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BBC Proposes Higher ISP Pricing for use of its iPlayer Service

Posted: 23rd Dec, 2008 By: MarkJ
The European Broadcasting Union (EBU) has issued a new Q4-2008 Technical Review interview with the BBC's Controller for Vision and Online Media, Anthony Rose (here). The piece reveals that broadband usage of the BBC's iPlayer Internet TV (IPTV) service now accounts for approximately 7% of peak UK broadband Internet usage and that some ISPs could soon charge up to £20 extra for access to it:

Anthony Rose said: "The press largely misrepresented the situation by saying that due to the iPlayer, the internet will collapse and everything will come to an end. Of course, this is not true. We spent a lot of time talking to ISPs and we continue to meet with them regularly. The reality is that about 7% of peak UK internet usage is due to the iPlayer. So, the iPlayer service is only a small fraction of the overall traffic and will certainly not cause internet failure.

In the UK, there are three classes of ISP delivery networks: cable (example: Virgin Media), LLU (Local Loop Unbundling) and IP stream.

The cost of reaching the end user with cable is very low. In the case of LLU, the ISPs invested a lot of money in putting some equipment in the local exchange, resulting in a very low cost-per-bit. The third class, so-called IP stream [ADSL etc.], is a rented bandwidth from BT Wholesale.

If you are looking for some figures, there are in total about 5000 points of presence (POPs) around the UK. About 1500 of them are LLU enabled. About 30% of users are on cable. For cable and LLU the cost is relatively low, while for IP stream the cost of bandwidth is very high. This hurts those ISPs.

There is no problem with the amount of bandwidth as the iPlayer is no way near reaching the bandwidth limit. However, our audience statistics show that iPlayer usage peaks in the hours between 6 and 11 p.m., which is also peak traffic for ISPs. The ISPs license the bandwidth for IP stream, based on peak usage. For this reason, iPlayer traffic is costing those ISPs. It is not just iPlayer, all traffic from YouTube, Facebook and other services is costing them. Our statistics indicate that this traffic is even larger than the iPlayer’s traffic.

To solve this problem the BBC claims that it will look towards tiered solutions by offering iPlayer services at different quality levels and allowing ISPs to provide different bandwidth propositions to users, albeit at a cost:

Rose continued: "For example, the user who enjoys higher bandwidth connections would pay more, and those who are satisfied with lower bandwidth connections would pay less. Of course, nobody should get a worse experience than today. We were offering streaming initially at 500 kbit/s. Today we are also offering 800 kbit/s and in three months time we might be offering 1.5 Mbit/s."

Rose suggests that an iPlayer user could end up getting a good quality service for £10 a month, with improved video and audio quality coming at a cost of perhaps £20 per month. Certainly this would make iPlayer more attractive to ISPs but what about consumers?

The content delivered by iPlayer is already freely available via terrestrial TV and for no extra cost outside of a license fee. Forcing people to pay such a HUGE amount more just to access such content online is likely to push many back to the cheaper solution and away from the Internet.

For many the iPlayer remains, much like YouTube, a passive service of occasional use. Clearly such things do not come cheap and some ISPs may need to raise prices to compensate, but it should not just be in support of a single service.
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