BT has delivered a major blow to net neutrality in the UK, with the launch of a new wholesale service that will allow ISPs to charge content providers in return for offering higher-quality distribution of their video content.
The new network, Content Connect, streams video from participating providers directly from local servers to consumers, enabling them to access content more quickly and with less chance of interruption, even at peak times.
The service is designed to allow ISPs to cash in on the boom in streaming video services - but critics claim it could herald the creation of a 'two-tier' internet, with small companies bring driven out by bigger providers with the financial muscle to ensure their services reach consumers.
Content Connect is currently used by the company's BT Vision service to supply television customers with the BBC's iPlayer streaming video service.
BT's move follows controversy sparked by communications minister Ed Vaizey's apparent support for a two-tiered web in a speech he gave in November. Following criticism from the BBC and internet luminaries including entrepreneur and rock star Peter Gabriel, Vaizey claimed his comments had been misinterpreted, and that he fully backed net neutrality.
Last month saw US telecoms regulator the FCC uphold the principle of net neutrality for fixed-line broadband connections, but give mobile operators greater scope to offer higher-bandwidth, premium services over their networks.
UK watchdog Ofcom is expected to clarify its position on net neutrality later this year.
Jim Killock, executive director of consumer organisation the Open Rights Group, expressed his concern at BT's new service, saying: "BT's plans have the potential to end up with a two-tier internet, with customers increasingly tied to bundled services [from broadband providers], and a reduction in competition across the open internet."
Sally Davis, head of BT Wholesale, rejected accusations that the new BT service would hamper competition, and said that the increasing speed of home broadband meant most consumers had decent access to streaming video via a standard connection.
Davis reckons broadband providers have shown "considerable" interest in Content Connect.