A better analogy for the telecommunication companies’ plan to offer tiered services might be the relationship between a food manufacturer and supermarket, says Yoo. The manufacturer will pay the supermarket more money for better shelf positioning. In this example, both the food manufacturer and the supermarket have the same goal: to sell more food. The argument, says Yoo, is over how to break up the profits.

If the telecommunications companies develop the online equivalent of the eye-level shelf, CIOs will have to give up a percentage of their companies’ profits to be placed there. If this new arrangement results in significantly more sales and revenue for a company, most probably won’t mind paying the extra freight. But there’s no guarantee these new charges will result in additional business, and it will be years before anyone knows whether the juice is worth the squeeze.

Even so, the telecommunications companies all agree with AT&T that "this is an issue best left to the marketplace."

The Elephant in the Room

The problem is that the telecommunications marketplace is fast consolidating. The proposed AT&T/Bell South merger means that the 10 regional phone companies that emerged from the Ma Bell breakup will have shrunk to three in less than a decade. And the new AT&T will be twice as big as all the cable companies put together. "A free market works as long as there is competition," the University of Michigan’s Hilton says. Hilton and other proponents of net neutrality are concerned that giving carriers the right to decide how traffic flows over their networks will turn telecommunications companies into online kingmakers, giving them the power to decide who will be winners and losers online through the rates they charge and the speeds they deliver.

This kingmaker role greatly dismays content providers and other proponents of a free and open Web. "The Internet is the greatest engine of innovation we have ever seen because no one had control over it," says Art Brodsky, communications director for Public Knowledge, a digital rights advocacy group.

After all, Google and Yahoo are among the new economy’s greatest success stories not only because they developed services that people want to use, but also because people had access to those services. What if a telecommunications company downgraded one of its services because it had a partnership with a rival? That’s possible in a world without net neutrality. In fact, it is already happening. Clearwire, a wireless broadband provider, sells a VoIP service from Bell Canada and acknowledges blocking VoIP from other providers, as well as other high-bandwidth applications. Clearwire says it is allowed to do this because it sells an information service and thus is not covered by the Telecommunications Act.