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EC Nixes Pure Net Neutrality

Ray Le Maistre
5/30/2012

8:30 AM -- Neelie Kroes (or Steely Neelie, as we prefer to call her), the European Commission 's vice president for the Digital Agenda, looks like she's made her mind up on the issue of "net neutrality," with marketing transparency and free-flowing competition the most suitable solution.

Crucially, under Kroes's proposals, service providers will not be forced to offer unrestricted services. One could argue, then, that net neutrality in its pure form is set to be sidelined in Europe.

Kroes issued a statement late Tuesday that sets out her position -- you can read it here.

Basically, she is proposing that service providers must make it absolutely clear what consumers are buying -- realistic average downstream and upstream speeds, precise data caps (rather than vague "fair usage" limits), whether any applications are blocked or throttled -- and make it very easy for consumers to change providers. In that way, "consumers [can] vote with their feet," writes Kroes.

She believes this approach can work (if implemented correctly in each market, of course) because a study by Body of European Regulators for Electronic Communications (BEREC) , details of which were released Tuesday, found that "most, if not all" ISPs in European Union member states offered at least one service that was without restrictions on data consumption and application usage. What is lacking, the BEREC study concluded, is effective consumer choice.

Kroes, then, believes that people should be able to decide whether they want an unrestricted, open Internet experience or one that has very clearly defined limitations that would cost less. Kroes proclaimed:

    "I do not propose to force each and every operator to provide full Internet … If consumers want to obtain discounts because they only plan to use limited online services, why stand in their way? And we don't want to create obstacles to entrepreneurs who want to provide tailored connected services or service bundles, whether it's for social networking, music, smart grids, eHealth or whatever. But I want to be sure that these consumers are aware of what they are getting, and what they are missing."


So, the plan is to make it easier to switch "service providers, and service offers, so that you can choose the market offer that suits you best … I am in favour of an open Internet and maximum choice. That must be protected. But you don't need me or the EU telling you what sort of Internet services you must pay for."

By adopting this approach, Kroes hopes that ISPs will invest and develop services that suit their business and operational strategy, while consumers will have a crystal-clear view of the various options available to them and make the appropriate choice.

Kroes, though, is aware of the concerns surrounding the use of deep packet inspection (DPI) technologies. "Products that limit Internet access often require monitoring of online traffic, through so-called 'packet inspection'. This raises privacy concerns, and we need clear guidance on responsible behaviour by ISPs; and on how consumers can exercise effective and informed control if they opt for such products," noted Kroes.

Recommendations now need to be drawn up in detail and proposed to the EU's Commissioners, a process that will likely take up to a year.

It's clear that Kroes is looking to provide clear guidance and enable the market and consumers to move on without delay while at the same time ensuring that consumers have a positive experience and service providers are not subject to draconian rules. But by not forcing every service provider to provide the "full Internet" experience, Kroes will deny net neutrality.

Kroes does also state, though, that she intends to ensure that consumers can always choose/access a "full Internet" service, "a robust, best-efforts Internet with all the applications you wish." That suggests a market where all services are subject to some sort of restriction will not be tolerated.

However, if market forces are left to rule the day, it could result in an unrestricted, neutral Internet experience for just a sub-set of users -- those who can afford it.

— Ray Le Maistre, International Managing Editor, Light Reading

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yarn
yarn
12/5/2012 | 5:31:39 PM
re: EC Nixes Pure Net Neutrality


A triumph of reason over rhetoric.

parwaz
parwaz
12/5/2012 | 5:31:34 PM
re: EC Nixes Pure Net Neutrality


How is this good for anyone other than the opertor? This is creating walled-gardens in the Internet. Today with a wirless or wireline access I can go anywhere in the web. Tomorrow, myOperator will tell me that I can go anywhere in the internet but not, for eg, skype (this is already being done by some operators in the EU). Why? Is myOperator doing anything special when I use skype? The answer is NO, the opertor is not donig anything special when I am using skype. Infact he needs to do something special if he does not want me to use skype. And for this (un)blocking_feature I need to pay him more! Ridiculous. It makes sense for me to pay something extra if myOperator does something extra for me when I am using skype over mobile (better qos, better guarantee that I will not get dropped during congestion, etc). This is just a ruse by cellular opertors to sell their own web-based services. So they will tell me that IMS (VOIP) comes bundled in my basic access AND i am not allowed to get to skype. I need to pay extra to get to skype. Excellent! The operators should instead be trying to figure out how they can make money by providing some differentiated experience when I get to certain webservices, and not just by blocking accesses to those web-services. When I get internet access, it SOULD be THE WHOLE Internet. NOT Internet-minu-skype-minus-facebook-minus-nytimes-minus-service_that_operator_wants_to_force_me_to_use_from_his_walled_garden.

