodies of cloud data storage and telecom operators revealed that the legislation has been put forward in haste without adequate technical analysis. This could lead to the same legislation turning out to be an anti-consumer legislation, rather than in their interest, since a lot of consumer services will get disrupted with such a legislation coming into power. The current practises of the ISPs of UK revealed that they were operating their services with controlled traffic already, thereby questioning the construction of net neutrality’s actual reference in the present scene (Kramer et al, 2012). However, the proposed open internet packages were being welcome by the general public and also by other internet service providers, with regard to the inference of net neutrality.

The following would be the relevant various consequences once the EU legislation on net neutrality is cleared by the Parliament (Meyer, 2013).

1. It will not be in the hands of the service providers to steal their custom, as all this was required earlier under the umbrella of the different operators, for instance, Skype.
2. In the coming years, there shall be no existence of something called roaming charges
3. In specific cases, the consumers might have to clear payments to certain ISPs in order to prioritize their traffic,
4. A uniform license for one state shall act as the license for the other member States of the European Union.
5. Another major factor is that the existing barriers to the offloading of mobile traffic onto the radio LANs shall continue to be disrupted.
6. Broadband terms and conditions must be made clear to the target audience, thereby facilitating the decision making of users across the EU nation. Moreover, the users shall not be subjected to penalties since there are random price hikes and other things altogether.

A direct impact of such an act coming into existence would be the increased bills of the consumers who demand online entertainment media. For instance, in order to download movies and watch videos/movies online, the consumer will have to bear the extra infrastructure costs which will be pushed down to them from the internet service providers (BBC, 2014). This statement was also passed by Chris Green, a technological analyst employed with Davies Murphy Group Consultancy. However, one positive implication of the European Union’s proposed legislation would be the direct ban on the roaming charges while travelling in other European countries (Jurist, 2014).

Differentiated services indicate that the consumers face a mix of different internet packages across the EU states, which ranges between two extreme limits of a free open internet source and high-quality paid services. These high-quality internet services cater to the needs of consumers who are willing to pay a higher range of prices in order to accommodate their demand for much faster and smoother internet connectivity for their personal/business usage (Baker, 2015). However, one must keep in mind that the initial birth of internet services was propagated with the concept of a fair and equal availability of internet services to the worldwide consumers without any form of prejudice or bias. However, now that, European Union has pushed off the legislative proposal to implement net neutrality, internet service providers (ISPs) have a green signal to practice the supply of different internet packages in order to maximise profitability off the same.

The EU Legislative Proposal on Net Neutrality: A Key Decision

One must mark that Italy has come forward in the year 2014 (November) to express its objection on the restriction of preferential internet service supply, stating that the definition of net neutrality might stand to be at variance from different provisions (Essers, 2014).

Monopoly of internet service providers

It is certainly evident that the supply of differentiated services of internet packages will emphasises the role of internet service providers in the community, both financially and strategically. In order to apply differentiated services practice in the market, ISPs offer two different schemes generally to the customers. First, nominal users of the internet might be offered a cut-off from the fixed charges which a heavy user pays for his unlimited data usage. This would lead to a situation where in the nominal user might have to incur additional charges for accessing several other websites, or either in the case of diminishing their fixed data packages. The other manner of violating the net neutrality practises would be to offer different Quality of Services (QoS) packages to the customers which would directly lead to creating biases of speed for the amount paid for accessing the internet services (Kramer et al 2012). Such practises come across as destructive for the future of internet communication as; an unregulated and biased practise is definitely unfavourable for the customer who might simply switch to alternate forms of communication.

The ISPs are the middle agent for the two sides of the market, one wherein the supplies of content and services (CSPs) are present, and the other would be the demand side of the consumers (integrated users – IU) (Kramer et al 2012). Now both the CSPs and the IUs want to be connected to one another, and the platform for the same is created by the ISPs, thereby giving birth to the possibility of their monopoly in the coming future. The power of charging preferential rates remains in the hands of the ISPs as long as the concept of net neutrality does not come into the scene, however, once it does, it will weaken the overall capacity of ISPs to influence advertisement and content decisions. Also, in order to maximise revenue, the ISPs charge fees from the side whose value is the most. In order to support the above stated statement, various examples can be stated. For instance, the credit card companies always levy a charge on the merchant and not on the customers, or the free entry of ladies to clubs whereas men have to bear the cost for the same. Such practises again disdain the idea of providing utmost customer satisfaction to both the parties, the CSPs and IUs, thereby creating a disorganized platform of operations.

The last mile of connection

There are severely high chances of monopolistic conditions in the European economy, if the proposition of differentiated internet services is to go on being practised by telecommunications companies (Jordan, 2009). The last mile of connection is synonymous to and indicative of the final delivery of internet accessibility from the provider to the consumer. At this juncture, it must be observed that the data packet has to be transferred through other service provider’s equipments. The consumers are generally concerned about the higher charges due to the ownership of these cable lines by the internet service providers as compared to the other ones who are rather deploying the accessibility of other ISPs (Jordan, 2009). Such reliability on the cable owner’s equipment accessibility might completely jeopardise the business of the content providers, as they may land up charging exorbitant rates of charges.

Restrictive Barriers on Internet Service Providers: Addressing Data-Hungry Consumers

Conclusion

In the current scenario, we see that the EU has suspended the plan of net neutrality and postponed it to the next couple of months. This has given ISPs the green signal to go ahead and practice differentiated services in the internet market, therefore maximising their revenues by offering preferential data packages to customers. The initial few days of the current year of 2015 witnessed Latvia adopting the new presidential rule of the European Union’s Council of Ministers, which has led to the pushing off the net neutrality ideology of the EU for a couple of months, as mutually decided upon by the European Union member states (Baker, 2015). This compromise upon the concept of net neutrality, indicating that, the European Union now will be finding a fine balance between the high quality internet services by ISPs, and a reasonable price offering for the consumers, which leads to the birth of differentiated services’ existence in the EU member states.

The reason why differentiated services are not taken to be healthy for a coming future generation would be the high possibility of manually controlled internet environment by the major players of the industry. With context to the proposed legislation of net neutrality, differentiated product offerings by internet service providers might lead to unhealthy competition amongst different ISPs leading to higher speed in certain internet packages and a compromise over the other. Moreover, the customers who are willing to pay higher charges get benefitted, whereas the general public who are not willing to shell more money than required remained at an uncalculated disadvantage. Moreover, the structure of net neutrality suggests that all the citizens of the European Union’s member states must have access to open and equal internet networks, a situation, destroyed by differentiated product offerings.

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