It’s not often that I find myself passionately on the same side of a controversial issue with the likes of Amazon, Microsoft, and the Seattle Times editorial board. Then again, there really shouldn’t be anything controversial about net neutrality.
FCC Chairman Tom Wheeler has suffered a barrage of criticism since he proposed allowing Internet service providers (ISPs) to cut deals with content providers to pay more for faster service.
Wheeler’s pay-for-prioritization proposal means the end of net neutrality, the idea that all Internet content is treated equally — free of toll booths or fast lanes.
Imagine if, let’s say, HA suddenly started loading a quarter as fast as the Seattle Times—or perhaps not at all—because I couldn’t afford to pay Comcast and Qwest the “prioritization fees” necessary to get my content to their customers via their fast lanes? No wait. I don’t have to imagine. I’ve already been through something like that in a prior venture.
When I first started up my software company in the early 1990s, large software retailers like Egghead, Computer City, and CompUSA all bought direct. We got crappy terms, and it was often a hassle (Computer City had us ship directly to individual stores, sometimes ordering as few as two copies per store), but at least we had access to the market.
But it was right around that time that an explosion of consumer titles and a wave of consolidation started changing everything for small independent publishers. One by one the major retailers stopped buying direct, instead insisting on buying through one of two or three distributors. But we were too small to get into distribution. The two largest distributors demanded annual six-figure “market development funds”—essentially a retail channel entrance fee. A second tier distributor took us on before quickly going bankrupt, stiffing us on tens of thousands of dollars in accounts receivable.
But wait. It gets worse.
Once we lost access to brick and mortar retail, the mail order catalogs, which had previously accounted for more than 70 percent of our sales, started jacking up the “co-op advertising fees” to independents like us who had no other options. An eighth of a page ad that cost us a few hundred bucks a month in 1993 could run as much as $8,000 a month by 1996. It wasn’t that there wasn’t a market for our rhyming dictionary software, it’s that we could no longer afford to access to it. So products like ours disappeared from the market until the App Store model democratized the software industry more than a decade later.
It’s not a perfect analogy, but it’s close enough. When I first started blogging a decade ago, I had every disadvantage but one: equal and unfettered access to readers. And so I was free to compete in the marketplace of ideas, winning what readership I could based on the quality of my content rather than the whims (or extortion) of some gatekeeper. This relatively low barrier to entry is one of the things that has made the Internet so transformative. But take away net neutrality and you will ultimately create a sort of broadband apartheid—a separate and unequal Internet forever in the grasp of those who levy the tolls, and those few who can afford to pay them.