Internet Service Providers will be given sweeping powers to discriminate against traffic as the result of new telecoms regulations this year.
This means that ISPs will technically be able to decide to impede the flow of certain video, music or VOIP services.
The pay off is that they must be ‘transparent’. Today’s code from the Broadband Stakeholders Group reiterated this legal commitment.
The supposed thinking, according to Ofcom and others, is that customers will walk with their feet if they get a bad service, so transparency will protect us from an Internet that is full of anti-competitive ISPs.
But ISPs are doing their best – through bundling phone, tv and equipment contracts with broadband – to reduce customer switching. Thus ISPs are doing everything they can to remove the supposed protection we will get from “transparency”.
This is not to say that every ISP has evil intent, but they are already doing bad things, which are today reducing innovation and choice.
The classic case is the way that Peer-to-peer traffic is being blocked and throttled. This is discriminating against small and medium size software companies, independent artists and film makers and will have as yet unknown effects to future innovation.
Every time that an ISP impedes the flow of information, we risk economic damage. Of course there are reasons why traffic in our under-invested networks currently needs to be managed. But the solution is not to push towards walled gardens and paid content delivery, but to invest in the networks themselves.
Graham Cobb:
Mar 15, 2011 at 01:59 PM
Transparency is critical but, as you say, it needs to be combined with real choices. That means a very competitve market, with low barriers to moving ISP. Rather than pushing for a different rule, I think we should be pushing for Ofcom to monitor how well transparency is working in making sure that there is real and effective choices of packages, including reasonably priced options with no restrictions on traffic.
There is a lot of option for ISPs to come up with low-cost, restricted packages (e.g. some people might be happy with just email access and web browsing and a very low bandwidth for all their traffic, others may only ever access video from particular websites, etc). And also to offer full-service, unrestricted access at higher prices. That is fine, if it is clear what you are getting and as long as there is effective competition at all the service levels (including the more expensive full-service option).
Ofcom needs to make it clear that it will take regulatory actions if the market is not proving effective after a review in (say) 12 months time. Regulatory action could include restricting bundling options, or it might include things like email address portability to make changing ISPs easier.