The Senate Commerce Committee is holding a meeting today to consider whether Web access providers -- the phone and cable companies behind broadband networks -- can charge content providers like Google and Yahoo for speedy delivery of content.
The former, led by the like of Verizon and AT&T, claim Google is getting a free ride (free registration required) off the infrastructure they spend billions of dollars to build and maintain. They charge other companies are stifling the development of better networks by sucking out profits from the middle.
On the other side, consumer advocates have suggested that allowing network operators to charge for certain traffic might restrict the open flow of content and information -- and lead to higher costs for consumers. Vinton Cerf, a founding father of the Internet and now a VP and "chief Internet Evangelist" at Google, shot back at Verizon execs via the Washington Post: "My big concern is that suddenly access providers want to step in the middle of create a toll road to limit customers' ability to get access to services of their choice even though they have paid fo access to the network in the first place."
The debate raises a number of questions about restricting access to information, limiting consumer choice, and so on. Do you think access providers should be rewarded for their infrastructure investments or will their sense of entitlement lead to an Orwellian future?
Related Stories: | Topics:Work/Life, news + current events, Google Inc., Verizon Communications Inc., Yahoo! Inc., U.S. Senate Committee on Commerce, Science, & Transportation, AT&T Inc. |
Recent Comments | 17 Total
February 7, 2006 at 6:48pm by elaine coffey
Access providers are already being paid for their infrastructure by their phone customers. I already pay $40 a month for broadband access. That is more than ample compensation for their infrastructure. Yahoo! and Google are gateways accessed by that broadband service. Why should I, the consumer, pay twice to access the same infrastructure?
February 7, 2006 at 10:19pm by Dan
This argument by the telecom industry is the reason why I have a dozen different charges on my utilties and cell/landline phone bills. We, the consumers, already pay for access to the internet as do the likes of Yahoo and Google. The telecom companies have never learned a thing since the 1800's and still do business that way. They have not evolved their business to deal with the new era of e-business. They rode high and mighty during the tech boom, but are now consolidating into giants again, trying to use that muscle for their benefit instead of adapting to the ever changing world. Telecom is a low profit margin business, diversify your business with other ventures that will make a high yield profit. Make your own portal/search engine and tie it in with your wireless or ISP divisions . Learn from Google whose revenues are mostly from advertising. Why waste money on lobbying and lawyers? Spend your money on different investments.
February 7, 2006 at 10:50pm by Keith
This is obsurd. We (the customer) PAY for the use of Verizon's network as any ISP would be paid. To try to add additional charges for content they do not own or create is ludicrous. This is just another example of Verizon attempting to rip off consumers and create a monopoly position in the mobile market.
February 7, 2006 at 11:03pm by Jon
The telcos are already paid twice
a) The consumer pays network access fee.
b) Google and other content providers pay for the bandwith they are using. Quite a bit actually.
So essentially they now want to cash in a third time and piggyback of the success of those content providers.
I wonder if the owner for a bridge with a tollboth next to the IBM headquarters could start asking IBM to pay them for all those pesky employees "clogging" (i.e. using and paying for) their bridge ... and if they could use the "IBM makes lots of cash, they're having a free ride on our bridge" argument there.
This is so absurd, it could only work in setup where laws are made by the people who buy out the most politicians.
February 8, 2006 at 4:32am by Chris
Yet another attempt by the telecoms to extend receivables while ignoring the patched-together 'infrastructure' they so liberally charge for. No other industry is able to dip in a toe in the pool of luxury that these telcom giants swim in, in that they are not required to fix thier current leaks before marketing and charging for the next shodily-working product. These recent attempts to recoup additional funds for water that already passes under thier bridge is a tell-tale example of the greed that currently supersedes any noble worldly value once held (decades ago) by the visionaries who really did deliver benefits by conglomerating wires accross a nation. Dispicable are the intentions of these companies.
February 8, 2006 at 5:24am by Max
My prediction: Most cities will be free or low cost wi-fi enabled by 2012. No more need for the Ma Bells of the world.
February 8, 2006 at 5:27am by Cagatay Kiyici
Quite funny....So GM, Toyota, Shell and BP can charge Wallmart in the same way :)
If telecoms can not make enough return from their investments they should think about their offerings e.g. pricing, servicing.
February 8, 2006 at 7:59am by Drew
They should stop whining about lost profit when there are places out here (and I'm about 5 min from the center of a city) that still doesn't have DSL!
