SBC: We Own The Internet, So Google Should Pay Up

from the uh-oh.--trouble-coming. dept

It's become pretty clear that Kevin Martin's FCC has no problem considering "competition" in the broadband space to mean incumbent telcos vs. incumbent cable companies. So far, the FCC has done just about everything possible to make it much harder for any third parties to get into the game. So is it really any surprise to hear the CEO of SBC, Ed Whitacre, in an interview suggest that it's only a matter of time before they start going after any of the services that make the internet useful to try to make them pay up to remain reachable? When asked about companies like Google, Yahoo and Vonage, he says: "Now what they would like to do is use my pipes free, but I ain't going to let them do that because we have spent this capital and we have to have a return on it. So there's going to have to be some mechanism for these people who use these pipes to pay for the portion they're using. Why should they be allowed to use my pipes? The Internet can't be free in that sense, because we and the cable companies have made an investment and for a Google or Yahoo! or Vonage or anybody to expect to use these pipes [for] free is nuts!" In other words, he's talking about going well beyond blocking some ports like BellSouth, to actually blocking out websites and services unless they first pay SBC a fee. It certainly has the feel of extortion: pay up or no one on our network will be able to reach your website. If you thought that mess Level 3 and Cogent was problematic, just wait until you can't access Google from SBC, because Google fails to pay up SBC's "connection" fees. What Whitacre seems to be forgetting is that it's all of these services and the ability to connect that makes the internet access worthwhile. Now who was just saying that network neutrality wasn't needed? Notice that the only reason this is possible now is because there's less competition in the broadband space, not more. If there were real competition, SBC would never even dare to suggest that they might cut off a Google, Yahoo or Vonage.

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  1. identicon
    Brian Bartlett, 31 Oct 2005 @ 5:54am

    Mystified

    I'm totally mystified by this idea. As an economist, I have to wonder where the heck this idiot went to business school and exactly what courses in economics, if any, he took. His grades might be useful although I doubt it given the way I've seen grading in academia being conducted. For some reason the CEO of SBC feels he has a monoposony which couldn't be further from the truth. While SBC may have a monopoly in some markets, and an oligopoly in almost every market, this is not the same thing and conflating the two is a fundamental mistake.

    As an engineer (I'm both among other things), I have problems understanding how it would work. This would involve some serious reprogramming of their network to accomplish and I can picture the game of one-upmanship that might occur should Google, or any other major player, not play nice with them. China is having a hard enough time with this, does SBC think they can do better?

    It should prove interesting and I wouldn't mind seeing SBC blown out of the internet waters in the least. The walled web garden approach didn't work out so well for AOL, I firmly believe it will not here either.


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