The term net neutrality has been the subject of half-page ads in the Washington Post, bumper stickers, even ironic t-shirts. Unfortunately, all of the advertising, partisanship, and hipsters may be obscuring the importance of a difficult debate about the evolution of the Internet. If the father and grandfather of the Internet can’t agree, what can the rest of us do?

Let’s try to understand the term net neutrality. When a consumer wants a good, service or information from the Internet, they surf an almost infinite number of web sites. Here’s the only catch: in order for a consumer to have access, they have to pay for the connection. In return consumers have equal access to all web sites.

But some broadband providers have started complaining that not content is alike. The consumer may be requesting enormous amount of data in a streaming movie, or a few 1s and 0s in an email message. So the broadband providers want to start charging the content producers for their bandwidth usage. Sure, the producers don’t have to pay these tolls, but if they don’t their competitors’ web sites might load faster.

Content providers assert that they are merely responding to consumers by sending the information they request. Broadband providers claim that with these new fees, they can build even bigger, faster networks that consumers will love.

So the producers of content are actively lobbying Congress to push for what they call “net neutrality.” This so-called neutrality is actually regulatory legislation that would prevent broadband providers from a discriminating against particular companies. It would apply common carrier rules to the Internet, ensuring that all Internet traffic is managed on equal terms, protecting startups that might not be able to compete with bigger, faster web sites.
But wait a second, it’s not just Internet giants such as Google that use an enormous amount of bandwidth, so do newcomers such as youtube.

Let’s say I’m at a startup and our business strategy is to stream movies faster than anyone else. We’ve allocated half our budget to pay Comcast cable for broadband priority. And then a pokey competitor sues. How long would it take the courts to determine what’s fair? Would bad network neutrality legislation stifle innovation more than the status quo? (Just ask Ted Stevens.) Many techies are opposed to net neutrality because they’re worried that the government just wouldn’t move fast enough if there were net neutrality violations.

But if broadband carriers start charging content providers for bandwidth, what’s to prevent them from acting more like monopolistic cable companies? Couldn’t they start packaging Internet “channels” based on which company is bidding the most? Maybe, but not for long. Current broadband providers are still under the supervisory eye of Department of Justice (anti-trust), FCC (content) and FTC (consumer protection).

So it seems to come down to the market of broadband providers. If our goal is consumer choice and innovation, then we need more competition between the carriers. How much is there? Only about 50% of Americans have two or more broadband options.

How does the U.S. compare to the rest of the world? Let’s have a look at the statastic. Even though the U.S. is twelfth in the percentage of the population with broadband connectivity, we do have three competing broadband options: cable, DSL, and satellite. As a nation, we have a healthy broadband competition relative to the rest of the world… even if it doesn’t seem that way in your neck of the woods.

Sources: Statastic research, OECD

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