Overruled Net Neutrality Judgment

net-neutralityThreat or Opportunity for Networking Innovation Experts?

Imagine…your favorite band is coming to town, tickets go on sale at 2pm, you’re sitting at your computer at 1:59 set and ready to go. Two o’clock hits, you click “purchase” and all of a sudden you receive a message – “loading…loading…loading”. The webpage finally finishes loading and the tickets are gone, the concert is sold out.

Imagine…you finally land a date with that attractive neighbor you couldn’t help but notice when you moved in. You convinced her to say yes because you have that new movie she’s dying to see on your computer already – you can’t wait to wine and dine her, and impress her with your computer skills. The movie is set up and ready to go…the lights are dim, wine in hand…the movie opens with non-stop action and halfway through the opening scene a message pops up – “buffering” – the dreaded interruption to your impressive night.

Loading…buffering…two cringe-worthy messages that no one wants to see. These messages appear when internet speeds are low, and bandwidth is lacking. Now imagine calling your internet service provider, like Verizon or Comcast, in hopes of increasing your connection speeds and bandwidth – you don’t want to spoil your next date or miss that next concert – and you’re met with no options to do so.

Under the Federal Communication Commission’s (FCC) proposed net neutrality (or open internet) rule – this could be a reality. The D.C. Circuit Court issued its opinion last week rejecting the FCC’s net neutrality nondiscrimination and anti-blocking rules, citing that the FCC did not have the authority to implement these rules under the Communications Act. The implications of open internet suppress innovation in the industry because it prevents service providers from the freedom to offer different options and levels of services tailored to each customer, thus depriving consumers of choice. Choices like paying for enhanced internet speeds and bandwidth in order to prevent future occasions where loading and buffering spoil your internet experience. With this ruling in favor of service providers, it will cause many of them to grasp this opportunity to offer their customers new differentiated services, and to reposition themselves as a value added service provider, and not just a connectivity provider. Service providers will then seek to increase the intelligence of their networks.  Telco Systems is well positioned to help our customers take advantage of this opportunity for innovation in the industry.

What does this mean for telecom customers?

While some are saying that the current standing of network neutrality is not a win for the average consumer, there are many points to the contrary. The new ruling will enable users to buy advanced services to promote enhanced experiences using network dependent services. The ability to differentiate services opens up new opportunities for service providers to deliver an increasing number of services with higher granularity. The value is created by allowing each customer to custom fit the services of their choice, based on a variety of parameters like quality, cost, and availability, among others. It will also expedite trends in the telecom world towards offering more dynamic and elastic services while enabling customers to get the exact services they seek.

What does this mean for telecom industry players?

Today, content providers like Netflix and YouTube are the key players influencing the revenue stream, while service providers are considered pipelines for streaming their content. This leaves no real incentive to enhance the pipelines – it’s like drinking pure spring water in rusted, decayed pipes. Under the new ruling, service providers will be included back in the revenue system by driving content providers to re-invest in their network capabilities in order to enhance the services provided, while allowing consumers access to advanced services.

Content providers will also be able to offer end users services with guaranteed performance, instead of “best effort” services that are often seen today. Picture this… you rent a movie from Netflix with two options: $2 for a movie that can get stuck buffering every few minutes (which you’ve probably experienced before), or $3 ($2.2 will go to Netflix and $0.8 will go to the service provider) for a movie that is assured not to get buffered, providing a clearly optimal user experience. With network neutrality, service providers do not have the incentive to offer these services, denying consumers the optimal experience they seek, and networks will not be driven to innovate towards advanced technologies to provide that experience.

How will this affect Telco Systems?

Given that service providers, mainly at the edge and access, will invest in these capabilities to generate revenue, and will reinvest their profits from such services back into their networks, this will immediately boost the business opportunities and revenue of advanced network technology vendors like Telco Systems. A boost of growth is imminent for vendors in this field, with Telco Systems best positioned to make this new offering possible.

Specifically, Telco Systems’ technology is at the core of such new services, offering advanced flexible and policy-guided switching software capabilities and enabling differentiated and guaranteed services. The only vendors that can really guarantee the performance and enablement of these services are those that are focused on data networking – Telco Systems is the leader in such technology.

By offering its comprehensive 1GigE / 10GigE Carrier Ethernet 2.0 carrier grade line of products that enable many key features like highly granular HQoS and advanced operations, administration and management capabilities, Telco Systems is well position to be a leader in the telecom industry revolution. As a fast paced company, Telco Systems identifies this judgment, together with the SDN and NFV development, as an opportunity for increased growth and faster innovation, and is setting up to pave the way for a new era of innovation!

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