Broadband ISP’s Fear of the Web Video

Update: British Telecom is quickly distancing itself away from the BBC iPlayer bandwidth demand controversy, reports The Register.

“Whilst we’ve been fingered as ‘part of the gang’ in certain press reports, BT is not complaining about or discussing the implications of iPlayer with the BBC.”

BBC’s controversial iPlayer P2P video client is drawing the ire of Internet service providers in UK, many of them including Tiscali and Carphone Warehouse threatening to either use traffic shaping or boycott the service all together. Their reasons: BBC’s web video service could bring down their networks.

[qi:004] Their arguments sound hollow — on one hand they urge subscribers to sign-up for faster download plans, and pay premium prices. And yet, they complain when subscribers finally find an application that puts their web speed to work.

The reason the broadband ISPs in UK are bemoaning the BBC iPlayer is because it can cost up to $2 billion to upgrade the networks, and they don’t seem to want to spend that money. And that would eat into their gigantic profit margins.

This is a situation not unique to United Kingdom. Here in the US it is a much-debated issue as well. Every so often someone or the other comes up with a report that talks about enormous strain web video puts on the network, only to be refuted later. And if web video does put strain on their infrastructure, upgrading the network should be viewed as cost of doing business.

What are they charging us $45 a month for? The bottom line is that broadband service providers came up with the current pricing plans to lure customers to sign-up for their service. They didn’t count on the web video explosion, which means now they have to spend money and upgrade their networks to keep customers’ happy.