Verizon says Net neutrality is overhyped

But it's not every day that he fields questions on hot political issues--particularly when it comes to the argument that the Internet should be kept open with little to no interference from network operators, a subject summed up under the rubric of Net neutrality.

As Congress looks at reforming the Telecommunications Act of 2006, supporters of Net neutrality are pushing for a new law restricting phone companies and cable operators from creating special tiers of service that favor one company's traffic over another. The debate has reached a fever pitch in Washington, D.C. In fact, some interest groups claim that without a Net neutrality law, the Internet could wind up dead.

The hot button issue has divided the technology community in two. Content providers such as Google and Yahoo are lined up against the former Bell phone companies and infrastructure equipment makers, such as Cisco Systems. So far, much of the debate has focused on speculation that the phone companies won't continue to play nice with application providers running traffic over their networks.

Wegleitner sat down with CNET News.com to answer some questions and address concerns from Net neutrality supporters.

Q: We have heard so much about Net neutrality recently. It is clear to me that Verizon is opposed to any legislation that puts the Federal Communications Commission's principles of Net neutrality into law. But what is it exactly, that Verizon wants to be allowed to do? Do you want to charge differentiated rates to content providers who use the network?
Wegleitner: I think it's a leap to jump to the idea that Verizon wants to charge differentiated rates for service. Net neutrality is a phrase that is applied in a variety of circumstances.

First of all, let's talk about consumers getting access to applications. We see no reason to prohibit a customer from accessing any lawful Web site. And in fact, that is one of the FCC's principles, and we have no problem with those principles. We think the richest, broadest choice in applications provides a better broadband experience and makes for a happier consumer. We also think that some of those applications will come from outside parties and some of them will come from us. That's only natural.

But getting an application to perform on a network involves a lot of things. How technologies might be employed on the network is another aspect of the Net neutrality debate.

So what's an example of the kind of service that Verizon might offer?
Wegleitner: There are ways for the network to provide more bandwidth for a short period of time. So if you're only a 768kbps-DSL subscriber, you can see a video in real time. There are ways to energize the loop to get more bandwidth for the two hours it takes to watch the movie and then drop the bandwidth down to the regular rate. But someone would have to pay the network provider or the content provider for that experience.

How close are we to having these kinds of services commercially available?
Wegleitner: We've demonstrated them and some people have tried to implement them commercially. But we are in a chicken and egg situation. You need a certain number of content providers and a certain amount of network infrastructure available in order to make a commercial endeavor viable. So while it's technically possible, it has not yet been achieved on a commercial scale, because the market drive hasn't been there. But it might be one of the applications that appear in the future.

Have any companies, such as Google or Yahoo, approached Verizon about providing a differentiated service?
Wegleitner: I can't pick an example out of the air. But content providers in general have discussed this with us. I think if a company is interested in offering a service to allow movies to be downloaded faster, then we can make more bandwidth available the instant the movie is being downloaded.

This idea has been discussed for years. It's not that much of a departure from what we have been talking about for a long time. In that regard, maybe some of this Net neutrality talk has been overblown as a concern. If a content provider wants a special capability in the network, then we are interested in providing that. That's our business.

I think a lot of people are worried about what happens to companies who don't choose to have their services differentiated. What happens to their traffic?
Wegleitner: The default method is a best effort delivery system.

But doesn't giving priority to some traffic, create a shortage of bandwidth for other traffic?
Wegleitner: We don't have any desire to create any shortages of bandwidth. The issue is that consumers at times want to do more things than their bandwidth subscription allows them to do. So do we let all the applications and users suffer as a result of the one request that put them over the top? Or do we provide four to five excellent experiences, and tell the sixth person, you will have to do yours another time? Common sense would tell you, you'd want to preserve the performance of existing applications and not just have everyone coming in on top of each other ruining the experience for everyone else.

So all this talk about creating different tiers of service in the network is really about managing traffic rather than trying to create a new revenue stream or even keeping competitors off the network?
Wegleitner: Yes, in my estimation it is. The real issue is what do I need to do to maintain the service level performance to make sure the customer continues to be my customer? And the network and users of the network, whether they are consumers or content providers, have to agree on what is important. I just don?t think that a free-for-all situation will result in the kind of user experience that will make anyone happy.

But is it really necessary for Verizon to charge additional fees to manage its own network?
Wegleitner: I can't provide the kind of management, in terms of quality of service to ensure the user experience is a pleasant one, without investing in the network. There's a lot of difference between a best effort network that will just choke in the event of an overload and one that will manage through that period preserving as many sessions as possible with adequate performance and gracefully denying additional usage in those cases where they can't be served.

I'm sure consumers and businesses would like to at least preserve the experience they've got, rather than allow that experience to be trod upon by anyone who would make a high bandwidth request. If you want that kind of managed service, some sort compensation is appropriate because there is an investment involved to provide it.

If people are willing to live forever in a best-effort world and say, "I don?t want any management, make it the Wild West, and whatever happens, happens," then we have a whole different ball game. But I just don?t think that people who are interested in providing quality services to their customers really want that.

Aren't content providers already paying Verizon and other broadband providers to access their network?
Wegleitner: Not necessarily. They are paying some Internet service provider. So Google or whoever is paying some ISP. And DSL consumers are paying us for access to the Internet.

We are also a major tier-one Internet service provider, so some Web sites are hosted off that network. And we get some ISPs that pay us for Internet connectivity there. But there are a lot of backbone providers, such as AT&T, Level 3, Global Crossing, and anybody else hosting Web sites. They are all being paid by people connecting to them.

Then there are peering and transit arrangements between carriers. So if you have a peering agreement between, say AT&T and Verizon, there is a traffic exchange. In many cases this exchange happens without monetary compensation. But in some cases, depending on what kind of peering and transit arrangements you have in place, money is exchanged.

Even if you charge content providers for differentiated service, won't the cost be passed onto consumers anyway?
Wegleitner: I don't think the cost has to go to one area. I think the content provider and consumer or the business or the end user can participate in the economics associated with providing the kind of service that I am talking about here.