I've been waiting and B.S.-ed to for 5 years now ("we plan on covering your area by the end of the first Quarter of next year"(this was 2002))
February 8, 2006 at 9:14am by R. D. Ochs
The Telco's, the Cable Companies, and the Satellite Companies (small dish, Direct and DishNetwork) are just the latest corporate whores...and we have let the FCC get away with simply managing the frequencies, and not their business practices....these companies have a government license to steal, and basically run unregulated. I travel the US, and have both Cingular, Verizon, and Sprint. Cingular can not change towers with out a dropped call 90% of the time, Verizon never has enough power, but has better coverage, but stil vast areas where it says it has coverage, and does not. Sprint, works where it says it will work (not complete US)and generally is the better company to deal with.
In Europe, the cell companies derive about 12% of their income from the sale of ring tones...I would like to know what it is in the US.
I can only guess that as long as the cell companies business model is to make more off of teen's who's parents pay the bill, and that bill is for ancellary servies, which require no expanded coverage area, the core of America is screwed....
February 8, 2006 at 10:49am by Jared Tunnell
What about the fact that Google and other "Hosted" services already pay huge monthly hosting fees (which include bandwidth useage) within the collocation facilities used to operate the web servers powering their service?
Another illustration of big business trying to use its lobbying muscle instead of its brain to generate profits!
February 8, 2006 at 11:02am by iTodd
The bigger issue [than the triple charging, etc.] is how insanely stifling this would be to business.
The internet is an amazing place because the barrier to entry is soooo low that almost anyone can start a service or product online. If people have to start paying even more for the bandwidth it could significantly reduce innovation.
I truly believe Google has the right stance here and eventhough they stand to get hit personally by network discrimination, I think they are looking at the bigger picture and using their weight to argue for everyone -- kudos.
February 8, 2006 at 11:31am by Sam
This undermines everything the Internet is all about. I am always nervous when Internet issues show up in Washington. Hopefully the politicians are not too out of touch to see the light.
February 8, 2006 at 12:15pm by JB
What's going on here? Not a single commenter seems concerned that SBC communications struggled to earn a mere $1.8 billion last quarter. Does nobody care for the rich guy around here? They could barely afford to buyout AT&T!
Clearly all of those millions of freeloading internet users who are only paying once for their service are to blame!
February 8, 2006 at 3:36pm by john
The ATT/ Verizon crowd realizes that their revenue models, built on local loop voice can not sustain and compete with broadband VoIP for future dollars. Thus they are attempting, now, to find money in every possible way, thus this restrictive pay to play scheme. This has Verizon written all over it. If I played the market,(IMHO) I'd short Verizon as they are starting to wheeze a bit... showing the first strains of revenue failure...(IMHO) they're going down in
February 8, 2006 at 3:59pm by Fred Zeigler
All that has been said previously are true and valid concerns. However, I think from a business perspective it is the potential total cost of Verizon’s Google ploy that is most important. What I mean is this. Verizon is one of seven or eight Tier #1 network providers. If Verizon wins, what is stopping the other Tier #1 providers from charging the same or more? You can take it to the bank --- if Verizon charges so will the others. What is also scary is the next logical step. If Tier #1 providers can charge, then hundreds of Tier #2 network providers will want their share and start charging too. Where will it end?
All content providers should be as concerned as Google. If Google is charged, then every content provider is at risk. Since most web sites provide some form of content, every web site could be charged; with those sites with high traffic volumes being hit the hardest. What does the future hold? I believe if Verizon wins, one or two things will happen. The content provider will have to start to impose a fee for their data in order to pay the network providers’ charges or they will go out of business. The conclusion is simple it will cost all of us more to get the information we need or want and in a lot of cases the information will no linger be available.
Hold on to your hats. Do you know what Verizon is also doing? They are telling their customers with large amounts of E-mail traffic that they will have to pay an additional charge if they want guaranteed delivery of their E-mails. In essence, if you don't pay, your E-mail most likely won't get through. THERE GOES THE INTERNET!!!
February 9, 2006 at 4:15am by John
To my way of thinking - Google is just excercising their capitalist instincts... Which is what this country is about....
February 13, 2006 at 4:16pm by Luan Vu (Michael)
Google's response was to go buy a ton of dark fiber. "If other's won't let you play in their sandbox, go build your own", I say!