• June 29, 2007

A day after the Federal Trade Commission recommended that Congress not deal with the issue of net neutrality, a report issued by IDC on Thursday said the proponents of such neutrality--Web content giants like Google, eBay and Amazon--may ultimately benefit from not getting it.

IDC forecast that U.S. consumer Internet traffic will increase threefold by 2011, prompting the need for massive broadband network upgrades. But net neutrality regulation would have a dampening effect on such upgrading, as broadband providers like AT&T, Verizon and Comcast "would be prevented from architecting their networks to offer new services that require higher speeds or quality of service (QOS)." And the Googles of the world, according to IDC, would require greater QOS to deliver new services.

"Google will likely maintain a public-facing resistance to network control in the short term, but should be making behind the scenes plans to act quickly when the matter is settled and the opportunity materializes," said Matt Davis, program director of IDC's Consumer Multiplay Services program. "Being caught flat-footed when a game-changing development occurs makes disruption from smaller, hungrier players willing to deal with facilities-based providers much more likely."