So, the net neutrality war has finally begun in earnest after BellSouth confirmed it is moving to charge Internet content and service companies for traveling over "its" network. "It's the shipping business of the digital age," said BellSouth CFO William Smith in trying to justify the new, misguided tactics to ensure, for example, the complete and rapid transmission of an iTunes song. As much as Fred Wilson might describe these new fees as "jealously", the sad reality is the carriers are trying to make it happen as they desperately scramble to deal with the decline of their local phone businesses. To support TechDirt's succinct take on this evil campaign, the carriers trying to cut off their noses to spite their faces. Truth be told, their networks have little value unless there's content from Yahoo, Google, eBay, Vonage, Joe's Fishing Shop, et al to convince consumers to pay for them. I mean, do we really need high-speed Internet to check e-mail? Unfortunately, the carriers don't see it this way because they're blinded by an economic revolution that has caught them by surprise. Who would have thought five years ago their monopoly on the high-margin local phone business would start to crumble? So what do the carriers do in response? They battle back with an uncreative, destructive, ill-conceived strategy: downstream fees and tollgates. This may be a short-term fix for the carriers but think about how this scheme/scam is going to hurt innovation. If the Internet is no longer a super highway but a toll road, how will the U.S. be able to rely on technology to remain globally competitive? If the U.S. Congress has any vision as its re-makes the Telecommunications Act, it has to push back at the carriers when it comes to net neutrality. Maybe the carriers are just looking for a political bone to make their lives easier; but maybe they're really desperate enough to think tollgates are their economic salvation. Whatever their motivations, it's just stinks.
Update: Jeff Jarvis doesn't buying into the high-speed operators crying poverty. He claims cablecos are making 40% profit margins.