Broadband News

Could providers start charging video providers?

Ovum has run with the news that some US broadband providers (Verizon, AT&T, BellSouth) are considering charging video content providers for prioritising their video data when transported across their networks.

This move to charge companies like Google and Yahoo may as much be for the work of actually managing the traffic systems, as it is for what providers thinking ahead about the extra load this video traffic will put onto their systems. These arguments stretch to more than video streaming, it can also apply to Voice over IP and online gaming. We may well see UK providers giving a higher priority to their own services, and leaving competitors in a lower priority queue. The UK broadband market is so cut throat in the retail sector that as usage patterns of the customers change, traffic shaping is playing a constant soft shoe shuffle to keep up. Put simply that person who perhaps used 1 or 2 Giga Bytes per month has now just bought an XBox 360 and is now using 10GB per month, and if this happens for enough customers an ISP may suddenly find its budgets stretched.

One likely option in the UK, is that end-users may end up with multiple subscriptions per month, one for their basic broadband connection, another to the content provider and then a fee to their service provider again to ensure that video/audio content is given priority. The alternative if video over broadband really takes off, is for UK broadband prices to start rising slowly. With little prospect of wholesale price cuts from BT in the near term, it would seem possible that some providers may risk some small price rises during 2006.


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