The Communications Minister Ed Vaizey announced the government’s position on net neutrality on 17 November 2010, stating that “ the internet has been responsible for an unprecedented level of innovation, which has led to multi billion dollar companies being formed in just a couple of years” and that the government is keen to protect this model.

With this in mind, the Minister has announced a cautious move towards a lightly regulated internet, which the government believes is good for business, the economy, and consumers. However, before considering proposals for intervention, the government will take into account whether intervention is necessary to deliver important benefits for consumers, including the following three factors:

  • Openness - consumers should be able to access any legal content or service and content providers should be able to innovate and reach users.
  • Transparency – internet providers should set out in detail the extent of their traffic management and the impact on customers.
  • Support for innovation and investment – internet service providers should be able to manage their networks to ensure a good service and have flexibility in business models. In this context the government is of the view that competition is important for ensuring continued openness and choice.

This announcement follows on from broader debates over net neutrality in many countries in recent years. In the UK a discussion document on net neutrality was published by Ofcom in June 2010, with the aim to open up the debate on what, if any, regulatory intervention should be required in this area. The European Commission also published a consultation on net neutrality in June 2010, with responses published in November 2010 revealing near consensus on the importance of preserving an open internet. However, there was no consensus for new legislation, with a view that the revised EU telecoms framework should provide the basic tools for dealing with neutrality issues.

Whilst some commentators have focussed on the potential for such an approach to deliver a two-speed internet, in practice little is likely to change. Most ISPs already manage traffic on their networks whilst wholesale regulatory change appears very unlikely. At a European level, a report on net neutrality following on from the June 2010 consultation is expected next year. Given that competition amongst ISPs in the UK is strong, with significant consumer choice, it seems likely that proposals will focus on transparency and ensuring that consumers are informed at the outset of the kinds of traffic management undertaken by their respective ISPs. This will be further supported by Ofcom’s plans to improve the switching process and we wait with interest to hear proposals arising out of the September consultation which closed today.