5 minute read |

The End of Net Neutrality – Its Impact on VoIP?

VoIP phone service background

The year 2017 saw the end of the existing net neutrality rules. With the FCC’s recent decision, ISPs are no longer restricted in their ability to limit or throttle Internet traffic. It’s almost certain that there will be court challenges and the battle continues to rage. In the meantime, we have to consider the impact of this decision on the VoIP industry.

Why Net Neutrality Is Important for VoIP

Net neutrality rules prevented ISPs from speeding up or slowing down traffic based on type, destination, provider or any other variable. It doesn’t matter if you stream movies from Netflix or videos from YouTube, your speed remains constant. The rules protected enterprises as well. All of your business traffic (documents, videos, audio, voice, pictures etc.) traveled at the same speed towards their destination.

Given that the ISPs lobbied hard for this decision, it’s not difficult to foresee the consequences. Your service provider is now free to charge Amazon or Netflix extra to make sure that content reaches your devices. They can even chop up your Internet access into bundles like cable TV. We may soon see packages like Netflix plans or YouTube specials. In essence, ISPs can charge both content providers and users extra fees to route the same traffic as they do now. Businesses and consumers will be forced to pay extra for no additional value in service.

Many of the arguments on both sides of net neutrality focus on consumer facing websites like Amazon or Netflix. But net neutrality protected more than the entertainment or e-commerce industry. Enterprise VoIP traffic benefited from the same speed as the rest of your data. Your ISP will not charge more to carry voice traffic any more than they could charge special fees for videos. Net neutrality rules ensure that you only had to pay your hosted VoIP vendor for better quality audio calling or video conferencing features. All that is about to change.

Impact on the VoIP Industry and Providers

The VoIP industry should be very concerned right about now. So far the market has been driving due to low prices and stiff competition. The end of net neutrality could eliminate both those aspects in one stroke. If ISPs start charging extra for VoIP traffic, hosted providers will be forced to pay. If not, they could see their traffic relegated to the slow lanes and affect the user experience. Since VoIP is real-time communication, there is no real way of masking slow speeds similar to how videos may buffer before playing.

VoIP providers will have to make a decision – pay up or degrade the user experience. Eventually they’ll have to pass the cost onto their clients which will force prices up. The ones which don’t will lose customers and go out of business. The double-digit growth forecasts for the various VoIP industry segments could slow down dramatically. This decision brings the entire future of VoIP into question. Not that the technology is going away anytime soon but the entire landscape of the industry could change.

Impact on Enterprise Users

If your organization has shifted to VoIP or is in the process of doing so, you should be concerned. Any extra fees between the ISP and your provider will affect the price you pay each month. In the meantime, your ISP could even charge you extra for transmitting voice calls over their network. For companies that make thousands of calls per day or use features like videoconferencing to replace business trips, the price difference could be significant.

There are several other consequences as well. Your VoIP traffic may travel over several different ISP networks before reaching the destination. Will your VoIP provider negotiate with all of them to make sure your traffic is not throttled? What happens if a single ISP does not want to negotiate or demands exorbitant charges to sign the contract?

You should also be concerned if you have remote workers, telecommuters, employees who travel frequently or anyone who uses VoIP away from the corporate network. Even if you are able to negotiate QoS contracts between your provider and various ISPs, there is no guarantee that your employee has the same benefits. A manager trying to join the conference from a hotel room may experience bad audio quality because of a single ISP somewhere on the route. Staff that work from home or from client sites may no longer be able to take calls because their ISP is throttling VoIP traffic.

Not all users have the same bargaining power when it comes to negotiating contracts with other organizations. Small businesses may not be able to afford VoIP enabled Internet packages. Increased prices will significantly reduce the savings you can see from shifting to VoIP. With net neutrality gone, it’s time for every enterprise that uses VoIP to re-examine Internet usage.

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Start a free 30 day trial now, no credit card details are needed!