Advanced Television

Telcos target OTT traffic

April 27, 2011

By Colin Mann

Leading European telecoms companies want to levy significant charges on Google and other online content providers through an overhaul of the regime governing how data travel over the Internet, reports the Financial Times.

The telcos complain that they are contending with an explosion of data on their networks, much of which comes from US sites such as Google’s YouTube video service.

Led by France Telecom, Telefónica and Vodafone, they favour the introduction of wholesale charges based on the volume of data traffic passing through their networks, which could result in online content providers making substantial payments to get their video material to consumers.

This balance has been undermined by video traffic, much of which comes from the US as well as services such as the BBC’s iPlayer.

This idea is contentious because supporters of net neutrality – the idea that all web content should be treated equally – claim that charging content providers would create a two-tier Internet. The operators’ plans are supposed to preserve the basic, ‘best effort’ Internet, but there would also be a ‘fast lane’ under which content providers could pay to secure prioritised delivery of their material to consumers.

The telcos are effectively seeking reforms to so-called ‘peering  arrangements’ where historically they  entered into agreements that stipulated how they would pass data traffic between each other at interconnection points.

The system functioned well because operators would push and receive similar amounts of traffic on behalf of their customers. The telcos now claim that the system is failing because data traffic flows are heavily skewed towards their networks.

Elie Girard, head of strategy at France Telecom, said: “Our current peering agreements are no longer viable. If the Internet is to continue to develop sustainably, we need to set charges linked to the amount of traffic that goes through our networks.”

Cesar Alierta, Telefónica’s chairman, said: “All the peering agreements are going to change, which means [online content providers] will have to pay for traffic.”

The issue was raised in March at a Brussels meeting between the telcos and the content providers convened by Neelie Kroes, the EC’s commissioner for the Digital Agenda.

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