Friday, June 25, 2010

Net Neutrality is a Fight Over Ecosystem Revenue Share

The net neutrality debate is, at its heart, an argument about the distribution of future revenues in the broadband ecosystem. Sure, there are technical issues, such as how best to manage scarcity of bandwidth at times of congestion.

And there are legitimate concerns about potential anti-competitive behavior.

But at its heart the arguments are about gaining the best positioning with the new ecosystem. Were it not for mobile services, communication service providers would be in big financial trouble.

Broadband services have helped, but are a fraction of the voice revenue now dwindling away. To replace lost voice revenues, access provider broadband revenues would have to triple. To many observers, that must mean revenue shared with business partners, as it is hard to see end-user payments tripling.

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