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Seattle startups worry how net neutrality vote could hurt business, innovation

SEATTLE — The Federal Communications Commission voted to gut net neutrality rules Thursday in a three-to-two vote.

It has several Seattle startups that are worried this ruling could hurt their chances of success.

Twenty-nine Seattle startups joined more than 1,000 others across the U.S., signing a letter to the FCC asking the chairman to protect net neutrality. Despite the effort -- from letters to protests -- it didn't work.

“Extremely disappointed,” said Joshua Gebhardt, CEO and co-founder of Metricstory.

“Disappointment. Real disappointment,” said Mike Saffitz, the CTO and co-founder of Apptentive.

The FCC repealed rules that prevented internet service providers from blocking or slowing down traffic for specific apps or websites or from charging more money. The FCC chair says the ruling will help internet providers expand.

"Investment in high speed networks has declined by billions of dollars,” said Ajit Pai, the FCC chairman.

“Those tele-cos and cable giants are essentially fat, lazy, quasi-monopolist, standing behind the free market principals -- I don't buy it,” Gebhardt said.

His startup, Metricstory, helps companies comb through huge amounts of web traffic and figure out what data is valuable, in part by using machine learning.

“We’re processing gigabytes and soon into the terabytes on a daily, and soon hourly basis,” Gebhardt said.

Startup "Apptentive" helps companies gather mobile app feedback from customers and helps them improve customer experience.

It relies just as heavily on the internet.

“We have hundreds and hundreds of millions of devices we connect to each day,” Saffitz said.

Both are worried about what the FCC’s ruling will mean for their companies futures.

Metricstory says it's the verge of turning a profit.

“If we're taking in terabytes of data and they're saying hey – you’re that Netflix user that's streaming 20 gigs of movie, you're going to have to pay for that. That's a significant cost we're going to have to incur as a company which means we have to pass that on to our customers, which means we might not get that customer or make that hire,” Gebhardt said.

And there’s another concern beyond the bottom line.

“I think it's going to be a real hindrance to innovation. I think it's one more thing entrepreneurs have to worry about,”

Washington Gov. Jay Inslee agreed with these startups Thursday and vowed vowed again to fight the FCC.

“We are not powerless. We have significant ability to protect net neutrality in our state, we intend to act,” Inslee said.

These startups say they're happy our lawmakers are taking the stand but also are hoping for action beyond Washington State.

“So it'll be a good first start, I don't think it'll be sufficient,” Saffitz said. “Most fundamentally I'm hoping that we'll continue to have an internet with fair and equal access, and it's that simple.”