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What The Net Neutrality Battle Means For Entrepreneurs

Tomorrow’s FCC vote could have a huge impact on small online entrepreneurs, but the two sides can’t see eye to eye.

What The Net Neutrality Battle Means For Entrepreneurs
[Photo: BRENDAN SMIALOWSKI/AFP/Getty Images]

A ruling tomorrow could change the way we use the Internet–but will it threaten the entrepreneurial spirit of small startups and vendors online?

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Net neutrality, a guiding principle of the early Internet, keeps access to all websites equal and open. On Thursday, the FCC will vote on whether to reverse a 2002 ruling that classified the Internet as an “information service,” in favor of a Title II “telecommunications service,” over which it can place more regulations–and more protection–as a regulated utility.

In short: The big guys, including Comcast, Verizon, AT&T, T-Mobile, and Time Warner Cable, aren’t happy. A win tomorrow for the FCC would cramp their plans for “fast lane” access to the Internet. There’s a lot of money to be had in throttling broadband speeds for companies that can’t pay for it or refuse to pass the cost down to users.

Among those opposed to the increased regulations are Ajit Pai, a Republican member of the FCC: He has said that the ruling “saddles small, independent businesses and entrepreneurs with heavy-handed regulations that will push them out of the market.” Shark Tank investor, and billionaire owner of the Dallas Mavericks, Mark Cuban calls net neutrality “a demonization of big companies” like Comcast, and that the latest FCC revision will “fuck everything up.”

But if you talk to small business owners themselves, they tend to strongly disagree. One hundred companies–including Yelp, GitHub, Foursquare Labs, Etsy, Kickstarter, and Tumblr–wrote to the FCC last week, saying, “Any claim that a net neutrality plan based in Title II would somehow burden ‘small, independent businesses and entrepreneurs with heavy-handed regulations that will push them out of the market’ is simply not true.”

Etsy CEO Chad Dickerson’s February 20 blog post details his own experiences with early Internet entrepreneurship, and the testimonies of fellow business owners and people whose livelihoods depend on an open, equal Internet. He writes:

Etsy now hosts over 1.3 million sellers, 88% of whom are women, most of them sole proprietors working out of their homes. Individually they may be small, but together they sold over $1.35 billion worth of goods in 2013. That’s the power of the Internet. But it only works if net neutrality–the idea that all traffic on the Internet should be treated equally –is protected.

Dickerson testified at a Congressional hearing last month and presented stories of Etsy sellers and small business owners who’d be affected by the decision. These accounts included statements from artisans like Amanda from Oregon, who said, “If Net neutrality is struck down, smaller businesses like mine will have no chance to compete against larger companies,” and Tina from Illinois, whose sales mean “the difference between balanced meals for my children and cereal for dinner.”

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The open Internet allowed Dickerson to realize his own entrepreneurial goals with Etsy, where sellers could compete with big-box stores online. If, for example, Net neutrality was no more and Etsy couldn’t cover the cost of joining a “fast lane,” it would have to opt for slower speeds–something buyers short of attention span would not tolerate before turning to retail giants with faster loading content–or opt in, and charge sellers more to keep shops open, forcing small businesses out of the picture.

Alexis C. Madrigal and Adrienne LaFrance summed up the importance of a seemingly Kumbaya-sounding notion for The Atlantic:

This was not just a nice thing, it was the very nature of the Internet. Without it, the Internet will become, as Tim Wu put it, “just like everything else in American society: unequal in a way that deeply threatens our long-term prosperity.”

The Internet could be our last truly level playing field in business. Google, YouTube, Facebook, Amazon, eBay–the list goes on of companies that began in garages or dorm rooms, and went on to become the beams and hinges of how we live and work online. Without a neutral net, the next Bezos or Jobs could be left in the slow lane.

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About the author

Freelance tech, science and culture writer. Find Sam on the Internet: @samleecole.

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