BT offers glimpse of tiered Internet

Despite what many seem to believe, service providers will not stand idly by and watch video subscribers scamper off to "free" Internet services; they'll recoup their losses in some manner-probably by charging more for the broadband connection that leads to the so-called free content.

A glimpse of how that might happen is occurring now in the U.K. where BT (NYSE: BT) has created an Internet offering that gives broadband providers the chance to charge content owners for high quality video distribution. By paying more, these content distributors would be assured that their material is always streamed without interruption.

Critics claim this is creating the dreaded "two-tiered Internet" where some richer content providers will have a better opportunity to display their wares than the smaller guys. Sally Davis, BT Wholesale's leader, denied this but said in an interview that there has been "considerable" interest by broadband providers in the new network.

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