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Whose Line Is It Anyway?
By Dan Frommer
Monday, 1-30-06

NEW YORK - Some of America's largest telecom companies are hoping that Internet content providers would be willing to swap their corporate cards for faster access to you.

A skirmish is brewing in Washington over control of the Internet.  Not what's on it, per se, but what might be considered fair game for new revenue streams, which telecom companies are hoping to tap in exchange for a priority tier of high-speed network service.

At a private meeting in the nation's capital on Jan. 25, representatives from some of the largest content and application providers, cable companies and telecom titans squared off to discuss the issue that has lately become a hot topic among political and tech wonks alike:  network neutrality.

Network neutrality suggests that anyone using the Internet would have equal access to its pipes, which the big telecom companies -- who see a pot of gold at the end of this rainbow -- are doing their level best to veto.  They want, effectively, uneven access for those willing to pay more.

As Congress revises its telecom laws, giants like AT&T are looking to fatten their bottom lines, while they spend billions to upgrade their networks to support higher-speed data and digital-television connections.  AT&T, for one, says it will pay some $4 billion over three years to reach half of its customers with its digital-video network, "Project Lightspeed."  (A cynic might note that the company, fresh from acquisition by SBC, is also spending an estimated $800 million on its latest branding campaign.)

BellSouth has publicly taken the lead in the networking sweepstakes by suggesting the creation of a new tier of enhanced services with fatter and quicker connections, which are tailored to the needs of gamers, digital-media collectors or other network "power users."  Depending on how business relationships are defined, a bandwidth-heavy content provider like Apple Computer could voluntarily pay the telecom company 5 cents to 10 cents per transaction for priority bandwidth access, presumably speeding up an iTunes customer's video download.

"We believe that a company that is feeding video or games or voice-over-Internet Protocol services would want their customers to have a good experience and would be willing to pay for that priority service," said Bill McCloskey, director of media relations for BellSouth.

Moreover, it doesn't take a math whiz with a graphing calculator to conclude that those relationships -- even at a nickel at a time -- could provide a windfall of new income for the telecom companies.  Some use the tollbooth analogy, while others argue that this directly challenges the free-market spirit of the Internet that has allowed companies like Yahoo! and Google to propel themselves from humble roots to some of the world's most recognizable brands.

"The Internet has flourished as the most revolutionary communications medium in history, based on a model where carriers do not interfere or choose what people do online," said Alan Davidson, Washington policy counsel for Google.  "Even simply picking winners among services threatens the basic Internet model of communications, where users get to decide which services are the most important to them."

Tim Wu, a professor at Columbia Law School and author of the forthcoming book, Who Controls the Internet?, is among those concerned that new payment models for preferential data delivery and a higher cost barrier for entry into the market could skew innovation.  "The Internet, by its design, was a place where you could start a business with very little.  It was designed to be neutral and designed to make everybody equal," Wu said.  "When we're talking about a network with a lot of inequality and disparity, that changes the conditions of the entire sector."

For the time being, picking winners might effectively also mean picking losers.  As bandwidth is currently a finite resource, prioritizing network packets to preferred sites would thereby de-prioritize packets sent to others -- though not to a degree discernible by the average user, according to BellSouth's McCloskey.

Still, some worry that if taken to an extreme, preferential routing may slow or block access to nonpreferred sites and applications.  "Prioritization means taking packets out of their turn.  Something gets pushed back and that is degradation," said Paul Misener, vice president of global public policy for  However in the future, greatly increased bandwidth availability may neutralize all such reservations.

More than two-thirds of respondents in a recent consumer study about network neutrality said that slowing or blocking specific applications was a concern.  But the telecoms insist that's not their mission.  "We have no intention to degrade services that people enjoy today," said Dorothy Attwood, senior vice president of regulatory planning and policy for AT&T.  "There's no value in that.  It's bad customer policy."

Last Friday, Thomas Tauke, executive vice president of public affairs, policy and communications for Verizon Communications, repledged the company's commitment to an open Internet that is free of boundaries.  "Having said that, we're not sure it's a great idea to start adopting a lot of regulation," Tauke said, citing concerns with governmental Internet involvement in Europe and China.  "We continue to explore ways to address the issue without getting bogged down in a substantial amount of government regulation."

The debate will undoubtedly intensify, and until Congress takes a stand on the issue -- potentially later this year -- the winners and losers remain uncertain.  There's still a lot at stake for all parties: telecom companies, Web giants and Internet consumers alike.