Who pays the internet? Dinner with Ed Vaizey

26 May 2011 Author: EIFonline

The Internet of things is starting to emerge and there is a real need for Europe to 'up' its Internet game and to promote, rather than stifle web innovation. At the EIF dinner debate on 26 May, Mr. Ed Vaizey, the UK minister responsible for Culture, Communications and Creative Industries, in the Department for Culture, Media and Sport, advocated an approach of letting the market regulate itself and to appreciate the complexity of the current debates.

In April there was a call from telecoms operators for a new approach to peering. Based on that, there seems to be the expectation that something has to be done. Mr Vaizey stated he believes that right now there is no case for regulating peering. In fact he recalled that only a few years ago the very same regulation issue was opposed at ITU level. The argument then was that it would be best left to the market; and this Mr Vaizey supports wholeheartedly today as well.

Within the debate, the question has emerged whether or not the current commercial model of Internet traffic flows (peering) is broken. In Mr Vaizey's eyes it certainly is not. If it had been he said, it would have become evident before the current debate on peering emerged. There is no compelling evidence to suggest that the commercial ranges on peering that exist at the moment are inadequate.

It would certainly be a simplification of the debate to believe that network owners are doing content providers a favor of carrying their traffic. The reality is more complex and it would be a false conclusion to think that all the pain is for network operators. 40% of the revenues of dailymotion.com for instance are quoted by this service to be supporting network operators and peering arrangements. Any threats to flexible peering would undermine the infrastructure of the Internet and as such, if telecom operators and other players are not adhering to existing arrangements that are in place, then regulatory intervention might be a necessity.

On a par with peering, network neutrality also remains a complex debate. Mr Vaizey agreed that Commissioner Kroes' approach is the right one. There should be a focus on the customer and on competition, and making sure that customers are free to choose the operator they want.

For the UK the focus at this very moment is on rolling out faster broadband services and on stimulating investment in this area by deregulation and sharing of infrastructure. The UK 2015 target to connect a large majority of the UK to superfast broadband networks is currently on its way with 7 pilot projects rolling out to hit so-called Not Spots. IPv6 is of course a major part of the whole discussion as it would be no good to have superfast networks if people cannot connect to them. As such Mr Vaizey is promoting the discussing in an IPv6 forum led by business.


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