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Tuesday, 28 December 2010

Is Net Neutrality really better?

The US Telecoms Regulator recently announced a Bill they are seeking to get passed by the Government to implement net neutrality by network providers for the end consumer - this is an increasingly common topic for Telecom Regulator's around the world. Everyone is patting themselves on the back believing they have done a wonderful thing in ensuring that all content reaches the end user and that everyone has the same internet experience. However what regulators are overlooking is that by making the internet service experience all equal, the costs to the average consumers will actually increase due to costs of providing all users the same experience and access to all content.
I know many of you are there thinking of course we should be given access to all Internet content in a high quality status at a low cost, the Operator just has to find out how to make it work. Now consider the same issue on highways and how governments are trying to address the challenge of too many cars on the road. In many countries we pay Toll’s, Road tax based on driving week days or weekends, or even in peak hours we pay premiums to use the express lanes on highways. But if were to implement the same policy of neutrality being demanded for Internet on our highways we would all be stuck and equally frustrated with a significant impact to our working and social lives. Of course we could all make the same argument that we should all get access to the same road experience and that it is the responsibility of the government to make sure that we all get the same experience with no Toll’s, express lanes with premium charges or even time of day charges. The answer from the government would undoubtedly be – it would cost too much money to provide everyone the same experience, so why would the government ask Operators and Service Providers to manage the same challenge?
On the other side we have the Internet based Services companies who want easier access to their content which in this case could be compared with a Shopping Mall, or Beach Theme Park – in both cases users pay for parking, and then end up paying premiums to have access to better services whilst at those destinations. Should parking then not be free? I mean after all we are buying their products right? And Consider Internet Services should be available anywhere in the world and not based on where you are connecting from? i.e. Singapore vs. UK why should some Internet Services only be available in UK and not in Singapore - consider BBC iPlayer. Net Neutrality means equality right? Or does it mean only as far as a Country’s borders? (Hmm let's keep that topic for another day!)
I appreciate these may seem like areas outside the scope of Net Neutrality but we need to step back and understand what is the real question not simply assume we have the answer. The Question MUST be how do we improve the user experience of Consumers to access a rapidly expanding scope of content available through the Internet. In order to improve the experience Government’s need to actually look at themselves rather than implement a one size fits all approach.
Regulator’s need to look at the Internet in the same way that Government’s manage highways, without some diversification of traffic types and usage everyone will end up paying more. If there is important content that Regulator’s/Government’s feel that a consumer should have access to then mandate that or subsidize it for consumers in a particular segment. At the other end of the spectrum we know that there are many internet users are willing to pay a premium for high end services such as Gaming, Video Content and business requirements, by allowing operators to differentiate services with subscriber groups (both fixed and mobile by the way!) then the basic internet services can be improved for all. Look at peak traffic tariffs for major highways, the revenue generated from these highways is not used to improve the service for those who pay the premium toll, but for all users of the road. The same can be achieved for Internet Services, Premium users are solely looking for an improved service, if that means they need to help subsidize part of the improvement for basic Internet Services then that will be accepted, they won’t like it but this is common for many aspects of our daily lives today.
If Regulator’s and Government’s are looking to improve Access to the Internet for Subscribers then here are some areas they should consider to drive the right behaviours of individuals, businesses and operators:
  1. Identify what is important for Consumers to be able to access equally – Government services, News, Basic Communication – email, SMS, Phone, IM - this should then become the "Baseline" of services to be provided. The Regulator then needs to ensure these services are accessible, but at the same time acknolwdge that consumers should be paying for Video communication, Internet Gaming or Internet TV - if the consumer wants a better experience - as these can disrupt the performance of baseline consumer services.
  2. Encourage Bandwidth demanding content to be paid for by consumers who wish to access it, this will drive Content providers who are charging for these services to either subsidize the use of their content OR work with Operators to agree revenue share when consumers use their content.
  3. Consider promoting time of day use – peak hours like access to highways are in high demand so why not pay for premium access – consider if you are going to the supermarket do you really need to travel in peak hour? Likewise for Internet connectivity, if you are watching the latest episode of Top Gear on your Laptop/Mobile/Tablet, do you really need to download this during peak Internet usage and if so are you willing to pay a premium to do so?
I am sure there are many other suggestions that people would have and the above are merely the tip of the iceberg, but the point remains, Net Neutrality is not really helping to answer the question, if anything it will seek to create greater issues with Internet connectivity and most likely increase the costs as Operators and Service providers seek to provide equal service to all users. I would suggest it is time to re-think the question and identify what we are really trying to achieve. Internet is becoming an increasingly dominant medium in how we access content, communicate with each other and store information. Therefore it is crucial we get it right and avoid one size fits all type of policies which will only send us backwards and not address the challenge of providing all consumers the opportunity to maximize the benefits the Internet can provide.

 

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