UK broadcasters: open internet essential for broadband growth

Telcos are benefiting from the development of bandwidth-hungry online video services and it is in their interest to ensure the internet remains open with low barriers to entry. That is according to a new survey commissioned by UK broadcasters the BBC and Channel 4, online video platform Blinkbox, Skype and Yahoo!.

The Plum Consulting report, titled “The Open Internet: a platform for growth”, claims that online content and application providers have helped drive the growth in demand for broadband connectivity, which contributed towards fixed and mobile broadband revenues of approximately €155 billion in Europe last year. Without content providers’ investment in online consumer services, telcos would experience a “rapid decline in revenue”, according to the research.

Plum Consulting was commissioned to assess the value of content providers to the internet value chain, and to inform the ongoing policy debate about net neutrality in Europe. The report comes on the eve of the publication of regulator Ofcom’s guidance on net neutrality, while the Body of European Regulators (BEREC) is also expected to publish a report on internet transparency in the coming weeks.

Plum’s report claims that telecom providers’ costs are not “ballooning” because of data growth; that content and application providers “do not cause traffic” and that they invest considerably in distribution infrastructure and technologies rather than “free riding” on networks; and that investment in next generation broadband would not necessarily increase (and could decrease) if content and application providers were required to pay for access to consumers.

Brian Williamson, director at Plum Consulting said: “The open internet has supported a virtuous circle of innovation in applications and content provision and in broadband access provision. The open internet benefits consumers and the whole economy. A commitment to the open internet is now required, given the costs and risks involved in a possible departure from the open internet norm, in order to sustain innovation and investment along the value chain, to the benefit of all.”

The report recommends the application of a code of conduct requiring open access to and distribution of internet-based, lawful content and applications for consumers and no blocking of legal services or discrimination on the basis of commercial rivalry; protection against unilateral and opportunistic requests for payment; and a principle of parity of access if and where prioritisation is provided on voluntary commercial terms for any content or applications.