Internet Freeloaders - Should Google have to pay for the bandwidth it consumes?

Adam L. Penenberg, an assistant professor at New York University and assistant director of the business and economic reporting program in the school’s department of journalism, writes a great piece for Slate that if Telcos honestly can’t sustain their networks, then they should just start charging people based on usage:

If the telcos and cable companies get their way, we’ll have a Balkanized Web. Content providers who can afford to pay for premium service will market superior products to consumers with fast connections. Everyone else will make do with second-class companies at second-class speeds.

The business model that this most resembles is cable television. There’s one key difference, though. In the cable world, the service providers pay channels for the rights to broadcast their shows. In the system that telco-cable is proposing for the Internet, the content providers—who provide the services that make customers clamor for broadband in the first place—would have to pay for the privilege of being included.

Not all content providers are taking this lying down. Business 2.0’s Om Malik reports that Google has been buying up miles of “dark” fiber—unused fiber-optic cable—at severely depressed prices. Malik believes that Google plans to “blanket major cities with Wi-Fi,” including San Francisco, Washington, D.C., and New York. Given Google’s ethos, its Wi-Fi would probably be free, with revenue derived from targeted advertising. Obviously, the telcos and cable companies would have trouble competing with that. Even if telco-cable is successful in implementing a two-tiered Internet plan, another workaround could be municipal wireless networks, like those being built in Philadelphia. (No wonder Verizon has been fighting them tooth and nail.)

There’s a far better solution than Verizon charging Google to use its bandwidth or Google becoming a service provider itself. What about having subscribers pay for the bandwidth they consume? Just like you buy variable rate cell-phone plans and pay for electricity based on how much you use, your broadband bills should be calculated the same way. That way, heavy Net users could subsidize the Internet for those who don’t use it as often, and access would be available for anybody who wants it. Then content would remain free, and everyone would benefit.

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Published:
3.16.06 @ 1am

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