New online services face threat from ISPs, CRTC told

New services such as internet-to-TV video rentals could face unfair hurdles if internet service providers have the power to slow the applications of their choosing, Canada's internetregulator was told Tuesday.

"Giving carriers the power to slow down applications at their own discretion will change user behaviours, distort innovation and undermine the competitive market in applications," said Jacob Glick, Canada policy counsel for Google, at the second day of Canadian Radio-television and Telecommunications Commission hearings in Gatineau, Que.

The hearings, which will run until July 13, are intended to help the CRTC set guidelines for how internet service providers(ISPs)can control internet traffic and congestion, including whether they are allowed to selectively slow certain applications.

Glick was speaking on behalf of the Open Internet Coalition, which representscompanies that rely on the internet to deliver their services including Google, Skype, eBay and Ticketmaster as well as threepublic advocacy groups.

He said there is nothing wrong per se with internet traffic management, but techniques that target certain applications over others should only be used as a last resort and only if it is shown to be a tailored, minimally restrictive method of dealing with a pressing problem.

Otherwise, they have the potential to hurt innovation and other techniques are preferable, including:

• Boosting network capacity.
• Using different pricing models.
• Using techniques that target the amount of bandwidth use rather than the type of applicationusing the bandwidth; for example, slowinga user's connection after reachinga certain limit.

Glick argued thatsuch techniqueshelped the U.S. ISP Comcast reduce network congestion after it was ordered by regulators to stop throttling its customers.

"It hasn't all gone to heck in a hand basket," he added.

Timothy Denton, national commissioner for the CRTC, asked whether the other types of pricing models proposed couldthemselves have an impact on innovation.

Coalition members admitted that pricing based on the number of bits transferred or with higher pricing at congested times could discourage or limit internet use, as do many mobile data plans using those types of pricing.

Online video may compete with ISP services

In the case of online video, which uses a lot of bandwidth, there is the risk that such pricing could be viewed as anticompetitive, said Marvin Ammori, general counsel for Free Press, a group that lobbies for media reform and a member of the coalition. Therefore, such models should be reviewed.

This is a concern because many ISPs such as Bell and Rogers have TV on-demand services that may compete directly with video delivered over the internet, argued Rob Hall, chairman of the online video rental company Zip.ca and CEO of its parent company.

Hall, who addressed the CRTC after the coalition,said his company will soon launch a service to download videos directly to a customer's television, and he is concerned internet traffic management practices by some ISPs could make that unviable.

Part of the problem is that the CRTC has said its guidelines will not apply to traffic generated by ISPs for their own services, such as cable pay-per-view and IPTV, which are carried on the same wires as their internet service. That means these services could get priority on the network over other traffic.

"The same rules must apply to both," Hall said.

Zip.ca eyes BitTorrrent

Hall's other concerns were that:

• Some ISPs are throttling peer-to-peer file transfers using programs such as BitTorrent, which "might be an ideal platform" to deliver Zip.ca's movies, as it uses the network efficiently.
• Deep packet inspection, a technique used for traffic control, will be abused to access marketing information about users that his company has collected.
• If rules change suddenly, and there is no way to resolve the problem quickly, his company could be put out of business.

Three other speakers addressed the CRTC Tuesday.

Franois Menard spoke on behalf of the Coalition of Internet Service Providers, which represents a number of smaller ISPs in Quebec. Many of his members buy network access wholesale from larger ISPs.

Menard argued that large ISPs that sell network access should let the smaller ISPs know when the network is congested. That would let the smaller ISPs use technology that tells certain applications to slow down at times of heavy traffic.

"We'd like to be part of the solution, and we're not being offered the chance," he said.

Two information technology professionals addressed the CRTC as private citizens.

Jean Franois Mezei, who runs the consulting company Vaxination Informatique,told the commission thatpeer-to-peer file transfer methods like BitTorrrent are still in their infancy, with lots of untapped potential to transfer large files.

"In the long term, you can't afford to allow the telcos to start deciding what to nip in the bud and what to allow," he said.

He added that throttling such applications would just make users take a less efficient path in an effort to avoid detection, worsening congestion.

Mezei added that throttling isn't necessary as old, simple technology exists to identify and slowheavy internet users if necessary. Such technology has been employed by Montreal-based ISP Vif Internet for a dozen years, he added.

ISPs overselling networks, critics allege

Toronto-based technology consultant Jason Roks said new applications that consume more bandwidth are constantly being developed, and that's a long-term problem that throttling certain applications won't solve.

He said the realissue isISPs are overselling their networks. If they can't afford to upgrade their networks to support that many customers at advertised speeds, they should let customers go, he argued.

Mezei said many ISPs advertise theoretical maximum speeds that they can't actually support. The CRTC should force them instead to publish their actual speeds, including those during throttling.

"If they were forced to advertise that, you might find throttled speed would go up and thecongestion problem would disappear."