Tuesday, March 14, 2006

VON Spring: Qwest Promises No Traffic Degradation, Sees Preferred Bandwidth Deals with Content Providers

Qwest's job as a telecom service provider is "to see the world through the eyes of customers," said Richard Notebaert, Chairman and CEO of Qwest Communications, speaking at Spring VON in San Jose. On this point, he believes the Internet industry, the VoIP segment, online content providers and other network operators can all agree. We should see the world from the customer perspective.

Beside its role of mass market last mile provider, Qwest also provides business services and wholesale services, which are defined by specific network performance contracts. Its these commercial relationships that Notebaert sees as a good model for the industry.

On the contentious debate of Net Neutrality, Notebaert promised that Qwest will never block traffic and will never degrade service. He said such policies are fundamentally against the DNA of the company as a service provider. He vowed that Qwest would never deliver less capability than the customer has paid for.

However, Notebaert said arguments about content delivery, network neutrality and the need for regulatory action are bogus. Rather than government mandates, Notebaert argues that these issues can best be addressed through commercial agreements.

As he sees it, nothing should prevent a content provider from negotiating a better delivery method for their service. And he believes that content providers will be eager to pay for enhanced bandwidth, as it will give them a competitive advantage. As an industry, he noted that telecom has always sold bigger pipes and enhanced services in order to give customers a competitive advantage. If they want to buy, the telecom providers should be willing to sell.

Notebaert gave two examples. Consider 800 numbers. Yes, the customers have already paid for the ability to make telephone calls. However, 800 numbers provide an easier way to reach customer service. Businesses are willing to subsidize the 800 calls in order to better serve them.

A second example is the retail industry. If L.L.Bean wants to offer free overnight shipping to its customers and makes a deal with FedEX, should the government prevent them from doing so because it would be unfair to retailers? Notebaert argued that the government ought to stay out of this issue and let the market reach its own agreements.