News
22/04/2008 - Virgin Media CEO attacks net neutrality
Last week several UK ISPs banded together to tell the BBC that their iPlayer application was "overwhelming" their networks, and that unless the BBC pay them to increase their network capacities they will start throttling the traffic being sent over their networks by iPlayer.
The same week, in an interview with the Royal Television Society's Television magazine, Neil Berkett (the new CEO of Virgin Media) attacked the concept of net neutrality and even went as far as to call it a "load of bollocks".
For those not familiar with the term, Columbia Law School professor Tim Wu defines net neutrality as "the idea is that a maximally useful public information network aspires to treat all content, sites, and platforms equally."
What the issue essentially boils down to is that ISPs around the world are starting to see an increase in the traffic being sent across their networks as bandwidth hungry applications like Bittorrent and video on demand (VOD) services break into the mainstream.
Rather than investing money in their network infrastructures themselves, the ISPs seem to have banded together to try and get content providers like the BBC to pay for it instead.
Whether net neutrality is right or wrong is a side issue, as the idea of content providers having to pay ISPs to upgrade their networks is ridiculous.
If a telephone directory enquiries company suddenly became incredibly popular and were causing a strain on the UK's telephone network I find it hard to believe that BT could justify demanding they pay for BT to upgrade their network, which is basically what ISPs are asking the BBC to do.
In the interview with Television magazine, Neil Berkett suggests that Virgin Media are already in talks with several content providers about paying for a priority service over their network.
As someone who's a supporter of net neutrality, this worries me.
The best way to explain why this worries me is with an analog:
Firstly, imagine a scenario where you have two companies who both provide video content and both produce a video podcast about technology.
One is a small start-up with limited funding (let's call them Web Startup) and another an existing media company with deep pockets (we'll call them Old Money).
Because Web Startup has limited funding, they are unable to pay Virgin Media for a higher priority across their network but Old Money can so they do.
In this example whenever users on Virgin Media's network try to watch Web Startup's video podcast streaming online they find they can only watch a few minutes at a time before it pauses to re-buffer the video; this can only harm their ability to keep subscribers.
Because Old Money are paying for a higher priority then they don't have this problem and subsequently they'll find it easier to keep subscribers.
This then brings me onto my second point.
Even if Old Money are able to pay Virgin Media, this would only cover Virgin Media's customers. Old Money would also have to pay every other ISP who charge for higher priorities, possibly including those from the rest of the world, to be able to provide a good service to their subscribers; the cost of this could be astronomical and probably prohibitive.
In the example above Virgin Media were having an affect on subscribers without their knowledge, but let's imagine another scenario.
ITV, Channel 4, Sky and the BBC all have online VOD services, and in the future these may be ad supported (except for the BBC's) and therefore start bringing in revenues for their respective companies.
In a world where Virigin were providing higher priority access to content providers who pay for it, it's quite possible for instance that ITV could get Virgin to agree to some sort of exclusive agreement whereby they only give ITV higher priority and agree not to do the same for Channel 4, Sky and the BBC.
If VOD was generating large revenues, then it would be in ITV's interest to make sure their competitors services look poor in comparison and this would be one way of doing it.
Of course I'm not suggesting that ITV or any other content provider would be this unethical, but in my experience if the opportunity is there then someone is going to take it.
As I, I hope, have demostrated, when start charging content providers for bandwidth services, you start getting into some very murky areas.
I also believe that when you force content providers to play on a level playing field you force them to make better content, which we can all agree can only be a good thing.
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