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Net neutrality and the IoT: What you need to know

How will the Internet of Things be impacted by the recent repeal of 2015's net neutrality rules? Explore both sides of the debate.

The U.S. Federal Communications Commission’s recent repeal of its 2015 net neutrality rules could spur the growth of the Internet of Things (IoT), at least according to some critics of the regulations.

The argument, advanced by FCC Chairman Ajit Pai during the commission’s December vote to repeal the rules, goes something like this: The IoT is projected to grow like wild in the coming years, and broadband and mobile providers will need incentives to invest in their networks.

While it’s true that the number of IoT devices is expected to skyrocket, the argument largely depends on the disputed assertion that the regulations caused broadband investment to drop during the past two years. By some measures, broadband investment did decline, but the exact cause is unclear.

As Pai and his allies defend the repeal, several supporters of the net neutrality rules suggest the FCC’s action may actually hinder the IoT. A lack of regulations will allow broadband providers to block or slow some consumer-grade IoT applications, they argue. In that scenario, a broadband provider offering its own smart home services might throttle smart home products from competitors.

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The assertions that the repeal will lead to a new spike in investment seems like a stretch, some net neutrality supporters say.

Most bandwidth-sensitive IoT services, such as connected cars and industrial systems, will operate on dedicated or enterprise networks. Those specialized networks weren’t subject to net neutrality regulations, which applied to the public Internet, says Harold Feld, senior vice president at digital rights group Public Knowledge.

Meanwhile, most consumer-grade IoT services traveling over the public Internet use low-bandwidth devices that require a tiny fraction of the network’s resources, compared with services like streaming video, Feld adds.

Tying the IoT to net neutrality rules is “really just grabbing for a buzzword.

Harold FeldSenior vice president at Public Knowledge, a digital rights group

“Even if the IoT increases at the rate everybody’s expecting, it’s still going to be a fairly low percentage of traffic over the network, just because it’s low volume,” Feld says. “Telling my house to raise the temperature from 65 to 72 because I’m about to come home is not something that drives network demand.”

No IoT services now projected would require a massive network investment that “isn’t already planned,” Feld adds. “If you’re talking about the big stuff like [connected] cars, that investment is going to happen, and it’s going to be a separately built network.”

Tying the IoT to net neutrality rules is “really just grabbing for a buzzword,” Feld says.

And if network demand on the commercial Internet also increases, broadband providers and carriers will invest in their networks, with or without net neutrality rules in place, other supporters of the rules say.

“The carriers have to do this anyway just to keep up with competitors,” says Tim Lynch, president of PC maker Psychsoftpc.

Still, supporters of the repeal point to the broadband industry’s own numbers, which show investment declined from $78.4 billion in 2014 to $76 billion in 2016, the first year after the net neutrality rules passed.

Economist Hal Singer, who objected to the reclassification of broadband as a common carrier service in the 2015 rules, also found a recent decline in investment among 12 large broadband providers, although net neutrality supporter Free Press disputed numbers showing a decline.

Even if there was a drop in broadband investment, it’s unclear how much of it was due to the net neutrality rules as opposed to other factors, including some mobile carriers winding down their LTE deployments.

“What if we aren’t done? What if the Internet of Things moves beyond this messy experimentation phase and into real-time value generation, not just in the home but in all kinds of unimagined commercial applications?”

Ajit PaiFCC chairman

But Pai injected the IoT into the debate, even though it wasn’t a major topic of discussion leading up to the FCC’s vote to repeal the net neutrality regulations.

Several broadband providers told the agency they held off on improvements because of the regulations, Pai said during the FCC’s December meetingKeeping the net neutrality rules could negatively affect the “Internet we need 10, 20 years from now,” he said.

“With the dawn of the Internet of Things, with the development of high bit-rate applications like virtual reality, with new activities like high-volume Bitcoin mining that we can’t yet fully grasp, we are imposing ever more demands on the network,” Pai added. “Over time, that means our networks themselves will need to scale, too.”

If today’s bandwidth is all customers need, if the Internet is essentially “done,” then the 2015 rules to reclassify broadband as a regulated, common-carrier service wouldn’t be that harmful, Pai said. But many new technologies are on the horizon, and they will need more bandwidth, he argued. “What if we aren’t done?” Pai added. “What if the Internet of Things moves beyond this messy experimentation phase and into real-time value generation, not just in the home but in all kinds of unimagined commercial applications?”

Much of the concern over the 2015 rules centered around the FCC’s decision then to reclassify broadband as a highly regulated, common-carrier service under Title II of the Telecommunications Act, instead of a lightly regulated information service.

Title II contains a long list of potential rules, including rate and network-sharing rules, and although the FCC in 2015 promised to forebear from imposing many of those common-carrier rules, there was no guarantee that future commissions would do the same thing, says Rick Boucher, a former Democratic congressman and honorary chairman of the Internet Innovation Alliance, an advocacy group for broadband interests.

That uncertainty about new potential regulation was a drag on investment, even as mobile carriers consider how to build out their next-generation networks, Boucher says. While many IoT networks may be separate from the public Internet, 5G mobile service will be an important driver for the IoT, he says.

Mobile carriers are “on the threshold of 5G deployment,” but the new mobile technology will require the purchase of many more antennas, routers, and other networking equipment than 4G did, Boucher says. “We need greater investment than we ever did before,” he adds.

If, for example, a future FCC required broadband providers to share their networks with competitors, as was the case for some of them in the early 2000s, “it would be very difficult to get the return they would need to justify their deployment investments,” Boucher says. 

Net neutrality: Lessons for leaders

  • Some opponents of the FCC’s 2015 net neutrality rules say the repeal will lead to new investments needed to help the IoT grow.
  • By some measures, broadband investment did decline in 2016 and 2017.
  • Supporters of the rules question the impact on the IoT. Many commercial IoT services run on networks disconnected from the public Internet and are not impacted by the 2015 rules.

This article/content was written by the individual writer identified and does not necessarily reflect the view of Hewlett Packard Enterprise Company.