This week the CTIA (Cellular Telecommunications Industry Association) rejected calls for regulations that would force cellular carriers to adhere to net neutrality principles and open their networks to 3rd party applications or devices (e.g. Skype VoIP services).
In recent months, the debate over ‘net neutrality’ has spread to a new battlefield: cellular networks. Advocates argue that the principles of net neutrality should apply to cellular networks, particularly since carriers such as Sprint, Verizon, and Cingular are now offering broadband data services.
Skype formalized this concept with a plea to the FCC in February. A consortium of cellular networks represented by the CTIA challenged their plea this week with a petition that rejects wireless net neutrality on the basis that it threatens to ‘stifle consumer benefits’ (link to pdf).
Broadly speaking, net neutrality is the democratization of internet bandwidth and requires internet service providers to treat all data packets equally (e.g. not accepting payments from companies to favor their services).
Whilst the debate over net neutrality remains a hotbed of legal and political wrangling, the FCC claimed some jurisdiction over the matter as early as 2005 in a directive for the telecommunications industry. These guidelines state:
‘Consumers are entitled to access the lawful Internet content of their choice, run applications and services of their choice and plug in and run legal devices of their choice.’
The cellular network carriers are worried that if such a directive were applied to their networks, then applications such as Skype’s VoIP service would have to be granted the free range of their network and take a big chunk out of their share of the market. In a worst case scenario for the carriers this would relegate them to an ISP type role for cellular networks, whereby they would maintain and operate the network but customers would use 3rd party VoIP software to make their phone calls.
At first glance, wireless net neutrality seems like an obvious extension of current net neutrality principles, with the end result being lower prices for consumers and higher levels of competition. However, the situation differs slightly: Unlike the wired networks operated by normal ISPs, the wireless cellular data networks are limited to the cellular bands licensed by the FCC. Cellular frequencies are a finite commodity, with many networks eager to get their hands on more spectrum just to improve their voice coverage, let alone providing extra bandwidth to accommodate users who want to use Skype. This problem is compounded by the fact that VoIP requires a more sustained data connection than the periodic data exchange pattern that marks normal internet browsing. This can lead to interference issues on existing cellular networks which were originally optimized solely for voice coverage.
Having said this, VoIP offers a cheap alternative to current cellular communications and resisting this is something that the consumers won’t stand for when price cuts may be available. The networks will argue that call quality, amongst other factors, will suffer if a switch is made to put VoIP services on an equal platform but ultimately the biggest driving force for consumers is the price they are required to pay. The networks need to bite the bullet and look back to 1968 when a similar debate arose for the PTSN (landlines). This was settled by a legal decision known as the Carterfone ruling, that forced AT&T to allow users to connect any device to their network so long as it was safe to do so. Although initially opposed, the liberation of the PTSN led to increased revenues for AT&T and the telecommunications industry at large.