Following hot on the heels of one of Englandâ€™s greatest sporting triumphs, beating Australia on its home turf in cricket, is good old British Telecom thumbing its nose at those other ex-colonials, the Americans, and the net neutrality bunkum.
In the best spirit of capitalism and free-trade, BT Wholesale has devised aÂ specialized content delivery network that it will be offering to ISPs to enable uninterrupted delivery of bandwidth-hungry applications like video. Named Content Connect, the service is already being deployed to supply BTâ€™s own TV customers with the BBC iPlayer.
ISPs, content providers and over-the-top (OTT) players that want to guarantee the very best experience for the customers are welcome to buy this premium service. BT claims that by using Content Connect, broadband providers would be able to reduce their costs through reduced spending on backhaul connections between phone exchanges and their own infrastructure.
Presumably, retail customers wanting guaranteed quality delivery would be willing to pay a premium. Of course, OTT players can continue to deliver over normal connections but there is no certainty that high bandwidth video will always be delivered interruption-free. This is a classic case of a supplier giving its customers a choice. We pay for higher quality in every aspect of our daily lives so why should telecommunications be any different?
Ah, butÂ those net neutrality soothsayers were quick to bag the BT initiative saying it would create â€˜two-tierâ€™ internet and that it violated the very principle of net neutrality. The last time I looked, Great Britain was not actually part of the USA and that its regulator, Ofcom, was quite independent from any rules the FCC thought up.
However, Jim Killock, executive director of online consumer rights organization the Open Rights Group, said the service could results in a â€œfundamental shift away from buying services from the Internet to bundled services from ISPs.â€ Yes, Jim, thatâ€™s exactly what BT is probably hoping for! No â€˜big fat dumb pipeâ€™ for them, this is business.
In any case, this is BTâ€™s network that it has invested in and has a right to see a return on. If it comes up with commercially viable options for its customers and they take them up then it is doing its job. If the market doesnâ€™t want to pay more for better quality then BT will lose out and probably drop the whole idea in due course. That is the essence of business in free market economies and I, for one, support BTâ€™s ballsy move so soon after the FCC announcements.
I suspect that diplomatic cables on this very subject are plying the Atlantic even as you read this, but donâ€™t worry, WikiLeaks should have them online in no time!
Howzat?!?! Tony, I love the way you’re calling this one out. The Aussie Cricket team needed you on the field in Sydney.
Jim Killock of ORG is usually a pretty shrewd interpreter of news events like these, but this time his response was well wide of the mark. Arguing that BT’s offering will reduce competition and be bad for everyone is a lot like pointing out that your local mom and pop convenience store doesn’t offer every product and every brand you can find in the out-of-town jumbo-mega-mall. The logic continues that the local convenience store should be banned because its existence will discourage investment in the roads people would need to get to the mega-mall.
Another point is that it’s not at all clear how BT Wholesale’s offering could be interpreted as violating internet neutrality, unless you start arguing neutrality includes banning anything that competes with the internet. I think it is telling that Killock avoided talk of neutrality in his press release.
At the same time, I wouldn’t say that BT have been as ‘ballsy’ as you suggest. The tone from the EU is that transparency and competition will be the main way to serve the interest of customers, rather than the imposition of unbending rules. Ofcom looks set to lean the same way. And the relevant government minister, Ed Vaizey, has already spoken publicly about being fine with differentiated tiers of service:
“We have got to continue to encourage the market to innovate and experiment with different business models and ways of providing consumers with what they want. This could include the evolution of a two-sided market where consumers and content providers could choose to pay for differing levels of quality of service.”
Summary: BT not put off by sledging; uses good footwork and plays with a straight bat. Opposition struggle to find the right line.