E-Strategy & Management: Analyzing Net Neutrality Case Study

This case study delves into the concept of net neutrality, its implications for e-commerce, and the perspectives of Internet Service Providers (ISPs) like Comcast, Verizon, Time Warner, and AT&T. It explores the regulations put forth by the Federal Communications Commission (FCC) and the subsequent challenges and debates. The analysis covers the impact of net neutrality on bandwidth consumption, pricing models, and the ability of companies like Netflix and YouTube to stream videos inexpensively. Furthermore, it addresses the arguments for and against net neutrality, considering issues such as congestion pricing, revenue maximization for ISPs, and the distribution of costs for building high-speed broadband networks. The case study concludes by examining the bandwidth usage of platforms like Netflix and YouTube, highlighting the complexities of balancing network neutrality with the economic interests of various stakeholders.

CASE STUDY OF E-STRATEGY
AND MANAGEMENT
Name of the Student:
Name of the University:
Author Note:

Case Summary
 Net Neutrality is a key concept in e-commerce and especially directed to
the Internet Service providers (ISPs)
 It allows the ISPs to treat all the data on internet in same manner without
discrimination or price differentiation in terms of protocol, platform, content ,
hardware or watch video at application
 The concept of net neutrality has faced opposition from ISPs
 In the year 2015, regulations were put forward by Federal Communications
Commission ( FCC) that mandated net neutrality

What is the outcome of
implementation of network
neutrality when it was applied by
Internet Service Providers (ISPs)
like Comcast, Verizon, Time
Warner and AT&T?

Network Neutrality
 Net neutrality allowed the ISPs in charging same flat fee irrespective of
the bandwidth consumption.
 All activities like emailing, word processing, video downloading, video
files, music and video downloading are charged same rate
irrespective of the bandwidth used
 In the year 2010, Federal Communications Commission in relation to
net neutrality forced the ISPs to be transparent about handling
network congestion.

Comcast
 It is the largest ISP of United States
 It slowed down traffic and websites through Bit Torrent protocol
because the video users consumed huge chunks of data during
the peak loading times.
 Comcast the policy legitimate for managing the capacity to
which Federal Communications Commission (FCC) disagreed and
implemented a new rule in the year 2010
 In the year 2010, Comcast ruled against the federal court by
placing a counter argument stating that it possess the right of
managing its own network.

Verizon
 It is an Internet Protocol Service Provider (ISP)
 In the year 2011, Verizon sued FCC since its new rules
neither prohibited the paid prioritization nor did it cover
the cellular networks.
 It was followed by issuance and implementation of newer
regulations in the year 2014 by the FCC.

Federal Communication
Commission (FCC)
 In 2008, FCC put forward orders against discrimination of certain
websites by ISPs
 In 2009, FCC presented the national broadband strategy
 In 2010, FCC put forward approvals for comprise on the rules of
net neutrality
 In January 2014, FCC had some jurisdiction over the internet
providers and upheld the rules of transparency
 In May 2014, FCC put forward new regulations related to
network neutrality.

Video Case Questions
1. Are you in favour of network neutrality going forward? Why or
why not?
2. What is the problem with ISPs, which are private business firms,
charging whatever they want to charge and that the market will bear?
3. Major cities of the world have adopted “congestion pricing” in
which cars pay a toll to enter the core of the city during daylight
hours. Congestion pricing is also used to regulate demand by
businesses for electricity. During the day when electricity is in high
demand, many businesses pay a “demand” fee in addition to the
regular charge for electricity. Why is the Internet any different?
4. If your business model depended for its success on millions of people
being able to inexpensively stream videos on demand (like YouTube or
Netflix), would you be in favor of net neutrality or against it?

Are you in favour of network neutrality going forward? Why or why not?
 Network Neutrality refers to concept where the internet service providers (ISPs) ensures equal
treatment to all internet data.
 It does not cause discrimination or price differential in the context of protocol, content,
hardware, platform or application.
 It implies that everyone is charged the same flat fee irrespective of the bandwidth
consumption.
 It meant that people who downloaded large video files paid the same amount as the people
who simply sent email.
.

What is the problem with ISPs, which are
private business firms, charging whatever
they want to charge and that the market will
bear?
 It treated most internet traffic neutrally or equally
 It meant all the activities like e-mailing, word processing,
downloading, video and music files underwent an equal
treatment irrespective of the bandwidth used
 It allowed a person to pay the same price for streaming a
Netflix movie compared to a person who uses internet for
web surfing and email.
 Companies like the Netflix and You Tube who are heavy
users of the internet bandwidth demands no capping,
metering, toll pricing or price rationing for maximizing the
revenue

Major cities of the world have adopted “congestion
pricing” in which cars pay a toll to enter the core of the
city during daylight hours. Congestion pricing is also
used to regulate demand by businesses for electricity.
During the day when electricity is in high demand,
many businesses pay a “demand” fee in addition to the
regular charge for electricity. Why is the Internet any
different?
 Due to the presence of various Internet Service Protocols
(ISPs) like Comcast and Verizon
 The generation of huge traffic
 Consumptions of huge chunks of network capacity during
the peak loading times.

If your business model depended for its success on millions of
people being able to inexpensively stream videos on demand
(like YouTube or Netflix), would you be in favor of net neutrality
or against it?
 I would not be in favor of it as net Neutrality referered to the
distribution of the cost for building higher speed broadband
internet network.
 Besides, high end users like Netflix and You tube wanted no
caps, no price rationing or toll pricing for maximizing revenues
 Also, the landline carriers and ISPs wanted to charge the heavy
bandwidth users more compared to the light users and thereby
ensure in maximizing the profit.

….continued
 Netflix uses over 32 percent of the most of the
downstream internet bandwidth
 The heavily trafficked You Tube only uses 17 percent of
the bandwidth.

Thank You