Tech Curious
Tech Curious
12/5/2012 | 5:31:32 PM
re: EC Nixes Pure Net Neutrality


Hi


While the angst is understood, take a step back and look how internet reaches your mobile wherever you are. Operators pay huge amounts to develop infrastructure (cell sites, towers, coverage, mobility etc.) and pay heavily for the spectrum to regulators and what Skype gives to them? Wireline operators have to labouriously roll out broadband network to reach each household compete withother wireline as well as mobile to stay alive. If they deploy fiber for thsi sake that is both expensive and time consuming. For all these efforts of operators,  you pay to Skype for usage and neither the Skype user nor Skype pays anything while they use the massive infrasturcture of the operator and totally avoiding operator's voice services. For this reason why Operators should provide higher better qos for skype unless there is a kind of revenue sharing between all stakeholders.

parwaz
parwaz
12/5/2012 | 5:31:27 PM
re: EC Nixes Pure Net Neutrality


Hi,


I have heard this argument before, and I do not buy it. While I do agree with you that access providers (fixed or mobile) need to also be able to make money, I do not agree that the solution is to allow the operator to opportunistically block the parts of Internet I can go to unless I pay him/her extra money. The example of skype turns out to be an excellent one here. The objective of the operator is not to do some "revenue-sharing" with skype (in my case, I hardly pay anything to skype), but to block access to an internet service which is gourging the operators revenue-source, i.e circuit switched voice. If operators are allowed to do this, then they will for block any innovated web services that threatens their revenue source.


Access providers have, in their own foolishness, down-bid each other into a position where they are not able to make money (so we hear) in upgrading their networks. They also has so far not been able to figure out how to make money other than by charging for the bit-pipe that they are providing. I am all for trying to figure out if revenue-sharing models between web services and ISPs make sense or not. But in the current revenue shareing model, ISPs charge each other money based on volume of traffic carried and access providers are providing me bps and I pay them for the bps, more bucks for more bps and more Gigs per month. Where I go using those bps, is my business. Access providers are not wanting to be turned into "dumb bit pipe providers", which is fine. However, if they start creating hurdles for me to get to the site I want, then they are becoming "mean dumb bit pipe providers".

Tech Curious
Tech Curious
12/5/2012 | 5:31:25 PM
re: EC Nixes Pure Net Neutrality

First on mobile case. The mobile operator main business is to deliver voice anywhere and in the last decade data. I do not know about your case, but when they were introduced early, they were damn expensive mainly for the reason of mobility (handover, cell coverage etc.) for the convenience of being tether less and support emergency from anywhere. In some countries even incoming calls were charged (the business models of such countries predicted 10 year for breakeven). Why was this? It was because it was damn expensive to provide such a service. Now with SMS and commoditizing of the services, it became more prevalent. But look what happened with internet access. The mobile guy with all the infrastructure has to compete with skype for their business of voice who did not contribute a penny to the network not even in the country where it is located but everywhere from the world bleeding the operators. In addition to this to support of high bandwidth for internet, operators went through upgrading entire infrastructure twice within a decade (a very very expensive route) with customers paying less and less for services. Now at this juncture, if you want to take away their main business of voice through a skype who is no where in the revenue sharing route, then it is too much to expect operators to be kind to that web service.

Now the argument for free services on the web. No operator will really block a service that a customer is interested. Why would an operator block, NY times, CNN, Google etc., if that is what making a customer to go to internet and such services do not contradict into the operator main business. It is another story that NY times and many hard print newspapers will slowly die due to internet if web version is still offered free. Otherwise, they may have to take the model of Google and rely on advt., money through internet if it is still a viable model. Why Hollywood is against free digital content, as some one (who is not part of generating content) can easily provide access through internet denying the guys (revenue from a subscriber) who spent the $ to bring the content in the first place.

Now does this kill innovation? I don’t think so. Take information search pioneered by Google but having competition through WikiPedia and even forcing Britannica to be available only in online mode. Competition in each segments bring innovation and / or cost effective solutions. Take the case of iPhone, Apple, a computer guy who literally brought all the established cellphone manufacturers to their knees. It is competition in the hand phone segment which did this. In the same way competition in mobile segment will bring its own unique proposition and solution. (What is the cost of voice calls these days?). See 3G, and LTE now while still supporting 2G customers.

As this will take too long to read I skip the fixed case. (In any case you summed it nicely – they were foolish and had a complicated CLEC, ISP scenario etc.).

The bottom line is customer should be given more than what he expects but without service provider failing in their business.

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