The chief executive of the fourth-largest local phone company in the US yesterday broke his silence on the escalating issue of net neutrality at the VoIP industry conference VON in San Jose, California.
Richard Notebaert, who heads Qwest Communications International Inc, made an uphill argument to an audience of the country’s largest IP application and content providers that further regulation is unnecessary.
The concern of virtually all the major web companies is that net neutrality regulation is required to stop operators from charging for faster content delivery or favoring certain content over others, which they argue would have chilling business effect.
Denver, Colorado-based Qwest sells voice, backbone data services and digital TV to consumers, businesses and wholesale customers, as well as access services to wholesalers and Sprint Next Corp wireless services.
Like its operator peers, Qwest has bristled at a number of net neutrality bills that have been put to Congress ahead of its overhaul of the 1996 Telecommunications Act.
An open letter urging net neutrality laws was sent to Congress earlier this month by a group of 69 companies, including Adobe, Amazon, Earthlink, eBay, Google, Microsoft, Skype and Yahoo.
Their goal is to bar phone companies, cable operators and internet carriers from billing both the broadband user and the web services they use.
But Notebaert yesterday pledged that in the absence of neutrality regulation, Qwest would not block services or access, and there would be no degradation of quality for non-prioritized content.
I don’t think we ought to be blocking anything and we’re not going to be blocking anything with our company, he said, which elicited scattered applause by fewer than a dozen people.
Existing legislation is no way an impediment to the way people utilize the internet, he said. It does not mean that your company cannot reach commercial agreements to provide you with the services that enhance your commercial position, he said.
After all, customers have always been able to pay for enhanced services, such as faster broadband, he said.
Notebaert likened the ability for operators like Qwest to sell enhanced content services as a clothier offering free expedited delivery of sweaters during the holiday season in order to win customer business. The provider is willing to pay the difference, how can that be a problem in the commercial space?
In other words, content providers should also be allowed to pay for enhanced online delivery service as a competitive advantage over its peers who don’t want to sell that service, he said. That’s what it’s all about. Everybody is trying to get a little bit of differentiation.
If they want to buy, we want to sell. If they don’t want to buy, they don’t have to buy, he said.
Net neutrality regulation would, in essence, prevent content providers from enticing customers with faster delivery or paid-only content. Just as the government doesn’t prevent LL Bean from offering free fast-shipping by picking up the DHL tab, regulators shouldn’t stop content providers from offering Internet users faster or specialized content that it buys operators, he said.
But content providers and others have argued that this would set up a two-tiered internet — with a fast lane for those willing to pay for it and a slow lane in which operators could deprecate services to encourage a switch to the more profitable tier.
Our job has never been to degrade service, Notebaert said. Or to give any customer anywhere, at any time less capability than they ask for and paid for.
The suggestion that Qwest would slow down a less-expensive service was not even in the realm of possibility, he said. This did not elicit industry applause.
For most of his presentation, Notebaert set Qwest up as a customer-focused business, notably its wholesale customers.
He made a point of reaching out to the audience and repeatedly emphasized Qwest’s commitment to non-disclosure agreements with customers.
We have NDAs with many of the people in this room I would never cross over and breach an agreement that is so important to us, he said. I do want you to know how strongly we’re intertwined with this audience.
For its wholesale VoIP and all other customers, commercial deals — not the US government — are Qwest’ bread and butter, he said. It’s the commercial agreement that’s key and not the regulator.
When asked about Qwest’s motivation behind its confidence in commercial agreements with content providers for enhanced services – given that the world’s largest providers are lobbying for more regulation instead – Notebaert again focused on the audience.
I’m not going to violate an NDA, he said, but in all probability there may be people in this room today that have already asked Qwest for enhanced services.
It’s a fact that our wholesale customers want to serve their end user and it’s possible that they would like to have a differentiated service, he said. If you’ve got enough money, you can make a lot of things happen.
Notebaert said he’s heard opposition to commercial agreements before. And in relation to net neutrality regulation, I don’t think some of those comments hold any water at all, he said. I think they’re bogus.
Just outside the door of where Notebaert gave his keynote was desk with another open letter to Congress urging net neutrality regulation, which will be sent to Congress on Friday.
The risks posed by the fact that today phone and cable operators together control 98% of the broadband market are very real. VoIP blocking and Internet outages have already occurred, discriminatory Web fees and the creation of a ‘two tier’ Internet have been threatened and a future of bandwidth rationing and ubiquitous click fees is in the offing, the letter read.
Conference attendees lined up to sign it.