Net Neutrality is a recipe for paralysis: SeaBoard

"Overt government" regulation of Internet services in Canada will only serve to stymie investment in the global network, resulting in slower access speeds and potentially decreased subscriber numbers, according to a new report from SeaBoard Group."We assert that a neutral Net would produce an inevitable increase in congestion. ISPs would be forced to increase investment in service provisioning without the ability to segment user charge by type of traffic, or even, in the minds of some, by usage," reads the SeaBoard Group's It's Just a Tool, Reason not Romance: A Better Internet in the Balance. "Mandating Net neutrality will have the perverse effect of undermining the vitality of the Internet. ISPs would be prevented from managing the ever-growing traffic, thereby effectively eroding the network's value to the user."Net neutrality garnered significant attention this spring when the Canadian Association of Internet Providers (CAIP) filed an appeal with the CRTC after Bell Canada began slowing Internet speeds for its wholesale customers. CAIP argued that Bell's traffic throttling contravenes regulations and approved tariffs and shouldn't be allowed. Bell said the practice was necessary because a few bandwidth hogs were negatively affecting the Internet experience of the broader subscriber base.The CRTC was to rule on the matter by the end of October, but media reports indicate that the commission won't render its decision until sometime in November.Traffic management- or throttling depending on who you talk to - has always been part of the Internet, says the telecom consultancy, and is required more than ever because of increasing bandwidth demands and many of the critical applications used by enterprises and consumers can't function properly without it. Voice over IP, video streaming and web conferencing are types of applications that depend on traffic prioritization.Increasing network capacity and bandwidth capabilities are required to meet the continuing increase in network usage. Global Internet traffic in 2007 was 8.4 times that of 2003 traffic, and in 2010 it will be twice as high as 2007 figures, according to SeaBoard. To meet the ensuing demand increases, it says service providers will have to invest in network expansion and capacity increases, but adopting Net neutrality provisions will only be a drag on funding."Given that investments in infrastructure and technologies are needed to accommodate this rising demand for capacity, mandating neutral conditions (thereby lessening the potential for reward for risk capital) is counterintuitive. Without large scale infrastructure growth and an effort to manage growing traffic, the Internet will become incapacitated. The creation of policies that will slow investment in infrastructure and disallow traffic management will have dire consequences for the future of Internet service."As a result, government intervention in Internet regulation should be minimal, says SeaBoard, noting that existing legislation and regulatory safeguards are sufficient. "The ideal role for government is to be gentle in its attempt to husband the online environment. Our advice? Speak softly, and if there must be a stick, make it a small one," reads the report.The results of this type of light-handed regulation on the competitive landscape will be noticeable says SeaBoard, noting that investments in the provision and expansion of Internet access will be rewarded. "Operators that make the investments needed to continue to increase the quality of the product and enhance the user experience will also be rewarded. On the other hand, operators who invest too little and ‘shape' traffic too much will find themselves with a dissatisfied and shrinking user base and diminished customer spending."The implementation of Net neutrality rules won't make it better for consumers or for wholesale users of bandwidth. The SeaBoard Group says neutrality regulations will have unintended consequences. "Rather than save the Internet, a Net neutrality mandate will hasten its demise through the erosion of its network value and punish all stakeholders alike through higher Internet service prices, limited service choices, and impediments to development and growth of businesses and technology," the report reads.

Net Neutrality is a recipe for paralysis: SeaBoard

News | 10/20/2008 5:07 pm EDT

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