Telecom Sourcing Update: How the End of Net Neutrality Could Impact Enterprise Customers

The FCC voted to roll back Net Neutrality regulations on December 14th, 2017.  Much of the discussion around Net Neutrality has focused on the potential impact to consumers. For example, a customer getting their internet from Google Fiber may find their access to Yahoo for searching is either slower or that they need to pay for it.  Another example is that an internet customer of Time Warner telecom finds their access to Netflix is either slower or unavailable. Only time will tell how this will play out for consumers.
 
There has been no shortage of speculation on why this is a good or bad move – but let’s get down to facts…especially as they relate to the impact this could have on enterprise telecom sourcing, operations and costs. For enterprise customers, there is a more urgent need to identify and strategize the myriad implications that could directly impact telecom sourcing and spend.
 
Here are some scenarios to consider:

• ISPs could give VPN traffic a different priority than other types of traffic; doing so would affect latency and performance of data networks
• SDWAN is just now getting traction, but it too makes use of VPN technology and is potentially subject to the same restrictions
• Many enterprises use videos on YouTube or Vimeo for things like employee/customer training, marketing and other communication needs. As with the consumer market, the performance of these videos could be impacted
• Even video embedded on an enterprise website could be impacted

In reality, the lack of Net Neutrality returns all control over URL access and traffic prioritization back to the ISP. ISPs and major backbone providers can now determine the rules for prioritization and URL access either at the egress or even at major peering points (exchange points between two carriers), and now have the opportunity to monetize that prioritization. What will happen is still unknown, but where there’s money to be made, actions to capture it typically follow.

What steps can enterprises take in the absence of Net Neutrality?

1. File a comment with the FCC registering support for Net Neutrality.
2. File a complaint with the FCC in any case where traffic priorities or queuing impacts your business.
3. Write your own Net Neutrality clause to be inserted as an Amendment to existing carrier agreements and inserted into any new agreements.
4. Most enterprise agreements include clauses that allow the customer an opportunity to file a notice of adverse business impact in the event of changes the carrier makes to terms and conditions.  The clause allows a period for remedy by the carrier and if not remedied, the customer can terminate the affected service.  Keep a look out for changes in the appropriate Service Guide related to how internet services are delivered.