What does the repeal of net neutrality mean for development?

Students using computers at a madrasah school in Indonesia. Photo by: Asian Development Bank / CC BY-NC-ND

SAN FRANCISCO — Last Thursday, the United States Federal Communications Commission voted to repeal net neutrality, regulations that prevent internet service providers from favoring some sites or services over others. Net neutrality is the principle that internet service providers must offer equal access to all online content without blocking access to certain sites or charging people for better delivery.

It is unclear what all the implications of the decision will be — or even whether the repeal will remain, as advocates prepare a legal challenge to the FCC ruling and focus on the U.S. Congress. But experts tell Devex that allowing ISPs to decide what online content people see, and at what speed they access it, will have consequences far beyond U.S. borders.

“There is not a lot of discussion of net neutrality in international development or humanitarian circles,” said Reid Porter, director of transparency and open data at InterAction.

In a recent blog post asking what the implications of the repeal could mean for ICT4D (or information and communication technologies for development), the alliance of nongovernmental organizations explained that net neutrality was not a focus for its members. “People have decided it is not a primary concern, or haven’t thought through the secondary and tertiary implications of how a decision in the U.S. can affect markets overseas,” he said.

Devex posed that very question — the implications overseas, and specifically for global development and internet access efforts — to a number of experts on both sides of the net neutrality debate.

Connecting the unconnected

Even if U.S.-based NGOs are slow to realize that net neutrality regulations have implications for their work internationally, the world is watching and reacting to the news.

The major problem, according to Joe McNamee, executive director of European Digital Rights — an association of privacy and digital rights organizations — is that the repeal of net neutrality turns internet service providers into gatekeepers between the internet and users. “This has a catastrophic impact on investment in network infrastructure. The unconnected remain unconnected. The connected are only connected to those services that have the resources to pay the gatekeeper for access to the customer base,” he said.

Internet service providers have been hard at work lobbying for the repeal of net neutrality. With the rise of social media usage and online video streaming, they argue that some customers are using too much network capacity. While one option available to them is data caps, as the industry moves toward unlimited data plans, customers are paying the same for data whether they occasionally check emails or stream video all day long. Net neutrality prevents them from charging consumers more depending on how much network capacity they use, ISPs say, posing a problem as demand for data grows.

One question is what next steps ISPs will take, now that they have what they wanted. One of their arguments against net neutrality was that it reduces flexibility for business models, and therefore lowers incentives to connect the unconnected. But supporters of the regulation say they are skeptical that ISPs will ramp up their work in rural areas as a result of this repeal.

Proponents of a free and open internet say that if ISPs can determine what content to prioritize, they can block apps or features that undermine their paid services. There are concerns that this would allow larger companies that have more money to dominate the space, and crowd out smaller services that might start up, potentially including nonprofit organizations and the services they use. It would also give ISPs the power to highlight or silence stories or communities, they say.

“For the internet to realize its potential as a tool of economic growth and empowerment, content must also be relevant for the population accessing it, and must be available in the local language,” said Dhanaraj Thakur, senior research manager at the Web Foundation.

“The open internet, by providing a level playing field, enables local technologists to easily deploy their locally designed applications, and everyone with a connection can easily upload content and express their views. This is particularly important for populations in low- and middle-income countries — and for the development and humanitarian actors working with them,” he said.

A demonstration effect

The net neutrality regulations repealed last week were introduced in 2015, in part to classify broadband internet as a public utility so that the FCC could regulate it as it does with phone services, and support a free and open internet. At the time they were introduced, David Kaye, the United Nations special rapporteur on freedom of expression, said he hoped “the new rules may serve as a model for other governments seeking to protect or expand an open and secure internet.”

Now, he told Devex he is worried about just the opposite: that other countries may see the repeal of net neutrality as a signal that it is acceptable to put companies in a position that, in his view, allows them to interfere with content. Regulators everywhere look to experiences from other countries such as the U.S. as part of their decision-making process on net neutrality. Countries including India, Nigeria, and Brazil have taken actions to strengthen their net neutrality frameworks, but there is now concern about a demonstration effect, in which the decision to repeal net neutrality in the U.S. might affect those discussions elsewhere.

“Net neutrality is country by country, so it’s hard to know right now what the impact of the repeal will have outside the U.S., but there is the possibility of countries looking to what the U.S. did and saying, ‘If that’s an approach that democratic America can do, then we should do that too,’” he said.

Alex Howard, deputy director of the Sunlight Foundation, which advocates for open government, agreed. In an email to Devex on the day of the vote, he argued that “broadband regulation remains relevant globally.” Howard is concerned that the move by the FCC sets a bad example for developing nations looking to the U.S. for best practices on internet infrastructure. “There was a flawed public consultation, with no public hearings and poor use of evidence,” he said.

“Developing nations should take steps to avoid industry capture of regulators,” referencing the idea that regulatory agencies can end up becoming dominated by the same companies they are intended to regulate.

A complex debate

But the potential impacts of the decision are complex and uncertain, and some say it could help to increase access to the internet in lower income countries.

Roslyn Layton, an expert on regulation who served on the FCC Presidential Transition Team and has worked on technology adoption in developing countries, explained that government regulation is costly. If the goal is to get poor and rural populations connected to the internet, there is a need to make it as inexpensive as possible — including by reducing regulation, she said.

