Let us assume the net neutrality battle can be won.
And it can be won, in the market. A new Light Reading report, headlined "QoS Revenues Could Net Billions," indicates that the number on those billions is 2, a pimple on the $50 billion Internet access market. (Most revenue still comes from voice, which is why the telcos are fighting so hard.)
Meanwhile political activists continue to fight the Bells hard, learning valuable lessons along the way. What is usually an elite battle, fought among lawyers in Washington, has become a real political war, something the Bells are ill-equipped to handle.
So let’s assume a strategic retreat. Is the battle won?
No.
Why? One word.
Peering.
Peering is the task of connecting networks together. Under regulations going back 20 years telephone companies were forced to connect their networks with other network providers on a fairly equal basis. In fact at the heart of the Internet is the idea that "we won’t worry about the money, just pass the bits."
But the mergers of AT&T and MCI into SBC and Verizon, combined with the Bells’ successful legal fights to have their offerings called unregulated "information services," could change matters.
Between them, the two companies now control the vast majority of the "backbone," the fiber-based city-to-city links on which the U.S. Internet depends. There is far, far more capacity here than could ever be used. While the Bells are hoarding maybe 90% of local bit-power, they’re probably hoarding 99% or more of what is available in their fiber trunks.
But that doesn’t matter. By hoarding those bits, and demanding high prices to connect with other networks, the Bells could still strangle the Internet. As we’ve seen they have every incentive to do so — their fiscal lives are at stake. (The voice revenues are going to disappear, leaving a giant hole in their balance sheets.)
One battle is ending, but another will soon be joined.
….(The voice revenues are going to disappear, leaving a giant hole in their balance sheets.)….
This happens to just about any technology company out there. Take Microsoft. When Windows was first released it offered some basic things like a visual file browser (very cool). But when they started adding on new features like a media player, email client, web browser, etc. Did they keep raising the price? They certainly kept adding value but thankfuly we are not paying an accumulative $1 per feature. If so, Windows would now cost over $1000. The same type of case could be made for non rental companies. I mean can you even buy a plain stereo reciever anymore? Most are 5.1 surround and the new “feature to pay for” is 7.1.
The telephone companies need to start treating old services as a common feature. Why are we still paying extra for Caller ID? Why are we paying for in country long distance? We should by now have the infrastructure to just give away the voice features and be charging based on the data technoligies, DSL and FiOS. DSL should nearly be to the point where it comes standard with a copper land line subscription and the main upgrade prices should for fiber optic or something.
….(The voice revenues are going to disappear, leaving a giant hole in their balance sheets.)….
This happens to just about any technology company out there. Take Microsoft. When Windows was first released it offered some basic things like a visual file browser (very cool). But when they started adding on new features like a media player, email client, web browser, etc. Did they keep raising the price? They certainly kept adding value but thankfuly we are not paying an accumulative $1 per feature. If so, Windows would now cost over $1000. The same type of case could be made for non rental companies. I mean can you even buy a plain stereo reciever anymore? Most are 5.1 surround and the new “feature to pay for” is 7.1.
The telephone companies need to start treating old services as a common feature. Why are we still paying extra for Caller ID? Why are we paying for in country long distance? We should by now have the infrastructure to just give away the voice features and be charging based on the data technoligies, DSL and FiOS. DSL should nearly be to the point where it comes standard with a copper land line subscription and the main upgrade prices should for fiber optic or something.