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Big punch-up over neutrality on the way?

Its back to 'Pipes' and 'Free rides': Internet neutrality under attack (again)

Posted By TelecomTV One , 12 June 2009 | 2 Comments | (1)
Tags: internet neutrality BBC BT IPTV

Oh dear, here comes another assault on Internet neutrality in the UK. And the fear is it might be a warm-up bout for the main event which will come with the release of the Digital Britain report due this month - the protagonists probably know exactly what's going to be in it hence the softening-up barrage, says Ian Scales.

If the pre-publication summary of the Digital Britain report is anything to go by the final version will contain nothing that could effectively outlaw non-neutral behaviour by ISP's - that is, charging some customers extra (discriminating) for forwarding traffic on the basis of source, destination or content type.

And that could be a real problem. Many observers (and practically anyone who can lay claim to being a founding father of the Internet) thinks that maintaining that simple definition of neutrality is essential if the Internet is to remain the brilliant source of innovation that it's proved to be.

Allowing it to be tampered with, on the other hand, will accelerate a slide towards a corporate carve-up and a long-term innovation bypass..

This battle is just warming up - expect a sustained assault on Internet neutrality over the coming year (and watch the arguments carefully - this is an orchestrated campaign).

The latest utterances in the UK come from John Petter, managing director of BT Retail's consumer business. Petter has been dusting off his copy of The Thoughts of Chairman Whitacre (past of AT&T, now, apparently, taking the wheel at General Motors) who gave the game away in 2005 in the US when he talked about Internet companies getting a 'free ride' over 'his' (AT&T's) pipes. If they thought they were going to get away with that, muttered Chairman Ed in an interview at the time, they were crazy.

And now it's forward to the past. BT's Petter has been quoted in the Financial Times saying, “We can’t give the content providers a completely free ride and continue to give customers the [service] they want at the price they expect.”

It's all the fault of the BBC's iPlayer, apparently. BT alleges that the BBC is getting a free ride over its pipes for its TV catch-up programming, and that its customers' enthusiastic accessing of BBC content is clogging up its network and, worse, actually making the whole business unviable.

Most distasteful of all in this debate is the ludicrous accusations of anti-social behaviour.

Users who watch video are apparently selfish bandwidth hogs. Er what? They're not mugging little old ladies, they're just accessing data at a rate they've been lead to believe their broadband access pipe should be able to support (but often actually doesn't).

The arguments are appallingly misleading. Just for starters, there is NO FREE RIDE. Every company and individual attached to the Internet pays to connect and pass data, so to talk of a 'completely' free ride is just another example of disinformation (which will no doubt be repeated as if it were fact).

If anything the 'free ride' is all the other way - let's face it, ISPs, telcos and cable companies aren't selling broadband, they're selling Web access, plain and simple, and without those all Web applications there would be no demand and no residential broadband business.

And it's strange how the story changes when it comes to financial results. When moaning about the iniquity of not being able to make piles of risk free money from the Internet, BT paints a picture of an access business barely able to stay afloat. But in BT's glossy results documents the broadband business is invariably booming and more than making up for the contraction in its fixed line traditional voice market.

There's a good delve into the BT figures here on a site called 'The Inquisitr'.

But here's the big fact to hold on to. There is no compelling evidence that video on the Internet is doing anything more than helping to drive a gradual up-tick in data traffic growth. Despite all the talk of exafloods of data, the real figures out there seem to tell a much more boring story - a gradual rise in traffic perfectly able to be absorbed by reasonable infrastructure reinvestment funded under current Internet business model of open connectivity.

If BT wants to make more money at Internet services it needs to do a better traffic management job, trim its costs and, maybe, raise its prices. And if the Internet access business is so ghastly, then it should break out its figures and show us.

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2 comments (Add Yours) - click here to sign in

(1) 12 June 2009 19:30:53 by Francis McInerney

What will change all this is the potential to monetize the network backhaul using pricing models similar to Amazon's Kindle or Bigpoint's game platform. Both break out of the constraints of access, generating significant revenue growth from existing customers, and locking them in to a well-branded environment.

When this happens it will be in BT's interest to drive more customer traffic onto the network for as many free rides as customers can get -- because it won't be free and it won't alienate customers either.

(2) 15 June 2009 02:57:20 by Surapon Kiattiyossakun

I'd think that the iPhone's AppStore may be a good model for network providers to have a revenue sharing relationship with video content providers in streamlining users' favorite contents premium downloading into his/her PC (saving repeatedly downloads) and maintain the individual favorite profile within network providers' user database.