In mid-January, the US Court of Appeals for the District of Columbia overturned two of the three provisions of the Open Internet Order passed by the Federal Communications Commission (FCC) in December 2010. The two provisions that have been struck down were meant to promote net neutrality, the principle that Internet service providers (ISPs) should treat all data on the internet equally, and not treat data of any particular type or from any source differently from the rest (for details on the ruling, see this excellent article by The Economist).
This ruling paves the way for ISPs to charge differentially for services that they think are using a disproportionate amount of bandwidth on their networks, such as music and video streaming services such as Spotify and Netflix. So in theory, ISPs could tell customers that a basic broadband pack costs $25 per month, but if they want unlimited streaming from Netflix, they’ll have to pay $10 per month extra. For customers who don’t, ISPs could restrict access to such services, or, more likely, throttle the speeds customers get while accessing such services. Alternatively, ISPs can charge companies that use large amounts of bandwidth in order to provide unfettered access to their services to customers. There’s some evidence that a few such backroom deals are already in place – with this ruling we’ll start to see many more of them.