’Net neutrality: is it possible to find some common ground?

Ask Peter Bissonnette, president of Shaw Communications Inc., about the $10 fee his company charges customers to ensure that the Internet phone services they use work as well as possible, and he’ll sound bemused. Ever since VoIP provider Vonage Canada pegged the fee as anticompetitive at best – and, at worst, an indication that Shaw is on the wrong side of the wide-ranging ’Net neutrality debate buzzing about the telecom industry these days – Bissonnette finds himself having to explain what he sees as merely a fact of business. After all, if carriers enhance networks to ensure quality service, someone has to pay for those improvements. "It’s giving people choice," he says, explaining that the charge is no different from offering a 3 Mbps Internet service for one price and a 6 Mbps service for another price. Vonage, of course, disagrees, as Shaw’s $10 fee could make it that much harder for Vonage to sell its VoIP service. It’s also unnecessary, says Joe Parent, Vonage’s vice-president of business development. "We feel our phone service should work just fine over a normal Shaw Internet connection. There’s no reason for Shaw to charge an additional fee to ensure quality," he says. Vonage says Shaw’s fee goes to the heart of the ’Net neutrality debate. It’s a big deal in the US, where the government is considering enshrining the notion in law. Even though the debate started south of the border, the Shaw-Vonage fight suggests it might be just as important in this country. What is ’Net neutrality?’Net neutrality refers to the idea that networks and network operators should not discriminate among communications services. Irrespective of the service and its provider, the service should travel unhindered over the Internet. According to Vint Cerf, a Google Inc. executive, ’Net neutrality is the Internet’s state of nature. "The Internet was designed with no gatekeepers," he told a US congressional hearing late last year.But that’s just part of the issue. More than ever companies and citizens rely on the Internet to carry big important applications. The network needs to keep up, and it also still has to feed the coffers of its owners – network operators like Shaw, which are not in this business for the feel-good quotient. Profit and high-quality services are the name of the game. In March, AT&T Corp. announced it would set up Internet "fast lanes" for select services and content. AT&T CEO Ed Whitacre told Business Week last November that his company was looking for ways to make the network pay. "We and the cable companies have made an investment and for a Google or Yahoo or Vonage or anybody to expect to use these pipes free is nuts." But AT&T’s Internet tolls are just the sort of carrier move that ’Net neutrality proponents fear. They’re worried that carriers would not only give certain content and services preferential treatment, but also that carriers would treat services living outside of this exclusive realm like second-class citizens, in the hopes of convincing customers and content distributors to pay up for the better versions. "These actions or threats of restrictions are key to carefully calculated plans by ISPs to give ‘walled garden’ preferential treatment to their own service offerings, and to extract ‘premium access’ fees from remote Web services and other Internet services who are not their subscribers," writes the International Open Internet Coalition (IOIC) in a letter. In early March, US Senator Ron Wyden introduced his bill, the Internet Nondiscrimination Act of 2006, whereby "network operators would be prohibited from charging companies for faster delivery of their content." On April 5, a government subcommittee voted down a proposed amendment to US telecom laws that would force carriers to provide enough bandwidth to support any service at no additional charge. The US government seems divided as to whether or not ’Net neutrality should be part of the country’s communications laws. Michael Geist, a law professor at the University of Ottawa, points out that ’Net neutrality might make its way into Canadian law books, noting the Telecom Policy Review Panel recommended any new law should "confirm the right of Canadian consumers to access publicly available Internet applications and content of their choice by means of all public telecommunications networks." The panel also recommended that the CRTC should be authorized to enforce these rights. "I think the Telecommunications Policy Review Panel rightly identified the need for a legislative provision," he says. "I also think that the Competition Bureau must be vigilant to ensure that the major telco providers do not use their position in an anticompetitive manner."Bill St. Arnaud, senior director, network projects at CANARIE Inc. believes the problem will disappear without regulation. "For one thing, is impossible to regulate. And there are so many new infrastructure-free applications. Attempts by the carriers to build walled gardens and express lanes are self-defeating," he says. In his opinion, the carriers will end up alienating the infrastructure-free services and the people who use those services if they continue down this road. "They’ll try things like blocking and offering QoS services, but the intelligence at the edge will allow users to circumvent those efforts." Shaw’s Bissonnette says it’s important to ensure that networks provide high-quality service and access to everyone. With the controversial $10 fee, "that’s what we’re striving for," he says. It’s not as if all customers have to pay: Shaw only introduced the charge after some customers requested enhanced quality of service. Parent from Vonage says the ’Net neutrality answer must satisfy both sides. "I think there is an achievable balance, but anyone who would suggest that the ILECs or cable companies need any kind of regulatory support to maintain profitability isn’t looking at the books. These guys have been making money for a long time. They have a lot of equipment in the ground, lots of assets generating lots of return. They do not need to make more money by applying taxes to competitors’ products." Ron Gruia, an industry analyst at Frost & Sullivan, is worried about the long-term consequences. "Right now we’re in an interim stage the networks are still good enough and we haven’t discovered any huge bandwidth hogs," he says. "When we get to the next stage, doing video telephony and real-time applications relying on delay-sensitive data, that’s the point when we’re going to have to put some other elements in the network. That will further the case for service providers to invest in network equipment, and make the case for them to be compensated." An emerging concept in wide-area networking might make that possible. IP Multimedia Subsystem (IMS) is said to give network operators the ability to control access and services through traffic prioritization. It’s an emerging technology and standards bodies, particularly the Third Generation Partnership Project (3GPP), are working on it. Control is "built into the IMS model, and it will happen," Gruia says. "The carriers don’t want to be just bandwidth providers. They want to do so much more. That’s where applications play a role, but even if they don’t have the applications, they can create these mini walled gardens where they can control access." Network gear providers are part of the equation, and at least one of them is speaking up. Cisco Systems Inc. released a statement saying the US government should only regulate for ’Net neutrality if problems occur. "Imposing specific network neutrality rules now to address hypothetical problems would only compound the problem," the company says.

’Net neutrality: is it possible to find some common ground?

News | April 27, 2006

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