When the FCC announced on December 14, 2017 that net neutrality laws were being repealed, the U.S. erupted into a fit of fear and anger. But why were these laws so important, and what does their removal mean for YOUR business?
1. What Is Net Neutrality?
Passed in 2015, net neutrality laws required the entities that control access to the internet (internet services providers, or ISPs) treat all their users equally, and ensure the protection of the privacy of all the data that traveled into and through their servers.
The rollback of the these rules removed the legal obligation of those ISPs to ensure equal internet access to all, while also relieving them of the duty to protect data privacy. Businesses that relied on their ISP to both do business and maintain consumer privacy standards no longer have a “fair playing field” assurance or data security backup.
2. How Does the Repeal of Net Neutrality Affect Small Businesses?
Every person and company that seeks an internet connection must go through an ISP. That volume of usage gives ISP’s enormous control over who and what go through their servers. What features are subject to ISP manipulation now that net neutrality is over?
1. Equal Access to Digital Necessities
For businesses, equal access meant that they paid the same amount as their competitors for their internet service, which guaranteed them access to the same functions and markets as their industry rivals. Equal internet opportunity allowed businesses to:
- Scale their digital activities as needed without inappropriate penalties
- Rely on their ISP’s servers for backup and recovery operations
- Access customer-focused services to ensure that their internet presence was as comprehensive as that of their next competitor
In short, the neutrality of internet service supported head-to-head competition regardless of the size or location of rivals, so a small business with a limited budget had as much access to its target market as its big-brand opponent.
Prior to mandated neutrality, ISP’s could control simple access by charging some businesses more than others to gain entry to the net. Now, larger corporations with more resources can pay higher fees to obtain better, or more, internet services.
With help from their ISP, mega-retailers could ostensibly cause a slowdown of internet service to their competitors to ensure better access by their own customers.
The ISP can also add new fees to selected customers for backup or recovery services, or for scaling any or all of their corporate computing needs. They could even completely block some companies from accessing the internet or its sectors simply by demanding unreasonably high fees for that privilege.
Without a neutral internet, ISPs can now offer their bigger, richer corporate customers any added access and functionality they need at higher prices than their smaller, less well-funded customers can afford. For any business with an internet presence, limits on its internet capacities could spell the end of the enterprise.
2. User Data Privacy Regulation
Not only do they provide each of their customers with access to the global marketplace, but ISP’s also gather and retain billions of bits of data into their servers on a daily basis. Any potential manipulation of that data or restrictions on access to it could have a significant impact on the global community as a whole. Net neutrality regulations were designed to prevent the deliberate manipulation of ISP data for inappropriate purposes.
Repeal of the neutrality rules eliminates the mandate that ISPs maintain the privacy of the data contained within their data stores and servers.
This information includes not just names, addresses and the like, but also web browsing habits, frequently visited sites, shopping preferences and other personal behavioral indicators that companies analyze and use for corporate purposes.
Without that restriction, ISPs can now sell that information without notice to either:
For most businesses, maintaining high customer privacy standards remains a critical factor in their success. Many would lose – and have lost – customers when hackers or cybercriminals breach their data security perimeters. Ergo, they have relied on the neutrality/privacy mandate as a backup for their in-house data security practices.
In addition to their own “data collection privacy and use” policies and notices, the former ISP protections gave the customers of these small businesses added security that their information would be safe when providing it to an online marketplace.
Without that federal mandate in place, these entities are now faced with adding extra layers of data security to retain their customer base which may cost more than many smaller entities can afford.
3. How Can Small Businesses Respond?
There are several courses of action for businesses to take to ensure that they — and their users — are affected as little as possible by the changes.
Be Cautious of State-Specific Measures
Given the federal deregulation at hand, states are taking it upon themselves (10 states thus far, and counting) to ensure the privacy of internet users.
As these regulations pertain to both businesses that operate within that state and businesses that deal with customers from that state, business owners will have to be particularly cautious to ensure that they are following a wide range of privacy laws.
Reassure Customers That Their Data is Safe
In the face of the loss of net neutrality, most companies will benefit from reaffirming their customers of their commitment to maintaining the highest level of data security possible.