[Ecommerce] Towards a two-tier internet

[Michelle Childs]

Interesting article from Prof Geist on how ISP content neutrality is under
threat.
michelle

Towards a two-tier internet
 **
The egalitarian nature of the internet is under threat, argues internet law
professor Michael Geist.
< http://news.bbc.co.uk/go/em/fr/-/1/hi/technology/4552138.stm >

Towards a two-tier internet
The egalitarian nature of the internet is under threat, argues internet
law professor Michael Geist.

Services offering calls over the internet could be disadvantaged
Internet service providers (ISPs) always seem to get the first call when a
problem arises on the internet.

Lawmakers want them to assist with investigations into cyber crime,
parents want them to filter out harmful content, consumers want them to
stop spam, and copyright holders want them to curtail infringement.

Despite the urge to hold providers accountable for such activities, the
ISP community has been remarkably successful in maintaining a position of
neutrality, the digital successor, in spirit and often in fact, to the
common carrier phone company.

Adopting this approach has required strict adherence to a cardinal rule
often referred to as "network neutrality." This principle holds that ISPs
transport bits of data without discrimination, preference, or regard for
content.

The network neutrality principle has served ISPs, internet firms and
internet users well. It has enabled ISPs to plausibly argue that they
function much like common carriers and therefore should be exempt from
liability for the content that passes through their systems.

Websites, e-commerce companies, and other innovators have also relied on
network neutrality, secure in the knowledge that the network treats all
companies, whether big or small, equally. That approach enables those with
the best products and services, not the deepest pockets, to emerge as the
market winners.

Internet users have similarly benefited from the network neutrality
principle. They enjoy access to greater choice in goods, services, and
content regardless of which ISP they use.

While ISPs may compete based on price, service, or speed, they have not
significantly differentiated their services based on availability of
internet content or applications, which remains the same for all.

In short, network neutrality has enabled ISPs to invest heavily in new
infrastructure, fostered greater competition and innovation, and provided
all internet users with equal access to a dizzying array of content.

Challenges ahead

Notwithstanding its benefits, in recent months ISPs have begun to chip
away at the principle, shifting toward a two-tiered internet that would
enable them to prioritise their own network traffic over that of their
competitors.

  Recent developments in the US and Canada suggest that ISPs may go even
further in developing a two-tiered internet that differentiates between
different types of services and content

Michael Geist, University of Ottawa
The two-tiered approach is taking shape in various forms in different
parts of the world.

In the developing world, where there is frequently limited
telecommunications competition, many countries have begun blocking
internet telephony services in order to protect the incumbent telecoms
provider.

This approach, which has occurred in countries such as Panama, Oman,
United Arab Emirates, and Mexico, reduces competitive choices for
telecommunications services and cuts off consumers from one of the fastest
growing segments of the internet.

In Europe, some ISPs have similarly begun to block access to internet
telephony services. For example, this summer reports from Germany
indicated that Vodafone had begun to block Voice over IP (Voip) traffic,
treating the popular Skype program as "inappropriate content."

European ISPs have also faced mounting pressure to block access to
peer-to-peer systems such as BitTorrent, which are widely used to share
both authorised and unauthorised content.

The MPAA (Motion Picture Association of America) and the IFPI
(International Federation of the Phonographic Industry) are pushing
European ISPs to implement filtering technology to block services and
sites that the associations believe are "substantially dedicated to
illegal file sharing or download services".

In fact, the content industries have even suggested that European ISPs
limit the amount of bandwidth that can be used by consumers.

Issues of priorities

Recent developments in the US and Canada suggest that ISPs may go even
further in developing a two-tiered internet that differentiates between
different types of services and content.

North American ISPs have also begun to use their network position to
unfairly disadvantage internet telephony competition. For example,
Canadian cable provider Shaw now offers a premium Voip service that
promises to prioritise internet telephony traffic for a monthly fee.

The potential implications of such a service are obvious. The use of
competing services will require a supplemental fee, while Shaw will be
free to waive the charge for its own service.

In the US, earlier this year at least one ISP briefly blocked competing
internet telephony traffic until the Federal Communications Commission
ordered it to cease the practice.

While ISPs once avoided content intervention, even that now seems
possible. This summer, Telus, another Canadian ISP, blocked access to a
pro-union website named Voices For Change during a contentious labour
dispute.

The company has since indicated that it was a one-time event, though in
the process it also blocked more than 600 additional websites from the
U.S. and Australia hosted at the same IP address.

Alarm bells

Canadian customers of Rogers, Canada's largest cable ISP, have speculated
for months that the company has begun to block access to BitTorrent as
well as the downloading of podcasts from services such as iTunes.

While Rogers initially denied the charges, it now acknowledges that it
uses "traffic shaping" to prioritise certain online activity. As a result,
applications that Rogers deems to be a lower priority may cease to
function effectively.

Moreover, blocking services, websites, and certain applications may not be
the end game. Some ISPs see the potential for greater revenue by charging
websites or services for priority access to their customers.

In the US, BellSouth Chief Technology Officer executive William L Smith,
recently mused about the potential to charge a premium to websites for
prioritisation downloading, noting that Yahoo could pay to load faster
than Google.

Reports last week indicated that BellSouth and AT&T are now lobbying the
US Congress for the right to create a two-tiered internet, where their own
internet services would be transmitted faster and more efficiently than
those of their competitors.

These developments should send alarm bells to internet companies, users,
and regulators worldwide.

While prioritising websites or applications may hold some economic
promise, the lack of broadband competition and insufficient transparency
surrounding these actions will rightly lead to growing calls for
regulatory reform that grants legal protection for the principle of
network neutrality.



Michael Geist holds the Canada Research Chair in Internet and E-commerce
Law at the University of Ottawa, Faculty of Law.







--
Michelle Childs -Head of European Affairs
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