Connected Research

Union policy research in the 21st century

Posts Tagged ‘Project Canvas

The ‘Google tax’ and net neutrality

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It is being reported that Vodafone is to ask the European Union to take action so as to ‘facilitate bilateral agreements between telecom operators and online content providers like Google’ – essentially, to allow network operators to charge content providers, such as Google, YouTube and, probably, the BBC’s iPlayer, additional fees in relation to the network demands placed by the users of such services.

Operators would rather charge content providers than consumers, but it would seem that some network operators have started to realise that the ‘all you can eat’ model – under which bandwidth comes at a flat rate (except, perhaps, for usage caps on really high users) – is not a viable economic model in a scenario of the rapid growth in bandwidth consumption we are experiencing. More and more for less and less is never a particular sound economic model. Clearly, in such a situation of heavy retail competition, essentially preventing operators from starting to raise prices, or to alter pricing structures in accordance with consumers’ capacity usage, operators need to look for alternative sources of revenue – and content providers represent it. (How we’ve got into this mess in the first place is a different blog post altogether.)

Were they to succeed, then this is likely to lead to a further commercialisation of the internet, in terms of how the content that you read, or view, is paid for (though, to be fair, such a commercialisation is proceeding apace anyway via new advertising models), with network operators essentially wanting their own slice of this action.

On the face of it, the reference to the need for EU action looks a little odd – there is nothing to stop operators coming to such bilateral agreements amongst themselves and, in a free market, that’s probably the more preferable response (where, of course, content providers are prepared to play ball, which they may well not be).

The other difficulty, of course, is the reference to the principle of net neutrality, according to which network operators should carry net traffic on an open, non-discriminatory basis. (Roger Darlington reviews the issues of net neutrality very well in his monthly column for Connected, the magazine of the Connect Sector of Prospect, which you can also read online here.) Starting to charge content providers for network quality, or levels of consumption (as measured by capacity usage), starts to affect how the net operates since content providers, under the commercial pressures of such agreements, are likely to want to see ‘their’ traffic prioritised by those with whom they have reached such agreements. Indeed, such prioritisation is likely to be included within any such agreements on charging. The upshot will be changes to how the net operates, and is experienced, some of which may well be invisible to the naked eye – a problem for those supporting a liberal internet and likely to lead to such principles being heavily compromised.

The original source for this post reports that Vodafone is making its push via a shortly-to-be-finalised submission to an EU consultation on net neutrality. This is a bit strange, since the last I saw from the EU on this issue was this (part of last year’s EU telecoms package) which, in Annexe 2, does talk of the importance of preserving ‘the open and neutral character of the net’ and seeking to enshrine net neutrality as a policy objective for member states. I can’t find a reference to an open consultation on this on the appropriate pages of the EU portal, although we know from Ofcom’s annual plan for 2010/2011 that some activity will be taking place (A1.77) – while Roger’s piece also refers to a UK discussion and consultation on net neutrality taking place ‘later this year’ (and, evidently, within the context of EU action).

Such confusion aside, it is clear that operators (the original source cites also Telefonica) are starting to gird their loins for an attack on net neutrality so as to allow them to seek to charge content providers for access (in this context, Project Canvas takes on a new light since it would seem to allow project partners to side-step any such charges). Equally, the EU looks set against such a model, so it could be quite a battle. Consumers will end up paying the price somewhere, although whether that’s a cash-based or a principles-based price (or both) is an interesting question.

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Written by Calvin

27/04/2010 at 4:28 pm

BBC Trust gives approval for Canvas

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Following earlier media reports, the BBC Trust – which governs the structural policy aspects of the operation of the BBC – has today given provisional approval for BBC participation in Project Canvas, the Corporation’s own joint venture initiative for internet TV.

The language of the earlier reports remained extremely tentative, not so much about the Trust’s likely approval of the Project itself, but more a reflection of the uncertainties over the project itself. Project Canvas, which is a joint venture involving a number of media players other than the BBC, including ITV, Channel Four, Five, BT and Talk Talk (and which has it’s own unofficial blog – though this looks rather similar to the project’s own newly-established website), is a means of making the BBC’s iPlayer service, as well as other similar offerings from other broadcasters and particular internet services (including Facebook, YouTube and Flickr), available via Freeview and Freesat set-top boxes. It is a successor to earlier BBC initiatives in the same area. Essentially, the project is designed to develop an internet protocol standard for TV sets as a means of exploiting the internet-ready TVs expected to come on to the market in 2010 and to take up 20% of it.

The Project is not without controversy, nor opponents (including Virgin Media and BSkyB), and the BBC Trust has placed several conditions on the Corporation’s participation in it, as well as a period of further consultation. DRM (digital rights management), quality standards and fairness to rivals are all likely to be issues which need tackling, as Ofcom has stated in the past.

Should it be successful, its effect on network provision – with the the iPlayer already under criticism for swamping networks – is likely to be significant, and this has already had its effect on what Project Canvas should look like, particularly whether it should mimic the iPhone apps store, with additional and premium services the subject of separate fees.  Consequently, its impact on current free-to-air television – which is central to the BBC Trust’s deliberation of the concept, given the licence fee funding basis for the BBC, as well as to BSkyB’s own stated objections, is less certain – as its impact on cannibalising the BBC’s own programming schedules. Furthermore, and similar to the arguments around online newspapers: if you only watch the TV programmes you want to watch, rather than the ones that you really ought to watch, what future for news programmes and quality investigative reporting?

Written by Calvin

22/12/2009 at 1:06 pm