An ISP offers Internet services. In reality what is that service. It lays a wire or wireless network that connects your PC to the web. So they are the enablers of something that is not provided by them. Surfers access Internet for the content or services like a VoIP client, IM or an email service. Of these service providers only VoIP companies charge you for the service. Rest is mostly free. You can enjoy billions of pages of content free. Same is with IMs and email services. Everything is free.

The real value addition to the Internet is provided by the content developers or the service providers. Otherwise what ISPs offer is a dumb service. It is like getting a mobile service that cannot allow you to make calls or text someone. In the Value chain theory, upon which VAT is also based, each value addition attracts price. So why not the content generators? Why cannot Reuters, CNN or Facebook seek their share from the ISPs? Today, we have some of the mature web traffic analyzers and it will not be a difficult thing to estimate what is accessed most by the users of a particular ISP.

Based on this data, the content generators could seek share from the revenue that ISPs charge to the end users. This way we could say goodbye to the ad supported model upon which most of the Internet sites are sustaining. Internet is a heavily ad supported sector and with the companies cutting their costs due to the slowdown – primary being the marketing and advertising costs – the brunt will be faced by the website owners as they will definitely see declining advertisement revenues. Making the content paid will be a tough thing for surfers to accept. That could be a real disaster. This is the kind of mindset users have developed over the years and doing an entirely new experiment with the end users is not feasible.

The other way of increasing revenues for ISPs is getting into the VAS business and the value additions could be of the types that its customers are using. But being perceived equivalent of any stalwart will not be easy for them. They could perhaps look for strategic partnerships or work on profit sharing models. ISPs could develop their own email and VoIP services; many of them have it even today. But the content is owned and generated by third parties.

Without content the dumb www is nothing that ISPs offer and unless they do it, the content and the services available are inaccessible. So it is a symbiotic relationship that needs to be formalised at earliest and everything needs to be set right. Otherwise ISPs will feel these websites earning a lot because of them and they are charging few dollars from the users and the content generators will feel that they are the real drivers of Internet and only because of them, Internet is being used.

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