Currently, all internet traffic is treated in the same way, whether it's a web page from Google or a page from a small bakery in Wisconsin. It's the concept of net neutrality in action. No bits of data have priority. But some changes that have occurred over the past year may make net neutrality a thing of the past. Cable and DSL broadband network providers are considering creating a multitiered internet. For example, a company could pay a broadband provider to have its offerings load faster than others. Some broadband providers see a multitiered internet as a way to help cover their investment in high-speed broadband infrastructure.
This is something that entrepreneurs should keep an eye on. It especially concerns businesses that work with bandwidth-intensive multimedia or streaming video services over the web.
Established companies may be able to afford the faster top tier, but startups and growing businesses could find themselves in an awkward position. "The little guys who want to make a name for themselves are going to be at a disadvantage," says Gigi B. Sohn, president of advocacy group Public Knowledge.
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Large internet companies like Amazon.com and Google have come out in favor of net neutrality. There have been rumblings in Congress concerning this issue, with several bills floating around that address it to various degrees. "What the advocates of net neutrality want is essentially the internet of today," says Sohn. Nothing had made it into law as of press time.
Originally published in the May 2006 issue of Entrepreneur Magazine