What is net neutrality?

Net neutrality principle refers to the way that Internet Service Providers (ISPs) manage the data or traffic carried on their networks when data is requested by broadband subscribers (known as end-users under EU law) from providers of content, applications or services (CAPs), as well as when traffic is exchanged between end-users. 

The principle of net neutrality entails that ISPs cannot decide to prioritise, slow down or block internet traffic but they should treat all internet communications equally, offering users and online content providers consistent rates without regard to the content, application, website, platform, type of equipment, source or destination address, or method of communication at hand. 

Imagine watching a video on a platform and it suddenly slows down to encourage you to subscribe to a different video streaming service which gives you the “guarantee” that it will be offered at high speed. Competition should be about the quality of a product or service not about the speed of the traffic offered, and this is exactly what net neutrality ensures. The principle of net neutrality allows startups to thrive by ensuring that they can reach consumers all over the world to offer their products and services, given that this principle underlines the basic infrastructure which allows everyone to compete on a fair and equal basis.

Why does net neutrality matter for startups?

The free and open internet, which the principle of net neutrality advocates for, is the foundation for innovation and economic growth. Over the last years, countless startups benefiting from the open and free internet provide their products and services to people all over the world, generating economic growth, meeting growing consumer needs worldwide and increasing consumer choice at an unprecedented scale. 

This is a testament to the fact that an open and free internet offers equal opportunities for every company, no matter how large or small they may be or how many resources they have, which allows them to compete on a leveled playing field. If the open nature of the internet ecosystem was to come into question, it would become increasingly difficult for existing companies, including startups, to compete globally. This will have a knock-on effect on their market reach and their growth opportunities. Innovation comes to a great extent from startups being able to offer their innovative products and services directly to consumers. Regulatory initiatives that could impact net neutrality rules and result in lower internet speed for actors such as startups can affect their innovation potential and would impact the future growth of the European tech industry as a whole by discouraging new market entrants and investment.