Saturday, April 15, 2006

Google/Earthlink team up to fight the Carriers

BellWest Network Neutrality
Another spectacular offer from BellWest

For those who may have missed it, I spent quite a bit of time beating a dead horse discussing network neutrality. At the risk of further flogging the expired equine, I wanted to point out a fascinating development in the continuing war between the carriers and the content-providers.

A team consisting of Google and Earthlink was selected last week by the city of San Francisco to offer free- and paid-WiFi service to the municipality. Google possesses lots of fiber -- the backbone that carries traffic throughout the country -- while Earthlink has the infrastructure needed to deliver last-mile services to consumers and businesses.

What's noteworthy about this deal is that it breaks the monopoly on last-mile services (at least in SF) held by the telcos and cable companies. And it hamstrings the carriers' implied strategies to violate network neutrality, which could result in the kind of innovation-stifling network tollbooths illustrated by the hypothetical advertisement at right.

Now the Wall Street Journal reports that the Google/Earthlink pair are planning another joint bid for an additional American city. Additionally, the Journal notes that EarthLink has already won bids to build WiFi networks in Anaheim, CA and Philadelphia, PA. It is also a serious bidder on as many as two dozen other municipal networks.

Opening up last-mile services to real competition can't come quick enough. And it will put the telcos and the cable companies exactly where they need to be: in a position to add value by creating layers 4-7 services, not diminishing value by erecting useless Internet tollbooths courtesy of Cisco and friends.

Competition will make the carrers healthier. They may not like the attendant pain at first, but as the fitness trainers say, "no pain, no gain."

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