Comcast may receive financial penalties for managing its TCP/IP traffic

The Sacramento Business Journal had an article today discussing how the FCC Chairman is recommending punishment to Comcast for “violating commission principles meant to protect consumers’ access to the Internet.” In particular, Comcast started regulating BitTorrent Inc. file-sharing traffic in June 2008, and has been accused of creating network changes that have disrupted some users of Vonage VoIP phone service.

I’m both a Comcast and Vonage user, and I’ve never experienced any trouble with Vonage myself, although I’d raise hell with Comcast if they tried to interrupt the ports or connectivity associated with my Vonage use. Vonage is a great service, and I cannot recommend it enough. Internet VoIP is definitely the wave of the future. It’s inexpensive, flexible, highly configurable and most importantly, portable. I can keep my old phone numbers, no matter where I am on the Internet. I can also have phone calls routed just about anywhere.

What this points out, though, is that ISP’s must be ever more careful how they define services for their customers, as well as how they manage their networks. In the past, ISP’s have often had to make hard decisions in impacting one or more users’ access to the Internet, in order to save or protect the overall network. For example, in Comcast’s case, they are trying to manage overall network performance by reducing BitTorrent filesharing traffic.

In today’s ISP market, we market the value of the service by how fast it is, like when an ISP advertises “6 megs.” Consumers don’t appreciate the different between upload versus download speeds, although there are signs this is changing. ISP professionals will tell you that “6 megs” is really not telling the whole story, since it’s a measure of throughput not overall data transfer. If all customers on an ISP’s network fully utilized their full throughput (i.e. all “6 meg” customers transferred a full “6 meg” upload and download all day and night, 24×7), their networks couldn’t handle it. Every ISP’s network assumes customers utilize only a tiny fraction of their overall bandwidth allocation.

The better approach for an ISP, would be to state upload and download speeds, as well as put a monthly or daily cap on data transfer. This would help ISP’s manage their network, when you have heavy users, as well as provide a mechanism to tier access, therefore providing an ability to charging more for the “heavy users.”

The new gold-rush: Top Level Domains (TLDs)

ICANN, the overseer of the domain registry system and top-level domains (i.e. .com, .net, .info, .cc, .us, etc) has approved a plan to sell unlimited top-level domains (TLDs) on the open market.

Conceivably, anyone can purchase a new TLD, provided they are willing to shell out the reported $100,000 to $500,000 per TLD.

This number may seem like an astronomical amount, but when one considers the marketing potential for the right TLD, $500,000 could seem like chump change. For example, .com is frequently mistyped by people as .cm or .cmo. Obtaining those two TLD’s could give the potential owner a great deal of leverage to convert the typo into the appropriate .com, but turning themselves into a referral source.

Alternatively, a company could create some serious leverage with branding and trademarking, creating highly desirable TLDs that have a specific connotation, such as:

• .secure - Which is carefully controlled by the TLD owner, and guarantees any .secure website is audited and “scam proof.”
• .bank, .doctor, .law - Just about any market or industry niche could use its own TLD, and could become highly desirable for members of that market.
• .kids, .singles - Just about any market segment, such as “certified kid friendly”.
• .comcast, .ibm, .aol - Companies, especially ISP’s and hosting companies, would definitely want to get on this bandwagon and support customer accounts on its TLD’s.

Without a doubt, the new policy for TLDs will represent a tremendous gold-rush for those companies willing to get in early, make effective use of their new TLDs, and market it properly to create demand and market awareness.