American businesses and our economy need net neutrality

American businesses and our economy need net neutrality
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When you dominate a market, you can get away with charging a lot and delivering little. That is why most people are not fond of cable TV companies with their skyrocketing prices and bundles of channels no one asked for. But when you dominate a market, of course, you want to keep dominating. That is why big cable companies that also provide internet service, like Comcast and Verizon, pushed the Federal Communications Commission to repeal net neutrality last year.

On June 11, when the repeal goes into effect, the real winning for these companies begins. That is when they have the right to change the rules for internet access to their advantage. Who are the losers? They are consumers and other all other businesses across the country that rely on open access to their customers through the web.

Businesses know that internet speed matters. If your website does not load as quickly as a competitor’s website, customers will flee. Even back in 2008, an Aberdeen Group study found that a one-second delay in page load time equals “11 percent fewer page views, a 16 percent decrease in customer satisfaction, and 7 percent loss in conversions.” Nearly 80 percent of customers who wait longer than three seconds for a company’s website to load will not shop there again.

In a free market, your success is based on the value of your product and service, not your ability to pay a gatekeeper fee just to access customers and suppliers. That is what net neutrality ensured, and that is what we are likely to lose without it. The big internet service providers, also called ISPs, will not start implementing pay-to-play scenarios right away. Most likely they will ease into it to reduce the potential backlash.

What makes other businesses concerned is that eventually these companies will use their new power to their advantage at the expense of everyone else. The big ISPs are already very big. In 2017, even under net neutrality, revenues were $84 billion for Comcast, $126 billion for Verizon, and for $160 billion for AT&T. But as big as they are, they are dwarfed by the rest of the $20 trillion U.S. economy.

That includes a lot of restaurants, manufacturers, farmers, and other businesses across all sectors that depend on the internet for their success. Small firms and startups are at special risk. Typically, they do not have the resources to absorb higher fees, restricted access to customers, and slower speeds. Proving the point, a majority of small businesses indicated in recent polling that they are opposed to the FCC’s repeal.

Beyond the risks to individual businesses, net neutrality is essential to a strong and innovative economy. We may see creativity decline and entrepreneurism dwindle without it. Potential barriers to entry and other limits to internet access will make it harder to start and grow the next wave of pioneering businesses. The risk is fewer opportunities to create the next Google, Uber, or Amazon.

That is why, in a completely bipartisan way, companies of all sizes and from all industries are asking Congress to repeal the repeal of net neutrality. If that does not work, lawmakers should enshrine net neutrality in legislation. After a lot of hard work, the first step for repealing the repeal passed the Senate recently. It is expected to face an even tougher challenge in the House and with the president. Concerned business people can join the effort by signing online statements and contacting their representatives in Congress and the White House.

ISPs serve a critical role in enabling businesses, and for that, they are already well compensated. There is no reason for the government to give them power to turn the free market of the internet into an arbitrary “pay for play” system where they can decide winners and losers. In fact, there is every reason to stop that, and soon. At the state and federal level, businesses and lawmakers concerned with protecting a competitive internet economy should voice their support now.

David Levine is president of the American Sustainable Business Council.