- The Internet's promise as a new medium -- where text,
audio, video and data can be freely exchanged -- is under attack by the
corporations that control the publicâs access to the 'Net, as they
see opportunities to monitor and charge for the content people seek and
send. The industry's vision is the online equivalent of seizing the taxpayer-owned
airways, as radio and television conglomerates did over the course of the
- To achieve this, the cable industry, which sells Internet
access to most Americans, is pursuing multiple strategies to closely monitor
and tightly control subscribers and their use of the net. One element can
be seen in industry lobbying for new use-based pricing schemes, which has
been widely reported in trade press. Related to this is the industry's
new public relations campaign, which seeks to introduce a new "menace"
into the pricing debate and boost their case, the so-called "bandwidth
- But beyond political and press circles are another equally
important development: new technologies being developed and embraced that
can, in practice, transform today's open Internet into a new industry-regulated
system that will prevent or discourage people from using the net for file-sharing,
internet radio and video, and peer-to-peer communications. These are not
merely the most popular cutting-edge applications used by young people;
they also are the tools for fundamental new ways of conducting business
- These goals and objectives are visible to anyone who
cares to look at the arcane world of telecommunications policy and planning,
either in the industry trade press or government documents. The bottom
line is the industry want to kill the Internet as we know it.
- Take a minute and wade through this bit of arcana --
and ponder its implications.
- "The IP Service Control System from Ellacoya Networks
gives the Broadband Operator 'Total Service Control' to closely monitor
and tightly control its subscribers, network and offerings." So reads
the Web site of Ellacoya.com, a relatively new firm, describing the business-to-business
service that it is selling to large Internet service providers.
- Ellacoya is backed by Wall Street investment powerhouse,
Goldman Sachs, which sees a major opportunity to turn around the red ink-plagued
broadband sector. Continuing, the website explains, "Establishing
Total Service control enables operators to better manage traffic on the
network, [and] easily introduce a range of tiered and usage based service
plans... Talkative applications, especially peer-to-peer programs like
KaZaA and Morpheus, tend to fill all of the available bandwidth... The
IP Service Control System allows operators to identify, limit and report
on these aggressive applications."
- The fundamental character of the Internet today is that
it lacks precisely these kinds of tolls, barriers and gatekeepers. But
technology like Ellacoya's hardware and software is not just an enticing
idea; itâs more of a silver bullet for beleaguered telecom executives.
Itâs being tested in industry trials and points to the kind of Internet
the industry would like to develop over the next few years. The way telecom
corporations get from todayâs open-access Internet to their version
of the future starts by changing how people pay for the net.
- Industry's New Business Plan
- Most people now pay a flat fee for online access. But
the big media companies offering Internet service; Comcast, ATT, AOL --
would like to change that, and already have in a few test locations.
- The broadband industry's plans to institute tiered pricing
have been widely reported in its trade press. There are numerous articles
about replacing todayâs open 'Net environment with industry-self-described
versions of "walled gardens" or "Internet Lite -- "Cable
Operators Seek to Corral Bandwidth Hogs", Cable Datacom News, 10/01/02)
The central feature of these proposals is much like telephone companies;
thereâs a price plan for everyone.
- To make the case to regulators that such pricing is fair
and overdue, cable operators have begun a PR effort, spinning that a small
percent of users account for a disproportionately large amount of bandwidth
used on broadband networks. They've created and embraced the pejorative
term, "bandwidth hog," to describe those -- such as music-obsessed
college students -- who find robust uses for high-speed connections. Already
major news sources, such as the BBC, and technology journalists are using
the term in their reports.
- To deal with this "problem," the companies
are considering a variety of approaches to ensure they remain in full control
of their bandwidth -- unless consumers can afford to pay the hefty access
fees. Under a typical plan, a user would be allotted a limited amount of
bandwidth per month, and would be charged extra fees for going over this
amount. This approach isnât very different from the software industry,
where the free versions of an application are intended to frustrate and
prompt people to buy the 'better' version.
- Bandwidth caps have already been implemented in Canada
by major Internet service provider Sympatico, Inc., and observers have
been quick to note that the limit -- 5 GB per month -- would effectively
restrict regular use of emerging applications such as Internet radio, streaming
media and video-on-demand.
- Consider this excerpt from an article about AM&site=Technology>Sympatico's
bandwidth caps in the May 6 edition of Toronto Globe and Mail by reporter
- A classic conflict has arisen over streaming media, especially
of radio. In a recent letter to globetechnology.com, Andrew Cole, manager
of media relations for Bell Sympatico, defended the 5GB bit cap, saying
that "In my experience, Internet radio stations usually transmit at
approximately 20 Kbps. This equates to 1.2MB per minute, or 72MB per hour.
At this rate, a HSE customer could enjoy 70 hours of Internet Radio per
month and remain within the bandwidth usage plan."
