Net neutrality is the idea that there should be a specific QoS setting required by law. This locks in something that seems sensible based on current protocol usage.
How is traffic shaping used by ISPs? It's used to allow more value to be delivered to customers using the same size pipe. It's used to gracefully degrade some less obvious aspects of the internet in favor of keeping others uninterrupted.
What do ISPs actually do? Sellers of residential bandwidth are in a business that is actually much more like finance than like a typical technology business. ISPs invest in bandwidth contracts and then they arbitrage the bandwidth based on actual demand.
If an ISP expects demand for bandwidth to be strong for 5 years, it may negotiate a 5 year contract with its upstream provider. Risk is being taken, and profits are made when the ISP can re-sell bandwidth for a profit. The service being provided is that the ISP removes the need for consumers to make long-term projections about bandwidth, and removes the need for consumers to buy more bandwidth than they actually need.
Now think a bit more precisely about what the actual service an ISP provides is. It's an acceptable connection to the hosts that customers wish to access. If the ISP de-prioritizes youtube.com a bit so that its own VOIP offering can remain crystal clear during heavy usage, that should be completely up to the ISP.
If consumers don't appreciate 10ms more lag when accessing youtube, or similar minor degradations, they can switch to another ISP.
Now, why does Google support net neutrality? Google wishes to prevent ISPs from offering improved quality services for the "short head" of most popular content. Imagine if you could get ad-free, instant 4K streaming of the top 10000 videos on youtube directly from your ISP. This is where Google makes most of its money from youtube. Google can build a CDN near you, but it can't prioritize the last mile traffic shaping experience in a way that prevents ISPs from exploring business models like the one I've just described.
Google can't prevent it without laws like net neutrality, that is. Google wishes to lock in (by law) QoS that supports its own business model. What happens when you load a typical website? Lots of pixel traffic flies back and forth to Google/Doubleclick and market price ads are sold and delivered before you realize what happened. Google's massive profit infrastructure depends on local ISPs sticking only to bandwidth arbitrage.
In effect, net neutrality is a regulation very similar to financial regulations. It defines the characteristics of a residential bandwidth circuit, preventing ISPs from defining it their own way. Google wants this because the alternatives threaten Google's cash cow.
The problem is, many ISPs invested heavily in last mile buildout with the expectation that they could compete with Google by offering additional value delivered based on locality. All content providers are in the business of creating bits which must be carried across space, and there are some kinds of content where local offers a big advantage. Many of these are yet to be discovered, as local circuit quality has been fairly poor since the origin of the internet. Net neutrality makes it far less likely that any of these will be explored.
Net Neutrality is the perfect propaganda name. There is no need for net neutrality because ISPs want to make customers happy, and if they fail to do so, another ISP will.
Imagine if we'd had net neutrality in the origin of the internet, ISPs today would be forced to allocate significant priority to Gopher and FTP traffic.
The last thing the internet needs is non-technical people creating regulation for it. I'm deeply disappointed that Google has let its own corporate interest drive its propaganda campaign for net neutrality. I have much more positive sentiment for Google than I do for Comcast, but I want Comcast to have a shot at doing something innovative.