No need for neutrality rules in SA just yet

AS the debate over network neutrality rages in the US, South African internet service providers (ISPs), through their industry association, have urged communications regulator Icasa to steer clear of crafting regulations dealing with the contentious issue, at least for now.

AS the debate over network neutrality rages in the US, South African internet service providers (ISPs), through their industry association, have urged communications regulator Icasa to steer clear of crafting regulations dealing with the contentious issue, at least for now.

But what's right for consumers?

Net neutrality is the principle that all traffic flowing across the internet should be treated equally and that service providers should not be allowed to discriminate against certain types of traffic by slowing or blocking access, or levying different fees on consumers. One of the big worries is that without net neutrality rules, it may be more difficult for innovative new internet start-ups to emerge.

In January, a US federal court struck down the net neutrality policy adopted by the Federal Communications Commission, the US's telecoms regulator. But President Barack Obama weighed in on the issue this week, underlining his administration's support for the concept. "You want to leave [the internet] open so that the next Google or the next Facebook can succeed," he said.

The worry is that without net neutrality, big telecoms companies could use their broadband infrastructure in homes to block or impede certain types of content, or even websites they consider to be a competitive threat.

The commission is now considering two options, according to a report in the New York Times. The first would require service providers to offer a basic level of unfettered internet access to their customers, although they remain free to charge companies higher fees to deliver their content faster to end users.

The second option would involve changing the classification of broadband to a telecoms service, allowing for the more stringent regulation of operators, which would prevent them from engaging in unreasonable discrimination.

Although net neutrality has become a hot political potato in the US, there's no need to consider similar regulations in South Africa, according to the Internet Service Providers' Association.

"It's not a particularly helpful debate for us in South Africa as our market is at a different stage of development," said the association's regulatory adviser, Dominic Cull. "We face a different set of issues in order to ensure fair competition."

South African ISPs routinely discriminate against certain types of online traffic, particularly where uncapped accounts are concerned. Peer-to-peer traffic, generated by consumers sharing music and movies through networks such as BitTorrent, is heavily shaped by ISPs to ensure a consistent (and affordable) broadband service. Some even block this traffic.

But this does not actually matter. Consumers who want unshaped bandwidth can get it quite easily. Most ISPs offer these connections through capped data accounts for which consumers pay by the gigabyte for access to the internet.

The prices of capped accounts - at least on fixed lines - have also tumbled in recent years thanks to new undersea cables and greater competition in the domestic wholesale market. Intense rivalry between ISPs means that any reductions in wholesale prices are passed on immediately.

This competition ensures that if one service provider starts to discriminate against a certain type of internet traffic - say, YouTube videos - consumers are quick to punish them by switching to another provider. That obviates the need for net neutrality regulations.

And South Africa's competition authorities have done a reasonable job lately of policing anti-competitive abuses in areas of the industry in which sufficient competition has not yet emerged.

Net neutrality regulations may be needed in South Africa in future - particularly as mobile operators start edging their way into the content game - but the ISPs are right: Icasa should watch developments elsewhere with a keen eye and resist the temptation to impose regulations that are not needed right now.

McLeod edits TechCentral.co.za. Find him on Twitter @mcleodd