This is how we lose: metered net, and net neutrality.

It’s 2011. Net neutrality isn’t cemented in our laws, and the Canadian Radio and Telecommunications Commission (CRTC) has just legalized Usage Based Billing for home broadband connections - in other words, paying for the internet the same way you pay for data on your cell phone. This isn’t strictly a net neutrality issue, but it’s the same brand of anti-consumer thinking. No one benefits but the telcos, who have already been supported to an absurd degree by government funding and tax breaks.

This sucks, but it’s only the beginning. Let me explain how I think we’re all going to lose.

The example most often used to discuss the importance of net neutrality is cable TV. The open net is like paying for access to cable as a concept, and getting to see any show you want. The net that telcos are fighting for is more like cable TV - basic access, with extra fees for heavy use, for specialty services, for multiple devices, etc. This is bad, but it is far from the worst thing that can happen.

With traffic shaping and metering technologies, as well as tiered service levels, we’re reaching a point where different areas of the internet are going to be restricted by socio-economic status. Being able to treat the internet as an all-you-can-eat buffet of knowledge will only be available to the rich. This is one of the things the internet is supposed to fix - uneven distribution of knowledge. Without an open net, this is doomed.

Remember the music industry before piracy became the norm? More importantly, do you remember the moment that Napster exploded, and it seemed for a second like the entire music industry was about to move online, with a for-profit model, without needing to do any of the work themselves with regards to developing software, developing a market, and developing interest?

The reason that the music industry is smaller isn’t because people love downloading illegally. It’s because people will always choose their own best possible experience over a legal (but not moral) directive. Clay Shirky has pointed out that criminalizing filesharing just created a generation of people comfortable with being criminals. More than that, experience builds habit. Music is affordable and easy to download now, but people are no longer in the habit of buying music - this is why growth in digital sales is shrinking in recent years, as the decline in physical sales increases - when people learn to opt out of a system, they don’t bother opting back in.

ISPs will lose - they aren’t smarter than every geek in the country. I expect a (hacky) solution for mis-reporting my bandwidth usage to emerge within months, and I expect it to spread like wildfire. This isn’t like trying to get out of paying 20 bucks for a CD - the 25GB limit and $2/GB overages charges will likely come close to a thousand dollars per years in costs for me, alone. As such, the impetus to work around the system is very high.

And after this is in place, again, there’s no going back. Anonymous unlimited internet is not something the majority of people would have inconvenienced themselves for, but once they do, they aren’t giving it up.

As a side effect, legitimate transaction-based business of the internet is doomed. Try building a persistent login system that works with whatever hack gets me access to the open net. Try selling anything. Try serving relevant ads. I remember when the internet felt anonymous and somewhat shady. It was fun, but the only companies making money were either built on a wall of hype and VC cash, or the ones who rode an exclamation point to an IPO.

Finally, the people who, either due to an ingrained honesty, or lack of know-how, continue to follow the rules, are screwed anyway.

Computers, phones, tablets, videogame systems, and entertainment systems are becoming closed ecosystems. Microsoft is trying to sell you a Win7 box, a Win7 phone, an XBox, etc, that all play nicely with each other, but not so much with competitors. Apple is trying it with iOS (iPhone, iPod Touch, iPad, Apple TV) and integration into OSX. Google has Android, ChromeOS in the works, and Google TV.

What are the chances that these device ecosystems will not end up carrier locked, in the near future? I can already see you needing to go with a certain provider, and select a certain teir, to be able to use iTunes to stream media. How much further is it to have your device selection limited by provider, the same way for phone handset choice is?

And this is how we lose. By making it impossible to conduct legitimate business online, by destroying competition and choice, by making full access to the internet a privilege of the wealthy, and by forcing the future to pay to support the past.

How much does this matter to me? I’m actually starting to consider leaving the country. If I have to choose between the ability to live and work in an innovation culture, and staying in Canada, I’m going to leave.