No, Optus: don't try US-style net neutrality arguments in Oz

Netflix has ignited the Internet neutrality debate in Australia, something that was previously not a major issue in the nation.

The odd structure of Australia's Internet (compared to America's, at least) has long been criticised. Too few international links in too few hands makes connectivity to the US relatively expensive, and the big international carriers decline to peer with smaller locals.

That, in part at least, is why Australian internet service providers (ISPs) have always imposed download quotas. Only recently did these routinely surpass 100 GB per month (for fixed networks; mobile carriers think they're being outrageously generous if they offer a bonus gigabyte in a month).

Australians can often be heard complaining about those quotas – for example, this Whirlpool thread is a complaint about allowances on the National Broadband Network – but in reality we have always consumed less than quota.

The Australian Bureau of Statistics regular Internet Use, Australia report the average fixed user pulled down 56 GB per month.

While that's above the entry-level plans of local ISPs Telstra (50 GB) and Optus (30 GB), the next step for both is 200 GB / month. Among other ISPs, TPG starts at 50 GB and jumps to 150 GB; iiNet and Exetel both start at 100 GB / month.

The gap between allowance and the average user was, until recently, part of the Australian ISP's marketing DNA. “Double your allowance” gets a thumbs-up from customers.

Since actual usage would always lag allowances, it didn't really cost an ISP anything to tweak the plans: backbone capacity upgrades were already in the business plan.

And then Netflix arrived, and it all changed.

ISPs ran with their “free stuff” reflex, made peering arrangements to suck down Netflix as fast as possible without incurring new charges on their $x-per-100 Mbps-per-month transit connections, and got hammered.

iiNet was publicly caught short, and yesterday told the CommsDay telecommunications conference that Netflix traffic went from three per cent of its total downloads to 15 per cent, and then to 25 per cent.

While it said the 80 per cent of customers it backhauls on dark fibre were fine, a “couple of dozen” exchanges are connected by third-party data services (predominantly Telstra) and were under-provisioned for the Netflix data explosion.

But it's Optus that's turned “network provisioning” into “net neutrality”, with CEO Allan Lew saying outfits like Netflix should flick Optus a handful of cash if they want to maintain service quality.

Netflix already pays

With big carriers in the US prepared to go to court to avoid net neutrality, Optus' thought bubble is no surprise.

However – and here, Vulture South expects Australian commentators to get blind-sided into merely repeating US arguments – Optus is hoping we don't notice a key point: Netflix is already paying to deliver a “quality” experience in Australia.

The reason iiNet and Optus could walk into a bit barn, string a cable to a port marked “Netflix”, and offer unmetered downloads to their customers is that Netflix was there.

To get there, Netflix had to pay someone for international capacity, so its Open Connect CDN had a path from the US to Australia.

If Netflix uses the Southern Cross cable to reach Australia, then co-owner Optus is already clipping the coupon on its traffic. To ask for another toll on the landed traffic is a bit rich.

iiNet, at least, has had the good sense and good grace to take its stripes and tell customers it will do better. ®