Broadcasters and producers take note: net neutrality – or, more specifically, the lack of it – could have a big impact on your emerging content distribution models.

According to media consultant Jason Roks, without net neutrality, Canadian media companies’ initiatives to distribute their content over the Internet are endangered.

‘It’s the independent producer who has the most to lose,’ said Roks at a town hall discussion June 10 at the nextMEDIA conference in Banff, where he, and other advocates, made the case for net neutrality.

The premise of net neutrality is that all content on the Internet should be treated equally by Internet service providers (ISPs), regardless of the type of content or its origin. For the most part, that’s how things work today, but all that may change as ISPs struggle to cope with the ever-increasing demand that video content is putting on their networks’ operations.

While broadcasters are struggling to find ad-based and other monetization models to cover their existing online distribution costs, looming on the horizon is the possibility that these distribution costs could soar or, barring that, that the content-acquisition cost for consumers could skyrocket.

Roks predicts a future where ISPs charge consumers on a metered basis, not unlike the consumption-based billing model used for electricity.

But Roks is concerned about what this will do to emerging services. He asks, ‘Who’s going to watch [Internet TV service] Joost when it costs $15 a day?’

ISPs would be able to offer their own competing services on a pay-per-use basis, or bundled with other services, with no additional charge for the bandwidth usage, much like wireless operators do today.

Also possible is a push for ‘fee for carriage’ charges, but unlike those recently sought by traditional TV broadcasters from BDUs, these would be imposed by the ISPs on the originating source of the video traffic – for example, Google Video or Canadian broadband TV sites.

But Matt Thompson, campaign strategist for the savetheinternet.com coalition, said that consumers are already paying subscription fees to their ISPs in order to receive the content, and, likewise, the video sites are paying their access providers to upload the content, so there’s no justification for any additional surcharge.

Michael Hennessey, VP, wireless, broadband and content policy at Telus, was in the audience for the session and provided an ISP’s perspective, saying that such surcharges are an unlikely scenario, anyway. Canadian carriers, he says, really don’t have the clout to face off against the likes of Google in a battle for fees.

To varying degrees, ISPs already engage in a technique known as traffic shaping, whereby different types or sources of traffic are given different priorities. Video content may be given a lower level of service than typical web browser or e-mail traffic.

Today, the reduced prioritization for video traffic is mainly confined to torrent traffic. With torrents, consumers download video content for later viewing. Since the consumer isn’t watching the video as it is transmitted, slowing down this type of traffic has a less dramatic impact than it would if real-time streaming content were treated the same way.

At present, there is arguably good reason for ISPs to use traffic shaping to prevent massive video consumption by some from degrading the broader Internet experience for all. Perhaps, though, this may one day no longer matter, as Internet backbone speeds and speeds to the home become so fast that the networks can accommodate all the demand imposed upon them.

But the net neutrality question isn’t based merely on capacity issues. The major Canadian ISPs also have other corporate interests to consider. Rogers, Shaw, Videotron, Telus and Bell Canada are all BDUs as well as ISPs. Additionally, they all have interests in media content ventures and telephony operations. The proliferation of Internet-based movie, television and telephone services threatens to undermine other profitable interests of these companies, giving them an incentive to prioritize their own services and Internet-based content offerings over those of their competitors.

Countering this argument, Telus’ Hennessey explained that ISP operations are treated as a telecommunications service in Canada. Although ISPs are currently unregulated, Hennessey said that the CRTC can still intervene where it sees examples of anti-competitive behavior.

While acknowledging that the net neutrality advocates have a right to express concern, Hennessey says that they need to dispense with anecdotal rhetoric and paranoia, and should instead articulate the real issues at a more granular level. Only then, he says, can we have effective dialogue on the subject – and hopefully the nextMEDIA town hall was the first step in that direction.