Verizon Razzes Google

11:00 AM -- Verizon Communications Inc. (NYSE: VZ) has launched a verbal assault on Google (Nasdaq: GOOG)'s "free lunch," according to the Washington Post.

"The network builders are spending a fortune constructing and maintaining the networks that Google intends to ride on with nothing but cheap servers," John Thorne, a Verizon senior vice president and deputy general counsel, is quoted as saying.

"It is enjoying a free lunch that should, by any rational account, be the lunch of the facilities providers," said Thorne, speaking at a conference marking the 10th anniversary of the Telecommunications Act of 1996.

Party on!

— R. Scott Raynovich, Editor in Chief, Light Reading

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Scott Raynovich 12/5/2012 | 4:06:46 AM
re: Verizon Razzes Google As far as I can tell, nobody is talking about charging for plain-vanilla Interent (Web surfing). The discussion over fees is for real-time communications (VOIP & video). Right?

At any rate I'm working up a column on this so I'd be interested in more feedback.
ozip 12/5/2012 | 4:06:49 AM
re: Verizon Razzes Google LetGÇÖs assume that verizon decided that you could only connect to verizon sites through their broadband service, how many subscribers do you think they would have. hmmmmmm. The whole argument is based upon greed, the $60B broadband was great fun for them until they found someone else was making really big money as well. Mindless greed, if this isnGÇÖt biting the hand that feeds, I donGÇÖt know what is.

I wish the operators good luck with this strategy, if my service gets worse because I dont use the sites they prefer, Ill change. I have 3 broadband choices were I am. Since they also have my VIDEO/PHONE business (3-play), my change will cost them $150 each month.


BTW, as a web content provider with video I might add, (if that what you call LR TV), whatGÇÖs LRs position. Some of your content might be also be objectionable. How would LR feel if their site got severely degraded. You going anti-up and pay. Im sure some of your readers work at the operators in question, how about supporting your carrier employed readers...... (hahahahaha)
gzkom 12/5/2012 | 4:06:51 AM
re: Verizon Razzes Google Since MSOs pay big for content owners, by the same token telco and cable should pay Google to carry their search results.

The reason that Internet becomes so ubiquitous is exactly the existence of Yahoo, Google, eBay.

If there are two competing ISOs, one carries Yahoo, Google, eBay, ... and another one does not, who will be a winner?

That's why the ISOs or the RBOCs are taking the free lunch.
rjs 12/5/2012 | 4:06:52 AM
re: Verizon Razzes Google Verizon,SBC and the likes should stop behaving like Crybabies. Their entitlement attitude is quite obvious from their public statements.

Net Meutrality means, complete separation of
transport from services. Verizon and the other ILECs can easily spin-off content companies which can latter avail of the equal access services of transport from the parent.

The attitude is the monopolistic attitude of having a right to the content (sic! they even call it their LUNCH).

As far as the DSL or the access/transport is concerned, it should be paid for once. If the ILECS or Verizon feels that they should increase the broadband rates, so be it, let the market forces decide what the rate for a broadband connection to the customer premise.

Yes, internet is free, but I have paid for my broadband access, $29.99 a month.

Let there be apples to apples competition, namely,
transport of bits. Nothing wrong with commodity business if you know how to run it well and efficiently.


optiplayer 12/5/2012 | 4:06:59 AM
re: Verizon Razzes Google "they add no value to the pipe but want to share in the reward."

That may have been true when all we were talking about was best effort Internet traffic but what the LECs would argue now is that for services that require more than best effort to maintain quality, like video or VoIP, they can and will add value and expect to be paid for it. If the content providers won't pay then they can run their video as best effort while the LECs run their's with higher priority and let the consumers decide which is better.
telco1158 12/5/2012 | 4:06:59 AM
re: Verizon Razzes Google Much of the posturing at this point is being done by media companies who appear to bait the fight. Goog seems content to have things as they are, firing back just enough to not look stupid or passive. Best effort, lack of QoS or not, the current WWW suits Goog and their business model just fine for now. They could also be lying low because they have a hidden Ace up their sleeve which may make the media companies' arguments mootGǪ rumors have it they are building their own high speed network to bypass the current Tier 1 providers. Go ahead, charge Goog all you want. They will simply play in their own high speed sandbox. That is, if you believe rumors. :)
paolo.franzoi 12/5/2012 | 4:06:59 AM
re: Verizon Razzes Google To provide my answers to the questions I posed...


paolo.franzoi 12/5/2012 | 4:06:59 AM
re: Verizon Razzes Google
I actually think rj and alchemy are talking about two halves of the same problem and I agree with them both.

To me it boils down to the definition of net neutrality. Let me use cable as an example.

Cable uses the vast majority of the bandwidth in its network to send content that it has bought to consumers. Some it opens for Public Access. Some it uses for Internet Access.

FiOS is the same as it works very much like a cable system.

Now let's move to Lightspeed. In FiOS and HFC, the physical plant is shared between video and Internet but they are separately modulated (light and RF, but both are EM raditation and similar phenomenons). In Lightspeed, video and Internet are separated by logical addressing on the same modulation.

Is net neutrality, the requirement of FiOS and HFC to open the rest of the bandwidth to share with Google?

Is it the requirement to treat all Internet entering the cable modem/FiOS data network the same?

In the SBC case, does the logical partitioning of bandwidth receive the same treatment? Or is the fact that SBC will prioritize it's video over Internet services (even its own) violate net neutrality?

To extend this discussion. If Verizon, SBC or Cable offered non-video IP data services that were differentiated in a way similar to video, does that violate net neutrality?

To finalize my last question. Does an access provider have the right to slow down any application in order to provide fairness to its other customers (In other words, pace P2P traffic)?

rjmcmahon 12/5/2012 | 4:07:02 AM
re: Verizon Razzes Google The media companies supplied the content at a price in which the cable companies could afford and profit sufficiently such that they could pay for their network build outs. So maybe the media companies didn't provide direct compensation, but they did provide something of value in which the cable companies could sell to their customers. The end product to the customer was the video content supplied by media companies.

Google doesn't have broadcasting rights to any video content worth mentioning. They are unlikely to be a supplier for a new video infrastucture. That's my point.
alchemy 12/5/2012 | 4:07:02 AM
re: Verizon Razzes Google rjmcmahon writes:
If VZ wants compensation for network upgrades they should be talking to the media companies.

You have this exactly backwards. Cable operators pay huge dollars to media companies. They then resell the content to their subscribers. The cable operators spent billions building out their networks to distribute that content and didn't get a dime from the content providers. Even worse, they have to completely rebuild their network every 5 or 6 years so the cable industry has been roughly as profitable as the airline industry because of all the rebuilding costs. If a Google can piggyback on the MSO data network for free selling streaming video services and undercut the cable operators, the cable operators go out of business and you have no network.

Certainly Verizon isn't going to continue building out their FIOS network if Congress starts passing laws that parasitic video from Google has to be treated equally with any video product Verizon rolls out.
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