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Summary:

Google has reached an agreement with Verizon over Internet traffic management. It is the first step in what would amount to slow asphyxiation of network neutrality. The deal apparently prevents Verizon from blocking traffic but allows prioritization of certain types of traffic.

A long time ago, I offered to make a bet with a friend that when commercial interests would collide with the broader interests such as network neutrality, Mountain View, Calif.-based Google would do what any large company does: do what is right for its commercial interests. I should have made that bet. I would have won.

Today, news emerged that Google has reached an agreement with Verizon over Internet traffic management. It is the first step in what would amount to the slow asphyxiation of network neutrality. While Verizon and Google are keeping mum, in response to the news, Federal Communication Commission said: “The broad stakeholder discussions continue to actively include Google and Verizon.” The FCC is in closed-door conversations with different players — from Internet companies like Google to carriers such as Verizon and AT&T.

According to the Washington Post:

Google and Verizon’s agreement would prevent Verizon from offering paid prioritization to the biggest bidders of capacity on its DSL and fiber networks, according to the sources. But any promises over open-Internet access wouldn’t apply to mobile phones, the sources said, speaking on the condition of anonymity because the companies have not officially made their announcement. According to the sources, Verizon and Google have met separately to come to an agreement they will tout as an example of successful self-regulation.

Politico offers more details:

Sources familiar with the agreement tell Politico it would prevent Verizon from blocking traffic, but would allow it to prioritize certain traffic—such as premium services that would speed up movie downloads, for example – as long as doing so does not harm consumers.

This agreement shouldn’t come as a surprise. The two companies are becoming increasingly close of late. Google is trying to make Android a major player in the mobile world. One of the company’s closest partners in this effort, in the U.S., is Verizon Wireless. It would therefore make sense that the two will come to some sort of an agreement. The news has clearly riled up a lot of folks in Washington, D.C. Free Press President and CEO Josh Silver said:

“Two of the largest companies – Google and Verizon – have reportedly agreed to abandon consumer protections, filter content and limit choice and free speech on the mobile Internet. If true, the deal is a bold grab for market power by two monopolistic players. Such abuse of the open Internet would put to final rest the Google mandate to ‘do no evil.’ The financial interests of Google appear to have finally trumped its belief in policies to preserve the open Internet. A deal with Verizon cements its market power, and could make it more difficult for new app developers and software entrepreneurs to reach consumers.”

A coalition of public interest groups that included Public Knowledge, New America Foundation, Media Access Project and Free Press issued this statement:

As the major public interest groups in Washington involved in the struggle to protect an open Internet, we are united in our dismay about an agreement reportedly reached by Verizon and Google.   It is unseemly and inappropriate for two giant companies to decide the future of the Internet and how Internet will work for millions of users.  It would be inappropriate for Congress and the FCC policy makers to use this agreement as the basis for public policy.

“The public and policymakers should not be fooled.  This agreement cannot be enforced by any governmental agency and will provide no protection against the types of abuse we seen from large Internet Service Providers.  The Internet belongs to all of us, not to Verizon and Google.  There is widespread public support for an open Internet.

“We call on the Federal Communications Commission (FCC) to abandon its ‘negotiations’ with Google, Verizon and other large companies. Instead, the Commission should move ahead with legally enforceable, binding rulemaking that would govern not only the open Internet, but also ensure the Commission’s authority to reform Universal Service, and to make policy in cybersecurity, privacy, device compatibility and other critical issues involving broadband services.”

  1. Remember that Google entered the network neutrality debate only when Telcos started talking about “free rides” and threatening to limit traffic if they didn’t pay up. Google’s definition has always been whatever doesn’t disadvantage Google. Anything else you may have heard from them is PR rhetoric.

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  2. Totally surprised at the news of death nail for net neutrality. To tell the truth, I was on the other side of the fence who thought, you know, may be there is a company that would not budge to just the commercial interests. Especially on a issue like net neutrality. Lucky I did not bet on it :)

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  3. Sorry, I missed to mention that NYTimes is also a running a report on it.

    http://www.nytimes.com/2010/08/05/technology/05secret.html?pagewanted=1&_r=1&ref=technology

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  4. Om, “network neutrality” is not a “broader interest.” It is the corporate agenda of Google and is against the public interest. (The groups which you mislabel as “public interest” groups above all have ties to Google and lobby for it.)

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  5. Maybe it’s because I’m a little tired, but the second reading of this post has failed to clarify exactly what Google expects to gain.

    There’s no question that a carrier has much to gain, either by prioritizing its own premium services at the expense of rivals or by auctioning off what is after all a finite resource, wireless bandwidth, to the highest bidder. But Google?

    Is the expectation the Android phones or Google services will receive a larger slice of Verizon’s spectrum pie? At first glance, if Google is selling out net neutrality, Microsoft and possibly Apple, with significant bankrolls of their own, might be in a position to take advantage at Google’s expense. Utimtaely Verizon would be the only winner.

    Depending on the existence of this agreement and the details, there may be three victims: net neutrality, Google, and Google’s share-holders.

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  6. [...] and had somehow convinced themselves that, when push came to shove, Google would somehow not respond like the large, publicly traded, for-profit enterprise it is by cutting a deal, and who now feel betrayed. Oh [...]

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  7. [...] neutralidad parece haberse escapado por la puerta trasera, junto a los restos de Google Wave.Vía: GigaOM TwitterFacebookMenéamedel.icio.usGoogle Buzz Dirección para [...]

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  8. I agree that on face value this news looks threatning to net neutrality. But if this debate had come down to pure lobbying who do you thing was getting to get hurt. The consumers. Verizon has revenues of ~100 Billion and ~230,000 employees while Google has revenues of ~25 Billion and 22,000 employees. When push comes to shove who do you think Washington will support , when it comes to saving jobs and keeping face. I do not know how Google’s lobbying arm compares to the telco’s but I am pretty sure that we cant leave it up to that .

    I am not defending Google here & perhaps this was not the best way to approach this , but the only other options they have is to either invest in infrastructure ( check.new fibre optic experiments) or watch a long drawn out battle where everyone gets hurt.

    Think about it , if all the telco’s start getting relegated to becoming utilities and dumb pipes, the government is going to step in to save the jobs ( lots of them ).

    While I ultimately believe that connectivity should be a utility akin to power, this can be a good first step in that direction.

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  9. Bandwidth quality pricing and broadband metering makes sense. Youtube consumes about half the internet bandwidth today apart from BitTorrent bandwidth usage. I think it could actually mean cheaper and faster internet access for everyone, it depends how it would be implemented though.

    Imagine with this, for example, Verizon could offer FiOS service at 1gbit/s to the home for free, but where users would have to pay per Gigabyte that they use. Basic price per GB for basic usage where fast is only small sized contents, though where video contents would be delivered on lower priority bandwidth unless the user pays slightly higher price per GB for higher priority delivery of for example HD video contents. In a good system, the price per GB would be reasonable, less than $0.10/GB at normal priority high latency bandwidth and $0.15/GB high priority low latency bandwidth.

    For example, you’d want premium bandwidth for checking your email without latency, for browsing the web fast, for buffering videos or audio and for images in the browser. But for video, you wouldn’t mind it being delivered on lower priority worse quality bandwidth, as long as that video doesn’t interrupt its playback.

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    1. “I think it could actually mean cheaper and faster internet access for everyone”

      yeah, dream on

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