WASHINGTON ― The repeal of net neutrality isn’t great news for consumers. Giant internet service providers that control their own media empires will be able to push you toward their content while serving up their rivals’ content at molasses-slow speeds. Consumers could be driven into walled content gardens where what you read and watch will be partly determined by which company provides your internet service.
That’s probably bad for you. But it would be good for us. HuffPost is owned by a company called Oath, which in turn is owned by Verizon, one of the three largest internet service providers in the U.S. Oath was created after Verizon purchased AOL in 2015 and Yahoo in 2017 and combined them into one media corporation. It owns a wide range of media properties, including HuffPost, Yahoo News, TechCrunch, Engadget, Yahoo Sports and Tumblr. And now, absent the regulatory protection of net neutrality, Verizon and other internet service providers can favor our content while discriminating against the competition’s.
Verizon did not respond to a request for comment. The company wasn’t the first internet service provider to build a media empire, and it may not be the last — ISPs and tech companies have been acquiring content providers like HuffPost for decades.
“The television revolution that began half a century ago spawned a number of industries, including the manufacturing of TV sets, but the long-term winners were those who used the medium to deliver information and entertainment,” Microsoft CEO Bill Gates wrote in a 1996 essay published just after Microsoft and NBC joined together to create MSNBC. “Content,” Gates declared, “is king.”
The trend spread. Comcast purchased NBCUniversal in 2011. AT&T announced an $85 billion purchase of Time Warner in 2016 — a merger that is now being challenged by the Department of Justice.
AT&T was aiming to build an “empire,” The New York Times declared. More deals of similar size and scope could be on the horizon.
Because of this sort of consolidation, much more of the internet — and access to it — is dominated by just a handful of companies, less than even a few years ago. Soon those internet service providers that have vertically integrated media empires will be able to operate much like the old closed system of television — controlling both the production of media and the means of distributing it, warned Mitch Stoltz, a senior attorney at the Electronic Frontier Foundation.
“What the customer is presented with is what’s convenient and easy to find,” Stoltz said. “And where your eyes and ears get steered comes more and more under control of the [internet service provider].”
In other words, major ISPs will be able to promote the media companies they own — like this one — while punishing competitors’ offerings. That will force consumers, who often have no choice in internet service providers, into walled gardens of content that the ISPs create.
Some Democrats are now questioning whether the Justice Department and the Federal Trade Commission need to step in and redefine the terms by which ISPs can own media companies. Prior to the FCC’s vote to kill net neutrality, Sen. Richard Blumenthal (D-Conn.) asked the Justice Department to open an investigation into Comcast’s purchase of NBCUniversal in 2011 and consider “separating Comcast and NBCU in order to fully restore competition.” That merger came with specific conditions, set to expire in February, that included a promise to abide by the principles of net neutrality.
“[G]iven that the FCC is on the brink of reversing its Open Internet Order, it is all the more imperative for the Justice Department to ensure fair competition in this space,” Blumenthal wrote. “Without rules to protect consumers and govern how internet providers treat their competitors, Comcast-NBCU will be free to discriminate against online video distributors, which is exactly what DOJ is trying to avoid and is precisely what the merger conditions are meant to address.”
But even in the unlikely event that Blumenthal and his ilk succeed in breaking up vertically integrated ISPs or bringing back net neutrality, their victory won’t be complete. After all, the ISPs aren’t the only huge companies creating walled gardens: Silicon Valley giants followed Gates’ 1996 vision and created their own media empires, too. Today, Amazon has its own television and film studio, a distribution platform for its Prime Video offerings and hardware to deliver it in its Amazon Fire television device. Google owns YouTube, the largest online video platform, and manufactures Chromecast, streaming television hardware. Facebook has its own ambitions to produce video content for distribution through its platforms and apps. Apple has its Apple TV device and streaming video options available through iTunes.
These Silicon Valley firms are, even more than ISPs, “the most dangerous vertically integrated institutions,” argued Matt Stoller, a senior fellow at the Open Markets Institute, a nonprofit that backs vigorous antitrust enforcement. And like ISPs, these firms are likely to benefit from the repeal of net neutrality rules. Companies like Amazon are already hard-wired into the backbone of the internet at the service providers’ data centers, and it is likely that their market position will improve as competitors will find it even more difficult to challenge them.
This fact has been a convenient cudgel for net neutrality opponents. Since Amazon, Google and Facebook aren’t governed by net neutrality principles, Verizon, Comcast and AT&T shouldn’t be either, FCC Chairman Ajit Pai, a former Verizon lawyer and leading net neutrality foe, argued before the final vote to repeal the rules on Dec. 14.
Fortunately for net neutrality advocates, fighting the balkanization and walling-off of the internet doesn’t require picking between the ISPs and the Silicon Valley giants. Regulators and politicians could crack down on both. There’s some support for that idea, too: Soon-to-be former Sen. Al Franken (D-Minn.) called for net neutrality rules for companies like Facebook and Google just last month.
“No one company should have the power to pick and choose which content reaches consumers and which doesn’t,” Franken said. “Facebook, Google and Amazon, like ISPs, should be neutral in their treatment of the flow of lawful information and commerce on their platform.”
In the meantime, if you get your internet from Comcast, AT&T or Charter, we apologize in advance for the extra seconds it might soon take to load this website.
CORRECTION: A previous version of this article mistakenly said AT&T announced an $85 million purchase of Time Warner. It’s $85 billion.