The end of the free Internet?

Leading US telecoms executives are calling for the end of the free Internet, a move that would sound the death knell for web neutrality - the idea that users can go when and wherever they want on the Internet to get content, whether it be looking at websites or downloading video.

Spearheading the telecoms companies’ offensive is AT&T chairman and chief executive, Edward Whitacre, who argues that content providers should be responsible for paying for use of the networks, which they argue are being used for free but have been delivered at huge expense by the telecoms companies.

Speaking to BusinessWeek Whitacre said:

The Internet can't be free in that sense, because 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 [for] free is nuts!

He then followed this up with comments to the Financial Times this week arguing:

“I think the content providers should be paying for the use of the network – obviously not the piece from the customer to the network, which has already been paid for by the customer in Internet access fees – but for accessing the so-called Internet cloud.”

In essence, the telecoms companies want content providers to pay to deliver high-quality services such as software and film downloads, with the telcos floating the idea of a tiered Internet.

Here, a top tier, which would be paid for by the content providers, would get preferred delivery over the network. So, for example, if Google wanted its search engine results to appear quicker than those of say Yahoo! it could pay for its results to be delivered faster.

This seems to me to be a dangerous prospect, as although the telcos are promising that current services would not be degraded, what is there to stop a telco favouring its own VoIP service, over that of a rival such as Skype. Moreover, whilst your Amazons and eBays of this world would be able to afford to pay this premium, small-scale innovators offering new services could be priced out.

Then of course there is the issue of cost. Whilst the telecoms companies talk euphemistically of content providers paying, the cost is ultimately going to fall back onto you and me, the humble user.

Mr Whitacre seems to forget that we already pay for broadband access so in effect we would end up being charged twice for the same service. The telcos argue we have only paid for the last mile not the Internet backbone or “cloud” as Mr Whitacre calls it.

The very reason we do pay money every month into the telco’s accounts for broadband is because there are content sites, such as iTunes, where we can go and download films, music etc. Without these sites there would be no demand and, therefore, no revenue for the telcos.

Could Google not justifiably argue that by providing content, they are driving broadband revenue for the telcos, so shouldn’t AT&T be providing financial support to help fund Google’s extensive IT infrastructure? Which came first, the chicken or the egg?

The debate is complex, but it promises to be a key battle, which will shape the future of the Internet as we know it. Both sides will be raiding their lobbying war chests as US Congressional hearings on the topic of network neutrality begin in the next few weeks.

Expect to read a lot more on this debate over the coming months.