The Great Telecom Debate: (Re)Defining the Internet for the 21st Century

Critics of the two-tiered Internet cite the potential negative consequences of expanding a network operator’s role as gatekeeper, but BellSouth and others see it as business as usual. "I don’t see our role being any different than what it’s been up to now," says Morton. "I think a great analogy to all of this is an HOV [high-occupancy vehicle] lane out on the highway. If you’ve got six lanes that are all going to the same place and you’ve got one HOV lane, the HOV lane might get you there a little quicker but everyone will get there eventually."

Most of the media attention surrounding BellSouth’s public support of a two-tiered Internet has focused on the potential for abuse, which, Morton argues, misses the point. "Some of the stories in the media thus far make it sound like we are trying to degrade or take away from the current Internet experience," says Morton. "We’re not talking about anything other than letting the Internet be bigger, better, and faster. We’re not talking about taking away from today’s Internet experience; what we’re talking about is simply improving it."

Counterpoint
While the concept of a multi-tiered Internet isn’t necessarily new, its sudden rise to prominence over the last year along with the subsequent debate over Internet neutrality has resulted from the Supreme Court’s June 2005 ruling on the Brand X case. In that ruling, the Supreme Court overturned a federal court decision that would force cable Internet providers to share their infrastructure with other Internet service providers. At the crux of that case was whether or not cable Internet service should be classified as a telecommunications service, which requires the sharing of access, or an information service, which does not. Following the Supreme Court’s decision that the FCC was right in classifying it as an information service, the FCC released a report and order that classified all wireline broadband Internet access services, including DSL, as information services.

"It has to be the least written-about, most important telecom story in history," says Scott. "What these things did together was eliminate 100 years of communication policy known as common carrier legislation, which required that any network should provide open access at non-discriminatory prices. It’s the principle we’ve used for railroads, highways, and TV networks."

What happens when you eliminate open access is you eliminate competition in the wireline broadband market. "And now that the network operators don’t have competition, they’ve decided that they want to start charging people to be on their lines. That’s a tier," says Scott. "What they’re saying is that we want to collect rent from anyone that wants to speed up their service, and there are a number of problems with that concept."

The first problem Scott sees is the potential for smaller service providers to be left behind if they can’t afford to pay for prioritized access. "Startup companies on the Internet have been an economic catalyst for a decade. But if I’m a startup company on the Internet, how will I have the capital upfront to buy my way into that top tier? The tiering system is a tremendous barrier to entry for innovators and entrepreneurs," says Scott. "There will also be an incentive for the established parties to raise the rates as much as they can so that new operators are shut out. That’s just the logic of capital: avoid competition and maximize profit."

"Problem number two is that ultimately this is double-dipping on the consumer wallet," Scott continues. "First I have to buy my broadband connection. Then while it may seem to me like those sites on the top tier are going faster and I haven’t paid an extra dime, it would be foolish to think that those companies that have paid to be in the fast lane will just eat those costs. Eventually they’ll find their way back down to my wallet."