Technology vendors at the center of the network neutrality debate say broadband providers don’t yet have the traffic engineering chops to execute controversial QOS agreements with Internet companies. (See QOS Fees Could Change Everything .)

The QOS fee agreements, which would allow service providers to charge partners such as Internet service providers (ISPs) for "express lane" service to deliver speedier connections for premium applications like video, are seen as a market-driven way for Internet companies and network operators to share the costs of delivering content to the consumer.

The AT&T Inc. (NYSE: T) merger with BellSouth Corp. (NYSE: BLS) has got everyone talking about the issue again, but how close are carriers to actually being able to execute the technology?

Sources say many carriers have already invested in some form of traffic engineering technology, but most still lack the diagnostic and policy-making tools needed to share distribution costs with individual content providers for specific traffic types.

For instance, ISP X would be able to identify Google (Nasdaq: GOOG) packets running over its network, but might not be able to distinguish between Google search packets and Google video packets. Even if the ISP could make that distinction, it may not be able to form different QOS fee schedules for each traffic type. (See Net Neutrality Debate Wydens.)

Spokesmen from AT&T and BellSouth say they believe deep packet inspection gear is in place in their companies’ networks but wouldn't provide details on how deeply into packets the technology can see. Verizon didn't immediately respond to requests for comment.

“A lot of them don’t have the visibility into the subscriber and application activity that’s going on in their networks,” says Ellacoya Networks Inc. CEO Jerry Wesel. “And only when you know that, when you know what’s going on in your network, can you cut the deal with the [Internet] video guy.” (See BitTorrent to Open Video Store and Google Plans Video Service.)

Ellacoya sells deep packet inspection gear that collects traffic information used by operators to form bandwidth usage policies. Ellacoya’s devices also are used to carry out those policies in the network. Ellacoya doesn't write the traffic rules but acts as the traffic cop who carries them out. (See Ellacoya Sees Deep Packets at Shaw.)

Ellacoya says it’s received a lot of attention from operators in the past eight months, as interest in advanced traffic engineering technologies has increased.

Today, traffic engineering in broadband networks typically consists of creating application groups by packet type (VOIP, email, video, peer-to-peer, etc.), then assigning each a priority in the network, Wesel says. These priority levels are expressed in a series of usage policies that live in the operator's back-office systems.

If bandwidth is abundant in the network, Wesels says, operators usually let all traffic types flow over the network unmolested. But at peak periods when bandwidth is scarce, the policy servers and traffic-shaping gear begin making choices on which traffic gets the right of way.

“So what you’d do in the network is you’d set a policy that when a pipe is full all the email and all the Web browsing needs to be prioritized, it needs to get its share of the pipe, and then the peer-to-peer [traffic] would share the rest,” Ellacoya spokesman Matt Burke says. (See LR Poll: Net 'Squatters' Should Pay.)

But to create and enforce content provider-specific policies, operators will need to go beyond the “grouping and prioritizing” approach. Wesel says operators will need to identify packets by their application type, by their sender, and by their reciever.

Large ISPs probably have the ability to give preferential treatment to the packets of Internet companies with which they partner, says Bridgewater Systems Corp. (Toronto: BWC) product management director Mark Denton. For example, Denton says, AT&T probably can give preferential treatment to Yahoo Inc. (Nasdaq: YHOO) application packets flowing to and from its subscribers who have signed up for the services through AT&T.

“If that traffic is going to these well known IP addresses, which may be Yahoo or whoever, and is of this type -- email or Web browsing or video -- they would set up a policy that says this type of traffic has this type of priority,” Denton says.

Bridgewater provides the policy management solutions used by operators to form just such traffic and bandwidth allocation policies. (See Policy Control Heats Up.)

“And then when we see subscribers enter the network, we will push those [policies] down into something like an Ellacoya [device] and that will understand, then, to change its queuing patterns and its own internals to work out which packets have priority over other packets,” Denton says. (See Net Neutrality Goes to Washington.)

But like everyone else with whom Light Reading has discussed the issue, Ellacoya and Bridgewater people say they know of no confirmed cases where an operator has actually executed a QOS fee arrangement with a content provider. (See Ellacoya Gets $13.5M More.)

Regardless of the technology needed to execute them, QOS fee arrangements remain a shadowy subject among operators and Internet companies, and not one they are eager to talk about publicly.

— Mark Sullivan, Reporter, Light Reading