Here is Level 3’s plan to make interconnection fees a network neutrality issue

The gloves are coming off in the fight to prevent ISPs from charging content providers and middle mile transit companies a fee to deliver web content to the end consumer. Earlier this week Level 3 Communications, a transit provider wrote a post that claimed interconnection fees should be a network neutrality issue and then on Thursday Netflix CEO Reed Hastings posted a blog post and submitted a filing to the FCC that said the same thing.

On Friday Level 3 filed its formal comments to the agency, and both give examples of what they see as ISPs trying to collect tolls in the middle of the network.

This is the problem

One way ISPs ┬ájustify their interconnection fees is to point out that they will exchange traffic for free — so long as it is between “peers” or networks of equal size. They use traffic ratios to determine this and publish those rations online or in a publicly available database. However, Hastings said in this blog post that when Netflix suggested that it could become a peer to ISPs by making the upstream and downstream traffic burden it was imposing equal (and thus meeting the direct peering definition), “there is an uncomfortable silence.”

Meanwhile, Level 3’s filing claims that the company sought to peer with an ISP and was rebuffed even though it had offered to split the cost of connecting the two networks by paying for more ports and servers. It then showed two charts that illustrate how the single port it had with this unnamed ISP became congested at the same time every week as the ISP’s end users demanded more content.

Level 3 and Netflix argue that these are tolls placed by the ISP, which restrict the content providers’ ability to get their traffic to the end user. They argue that this is the same as discrimination on the last mile network, even though it is happening further upstream where the middle mile meets the last mile.

A solution for peering disputes?

So Level 3 has proposed that the FCC should require ISPs to interconnect on “commercially reasonable terms, without the payment of an access charge.”
Level 3 wants the FCC to say that access charges, where an ISP charges those it exchanges traffic with for the privilege of reaching its users, are not commercially reasonable. It then suggests some basics on how the FCC should think about “commercially reasonable terms.”

Basically, Level 3 wants an ISP to add more capacity at congested areas at no charge or offer another point of interconnection in the geographic area where it will provide interconnection without charge. It’s unclear if Level 3’s definition of no charge, means that Level 3 won’t help offset the cost of the gear to provide more capacity.

As a way of mitigating the burden such rules would lay on ISPs, Level 3 suggests that ISPs would only have to interconnect with large networks. It also notes that the FCC could implement this rule without imposing common carrier rules on ISPs, which the agency is clearly unwilling to do.

Level 3 says in its filing:

This proposed rule would directly target the threat large, last-mile bottleneck ISPs pose to the free and open Internet when they attempt to leverage their control over access to their users to generate inefficient rents and harm their competitors. Yet the proposed policy would not prevent ISPs from offering services, such as transit services or CDN services, to those that wish to interconnect with them (whether edge providers or others), provided that they also offer interconnection on commercially reasonable terms as described above. The rule would simply prohibit ISPs from levying tolls for access to customers

Why now and will it work?

Today is the last day to file comments with the FCC on its decision to address network neutrality in the wake of a court decision that struck down most of the commission’s 2010 Open Internet Order that made network neutrality an actual rule in the first place. The courts agreed in principle that the FCC could ensure that ISPs didn’t discriminate on traffic going across their networks, but disagreed with how the FCC wrote the rules.

The agency is now trying to address this legal flub, and in doing so, seemingly opened the door to ensure that interconnection agreements between ISPs and internet content and transit providers are protected. But for consumers who are sick of a crappy online video experience, the question isn’t why this is happening now, but whether or not this is a strategy that will work.

And that’s uncertain. The problem of ISPs choking traffic to extract access charges is a real one, I’ve no doubt, but the FCC may not see it as a network neutrality issue. It is an issue, and I think the current FCC Chairman Tom Wheeler understands the issue based on my interview with him in January, when he called it a “cousin” of network neutrality.

Harold Feld, an SVP at Public Knowledge, says it is an interconnection issue, one that should be addressed only when we have that data to understand what’s going on. I tend to agree that data will be essential here and hope the FCC asks for it.”If Wheeler wants to get [the data], he knows where to look,” said Feld, who pointed out that LEvel 3 and Cogent would be happy to give it up if pressed and that Comcast and Time Warner Cable could be compelled to do so as part of their merger process.

So the next question here isn’t about pushing network neutrality necessarily, but about getting the data to understand the problem.