- But a 20-Kbps stream is considered poor quality by many
people who tune into Internet-based radio stations for such things as classical
music concerts. For these people, audio quality streamed at 20 Kbps has
been described as "pathetic at best, somewhat akin to AM radio"
by Tony Petrilli of Level Platforms Inc. of Ottawa.
- "Decent audio quality starts at 56 Kbps to 64 Kbps,
and really gets acceptable only around 100 Kbps," he said. This alone,
continued Mr. Petrilli, "will blow the cap, let alone any other form
of surfing, such as looking at movie trailers or even reading Web-based
news. Heaven forbid that someone listens to 90 minutes a day of quality
Internet radio. That way we'd blow the cap in 20 days.
- When you consider the fact that the largest American
telecommunications firms are often part of the same mega-corporation with
music, video or movie-producing entertainment divisions -- such as AOL-Time
Warner -- you can see how an industry-regulated Internet would handily
end music and movie industry worries about Napster-like file swapping by
people who donât want to pay industry-monopolized retail prices for
- Thus, the strategic and technically feasible solutions
embodied by companies such as Ellacoya is obviously why Goldman-Sachs was
keen to invest in the firm -- as it offers the actual means to monetize
the net and turn around the revenue-poor broadband sector.
- According to Ellacoya's technical datasheet, operators
can create "up to 51,000 unique policies that can be combined to generate
limitless numbers of subscriber policies." Such rules, they explain,
can either permit, deny, priority queues, address lock, rate limit or redirect
access. The same technology also poses new concerns over privacy, since
Ellacoya's technology "collects usage statistics for subscribers and
applications, capturing service events, session details, and byte counts....
Operators can 'stamp' the subscribers identity on all records."
- The Industry Spin
- The cable industry will argue that such ubiquitous control
systems and restrictive pricing structures are necessary to resolve bandwidth
backups. But the fact is, this cannot be the case, because cable systems
are constructed to avoid bandwidth shortages. But don't take my word for
- Mike LaJoie, vice president for advanced technology at
AOL-Time Warner told MultiChannel News, "The way that the HFC (hybrid
fiber coaxial) architecture works, we never run out of bandwidth,"
LaJoie said. "We can always split or do other things that will give
us the bandwidth that we want, so it really ends up being a desire to provide
the best and highest experience for our customers." (See <http://www.tvinsite.com/multichannelnews/index.asp?layout=print_page&doc_id=&articleID=CA246930>"HD
on VOD Searches for Resolution", Multichannel News, 09/30/02) What
these statements make clear is that the cable industry's goal for broadband
is to monetize bandwidth. By charging a toll for every bit, the industry
can simultaneously extract great profits from the new applications that
it allows on its networks, as well as restrict access to those that it
finds problematic, i.e. those that compete with its own content offerings.
In short, the industry finally sees a way to make money online.
- Of course, these calculations are utterly self-serving,
ignoring the fact that the net was developed with tax dollars and has been
an incubator for an array of innovations that extend far beyond creating
new profit centers for big media companies. The envisioned control structures
will inhibit robust Internet use by early broadband adopters, and discourage
development of new high-speed applications such as Internet-based telephone
and video-on-demand, thus slowing overall broadband growth.
- Worse, this business model will erect high economic and
technical barriers to entry for non-commercial and public interest uses
of the high-speed Internet, threatening civic discourse, artistic expression
and non-profit communications. In moving to implement this highly centralized
vision for broadband, the cable industry does not simply ignore the democratic
and competitive history of the Internet -- it is actively hostile to it.
- Consumption-based pricing and other restrictive access
controls contradict the spirit of openness and innovation that built the
Internet in the first place, and will do irreparable harm to its future
as a medium for small business initiatives, non-commercial users and democratic
discourse. New threats to privacy are also clear, given the intrusive nature
of the technology to closely monitor all online use. If you think spam
is bad now...
- And Where Is The FCC?
- This new threat to online communications is a direct
consequence of recent Federal Communications Commission policies by Chairman
Michael Powell that permit cable companies to operate their broadband platforms
in a "discriminatory, non-open access" manner. This legalese
means the FCC, the historic guardian of the public interest in the communications
field, has abdicated its founding charge: to serve the public interest
before private interests.
- In sum, the Internet as we now know it -- and its revolutionary
promise -- may soon pass into the history books. In the absence of public
policy safeguards, the emerging pricing and control structures will fundamentally
change the kinds of information -- and way itâs delivered -- on the
Internet. The ramifications extend far beyond the quarterly reports and
shareholder earnings for the nationâs telecommunications corporations.
- The consequences are cultural and will affect the pace
and character of progress in the early 21st century. If the communications
companies impose tolls, roadblocks and dead ends on the information 'superhighway,'
they will be robbing public trust resources in much the same way 19th century
mining companies pilfered public lands and 20th century radio and television
networks privatized the publicâs airwaves.
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- Published October 24, 2002