BT is starting to sell a new service that gives broadband providers the tools to create a two-tier internet, where some video content would reach consumers in a better condition than other material.

The service devised by BT’s wholesale unit gives broadband providers the opportunity to charge content owners for high quality distribution of their video products to consumers.

BT is seeking to capitalise on the fast-growing volume of video being downloaded over fixed-line and mobile infrastructure, led by services such as Google’s YouTube and the BBC’s iPlayer.

A new content distribution network built by BT should ensure that bandwidth-hungry video can be streamed to consumers without interruption, even at peak web usage times.

BT is starting to give its retail unit, and other telecoms companies, the chance to use the network by selling a wholesale service called Content Connect. BT Retail is using Content Connect to supply the company’s television customers with the BBC iPlayer.

The Open Rights Group, a consumer campaigns organisation, expressed concern that BT’s content distribution network could clash with the principle of net neutrality, or the idea that all web traffic should be treated equally.

Sally Davis, head of BT Wholesale, rejected suggestions BT’s new network would result in a two-tier internet where smaller content owners could not afford to pay broadband providers for high quality delivery of their material.

She said all broadband providers were increasing their download speeds, so the quality of the basic, “over-the-top” internet experience was improving.

Ms Davis said broadband providers using BT’s network may be able to give their customers the option to make an on-demand payment for watching a live event such as football. The payment would be in addition to charges associated with watching premium content like live premiership football.

Broadband providers were showing “considerable” interest in the new network, she said.

By relying on BT’s network, Ms Davis said broadband providers should be able to reduce their costs partly by cutting spending on “backhaul” connections between telephone exchanges and their core infrastructure.

BT’s network operates by placing servers relatively close to homes and offices, so that data traffic travels short distances. It means video has a much better chance of reaching consumers without interruption.

Jim Killock, executive director of the Open Rights Group, said: “BT’s plans have the potential to end up with a two-tier internet, with customers increasingly tied to bundled services [from broadband providers], and a reduction in competition across the open internet.”

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