Qwest CEO: SLAs Are A-OK

SAN JOSE, CA -- VON Conference -- Qwest Communications International Inc. (NYSE: Q) CEO Richard Notebaert told the audience here yesterday that good old capitalism, not regulation, should decide who gets a lane on America's increasingly crowded broadband networks. (See QOS Fees Could Change Everything .)

Notebaert stressed that “commercial agreements” have always been struck between private businesses and network operators. Service providers, he says, have every right to sell Internet companies an express lane in the broadband network to speed the delivery of their online products. (See Qwest Wins $24.7M Contract.) (See RBOC IPTV: The Quiet Ones.)

He hinted that Internet companies have for a long time asked the phone company for better SLAs (service level agreements) as a way to gain an edge over their competitors. “All of us are trying to get a little bit of differentiation,” Notebaert says, speaking for the Internet companies. “As an industry we have always sold bigger pipes and better SLAs to those who want to purchase them. That’s how it works; that’s business.”

Retailers often pick up the shipping charges for their customers, Notebaert explains, and digital products should be regarded in the same way. “There is nothing that distinguishes an Internet customer from any other type of customer; they’re still customers.”

Voice On the Net (VON) Coalition president Staci Pies had some problems with the analogy. In the Qwest CEO's analogy, the shipping company (broadband operators) and the retailer (Internet companies) are two different entities. In reality, Pies points out, the broadband networks also sell their own IP voice and video products.

Pies believes some type of legislation is needed to ensure that the operator won’t slow the speeds of competing IP services while giving their own services the fast track. If that happened, the network neutrality proponents believe, competition could be stifled, and the universe of services available to consumers via the Internet could be skewed.

And, the big phone companies are well aware that Internet companies aren't happy with their views on QOS fees. Notebaert says his handlers at Qwest were surprised when he agreed to a speaking gig at VON.

“I got a little pushback, there were a couple of people who asked me if I really understood the objective of the people in this sector and in this room,” Notebaert says.

— Mark Sullivan, Reporter, Light Reading

eyesright 12/5/2012 | 4:01:39 AM
re: Qwest CEO: SLAs Are A-OK ...this from the same company that told Forbes two years ago that they were implementing VoIP and Wi-Fi in a big way.


If the track record remains the same Qwest will implement SLA's one day after everyone has bypassed them.

Might want to ask the CEO about a follow up to the Forbes article, you know, an update as to progess.
fanfare 12/5/2012 | 4:01:23 AM
re: Qwest CEO: SLAs Are A-OK I agree, LEC/BOC's have traditionally promised to build out the infrastructure needed in our society, and in the meantime the US continues to fall behind the rest of the world.

The problem, as if anyone needed me to state it, is that carriers don't want to build without having control over their infrastructure (and really, ya can't blame them .. after all, they are the ones shelling out the $$ for the builds), and if they don't build.. we won't have the infrastructure needed to supply the services such as triple play, and all the other next gen techno-goodies. However, if we do give them control, so that they agree to build, we risk losing neutrality. Without neutrality, we will not see the mega-innovation and expansion of services offered for less $$ passed on to the end users. Why? because we all know that carriers are in the "milking" business and they only bother to get off their butts and innovate when they see an opportunity to pull more money from their customers. Naturally, you say .. isn't this the way of business? True, but look at what this model has brought us in the past. If carriers had their way we'd all still be using POTS for our voice needs and paying outrageous fees for simple services like call waiting, caller ID, voice mailbox, etc. Heck, there are a great many carriers still milking themselves a good living from this model. IP driven technologies allows for a nearly limitless opportunity to expand on all sorts of services, at very little expense to the end users. Net neutrality ensures that anybody can set up a bunch of servers, buy some bandwidth and a few routers .. and start offering a service over the internet. Well, this simply won't due for our "milk maid" carriers. They can't have people running around inventing smarter ways to do things at lower costs.

It's easy to see both sides of the issue. Without the pipes, we have no avenue to innovate on. However, if we give carriers a free hand, they might just stifle innovation and so we are back to where we started. In the end, I think we may have to give them control over their networks and let them charge what they want for access as long as it is equal. However, if they are going to sell services as well as provide the pipes to those services, we have to find some way to keep them from bottling up access to the end user along with keeping the pipes open to competitors offering services. How is this done? Well, I could offer any number of solutions .. but then we are right back to the concept of regulation. The short answer is that nobody knows what the best solution is. This is a real quandry and I have changed my mind a few times. The bottom line is that we need to get in gear and build. If we don't, we are going to lose a very significant economic advantage.

Maybe we need to start veiwing the information highway like the actual highways. When the government decided on building the highway system in the US it was a major boon for businesses and consumers. It led to an upswing in our economy. Maybe government needs to get involved in this particular situation. I'm all for free enterprise, but when the desire to lock in profits is getting in the way of our economic progress, it's time to make some changes. Offer the carriers control over their networks and let them charge what they want. But if it is control over services, who gives them and who gets them, then we have a problem. Maybe the solution lies in the anti trust laws. After all, being a service provider and controlling all the avenues to those services is a monopoly of sorts .. isn't it? Oh, but then what do we do about those pesky cable companies who are using thier pipes to provide services as well as internet access. Cable operators developing new services is a major reason the carriers got off of their butts in the first place. OK, back to square one again. You see how this becomes a circular problem? There really is no easy solution to it. I hear people all the time stomp their feet and say "they just need to do X .. or Y". But the bottom line is, it's a problem that is going to require some innovation in intself in order to solve.

Right now, however, I don't think the carriers are in a position to demand anything. They have no choice but to build or die, and I kind of like it that way.
ethertype 12/5/2012 | 4:01:00 AM
re: Qwest CEO: SLAs Are A-OK So, you've ruled out unfettered monopoly and investment-killing regulation. How about competition? ILECs are moving far faster today than ever before for one reason: cable. Every time they think about putting some restriction on consumers' ability to freely choose apps & services, they think, "Oh crud, if we do that, everyone will defect to cable." Sure, the cable/telco duopoly is far from a perfect competitive environment, but it beats the alternatives. And various emerging access alternatives like muni wifi, despite technical inferiority, may be just enough to keep the duopoly competing honestly. I think it's time to admit that Michael Powell might actually have been right.
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