Why It Matters
Surveys show that three-quarters of Americans support an open Internet. They expect to always have open access. But that openness is not ensured for the wireless Internet. And that’s important, because experts predict that within the next few years most Internet traffic in the U.S. will happen on a wireless device.
There’s a lot at stake. For starters, your freedom to choose where to get the information you want and the best products at the best prices, with all websites treated equally. Right now, wireless Internet companies like AT&T, Verizon and Sprint are free to make deals that give preference for shopping to one web site (like Amazon) but not another (like eBay), or that make the download speed for one site faster than the other (unfairly pushing consumers to the faster site).
What many consumers and investors may not realize is that the incredible economic engine of the Internet has been built upon a critically important principle – network neutrality. Network neutrality means that companies like AT&T, Verizon and Sprint – that own network infrastructure – treat all content equally regardless of source, destination or ownership. In practice, it means they charge the same price for all content providers who want to reach an ISPs’ customers.
The problem: current network neutrality rules apply to traditional “wired” broadband networks – but not to wireless networks.
Network neutrality for wireless networks is critical to the health of the economy and to the many small and medium-sized businesses that rely on an open Internet. Network neutrality helps foster innovation. If AT&T provides preferential access to those who are able to pay for fast lanes on the Internet, we’re not creating a free market for new innovators to grow.
Research cited in the AT&T and Verizon shareholder proposals includes a study by the Institute for Policy Integrity at New York University which concluded that an open Internet accounts for billions of dollars of economic value for Americans. “This economic and social value is an important factor in the growth of our economy and widely diversified investment portfolios,” the Institute says.
Network neutrality is also vitally important to economically disadvantaged communities and to people of color. According to recent surveys, they rely on wireless devices far more than traditional wired access to the Internet. As the National Hispanic Media Coalition noted in a February 2011 report (PDF):
Failure to apply net neutrality rules to mobile broadband runs the risk of a new digital divide between those who can afford all the costs associated with home broadband and those who use mobile. This will essentially create two Internets, separate and unequal
AT&T, Verizon and Sprint need to help protect the nation’s Internet economy – and our freedom of expression – by applying network neutrality principles to their wireless Internet services. The issue is on the agenda at each of the companies’ annual meetings.
Note: The Open Media and Information Companies Initiative is NOT asking for your proxy card and is not providing investment advice. We will not accept AT&T, Verizon or Sprint proxy cards, and any proxy cards received will be returned. If you have any questions regarding investing in AT&T, Verizon or Sprint you should consult with a financial professional.