Layton argued that internet adoption has slowed globally, due in part to the lack of price flexibility and different business models to get people online, and said the repeal of net neutrality could help to counter this. “A lot of people working on net neutrality have never been to a developing country and talk about this as being about human rights,” she said. She described a “first-world versus third-world tension” in the debate over net neutrality.

“Human rights is also about just getting a phone and getting a connection and being able to talk with your family in times of emergencies,” Layton said.

In many low- and middle-income countries, the discourse around the internet generally focuses on affordability and access first, and then net neutrality second, if at all, said Thakur of the Web Foundation. The focus on access before neutrality “has led to an uptick in initiatives that provide users limited access to the internet for a free or reduced cost, with the limited access justified as acceptable because these plans are meant as a first step to getting people online,” he said.

He mentioned a proliferation of “zero-rated” mobile service plans, which offer users access to limited content for free — such as Facebook’s Free Basics, a package of free online content the company is offering across the globe as part of its mission to extend internet access to all. But the program was banned by the Telecom Regulatory Authority of India for favoring some websites over others and breaching net neutrality.

Similarly, service-specific plans offer cheaper data but restrict use to certain content and platforms, as part of efforts to connect the unconnected in low- and middle-income countries. But although net neutrality regulations can inhibit this type of effort, “it is important that net neutrality concerns not be left out of innovations to get everyone online,” said Thakur.

The Web Foundation has argued that instead of providing access to a few sites, the better way to get new users online would be to provide a free data allowance with no restrictions on what site or apps could be accessed. While the debate is typically divided between people who want more or less regulation, what really matters is the right regulation, said Michael Potter, founder of the NGO Geeks Without Frontiers, which is focused on extending internet access, and a member of the FCC’s Broadband Deployment Advisory Committee.  

In his opinion, legislation such as Dig Once! — an infrastructure-sharing initiative that his organization has proposed as a way to reduce the time and cost it takes to roll out fiber optic networks — would be more meaningful for internet access in the U.S. and emerging markets.

“If people are serious about legal models and examples that will help the developing world, I really think a sincere focus on competition law” would have much more impact than anything related to net neutrality, he told Devex.

Others point out that while the argument against net neutrality is essentially that the market knows best, and that consumer and competitive pressures will work to promote protections that look a lot like net neutrality, that overlooks the lack of competition between ISPs in many markets.

What comes next

Those who are in favor of the repeal describe the reaction to it as hype or hysteria.

The vote last week simply takes us back to 2015, before the regulations were put in place, Layton told Devex — with the important addition that transparency rules have now been strengthened. She explained that power has been shifted from the FCC to the Federal Trade Commission, which is working with the FCC to coordinate online consumer protection efforts.

But advocates of net neutrality say it is critical for the FCC to play a role in cases of blocking and throttling. They fear how this will play out over time. No matter how ISPs act in the short term, over the long term they could start to look more like cable television, offering bundled packages versus open access to information, they say.

“If you could look forward five years, and this decision holds as companies invest overseas in providing access, the idea that they can decide who can traffic on their networks and the cost they will be imposing on different content providers, that’s portable,” Kaye said.

Some of these U.S. based ISPs do operate internationally, or have plans to. So either in their expansion, or with international ISPs following their example, they could point to the lack of net neutrality in the U.S. as reasons that other countries might consider the same.

Kaye spoke with Devex ahead of a trip to the Internet Governance Forum in Geneva, Switzerland, this week, where net neutrality was on the agenda, with a major focus on the issue of zero rating. Kaye said forums like these allow stakeholders to discuss how regulation affects the way the internet works, and called the conversation timely not only in terms of the regulatory change in the U.S., but also because companies such as Facebook and AT&T are converging, with content companies building infrastructure, and ISPs offering content.

What remains to be seen is whether, following the repeal, the public will push the U.S. Congress to mandate “no blocking of websites, no throttling of connections, no prioritization of content,” as well as transparency in all three practices, Howard, of the Sunlight Foundation, wrote in a tweet last Thursday.

As a coalition of organizations prepare a legal challenge to the FCC ruling, and policymakers in Congress work in parallel to nullify the regulatory action, experts told Devex that global development professionals could do far more to inform themselves and make their opinions on the matter known.

“I want to see the conversation happen because it seemed like the conversation wasn’t allowed to take place,” Porter of InterAction told Devex about his work to start the debate among NGOs. “There wasn’t enough time for industries such as ours to think through the implications for them, beyond just what the effect would be on their daily internet browsing experience.”

Read more Devex coverage on connectivity and development.

About the author

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    Catherine Cheney

    Catherine Cheney is a Senior Reporter for Devex. She covers the West Coast of the U.S., focusing on the role of technology and innovation in achieving the Sustainable Development Goals. And she frequently represents Devex as a speaker and moderator. Prior to joining Devex, Catherine earned her bachelor’s and master’s degrees from Yale University, worked as a web producer for POLITICO and reporter for World Politics Review, and helped to launch NationSwell. Catherine has reported from all over the world, and freelanced for outlets including the Atlantic and the Washington Post. She is also the West Coast ambassador for the Solutions Journalism Network, a nonprofit that trains and connects journalists to cover responses to problems.