Industry News

The popularity of bandwidth-heavy video content raises the issue of who should pay for network upgrades, ISPs or content providers

Extract from an article originally published in Business Week 28th January 2008

The massive increase in bandwidth-heavy online TV and video content being downloaded by UK broadband users has raised questions about whether current networks can cope and who should pay for any upgrades.

Specifically the recent surge of interest in the BBC’s iPlayer online on-demand TV service raised this issue following a massive 3.5 million programmes being streamed or downloaded in the two weeks following its marketing launch alone.

And as more of these bandwidth-heavy content services — such as the multi-broadcaster Kangaroo media player — are launched and more people use them, the result could potentially be gridlock on broadband networks as bandwidth is used up.

But if this is going to be a bandwidth problem does the responsibility to fund network upgrades to cope with it lie with the internet service providers (ISPs) or the content providers?

Tiscali, which also owns Pipex, has been the most vocal ISP on this subject and has stated in the past it believes content providers such as the BBC should foot the bill for upgrading networks to cope with the content they’re now churning out.

Tiscali claims that both the streaming and download versions of the BBC’s iPlayer can create problems on its network.

Last August a Tiscali spokeswoman told silicon.com: “We don’t believe that the potential for it to cause congestion is being properly recognised and acknowledged.”

Tiscali employs traffic shaping on its network with bandwidth for large packets of data restricted at peak times to ensure every customer has a similar service.

This means services such as iPlayer or Channel 4’s 4OD can be slowed (but not interrupted) as available bandwidth is reduced.

Despite its comments, Tiscali says it would not target iPlayer content for traffic shaping — possibly as it can’t distinguish iPlayer content from other BBC traffic — but the issue is something the company is concerned about.

Speaking to silicon.com this week, a Tiscali spokeswoman said: “If the content providers don’t come to the table on this, the cost will be solely on the end user. It is an issue and we want to talk about it.”

Industry regulator Ofcom is also aware of the potential looming conflict and told silicon.com broadband traffic prioritisation is likely to be necessary in the near future as different kinds of traffic such as voice, video and data continue to proliferate.  Ofcom suggests the next generation of broadband networks may require types of new business models or commercial relationships to fund them.

This could see content providers paying for the delivery of services as well as customers paying to receive them — much like the way retailers and customers pay to use credit card services.

With Ofcom saying content provider business models may need to change in the future, there is the very real possibility that the BBC et al may one day have to put their hands in their pockets if home internet users are to continue enjoying shows such as Top Gear online.

On-Communications CEO, Ian Roberts comments:

One of the great hidden issues in residential broadband is that of contention, i.e. how many other users share the same bandwidth with each other.  It is only by massively reselling (should that be overselling?) the same bandwidth that consumers pay such low prices for high headline level services. 

That model has never worked for the enterprise market because business understands this issue and has the requirement to manage wholly owned bandwidth.  This is why dedicated business connections are so much more expensive than contended consumer and SOHO services.

The contended consumer networks can manage this ‘sleight of hand’ whilst consumers were light users of the network.  Mass adoption of heavy usage technologies such as video streaming however, changes all that and the fallout could be very substantial.

Virgin and BT who own their own networks will figure a way through the issue, the incumbents always do, but companies that rely on them are going to be massively exposed, hence why the other ISP’s are starting to squeal.