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